VAT 11th-Edn-2012

COMMENTARY ON
A.P. VALUE ADDED TAX

INTRODUCTION
Critical Summary of VAT Act, 2005

As and from 1st April, 2005 a new tax system called Value Added Tax
will come into force throughout India. It will replace totally the existing sales
tax system whereunder tax was levied and collected at every stage of sale
or purchase of goods or at specified points. There were different rates as
many as 16 for different commodities. In addition several goods, transactions,
individuals and classes of persons were exempted from the levy and collection
of tax. There were tax holidays, loans and deferments of tax. In the course
of time it has become too cumbersome. Evasion and avoidance of tax have
become common. Enforcement has become arbitrary. A new system of tax
called value added tax is designed to cure many of the problems above stated.
History
Way back in the year 1937 when Congress Governments were formed
in the then provinces they introduced total prohibition; as a consequence the
Governments lost huge excise revenue. In order to make good the loss the
Governments introduced the then novel tax system called sales tax. As a matter
of fact it was copied from several European countries including Great Britain.
This system became popular and the revenue earned by the Governments
became substantial. While that being so, it is now found that all the developed
and developing countries in Europe, UK and Asia numbering about 130
countries including Pakistan, Bangladesh and Nepal which were following the
multi-point sales tax system have switched over to value added tax as most
convenient and disciplined system in the place of sales tax.
What is VAT?
In this context the Government of India thought it advisable to replace sales
tax by VAT. The principal and most attractive feature of the value added tax
system is that in the tax payable by the dealer to the Government on his sales
turnover he will get advantage of deduction of the entire tax paid by him to his
vendor at the time of purchase. For example, if a dealer purchases goods for Rs.
10 lakh and pays his vendor a tax at 4% amounting to Rs. 40,000/-; when he
in his turn sells the same goods for Rs. 20 lakhs, he should pay tax at 4% which
comes to Rs. 80,000/-. But in the case of VAT he gets a rebate of
Rs. 40,000/- which he has already paid at the time of purchase and pays only
Rs. 40,000/- as tax and not Rs. 80,000/-. This advantage he will get only if he
maintains the accounts properly and correctly. Therefore under VAT
system it is to the advantage of the dealers to maintain accounts correctly
one after the other in the chain from manufacturer to the consumer. The above
adjustment makes it clear that what the VAT dealer pays as tax is on the
difference between the purchase value of the goods and their sale value when
VAT–1 1
2 Commentary on A.P. Value Added Tax
he sells them. Such difference is called value addition which may consist of
the costs of processing, packaging, transit incurred by the dealer between the
date of purchase and the date of delivery of the goods he sold, the tax he paid
to his vendor and his own profit margin. Hence this tax system has come to
be called Value Added Tax System.
Three categories of dealers
Under VAT there are three classes of dealers. Those dealers whose
taxable turnover is less than Rs. 5 lakhs, and the dealer who deals exclusively
in exempted goods are called exempted dealers. They need not get themselves
registered nor pay any tax. Even where the turnover of the exempted dealer
exceeds Rs. 1 crore he still continues to be exempted dealer, if he is dealing
in exempted goods.
The next group of dealers are called TOT dealers. The TOT dealer
is a dealer whose turnover of all taxable goods exceeds Rs. 5 lakhs but does
not exceed Rs. 40 lakhs. The rate at which the TOT dealer pays the tax
is 1% flat rate. These dealers cannot claim the rebate of tax they pay to
the dealers from whom they purchase their goods nor the tax they collected
from their purchasers will be counted in the tax payable by the subsequent
dealer or VAT dealer. The advantages the TOT dealers enjoy are: (1) they
need not maintain the accounts separately for each class of goods for which
different tax rates are prescribed under the Schedule; (2) easy quantification
of their tax liability. It is in the interests of the TOT dealers that they should
bring into account their turnover duly and properly so that they may have
the advantage of being taxed at the concessional rate of 1%.
The third category of dealers are called VAT dealers whose taxable
turnover is above Rs. 40 lakhs. They constitute an important sector of the
whole system. In order that this system works smoothly and without any
complications, the Act deliberately did not provide any exemptions whatsoever
in respect of any commodities or to any dealer or classes of dealers who come
under the VAT net.
The Act does not contain any provisions whereby the State Government
can interfere with the working of the system. It is expected that VAT would
operate as a computer by itself in accordance with the programme already
set.
Registration
Of the three categories of dealers – exempted dealers, TOT dealers and
VAT dealers, the first of them need not get themselves registered, and they
are unaffected by law. The second category of dealers must have been already
registered under the existing Sales Tax Act. They might have been given their
General Registration Number (GRN). All those dealers who were already
registered under the existing Sales Tax Act and whose turnover is above Rs.5
lakhs and upto Rs. 40 lakhs are deemed to have been registered as TOT
Introduction 3
dealers. In case, the turnover of these dealers exceeds Rs. 40 lakhs they
should necessarily apply for registration as VAT dealers if they are not already
classified as TOT dealers and given Tax Identification Number (TIN) by date
of commencement of the Act. Those dealers who expect their turnover to
exceed Rs. 40 lakhs in a year the last date of which falls in any month after
31st March, 2005 and all those dealers who start business after 31st March,
2005 and who estimate that their turnover in a year may exceed Rs. 40 lakhs
shall apply for registration and get themselves registered as VAT dealers. The
immediate consequence of registration as a VAT dealer is that he shall pay
tax at 1%, 4%, 12-1/2% or at special rates on the goods he sells and shall
have the advantage of deducting the input tax they pay to the dealers from
whom they purchase in the tax payable by them.
A registration as a VAT dealer mandates that the dealers shall maintain
the accounts in the manner prescribed and shall pay the tax in accordance
with time schedule.
Assessment
The assessment period for TOT dealer is three calendar months, January-
March, April-June, July-September, October-December. The assessment period
for VAT dealer is a calendar month. Therefore, the TOT dealer is required
to file the return for each quarter by the end of the month next following.
The return shall be filed alongwith the proof of having paid the tax in full.
In the case of VAT dealer, the return relating to the assessment period of
one month shall be filed within twenty days after the close of the month to
which the return relates. The assessing authority will scrutinise the returns
as per their contents and if for any reason, the assessing authority finds that
the tax paid is less than the amount payable as per the return, the assessing
authority will issue a demand for the deficit tax. If the dealer fails to file
the return within time, the assessing authority will immediately make an
assessment on the basis of the previous returns and will issue an assessment
order together with a demand for payment of tax. This type of assessment
is called unilateral assessment. If, after the assessing authority has made the
unilateral assessment, the assessee files his regular return, the unilateral assessment
will be withdrawn and the return filed by the assessee will be scrutinised and
the demand for tax will be issued, if necessary. In either case, the assessing
authority does not make any final assessment at that stage. It is assumed
that the return filed by the assessee is treated as accepted until the expiry
of four years whereafter it becomes absolute. During the period of four years
the assessing authority is competent to make an assessment or re-assessment
on the basis of any information received from any external quarters or on
the basis of any inspection or closer scrutiny. If, such information or scrutiny
reveals that the assessee has wilfully suppressed any turnover, such assessment
or re-assessment can be made within a period not beyond four years but within
six years. The whole process of closer scrutiny information received or
gathered is a matter meticulously designed capable of achieving correct results.
It is in this context, the maintenance of accounts correctly by the assessees

is treated as an essential condition for successful implementation of the Act
in which computerisation plays a significant role.
Best of Judgment assessment – Difference between old and new
An important departure here is made in the procedure for making
assessments. Under the old procedure prevalent while APGST was in operation,
rejection of accounts necessarily followed a best of Judgment assessment. In
the new scheme if the closer scrutiny reveals mistakes and the assessee
voluntarily corrects the accounts and pays the tax, the same will be accepted
without any further action. And, best of Judgment will be made only when
such voluntary acceptance of the assessee is not found to be a just substitute
for correct maintenance of accounts.
The forms prescribed for the maintenance of accounts and the forms
prescribed for filing returns should be adopted by all the assessees. The forms
are so designed that if the entries are made in strict compliance with their
requirements the net result obtained would naturally be correct and it would
be the same for every dealer. The cross-verification of accounts becomes easy.
Unless, there occurs a total omission of the transactions throughout in the
accounts of several dealers, it is not possible for any dealer to attempt avoidance
of tax under the VAT system.
TOT, VAT: Interchange of
Registering a dealer as TOT dealer or VAT dealer by itself is quite simple
but situations may arise where a person who is a TOT dealer may request
that he be registered as a VAT dealer or a VAT dealer may require that
his registration may be converted as that of a TOT dealer. Further, the
assessing authority may in certain circumstances require the TOT dealer to
register himself as a VAT dealer. Conversely, the assessing authority may
require a VAT dealer to register himself as TOT dealer. This is so because
of the actual reduction or expected reduction or increase in the turnovers
of TOT dealers and VAT dealers which may occur depending upon the
exigencies of the business. That apart the existence of TOT dealer in the
chain of VAT dealers creates inconveniences and disadvantages to the dealers
participating in the chain commencing from the point where the goods are
produced till the point of their last sale for consumption. Since, the TOT
dealer is not entitled to issue VAT invoice to enable the purchasing VAT
dealer to claim the benefit of any input tax, his intervention breaks the chain
of transactions among VAT dealers. It is unprofitable for the VAT dealers
to deal with TOT dealers. In such circumstances, where the assessing
authority is satisfied that a particular TOT dealer should be registered as a
VAT dealer, it may direct the TOT dealer to get registered as a VAT dealer.
In the interests of revenue the assessing authority may direct that a certain
class of TOT dealers may be registered as VAT dealers. Since, registration
of dealers is a distinct and separate subject, the authority to register dealers
Introduction 5
as TOT or VAT dealers is different from the authority which deals with
the assessments. When VAT dealer is registered as TOT dealer or when the
TOT dealer is registered as VAT dealer they shall maintain the records in
their respective capacities and pay taxes as applicable.
Tax rates and calculation of net VAT payable
Andhra Pradesh Value Added Tax Act contains Six Schedules. Each
of the schedules contain the list of goods subject to the rate of tax specified.
The First Schedule lists 47 items which are exempted altogether from tax.
They include certain essential commodities in common use. Any levy of
tax on these items may be looked at by public with disfavour. They are
so intimately connected with the life style of the people, they having been
integrated with life itself. It is really impossible to conceive levy of tax on
such items as glass bangles, earthern pots, charka, betel leaves and agricultural
machinery manually operated, national flag, salt and such others which are
included in this list. They are freed from tax net for yet another two reasons.
The administrative expenses involved in collecting the tax may be higher than
the tax which may be found to have been ultimately realised. Public policy
also may require imposition of tax on such essential and sensitive goods shall
not be resorted to.
Illustration
The transactions specified in Second Schedule are zero rated. They
are so because, no tax is levied and collected on these transactions since
they come within the purview of Central Sales Tax Act whereunder tax is
levied separately on those transactions and collected on behalf of the Central
Government and credited to the State Government.
The Third Schedule contains the names of articles which are of high
value such as Bullion specie, jewellery and precious stones. They are taxable
at 1%. The Fourth Schedule is an important schedule. The goods mentioned
in this Schedule are taxed at 4% which is called the concessional rate as
against 12½% tax which is called the standard rate. The goods mentioned
in Fourth Schedule are mostly useful in production and manufacture of goods
and those which enter into processing trade. The Sixth Schedule is applied
to liquors and petrol where liquors are taxed at 70% and petrol and diesel
are taxed at rates ranging from 23% to 32.55%. The Fifth Schedule is residuary
schedule to which 12½% standard rate applies. Instead of giving a list of
goods subject to 12½%, the Schedule V says that all goods not coming under
1st, 3rd, 4th and 6th Schedules come under this Schedule. To be specific
they are the goods which fill the consumer market.
Transaction which is complete in another state is covered by C.S.T.
Act and is not taxable in the state where goods are delivered on the ground
that the dealer transporting goods is not the registered dealer in the State.
Aravind Construction Co. (P) Ltd. v. Sales Tax Commissioner, 106 (2008)
CLT 493.
VAT Invoice
The Schedules I to VI and the rates of tax prescribed therein apply
to VAT dealers only i.e. those dealers whose taxable turnover exceeds Rs.
40 lakhs a year. It is this class of dealers who are entitled to and also liable
to issue what is called tax invoices. It is this class of dealers only who will
have the benefit of the tax paid by them to their vendors (called input tax)
as tax credit in the tax they will have to pay when they sell the same goods
to others. The tax invoice issued by the VAT dealers to their purchasers
shows tax charged by them so that the next dealer can have the benefit
of tax credit when they in their turn sell the goods. The following Table
illustrates the working of tax system in the chain of sales commencing from
manufacturer to the consumer.
1st VAT seller/ 2nd VAT seller 3rd VAT seller Consumer
Manufacturer/
Producer
As per VAT As per VAT As per VAT Price paid
Invoice price Invoice price Invoice price by the
of goods sold of goods sold of goods sold consumer
Rs. 10,00,000. Rs. 20,00,000 Rs. 40,00,000 Rs. 40,00,000
Add Add Add Add 1,60,000
Tax Tax Tax ---------------------
at 4% 40,000 at 4% 80,000 at 4% 1,60,000 Total 41,60,000
Total Total Total ---------------------
Rs. 10,40,000 Rs. 20,80,000 Rs. 41,60,000
There is no input Input tax credit Input tax credit
tax credit here as shown in tax as shown in tax
invoice issued by invoice issued
Tax paid: the 1st seller is by the 2nd seller is
Rs. 40,000 Rs. 40,000 Rs. 80,000
Tax paid: Tax paid:
(Output tax (Output tax
Rs. 80,000 Rs. 1,60,000
less input tax less input tax
Rs. 40,000). Rs. 80,000).
Net tax payable Net tax payable
Rs. 40,000 Rs. 80,000.
1. The above illustration shows the 1st seller paid the VAT on the goods
valued Rs. 10,00,000 at the rate of 4% amounting to Rs. 40,000/- to the
Government. He does not have the advantage of tax credit.
2. The 2nd seller sold the goods at double the price at Rs. 20 lakhs.
He is liable to pay Rs. 80,000/- as tax. But, he pays only Rs. 40,000/- which
means that he pays the tax on difference in price at which he purchased the
goods and the price at which he sold them. Hence, the tax the 2nd seller
Introduction 7
pays to the Government is the tax on the value addition which is represented
as a difference between the price at which he purchased and the price at which
he sold. Such difference being Rs. 10,00,000/-, the tax of Rs. 40,000/- he
has paid amounts to a tax on value addition.
3. The 3rd seller who sold the goods again at double the price at Rs.
40,00,000/-, even though he is liable to pay Rs. 1,60,000/- as tax, he pays
only Rs. 80,000/- which means that he pays the tax on the difference in price
at which he purchased the goods and the price at which he sold them. Hence,
the tax he pays to the Government is the tax on the value addition which
is presented as a difference between the price at which he purchased the goods
and the price at which he sold them.
Such difference being Rs. 20,00,000/- the tax of Rs. 80,000/- he has
paid amounts to a tax on value addition.
4. Accordingly, the tax levied and collected at each stage in a series
of sales is only on the value addition each dealer makes to the goods and
not a tax on the sale value at which each dealer sells to the next.
Hire purchase, licence, lucky draws and works contracts
The VAT scheme is applicable also to the dealers who sell goods under
hire purchase and to dealers who lease/licence their machinery to others for
use for any period or periods of time.
Where the goods are sold on hire purchase, tax is payable on the total
amount of instalments agreed upon. Similarly the dealer who licences the
goods to others for use, shall pay tax on the total lease amount agreed upon.
In the case of dealer who sells goods under the scheme of lucky draw, he
shall have to pay tax on the full value of goods on their delivery made to
each one of the lucky winners during the continuance of the scheme.
The VAT scheme is also applicable to those who carry out works
contracts. Here the price of the goods utilised in the execution of the contract
is deemed to be the sale price of the goods on which the works contractor
has to pay tax to the Government. In such case he would be given the
benefit of input tax to an extent of 90% of the value of goods incorporated
in the contract. Where the value of the goods incorporated in the works
contract could not be ascertained, the Act has provided very beneficial
alternatives to the works contractors. If they exercise the option of composition
they can pay 4% flat rate on the total value of the contract in case the
contractor is a VAT dealer; and at a flat rate of 1% on the total value of
the contract in the case of the contractor is a TOT dealer. Whatever be
the justification or otherwise of the rates of composition, realisation of tax
has been made very easy, particularly when such tax can be deducted at
source by the contractee-Government and made over to the Department. The
Act has cast a burden on the contractee to deduct the tax at source in such
manner that a failure to recover the tax will result in the contractee-Government
itself to bear and pay the same together with interest.
Casual traders are also covered by this Act. For instance, the dealers
coming from outside the State and outstations within the State and selling
goods at exhibitions shall have to get intimations of their commencing business
registered and pay tax on their turnovers. The same rule applies to hawkers
also but hawkers who are dealing in exempted goods and those whose turnover
does not give intimations or pay any tax.
The Act dealt with the casual traders in a confusing manner. A casual
trader meaning a person who indulges in isolated transactions, is different
from casual trader who trades in goods though casually as a business. In
the later they are not dealers. To say as the Act does that casual trader
need not be registered and yet pay tax at VAT rates is inconsistent. It could
only mean that the casual trader when he becomes a dealer, he shall pay
tax at VAT rates. This confusion of expressions between casual trader and
casual dealer may be cleared by the Government at the earliest.
Inter-State transactions, exports and transactions taking place outside
State
While, inter-State transactions and transactions involving exports and
imports are outside the scope of the VAT, those dealers who purchase and
sell goods outside the State, or purchase in one State and sell the goods
directly to another State without bringing them inside the State and the dealers
who purchased the goods outside State and export them directly abroad without
bringing them into the State are also not covered by the A.P. VAT.
Assessment, Appeal, Revision and Review and Collection of Tax
If on a scrutiny of the return filed, the assessing authority finds that
there is some shortfall in the tax paid, the assessing authority shall issue
a notice of demand for payment of the balance tax. If the assessee does
not accept the correctness of the demand he may file an appeal against the
demand treating it as an order of assessment, to the Appellate Deputy
Commissioner. If no such demand is made by the assessing authority the
assessee may treat the return filed by him as accepted. The assessment
made or deemed to have been made is subject to the power of the assessing
authority to make any assessment or re-assessment on the basis of any
information received or inspection made within four years from the date of
filing of the return. Such assessment or re-assessment by the assessing
authority can be made within six years if the assessing authority finds that
the escapement or the avoidance of tax has occurred on account of any
deliberate suppression of turnover and tax by the assessee. All orders made
by the assessing authority either as assessment or re-assessment are appealable
to the Appellate Dy. Commissioner. The orders of penalty imposed by the
assessing authority separately or as part of the assessment and re-assessment
orders are also appealable to the Appellate Dy. Commissioner.
If the assessee is aggrieved by the order made in appeal by the Appellate
Dy. Commissioner he can prefer a further appeal to the Appellate Tribunal.
Introduction 9
After the disposal of the appeal by the Appellate Tribunal a revision to the
High Court may be preferred. While, the right of appeal to the Appellate
Dy. Commissioner and the Appellate Tribunal are available to the aggrieved
assessee only, the right of filing a revision to the High Court against the
orders of the Appellate Tribunal is available to the assessee as well as to
the Department. On the High Court properly moved, the order made by
the High Court in revision may be reviewed by the High Court in appropriate
cases.
In addition to the orders made by the assessing authority relating to
assessment of tax and imposition of penalty, there are certain other orders
which could be the subject matter of appeal. They are orders made by the
registering authorities. Such orders may relate to the registering or refusing
to register dealers as TOT dealers and VAT dealers. Such registering
authorities have also power to direct a TOT dealer to register himself as
VAT dealer and vice versa or refusing to register a TOT dealer as VAT
dealer or refusing to register a VAT dealer as TOT dealer on the request
made by them. Such orders are appealable in the same manner as the orders
of assessment to the Appellate Dy. Commissioner and thereafter to the
Appellate Tribunal. Proceedings in the nature of revision to the High Court
and reviews thereon also lie in relation to the orders made in this regard.
Independent power to revise the orders of assessment made under this
Act lie to the Superior authorities commencing from Asst. Commissioners,
Dy. Commissioners, Joint Commissioners, Addl. Commissioners and
Commissioner. In all such cases, the power of revision exercisable by these
authorities is restricted to the case where revising authorities find that the
order sought to be revised is adverse to the revenue and it needs to be
corrected. Accordingly, the power of revision is exercisable suo motu by
the revisional authority. Neither the assessee nor any other person can move
the revisional authority to revise the assessments. All orders made in exercise
of revisional powers upto Addl. Commissioner are appealable to the Appellate
Tribunal and they follow the same route to the High Court. For revision
and review, while as respects the order in revision made by the Commissioner
an appeal lies directly to the High Court without intervening appeal to the
Appellate Tribunal.
Though the Act appears to confer independent revisional jurisdiction on
all superior officers to revise any order made by any subordinate authority
giving rise to multiple revisions, it is suggested that when once an order of
a subordinate authority is revised by the superior, it shall not be made a
subject-matter of further revision by a still higher authority. Any steps so
taken up indiscriminately may be found as arbitrary and liable to be quashed.
It is not or competent for any authority to review its own order or review
the order made by the previous authority an officer by invoking its jurisdiction to
rectify the mistake. Uma Polymers Ltd. v. State of Rajasthan & others, dt. 23-9-
2008 (Rajasthan H.C.).
Stay of Tax
As regards the payment of tax, the assessee shall in the first instance
pay all the tax determined. If the assessee questions the order of the assessing
authority in appeal he shall pay all the tax due by him except the amount
disputed in the appeal. The assessing authority at this point of time has a
discretion to direct the assessee to pay the tax due in instalments after taking
a surety from the assessee.
Where after filing an appeal to the Appellate Dy. Commissioner, the
assessee requiring stay of the collection of the disputed tax pending disposal
of appeal may approach the Joint Commissioner or the Addl. Commissioner
for appropriate orders whereon the authority may stay the collection of disputed
tax subject to such terms as it may think fit including grant of instalments
and furnishing of appropriate security covering only the tax disputed. Neither
the assessing authority at the time of making the assessment nor the Appellate
Dy. Commissioner nor the Joint or Addl. Commissioner have any jurisdiction
to issue a blanket stay of recovery of the undisputed tax. The Appellate
Tribunal is not conferred with any power to stay any tax disputed or undisputed
pending appeal before it. But, it shall not admit the appeal unless 50% of
the tax disputed before it is paid. The assessee however, has a right to
move the Joint Commissioner or the Addl. Commissioner to extend the stay
they have earlier granted pending appeal before the Appellate Dy. Commissioner,
extend its operation during the pendency of appeal before the Appellate Tribunal
as well. After the matter is disposed of by the Appellate Tribunal, the High
Court dealing with revision has power not to stay recovery of any disputed
or undisputed tax but has power only to make such arrangements as may
be just and reasonable for the realisation of the tax due.
The High Court may, however not having any power to stay collection
of tax may suspend recovery proceedings on the assessee furnishing bank
guarantee. In all cases where tax recovery is not the question all appellate
and revisional authorities have jurisdiction to make appropriate orders as may
be required by either of the parties during the pendency of appeals and
revisions.
In respect of appeals arising out of orders of revision, the provision
in regard to the stay of collection of taxes is different. Where an appeal
is filed against an order in revision made by Addl. Commissioner, Joint
Commissioner or Dy. Commissioner to the Appellate Tribunal the appeal will
not be admitted by the tribunal unless 25% of the tax ordered by the revisional
authority is paid. The High Court dealing with orders arising out of revisional
powers either under its jurisdiction as a court of revision or under its appellate
jurisdiction the power to make appropriate orders as regards the tax due from
the assessee is left to the discretion of the High Court.
It may be noted here that irrespective of the orders of stay granted
by the authorities the fact that any tax is due and payable by the assessee
will not in any manner postpone the disposal of appeals or revisions pending
before any authority or court; and subject to the orders relating to the
collection, all amounts due from the assessee are open for recovery in any
manner by the authorities competent to recover them.
Introduction 11
Further, the assessing authority is always competent to make a re-

assessment if so specifically directed or if the appellate authority or revisional
authority or the tribunal or the court require a re-assessment be made. While,
making such re-assessment the time spent for appeals and revisions shall be
excluded unless the orders otherwise specified any period by which such re-
assessment be made, shall be excluded from the period of four years or six
years prescribed under the Act to make such re-assessment.
Offences and Penalties
Value Added Tax system is called a self policing system. It is so because,
unless the dealers strictly follow the rules, maintain accounts which by nature
are interlinking with one another the dealers do not have a benefit of securing
a rebate towards the tax they had paid earlier to the previous dealer in the
tax they had to pay on their sales. It creates situations for self-discipline in
the business.
The another important feature of VAT system is that each one of the
defaults committed by the dealers is visited with prosecutions and fines.
Prosecutions are launched by the Department against defaulting dealers. They
are tried by the Magistrates having territorial jurisdiction over the assessees.
In addition to prosecutions, the assessing authority itself is competent to levy
penalties against defaulting dealers. Viewed in this context, Value Added Tax
Act should be classified as an enactment which requires strict compliance of
the provisions by all those who are mandated to carry on their business in
accordance with the law, pay the taxes promptly in their own self interest.
Right from the commencement of registration, till the dealer pays in
full the tax he is liable to pay under the Act almost every infraction on his
part is punishable as an offence. Failure to apply for registration, failure
to apply for cancellation of registration when such cancellation is required,
failure of the dealer to inform changes in the circumstances of the business,
failure to issue tax invoice or issue a tax invoice otherwise than in the manner
required, failure to file a return if the dealer fails to file a return within fifteen
days from the date when it should be filed, failure to pay the tax within
the time prescribed, failure to maintain a true and complete account and other
records. All the dealers are expected to co-operate with the Department.
Failure to provide reasonable access and assistance to inspecting authorities
are all offences for which the dealer can be prosecuted and punished in criminal
Court. The assessing authorities as well as the appellate or revisional authorities
are competent to call upon the dealers to furnish any information or particulars
from the dealer and also require the dealer to file all records available with
them as the assessing authority, appellate or revisional authorities may require.
These authorities have also power to call upon such information, particulars
and records from any other person also other than the dealer. The person
failing to furnish the information, particulars and records as well as the dealer
committing this default are liable to be punished. Where an unregistered dealer
collects any tax which he is not entitled to and the registered dealer who
collects any tax at rate higher than the rates prescribed from the purchaser,
where a VAT dealer misuses the tax payer identification number (TIN) with
a view to evade the tax or shift liability to pay the tax and a dealer makes
false and misleading information or supplies such material he is punishable.
If any dealer instead of providing assistance and co-operation to the authorities
carrying on their duties obstructs them in performing their duties entrusted
to them by the Act, are liable to be similarly prosecuted and punished.
If the dealer or the person accused of the above offences except the
offence of obstructing the authority from performing a duty when convicted
are liable to be punished with imprisonment which may extend to three months
or with fine or with both and the person convicted of the offence of
obstructing any authority under the Act from performing its duties, is liable
to be sentenced for a term which shall not be less than one month which
may extend to six months with fine. It means, in such cases a minimum
punishment of one month shall be imposed.
The Magistrate trying offences under this Act has discretion to award
imprisonment which may extend to the terms prescribed. It means, a
Magistrate can impose a punishment of one day or for the full term prescribed,
except in the cases where the dealer fails to provide assistance and co-operation
to the inspecting officers and where the dealer obstructs the authorities under
the Act to carry out their duties, in which cases it is mandatory for the
Magistrate to impose the punishment of imprisonment for a minimum period
of one month.
In all these offences where a person is punished with imprisonment
he is also liable to be punished with a fine or with both or with imprisonment
and fine. The Act has not prescribed any upper limit to the fine which
the Magistrate may impose. However, the fine which may be imposed shall
be reasonable in the context of the facts of the case. The fine shall not
be a token or onerous.
Where the offence is committed by a company, the person to be punished
is the person who is conducting the business of the company as well as
the company itself. Unless the person incharge of the company, proves that
the offence is committed without his knowledge and in spite of his diligence,
he is liable to be punished. All offences specified above are compoundable.
The offer of compounding shall emanate from the person prosecuted and
it shall not be proposed by the authority. The authority compounding the
offence may fix an amount to be paid by the offender to the Government.
The amount fixed for compounding the offence may be any amount which
may be equal to the tax amount involved subject to a minimum of Rs. 3,000.
Where the offence sought to be compounded, refers to any breach in
which there is no involvement of tax, the compounding fees shall not exceed
Rs. 3,000/-.
Introduction 13
Originally there were punishments which were higher, there were also
a few offences for which minimum period of imprisonment was prescribed.
By the time of issuance of the Act the punishments were made lighter since
the main purpose and design of the Act is to secure compliance of its terms
by a class of persons who could very well understand the implications of their
failure to comply, punishments which can make the offenders hesitate before
the default is attempted would sure secure best results. This is not to suggest
that punishments should be terror striking. If experience teaches that the
experiment of lighter punishment is ideal, then, the retention of the existing
scale of punishment would be welcomed.
Penalties
All the acts which are found to have been committed in contravention
of the provisions of this Act and which are specified as offences for which
the dealers and others are made liable to prosecution, are also the contraventions
in relation to which the authorities may impose penalties. The penalties so
levied are recoverable in the same way as tax can be recovered.
Failure of a VAT dealer to apply for registration before the end of the
month the penalty provided is Rs. 5,000/-. Failure of a dealer to apply for
registration before the end of the month in which the obligation arises the
penalty prescribed is an amount equal to 25% of tax due.
Similarly, failure to notify the change of circumstances by the registered
dealer or failure by him to apply for cancellation the penalty leviable is Rs.
2000/- for each offence, where the VAT dealer fails to file a return by due
date the authority may levy a penalty of Rs. 2,500/-. If such failure is
committed by any other dealer the penalty imposable is Rs. 500/-. If the dealer
files a return after the due date a penalty of an amount equal to 15% of tax
due shall be imposed. Failure to pay tax alongwith the return by the due
date but return is filed before the unilateral assessment, a penalty of 10%
of the amount due may be levied. Where unilateral assessment is made the
assessing authority may impose a penalty of 50% of the amount assessed. This
amount of penalty will be proportionately altered when unilateral assessment
is withdrawn and the return filed by the dealer is accepted. Where the dealer
under declares tax, if the under declared amount is less than 10% of the tax,
a penalty of 10% of such under declared amount may be imposed; if the under
declared amount is more than 10% of the tax, 25% of such under declared
tax may be levied. If the under declared tax is found to be so under declared
by the dealer due to any fraud or wilful neglect on his part the amount of
penalty is very high which is equal to the whole amount of tax under declared.
Any dealer who fails to use the TIN or GRN or misuses the TIN or GRN
a penalty of Rs. 1,000/- will be imposed each time or the number of times
such offence is committed. Failure of the dealer to issue tax invoice or any
other invoice as the case may be requires the imposition of Rs. 5,000/- or
100% of the tax covered by the invoice whichever is less for each offence.
If any VAT dealer issues false tax invoice, receives or uses a tax invoice
knowing it to be false, the authority may impose a penalty of 200% of tax
shown in the false invoice. If TOT dealer or any other dealer fails to issue
a bill the penalty imposable is Rs. 250/- for each offence. If a VAT dealer
or TOT dealer fails to maintain proper record even after being warned by
the authority a penalty of Rs. 5,000/- for each of such occasions is leviable.
The dealer who collects tax on goods not liable to tax or a person other than
dealer collects tax from any other person or dealer or collects tax at rates
in excess of the rates prescribed the amount so collected may be forfeited
and a penalty equal to the amount so collected may be levied.
Two important things may be noted in matter of prosecutions and
penalties. In the matter of prosecutions, persons who abet the offence are
also punishable in the manner and to the extent the offender is liable to be
punished. The other is no prosecution for any offence under this Act shall
be instituted except with a written consent of the Commissioner of Commercial
Taxes. This is so because, no frivolous prosecutions or prosecutions with
no chance of success and prosecutions motivated are not launched to the
detriment of the assessees. Another important provision in this regard is that
no prosecution against the dealers shall be instituted in respect of the same
facts on which penalty has been imposed which in other words can be construed
to mean that where prosecution is launched penalty provisions are barred.
The Act has delegated three types of powers: two to the Government,
one to the Commissioner.
Firstly, the Government is given the power to amend the Schedules which
form part of the Act. In case where the Government amends the Schedules
by Notification, a Bill to that effect shall be introduced in the legislature and
its approval shall be obtained.
Secondly, the Government is given the power to issue any orders intended
to solve the transitional difficulties from the previous APGST Act to the VAT
Act. Here, though normally such delegation is granted for a limited period
say, two years, here the power granted to the Government to issue orders for
solving transitional difficulties is unlimited by time.
Thirdly, the Commissioner is granted power to issue such directions or
proceedings as may be necessary to solve any difficulties arising in the course
of implementation of this Act. This power is also naturally not restricted
to any period.
In addition to the above three, the Government is given power to make
rules generally to aid implementation of the Act. These rules shall be placed
before the Legislative Assembly as soon as they are made. Such rules become
final after the rules are confirmed or deemed to have been confirmed by the
legislature.
Introduction 15
The next important issue dealt with in the Act is about repeal. The
consequences of repealing APGST and substituting in its place the VAT Act
of 2005 is that all actions taken under the repealed Act can be continued.
All actions which could be taken thereunder that Act can also be taken. The
substance on the repeal provisions is that the APGST Act of 1957 will be
deemed to be continuing in respect of all matters connected with that Act
and the repeal does not in any manner put an end of anything taken or could
be taken under that Act and the obligations entered under that Act or rights
accrued therein survive in the same manner as if that Act was continuing
to the extent of the matters taking place prior to 31-3-2005.
Before parting with this introduction it is necessary to refer to the novel
procedure of Advance Rulings. For this purpose a high level committee is
constituted and it is authorized to give rulings on any doubts which may
arise in the minds of the dealers as regards classification of goods and other
matters. The Act provides that a dealer having a doubt cannot make a
reference to the Advance Ruling Authority if it is already a subject before
any Assessing Authority or first appellate authority. Since there is no system
of annual assessment it is difficult to conceive a problem arising at any time
or immediately before the commencement of assessment of proceedings if
a return is filed. In such a situation, the provision is of no use to the dealer.
However, it is suggested that the embargo against the dealer from making
an application before the Advance Ruling Authority may be removed. So
that a dealer may seek Advance Ruling in matters pending before the assessing
authority and first appellate authority, both of them being subordinates to the
authority empowered to give Advance Rulings. This is all the more so because
the orders of the Advance Ruling Authority are not binding on the Commissioner,
Appellate Tribunal or any other Higher Authority or Courts but they are binding
on the assessing authority, registering authority and first appellate authority
and on the parties seeking advance rulings. The slender and limited opportunity
given to the dealer to file an application before the Advance Ruling Authority
just between the time when the doubt arose and the filing of a Return or
filing an application before the registering authority may not be of any
assistance to the dealer unless he is enabled to file the application before
the Advance Ruling Authority even during the pendency of the matters with
the original and first appellate authority.
By and large the Act is very well designed and it is mainly the
responsibility of the dealers to comply with the provisions and also gain
therefrom. The Government should act with dedication and without favouring
any person. As far as the people are concerned, they, as customers continue
to bear the tax burden.
Business Community
Needless to once again reiterate the success of the legislation solely and
mainly depends upon the cooperation of the well informed business community
since nothing is lost and everything is gained by the dealers in cooperating

with the Government to the best of their ability. It is suggested that all
Chambers of Commerce from the Mandal to the Capital shall train the traders
in the maintenance of accounts in a manner which heightens the prestige
of the business community as a whole.
Value Added Tax and Entry Tax

While Value Added Tax deals with the sale of goods and incidence
of the tax is at the point where the transfer of property in goods takes
place, entry tax is a tax levied at the point of the entry of motor vehicles
and other goods into the local areas from outside the State. This is conceived
as a tax to offset the difference in the rates of sales tax levied in one State
and the other. For e.g., if the rate of tax in Karnataka is less than the
rate of tax in Andhra Pradesh, people are tending to purchase the goods
from Karnataka and transport them across the borders into Andhra Pradesh.
In such a situation, Andhra Pradesh is losing tax on the goods transported
from Karnataka to Andhra Pradesh. In order to prevent such transactions
and to offset the loss of revenue, entry tax is levied as a balancing
arrangement and not as an independent revenue yielding tax.
Entry Tax is of two kinds. The first one is, the entry tax levied
on motor vehicles under Andhra Pradesh on Entry of Motor Vehicles into
Local Areas Act, 1996. The second one is, the entry of goods entering
into local areas from another State under the Andhra Pradesh Tax on Entry
of Goods into Local Areas Act, 2001. In both these enactments the assessees
are divided into: (1) importers who are dealers; and (2) importers who are
non-dealers.
In the case of dealers who are importers of motor vehicles they should
file a return before the assessing authority viz., the Commercial Tax Officer
of the area where the dealer is carrying on business within twenty days
after the calendar month in which he has imported or before he makes an
application for registration, a return and pay the entry tax alongwith the
return. If after the import, the motor vehicle is sold, the dealer is entitled
to claim adjustment/refund of the entry tax in his VAT return.
In the case of non-dealers, he should pay tax to the authority specified
by Commissioner within fifteen days of the entry of the vehicle into the
local area or before he applies for registration of the vehicle under Motor
Vehicles Act. Where the importer has purchased the vehicle outside the State
for his own use then the tax payable by him under the Act shall be reduced
by the amount of tax paid by him, if any, in that other State.
Similarly, in the case of entry tax on goods entering into any local
area a tax on the goods which may be notified and at rates which the
notification specifies shall be levied. Such rates shall not exceed the rates
Introduction 17
specified for such commodities under the Value Added Tax Act. Here also,
the assessees are of two kinds. The first one is, a registered dealer doing
business under the VAT Act. He is obviously importing goods for purposes
of re-sale. In such case, he is exempt from paying any entry tax. The other
category are consumers who use goods other than for re-sale. They shall
notify the assessing authority who shall assess on them the entry tax. While
assessing the entry tax in relation to the non-dealers who consume goods
and in the case of dealers who would use the goods otherwise than re-
sale, the tax which they might have paid on the goods in the other State
from which they are imported shall be refunded.
The point to be noted here is if the motor vehicles are resold, the
dealer shall have the advantage of refund/adjustment of the entry tax in
his VAT return. Similarly, if the goods are resold by the dealers, the tax
paid in the other State is made available for refund/adjustment in VAT
return.
Value Added Tax and Service Tax
Works Contract in which the transfer of goods predominates is taxable

under Value Added Tax. Where service predominates, the works contract
is not taxable under the Value Added Tax.
In all contracts and transactions where service is predominant or where
service is only the purpose they are covered by Service Tax. The applicability
of service tax is, however, limited to only such of those services which
are notified by the Central Government under the provisions of Service Tax.
Therefore, all the works contract in which service predominates are not
primarily attracted by the Value Added Tax Act. Similarly, all contracts
in which service predominates are not attracted by Service Tax unless they
are notified. The Central Government having power to notify the services
to which service tax applied has been notifying the services from time to
time.
The service tax is levied at a uniform rate of 15% on the amount
received by the assessee as consideration for the transaction or contract.
As on today, there are as many as 102 items of services with several sub
items in respect of which the value of the service rendered and consideration
received is made taxable. Insurance, banking, consultation are all included
in the list of services. Several other commercial activities which have the
sole object of rendering services are also included.
The procedure for collection of service tax is almost same as that of
the VAT Act. The assessees are expected to file their self assessments and
pay tax voluntarily and regularly. It is only when the assessing authorities
on scrutiny of the returns filed make any other assessment within a period
VAT–2
of four years or six years as the case may be, the assessment is deemed
to have been completed on the basis of self assessment. In order to protect
the revenue deterrent penalties and levy of interest at very high rates are
provided. There are provisions for appeals and revisions. There is also a
provision for advanced rulings.
The implementing authority of service tax is the Department of Central
Excise.
Service Tax is supplementary to Value Added Tax Act. While, sale
of goods is the incidence where tax is levied under Value Added Tax Act,
transfer of services is the point of incidence in service tax.
Service Tax is not a separate enactment. It is a part of Finance Act
of 1994. The provision of service tax are contained in as on today in Finance
Act, 1994 as Chapter V. Service tax was originally added in the Finance
Act of 1994 and the same was subsequently amended from time to time
by Finance Acts of 1996, 1997, 1998, 2001, 2002, 2003, 2004, 2005 and
2006.
VAT and Central Sales Tax
Central Sales Tax at the rate of 4% is levied on the sales taking place in
the course of inter-State sale. No Central Sales Tax is levied on the sales
taking place in the course of export to or import from foreign countries.
This tax was devised to eliminate double taxation. In inter-state
transactions, times were when sales tax is levied by different States at both
ends of the inter-state sales. In order to cure this anomaly Central Sales Tax
is devised in such a way that tax is levied by the Union at the point
wherefrom the goods are transported to other States irrespective where the
contracts take place or the goods actually delivered. This tax is collected on
behalf of the Central Government by the Commercial Tax Department of the
State concerned and the proceeds and tax realised are appropriated to the
State revenue. In the course of time, Central Sales Tax Revenue as multiplied
phenomenally.
Introduction of the uniform Value Added Tax has rendered the Central
Sales Tax Act a superfluity because every VAT dealer who transport goods to
other State will show in his VAT Bill tax at zero rate. Even as the Central
Sales Tax has become superfluity, States are not willing for its abolition
straight away because of the expected loss of revenue by the States. Therefore,
it is now proposed to abolish Central Sales Tax by stages in the course of 3
years. Of the 4% tax, 1% will be reduced from April 2007 and thereafter
successively each year by 1%.
Introduction 19
Till that time what is provided in the VAT Act is that the selling
dealer if he pays under the Central Sales Tax a tax of 4% is entitled to the
extent of such tax a reduction out of the purchase tax he has paid at the time
when the goods are purchased. It means, if the tax by the exporter on the
purchases is at the rate of 12½% he is entitled to a return or adjustment to
the extent of 4% only.
VAT vs. Printers & Publishers
Printers are those who carry on printing alone. If it is a job work,

the work done by the printers comes under service contract and hence
printers as a class who print material on the paper supplied are exempt
from VAT
Printers who do the job work utilising the paper and other materials
of their own come within the scope of the business of works contract.
The expression other materials include ink, oil, photo plates etc. They have
two alternatives open to them. The first is to pay VAT at the composition
rate of 2% on the value of the entire work executed by them. This is
called composition which has to be proposed and accepted at the earliest.
Alternatively they have to pay VAT on the total value of the goods utilised
at the rates applicable to them less the input tax credit to the extent
of 90% of the tax suffered by them at the time of purchase of those goods
utilised in the contract.
While calculating the value of input tax credit if the exact quantum
of goods is not proved, the dealer then have to pay 60% of the value
of the contract at 12½%. As per the rules, in contracts of nature of
printing 40% of the contract is exempted from tax and 60% only is liable
to be taxed.
Printers as publishers or publishers alone are exempted from payment
of VAT on the books and periodicals sold by them. In case if they sell
them on their own account printers and publishers are entitled to the
same benefit in relation to the refund of Central Sales Tax and also to
the benefit of input tax credit in the case of export.
Printers and publishers who sell exercise books including graph books,
laboratory note books, office stationery including computer stationary,
writing pads, account ledgers, folders and price covers have to pay tax
at 4% which is a concessional rate under Schedule IV.
While concluding this introduction I would like to thank Miss M.L.

Neelima, Advocate, Mr. S. Chakrapani, Advocate for their continuous
assistance in preparing this book. Equally I thank the enterprising publisher
Mr. Sunil Gogia, Asia Law House for his enthusiastic participation in making
this publication colourful and useful.
——
ANDHRA PRADESH VALUE ADDED
TAX ACT, 2005
Statement of Objects and Reasons (Act No. 5 of 2005)1
In order to implement the Value Added Tax system in all the States
in the Country, an empowered committee of State Finance Ministers has been
constituted under the Chairmanship of Dr. Asim Das Gupta, Hon'ble Minister
for Finance, Government of West Bengal. And the Committee has arrived at
consensus on various policy issues involved in implementation of the Value
Added Tax System in the country.
The Andhra Pradesh Value Added Sales Tax Bill, 2003, which has been
passed by the Legislative Assembl y of the State received the assent of the
President on 10.12.2004 and the same has been published as Andhra Pradesh
Act No. 9 of 2004 on 28.12.2004 in the Andhra Pradesh Gazette. The
provisions of the Andhra Pradesh Value Added Sales Tax Act, 2003 (Act No.
9 of 2004) have not been brought into force, as the intention of the Government
is to bring the said system of taxation into force with certain modifications.
The empowered committee constituted by the Government of India has
suggested certain amendments to the Andhra Pradesh Value Added Sales Tax
Act, 2003.
It is considered not desirable to carry out the amendments to the said
Act as suggested by the empowered committee at this stage, before bringing
the Act into force.
The registration of dealers must commence from 01.02.2005, so that all
the VAT dealers are registered and empowered to issue tax invoices by the
time the said provisions of the Act come into force. It is necessary to clear
the doubts in the minds of the general public and trading community in
particular before the commencement of the registration of dealers.
It is also necessary to complete the training for the staff of the Commercial
Taxes Department so as to enable them to undertake a State wide awareness
programme for dispelling any doubts in the minds of the general public and
trading community in particular about the provisions of the Act well in advance
prior to implementation of the provisions of the Act.
As the Legislative Assembly was not then in session and it has been
decided to give effect to the above decision immediately, the Andhra Pradesh
Value Added Tax Ordinance, 2005 (Andhra Pradesh Ordinance No. 1 of 2005)
has been promulgated by the Governor on the 31st January, 2005.
This bill seeks to replace the said Ordinance.
1. Appended to L.A. Bill No. 2 of 2005 and pub. in A.P. Gaz. Pt. IV-B, Ext. No. 2,
dated 3-3-2005.
20
Statement of Objects and Reasons 21
Statement Of Objects And Reasons (Act No. 23 of 2005)1

In terms of the provisions of sub-section (7) of Section 4 of the Andhra
Pradesh Value Added Tax Act, 2005, any dealer executing any works contracts
for the government or Local Authority may opt to pay tax by way of composition
at the rate of 4% on the total value of the contract executed; and any dealer
executing any works contracts other than the Government and Local Authority
may opt to pay tax by way of composition at the rate of 4% of 50% of the
total consideration received for any specific contract. In order to remove the
different rate of tax prescribed in respect of works contracts for Government
and Local Authorities and other than the Government and Local Authority
and to maintain uniformity in levying tax on the dealer executing works
contract, the Government have decided to levy a tax at 4% on all the contracts
executed for the Government or for others other than the Government by
suitably amending the provisions of the Act.
As the Legislative Assembly of the State was not then in session having
been prorogued and it has been decided to give effect to the above decision
immediately, The Andhra Pradesh Value Added Tax (Amendment) Ordinance,
2005, (A.P. Ordinance 20 of 2005) was promulgated by the Governor on 27th
August, 2005.
This Bill seeks to replace the above said Ordinance.
——
In terms of the provision of sub-section (9) of Section 4 of the Andhra
Pradesh Value Added Tax Act, 2005 every dealer running any restaurant, eating
house or hotel by whatever name called may opt to pay tax by way of
composition at the rate of twelve and half percent on sixty percent of the
total amount charged by the said Value Added Tax dealer for such supply.
Now, the Government have taken a decision to impose a tax on every
dealer running any restaurant, eating house, catering establishment, hotel, coffee
shop, sweet shop or any establishment by whatever name called and any club,
who supplies by way of or as part of any services or in any other manner
whatsoever of goods, being food or any other article for human consumption
or drink, at the rate of twelve and half percent (12.5%) on sixty percent (60%)
of the taxable turnover, if the taxable turnover in a period of preceeding twelve
months exceeds Rs. 5,00,000/- (Rupees five lakhs) or in the preceding three
months exceeds Rs. 1,25,000/- (Rupees one lakh twenty five thousand). The
Government also taken decision to amend sub-section (4) of Section 22 for
the reason that many works contractors having a turn over below Rs. 40,00,000
(Rupees forty lakhs only) did not registered as a Value Added Tax dealer.
1. Appended to L.A. Bill No. 31 of 2005, pub. in A.P. Gaz. Pt. IV-A, Ext. No. 33,
dt. 5-10-2005.
2. Appended to L.A. Bill No. 46 of 2005 and pub. in A.P. Gaz. Pt. IV-A, Ext. No.
47, dated 12-12-2005.
As the Legislative Assembly of the State was not then in session having
been prorouged, and it has been decided to give effect to the above decision
immediately, the Andhra Pradesh Value Added Tax (Second Amendment)
Ordinance, 2005 (Andhra Pradesh Ordinance No. 24 of 2005) has been
promulgated by the Governor on the 24th November, 2005.
The Bill seeks to replace the said Ordinance.
——
In terms of Section 3 of the Andhra Pradesh Value Added Tax Act,
2005 the Government shall appoint an Appellate Tribunal to exercise the
functions conferred on the Appellate Tribunal by or under the Act. However
the functions of the Appellate Tribunal are not specified in the Act. It is
therefore, now, proposed to incorporate a provision in regard to functions of
the Appellate Tribunal under Section 3 of the Act, on the lines of functioning
of the Sales Tax Appellate Tribunal under the provisions of Section 3 of Andhra
Pradesh General Sales Tax Act, 1957.
According to sub-section (2) of Section 13, the VAT Dealer who registered
under the Andhra Pradesh Value Added Tax Act, 2005 shall be entitled to
claim the Sales Tax paid under the A.P. General Sales Tax Act, 1957 on
the stocks held in the State on the date of commencement of the A.P. Value
Added Tax Act, 2005. As practical difficulties arose in implementation of the
said provision for assessment of tax on the stocks held it has become necessary
to amend Section 13 of the Act.
Similarly Section 38 of the Act also provides refund of Tax in cases
where input tax credit exceeds the amount of tax payable by the dealer. It
also prescribes time for refund of tax within a period of ninety days in respect
of exports and one year in other cases.
In order to grant refunds of excess tax by the dealers in deserving cases,
it is proposed to amend Section 38 of the Andhra Pradesh Value Added Tax
Act, suitably.
This Bill seeks to give effect to the above decision.
——
According to the sub-section (3) of Section 22 of the Andhra Pradesh

Value Added Tax Act, 2005, tax at the rate of 4% shall be deducted from
1. Appended to L.A. Bill No. 18 of 2006, Pub. in A.P. Gaz. Ext. No. 18, Part IV-A,
dt. 22-8-2006.
2. Appended to L.A. Bill No. 33 of 2006, Pub. in A.P. Gaz., Pt. IV-A, Ext. No. 33,
dt. 15.12.2006.
Statement of Objects and Reasons 23
the contractor who executed works for State Government or Local Authority
and to remit the amount so deducted as prescribed under rules. Further sub-
section (4) of Section 22 provides that the amount of tax payable by the
contractor executing works for contractees other than the State Government
Department or Local Authority, shall be deducted from the amount payable
by such contractee deducting tax at source shall remit such amount as
prescribed in the rules. The above provisions were made to collect the tax
on works contract at source effectively. In the case of works executed for
State Government Department and Local Bodies the deduction was equal to
the tax element provided in the estimates prepared and hence there was no
liability on the part of the contractor. In the case of other contracts the
deduction of tax which was initially prescribed at 2% was subsequently
enhanced to 4% presuming that the contractors will generally opt for composition
scheme.
In Writ Petitions bearing number 1278 & 7998 of 2006 filed by M/

s. Larson & Toubro and M/s. Clough Engineering Limited, the Hon'ble High
Court of Andhra Pradesh held that sub-sections (3) & (4) of Section 22
as unconstitutional and beyond the competence of legislature of the State of
Andhra Pradesh, on the grounds that (1) the contracts which do not involve
transfer of property in goods may be subjected to deduction of tax at source,
(2) the interstate purchases falling under the purview of CST Act are not
taken into consideration since deduction of tax at source is on total value
of the contract; and (3) it requires contractors to deduct tax from the sub-
contractors resulting in one more deduction of tax at source while the liability
is only once. The present amendment proposes to insert new sub-section
(3) for deduction of tax at source payable by the contractor by the contractee
by rectifying the deficiencies pointed out by the Hon'ble High Court of Andhra
Pradesh. The new sub-section (4) proposed to be inserted under Section 22
prescribes the procedure for deduction and remittance of the tax deducted
at source by deleting existing sub-section (7).
It is proposed to levy tax on the sales of packed items of food across

the counter by hotels and bakeries at the rates of tax as applicable under
respective schedules, as no service is involved in such transactions as in the
case of food items supplied in a hotel, and also to exempt the mess charges
collected by hostels run for students where the amount charged is less than
Rs. 1000/- per student per month.
It is also proposed to amend the Schedules to be in conformity with

the decisions of the Empowered Committee representing all States monitoring
the implementation of A.P.V.A.T. Act at National level.
To achieve the above objects in view, the Government have decided
to amend Sections 4, 22 and the Schedules, II and IV of the Andhra Pradesh
Value Added Tax Act, 2005 suitably.
Statement of Objects and Reasons (Act 14 of 2007)
Government of India extends several duty and tax concessions to
Diplomatic Missions/Consulates on the basis of reciprocity to facilitate their
functioning in India. The State Government also extended the facility of refund
of payment of taxes under the provisions of sub-section (5) of Section 38
of the Andhra Pradesh Value Added Tax Act, 2005 on the purchases made
by the specialized agencies of the United Nations Organisations and Consulates
or embassies of any Country located in the State, or International Corp.
Research Institute for Semi Arid Tropics, Hyderabad.
The Government of India, Ministry of External Affairs has requested
the State Government to stop exemptions or refunds of VAT or Luxury Tax
to U.S. Embassy and to issue notification to this effect. Accordingly, it has
been decided to amend sub-section (5) of Section 38 suitably.
The commodities "Jaggery" and "Tamarind" were exigible to VAT @4%
from 01-04-2005. In pursuance of option given by the Empowered Committee
of States and taking into consideration the interests of farmers and consumers,
the Government of Andhra Pradesh have decided to exempt the commodities
"Jaggery" and "Tamarind" from VAT and accordingly notifications have been
issued granting exemptions to the said items from VAT w.e.f. 01-01-2007
and 01-02-2007 respectively.
The Bill seeks to give effect to the above decision.
Sub-section (7) of Section 4 of the Andhra Pradesh Value Added Tax
Act, 2005 was amended by the Andhra Pradesh Value Added Tax (Amendment)
Act, 2005 to restrict the levy of tax on one dealer wherever the contractor
and sub-contractor was involved. As a result of the amendment, sub-contractor
is liable whereas main contractor is provided exemption with regard to the
consideration paid to sub-contractor.
1. Appended to L.A. Bill No. 27 of 2007, Pub. in A.P. Gaz. Pt. IV-A, Ext.No. 27,
dt. 12.11.2007.
Statement of Objects and Reasons 24(A)
It is observed that the composition of tax provided to builders and

developers of residential apartments/houses is getting complicated on account
of shifting of the liability to sub-contractors in general because most of the
builders getting the work executed by sub-contractors. At present, the builders
and developers are paying one percent of the total consideration of market
value fixed for registration whichever is higher toward tax by way of
composition. This is working very well and compliance is found to be very
high. It is proposed to levy the tax in respect of the residential apartments
and houses at one percent of the total consideration or market value for
registration whichever is higher without reference to any part of the work
being entrusted to sub-contractor. The liability will be fixed on only builder
if he has opted to pay tax by way of composition.
As the State Legislature was not then in session having been prorogued,
and it was decided to give effect to the above decision immediately, and
the Andhra Pradesh Value Added Tax (Amendment) Ordinance, 2007 (Act
No. 10 of 2007) was promulgated by the Governor on 18.9.2007.
This Bill seeks to replace the said Ordinance.
The Government of India reduced the rate of Central Sales Tax from
4% to 3% from 1-4-2007 as a first step towards phasing out of Central
Sales Tax. While doing so they have permitted the State Government to levy
tax on Tobacco products by deleting Tobacco from the list of goods liable
for Additional Excise Duty. Further, the Empowered Committee has
recommended for correction of entries of the respective Schedules of the
Andhra Pradesh Value Added Tax Act, 2005, so as to levy tax on par with
other neighbouring States based on feedbacks received from the States backed
by the said Committee. Accordingly, Government have made the following
alterations and additions to the Schedule-I with effect from 1-4-2005, Schedule
IV with effect from 1-4-2007 and Schedule-VI with effect from the date
to be appointed by the Government, of the said Act, 2005 by issuing
Notifications under the powers conferred by sub-section (1) of Section 79
of the said Act.
dt. 12.11.2007.
24(B) Commentary on A.P. Value Added Tax
(i) Entry 24 of Schedule-I: "Meat, Flesh of Poultry, Fish including dry

fish, Prawns, Prawn Seed, Lobsters, Crabs, Shirmps and other sea food except
when they are sold in frozen state or in a sealed container, eggs, livestock
and animal hair."
(ii) Entry 51 of Schedule-IV: "Rail Coaches, Engines, Wagons and Parts
thereof", and
(iii) Entry 6 of Schedule-IV: "Tobacco products including Gutkha, Khara,
Masala, Kimam, Dokta, Zarda, Sukha or Surthi except those specified in
Schedule-I and Cigarettes".
Sub-section (2) of Section 79 of the said Act contemplates introduction
of a Bill were notification is issued under sub-section (1) of Section 79 during
the next session of the Legislative Assembly following the date of the said
notification to give effect to the alterations, additions, or cancellation, as the
case may be, of the Schedules specified in the Notification.
Now this Bill seeks to give effect to above alterations and additions
to the said Schedules.
Statement of Objects and Reasons (Act 15 of 2008)
The Government of Andhra Pradesh introduced the VAT system by
enacting the APVAT Act, 2005. Under the said Act goods liable for tax are
included in six schedules. Ist Schedule consisting exempted goods from Tax,
IInd schedule consisting goods liable for Zero rated and eligible for input
Tax Credit, IIIrd Schedule consisting of goods liable for Tax @ 1%, IVth
Schedule consisting goods liable for Tax @ 4%, Vth Schedule consisting of
goods which are not included in any of the schedules, liable for Tax @ 12.5%
and VIth Schedule consisting of goods liable for special rates of 70% on
liquor and 33% and 22.5% leviable on different petroleum products.
Keeping in view the mandate of empowered committee and the rates
of tax adopted by the neighbouring States, Government has been considering
the request of the traders & proposals of the Commissioner of Commercial
Taxes, for making changes in the respective Schedules, keeping in view the
public interest, and to provide safeguards against diversion of trade to other
States.
Accordingly, the Government included the specified goods sold by
Canteen Stores Depot for Defence Personnel in Schedule-I of exempted goods,
Statement of Objects and Reasons 24(C)
by deleting it from IInd Schedule of Zero Rates and eligible for input Tax
Credit. A decision has been taken to include all goods sold to units, Operator,
Developer, Co-developer and Contractors engaged by them for use in processing
area of the respective Special Economic Zones. The Government also included
the Co-operative Electric Supply Society Limited, Sirsilla, under entry 116(k)
of Schedule IV to enable them to make purchases at 4% rate of tax instead
of 12.5% on par with similar Societies. The entries 119 and 120 have been
added to the IVth Schedule for leaving tax on Spare parts of Fire Arms and
Weapons and on Tread Rubber at the rate of 4% instead of 12.5% now
being levied, in order to facilitate the local manufacturers to sell their goods
in the State Competing with the manufacturers of the other States where
rate of tax is lower than the Tax existing in our State, otherwise the State
may lose the revenue on account of diversion of Trade.
The Government in order to promote Civil Aviation in the State and
for making Hyderabad as Hub, decided to reduce the rate of tax on Aviation
Turbine Fuel from 33% to 4%, by making amendment to Schedule VI
Accordingly.
Act, 2005 contemplates introduction of Bill where notification is issued under
sub-section (1) of Section 79 during the next session of the Legislative
Assembly following the date of the said notification to give effect to the
alterations, additions or cancellation, as the case may be, of the Schedules
specified in the Notification.
Now, this Bill seeks to give effect to above alterations and additions
The State of Andhra Pradesh introduced Andhra Pradesh Value Added
Tax, 2005 with effect from 1-4-2005 for levy and collection of Tax on sale
of goods.
Section 2 of Andhra Pradesh Value Added Tax Act, 2005 contains
definitions of various terms referred to in the Act. Amendment is proposed
to the existing definitions in case of Dealer, Input Tax, Output Tax and Total
Turnover to be in conformity with the amendments proposed to the relevant
dt. 26-8-2008.
24(D) Statement of Objects and Reasons
provisions in the Act. The definition of Special Economic Zone is newly

proposed as there are some provisions referring to Special Economic Zone
in the Act.
Under Section 4 of the Act contingent purchase tax is leviable under
certain circumstances at a uniform rate of 4% irrespective of the rate of
tax specified in the goods in schedules. Now it is proposed to levy tax at
the rate applicable under schedules and also on the value of purchase
proportionate to the value of the goods disposed off in the manner prescribed
under the Section. In respect of works contract as there was no clarity in
the existing provisions regarding reduction of value of goods purchased from
other States and from unregistered dealers, it is now proposed to remove
the ambiguity by way of amendment to the charging section. Further a new
charging provision is proposed to be added to Section 4 of the Andhra Pradesh
Value Added Tax to make the agents of resident principal liable to tax under
this Act on par with the agents of non resident principles. A new sub-section
7-A is proposed to be inserted by granting exemptions on sale of goods for
the purpose of setting up and maintenance of Special Economic Zone on
the lines of National Policy relating to Special Economic Zone. Consequently
it is proposed to delete the existing provisions under Section 8(c) of the Act.
It is proposed to add a new provision to Section 13, to allow adjustment
of Input Tax Credit between an agent and a resident principal. This is taken
up as a consequence of amendment proposed to make agent of resident
principal liable to tax under Section 4.
It is also proposed amend Section 17 of the Act to make agent of resident
principal register of Value Added Tax compulsorily irrespective of threshold
limit. This is also taken up as a consequence of proposed amendment making
agent liable to tax.
A new provision is proposed to be added under Section 22 authorizing
for deduction/collection of tax in total from the bills of works contractor,
wherever a separate provision for tax at the rate of 4% is provided in the
estimates in respect of works of the Government or Local Authority, to avoid
undue enrichment by the works contractor. At present, deduction of only
2.8% of tax is prescribed despite the fact that the tax is provided to the
contractor @ 4% over and above the estimates.
Commentary on A.P. Value Added Tax 24(E)
An amendment was also proposed to Section 29 of the Act, to authorize

the sales tax authorities for attaching the bank balances including over draft
amount for recovery of Value Added Tax arrears. At present the amounts,
of the defaulter available in the bank as balance, are only liable for attachment.
A new provision was also proposed to be added under Section 38 of
the Act to allow refunds of tax paid or amounts deducted in case of
unregistered dealers. At present the provisions for refunding of tax relating
to unregistered dealers are not available in the Act.
A new provision is proposed to be added under Section 55 of the Act
to levy higher penalty of 200% in case where a false or fabricated declarations
are filed to claim concessional rate of tax under the Section.
As all the above amendments are proposed to remove the ambiguity
in the existing provisions there is no revenue implication.
The following amendments to Schedules appended to the Andhra Pradesh
Value Added Tax Act, 2005 are also proposed to be made.
Based on the practical difficulties faced in applying the entries of
Schedules the description of commodities in entries relating to; Agricultural
implements (Sl.No.1), Seeds (Sl.No.44) of Schedule-I, Goods of intangible
or incorporeal nature (Sl.No.2), Pipes of all varieties (Sl.No.45), Moulded
Plastic footwear (Sl.No.46), Printed Material (Sl.No.47), Industrial Input
(Sl.No.100), Processed Meat (Sl.No.107), Ayurvedic Products (Sl.No.117),
of Schedule-IV) is proposed to revised for clarity and to remove ambiguity.
It is proposed to add the following commodities to Schedule-IV taxable
at 4%, which are presently taxable at the rate of 12.5%, to avoid trade diversion
and to encourage the local manufactures.
i. Yeast of all kinds and forms.
ii. Gel used for preparing bakery products and bread softener.
It is proposed to add the commodities i.e. Coconut and Copra to
Schedule-I, exempted goods, which are presently taxable at the rate of 4%
in the interest of the local farmers and agriculturist growing coconuts.
To achieve the above objects, it is decided to amend the Andhra Pradesh
Value Added Tax Act, 2005, suitably.
This Bill seeks to give effect to the above decisions.
24(F) Statement of Objects and Reasons
1
Statement of Objects and Reasons (Act No. 4 of 2009)
The proposal relating to amendment of Sections 4,17,22,33 and to give
statutory effect to the Notifications amending the Schedules, I, IV and VI
under Section 79 of the APVAT Act, 2005 aiming at removing the difficulties
arising at field level in implementation of the Act, etc. At present for registration
of dealers as VAT dealers and TOT dealers two fold threshold limit of Turnover
is prescribed for a year and for three months. As it is causing difficulty
in implementation, it is proposed to delete the three months turnover limit
and to keep the threshold limit at one year turnover only.
The film producers were exempted from Tax on lease of feature films
under Andhra Pradesh General Sales Tax Act in view of Entertainment Tax
collected from exhibitors but it was not extended under the Andhra Pradesh
Value Added Tax Act, 2005 introduced from 01-04-2005. Hence, without
considering exemption, it is proposed to introduce a composition scheme, to
levy Tax on the basis of number of film prints made and released at a single
point to reduce burden and to collect Tax at the source for effective and
timely realization of Tax. Accordingly, insertion of a new sub-section (8A)
under Section 4 and amendment to section 22 of the AP VAT Act, 2005
is proposed.
Presently Tax on sales of food articles and drinks in hotels, restaurants
etc., is levied @ 12.5% on the 60% of the annual Turnover if it exceeds
Rs. 5 lakhs, Effective rate of Tax on Total Turnover would come to 7.5%.
This is being misused and some of the dealers are resorting to collect Tax
@12.5% on Total Turnover but paying only 7.5% (i.e. 12.5% of 60% of
the Total Turnover). It is therefore proposed to levy Tax on sales of Food
items in hotels by classifying the hotels as four categories. Hotels providing
lodging and boarding will be categorized into Star status of three star and
above who will pay Tax @ 12.5% with Input Tax Credit and those below
three Star status will pay Tax @ 4% without ITC. The hotels providing only
boarding i.e., sales/supply of food articles and drinks and having annual
turnover of Rs. 1.5 crores, and above who will pay Tax @ 12.5% with
ITC and those will annual turnover below Rs. 1.5 crores will pay Tax @
4% without ITC. This will also benefit the people of middle and low class
dt. 9-2-2009.
Commentary on A.P. Value Added Tax 24(G)
as the restaurants with less than Rs. 1.5 crores turnover per annum would
cater to their needs. Accordingly, amendment to sub-section (9) of
Section 4 is proposed.
Whenever stay is granted against collection of demands raised by
assessing authorities and disputed by the dealers payment of part of the
disputed amount of Tax is imposed as condition precedent for granting stay.
The wording of the provision as it exists now is limited to Tax and is not
covering the demands of penalty, interest etc. Hence, amendment to section
33 is proposed to remove the said anomoly.
The following amendments to schedules of the Andhra Pradesh Value
Added Tax Act, 2005 are also proposed to avoid diversion of trade to other
States and to remove ambiguity in interpreting the description of goods
furnished in the schedules attached to the Andhra Pradesh Value Added Tax
Act, 2005.
The following changes are proposed:
(i) Organic Manure at Sl.No. 26 of Schedule-I (exempted goods), it
is proposed to delete de-oiled cake from exemption, as it is chargeable @
4% under entry 87 of IV schedule.
(ii) Entry 44 of Schedule-I. It is proposed to include NAFED in the
Nodal Agencies who sell seeds.
(iii) The entry (1) under VI Schedule. Change in description is proposed
for taxing liquor manufactured and Bottled in other Countries and in India
equally.
(iv) Under Schedule VI it is proposed to include two new oil companies
in the explanation-IV- ie., (1) M/s. Essar Oil Limited and (2) Numaligarh
Refinery Limited, to the existing list of Oil Companies.
(b) In respect of the following amendments it is proposed to reduce
Tax from 12.5% to 4%.
(i) Oats - New Entry 122 is proposed to be included in Schedule-IV.-
(ii) Under Entry 121 - The goods relating to battery chargers (generally
sold to Railways) are proposed to be included in Schedule IV of 4% rate
so as to avoid diversion of trade as this item is taxed at 4% in other States,
which is taxed at 12.5% in Andhra Pradesh.
24(H) Statement of Objects and Reasons
(iii) Under entry 102- amendment is proposed to include pharmaceutical

processing equipments.
To achieve the above objects in view, it is decided to amend Sections
4,17,22,33 and Schedules I, IV and VI to the Andhra Pradesh Value Added
Tax Act, 2005.
1
The Government of Andhra Pradesh introduced the Value Added Tax
system by enacting the Andhra Pradesh Value Added Tax Act, 2005. Under
the said Act goods liable for tax are included in six Schedules. 1st Schedule
consisting exempted goods from tax, IInd Schedule consisting goods liable
for Zero rated and eligible for input tax credit, IIIrd Schedule consisting of
goods liable for Tax @ 1%, IVth Schedule consisting goods liable for Tax
@ 4%, Vth Schedule consisting of goods which are not included in any of
the Schedule, liable for tax @ 12.5% and VIth Schedule consisting of goods
liable for special rates of 70% on liquor and 33% and 22.5% leviable on
different petroleum products and 25% on different Tobacco products.
Keeping in view the practical difficulties and to ensure that the provisions
of the VAT Act should not be complicated and should be transparent, and
in view of the rates of tax adopted by the neighbouring States, Government
has been considering the proposals of the Commissioner of Commercial Taxes,
for making changes in the respective Schedules to provide safeguards against
diversion of trades to other States.
Accordingly, the Government decided to delete the following goods which
are now taxed at the rate of 4% and specified in Schedule-IV, and to include
the same in the list of exempted goods in Schedule-I of the Act:
(1) ‘Soya Bean De-oiled cake’ is included in goods at SI. No. 3;
(2) ‘Textiles made-ups’ is included in the goods at Sl.No. 45;
(3) ‘Nawar’ is added as Sl.No. 60 in the Schedule;
(4) ‘Goods’ sold to transit passengers both incoming and outgoing, at
the duty free shops established at the Rajiv Gandhi International Airport,
Shamshabad, Ranga Reddy District’ is added as Sl. No. 61 of the Schedule.
dt. 25-8-2009.
Commentary on A.P. Value Added Tax 24(I)
Presently, the printed material like diaries, calendars etc., are taxed at
the rate of 4% and specified at Sl.No. 47 of Schedule-IV, now for more
clarity certain goods like annual reports, application forms, Stationery items
like letterheads, visiting cards, bill books, leaflets, flyers, folders, soft bound
books, center pinned books, hard case books, computer stationery, posters,
brochures, CD/DVD covers, visual aids, danglers, streamers, envelopes, labels,
telephone recharge coupons, report cards, Tickets, Cheque Books, Demand
Drafts, Coupons and all kinds and classes of forms including tender and bid
documents and similar printed materials are specifically mentioned at Sl.No.
47.
Further, presently the PVC Cloth, Waterproof Cloth, Tarpauline, Rexine
are taxed at the rate of 4% and they are specified at Sl.No. 86 of Schedule-
IV. Now, it is decided to include the goods like Vehicle Covers made from
PVC Cloths, Waterproof Cloth, Tarpauline and Rexine Products, in the said
entry.
Further, it is decided that, the goods like Clean Air Ventilation System/
Air Handling Systems and the parts thereof, used in Pharmaceutical Industry,
which are presently taxed at the rate of 12.5% shall be taxed at the rate
of 4%. Accordingly, the same has been included at S.No. 50 of the Table
under entry 102 of the Schedule-IV.
Further, it is decided that, the goods like Mosquito nets, insect screens,
perimeter screen, Meshes for insects protection, Meshes for gardening and
agro meshes, made up of Plastic (polymer) and articles thereof, which are
presently taxed at the rate of 12.5% shall be taxed at the rate of 4%.
Accordingly, the same has been included as entry 123 in the Schedule-IV.
Further, it is decided that, the goods like Tobacco products including
Gutkha, Khara Masala, Kimam, Dokta, Zarda, Sukha or Surthi which are
presently taxed at the rate of 25% shall be deleted from the Schedule VI,
so as to enable to levy tax at the rate of 12.5% on them.
Further, it is decided to include M/s. Shell MRPL Aviation Fuels and
Services Private Limited in the existing list of Oil Companies in the note under
Explanation IV of Schedule VI.
Accordingly, certain alterations and additions have been made to the
Schedules I, IV and VI by issuing notifications.
24(J) Statement of Objects and Reasons

sub-section (1) of Section 79 during the next session of the Legislative
Assembly following the date of the said notification to give effect to the
alterations, additions or cancellation, as the case may be, of the Schedules
specified in the Notification.
Now, this Bill seeks to give effect to above alterations and additions
1
The Government of Andhra Pradesh introduced the Value Added Tax
system by enacting the Andhra Pradesh Value Added Tax Act, 2005 with
effect from 1-4-2005. Schedule-I of the said Act contains the list of goods
exempted from tax, Schedule-II list of goods zero rated for tax, Schedule-
Ill list of goods taxed @ 1%, Schedule-IV list of goods liable for tax at
the rate of 4% and Schedule-VI contains list of goods subjected to tax at
special rates. All the goods other than those specified in I, II, III, IV and
VI Schedules come under Schedule-V and are liable for tax at the standard
rate (12.5%).
Keeping in view of the interest of stake holders and the rates of tax
adopted by the neighbouring States, Government has been considering proposals
of the Commissioner of Commercial Taxes, for making changes in the rates
of tax of items listed under various Schedules and to effect such changes
have been issuing notifications under Section 79(1) of the APVAT Act, 2005
from time to time. In the recent past, Government have notified the following
changes to various Schedules:
1. Government have included bed sheets, pillow covers, towels, blankets,
travelling rugs, curtains, Zari and embroidery articles under entry 45 of
Schedule-I (exemption items).
2. Earlier the Government had included 52 items of goods sold by Canteen
Stores Department of Defence Services to the defence personnel in Schedule-
I. On the representation of defence personnel, 47 more items of goods from
SI. No. 53 to 99 have been included in Schedule-I, through a notification
issued in February, 2010. An amendment has also been issued to the entry
dt. 18-3-2010.
Commentary on A.P. Value Added Tax 24(K)
relating to Indian Made Foreign Liquor giving exemption from VAT to liquor
with “basic price” upto Rs. 500/- per case instead of “sale Price” below
Rs. 500/- per case, as the latter did not allow any benefit to the Defence
Personnel.
3. The commodity “Cane (Rattan)” is hither to being liable to tax at
the rate of 12.5%. Since, Cane (Rattan) is the raw material which is used
predominantly by artisans / craftsmen in making handicraft articles of common
consumption; it is decided to include the same in Schedule-IV to levy the
tax @ 4% only.
4. The Diesel Power Generators were earlier taxed at 12.5%. It was
observed that trade diversion was taking place due to higher rate of tax in
Andhra Pradesh on Diesel Power Generators, as compared to the rate of
tax prevailing on the same goods, i.e. @ 4% in neighbouring States i.e.,
Tamilnadu, Karnataka etc. Therefore, it was decided to include the same in
the IVth Schedule for being taxed at 4%.
5. In order to augment Government’s revenue a notification has been
issued to increase the rate of tax on items of conspicuous consumption such
as motor vehicles, white goods, electrical goods, cement, lubricants, cosmetics
etc., from 12.5% to 14.5%.
6. Government have further decided to increase the rate of tax on
“Aviation Turbine Fuel” (ATF) (in Schedule-VI) from 4% to 16%, as the
lowest VAT rate on ATF in major States in the country is 20%.
7. In order to make the taxation structure on imported Foreign liquor
GATT compatible it is proposed to bring parity in the quantum of State level
levies on such liquor and domestically produced liquor. Accordingly Government
have issued orders revising the ‘Assessable Value’ and ‘Assessment Fee’ on
Foreign Liquor (Spirits, Beer and Wine). As a part of this exercise, it is
proposed that for the purpose of levy of Value Added Tax on Foreign Liquor
imported by M/s. Andhra Pradesh Beverages Corporation Limited the “Custom
Duty” charged or chargeable by the Union Government shall not form part
of the ‘sale price’ as defined in Section 2(29) of the AP VAT Act, 2005.
8. As stated above, Government have enhanced the rate of tax on goods
taxable at standard rate under Schedule-V of the APVAT Act, 2005 from
12.5% to 14.5%. In view of this, in order to harmonize the rate of tax levied
under Section 4(7) (a) (on works contract where accounts are not maintained)
24(L) Statement of Objects and Reasons
and Section 4(9) (a) & (c) (on hotels above 3 star status or with turnover
not less than Rs. 1.50 crores) which is now @ 12.5%, needs to be raised
to 14.5%.
sub-section (1) of Section 79 during the next session of the Legislature
following the date of the said notification to give effect to the insertions,
substitutions, additions or cancellation, as the case may be, of the Schedules
specified in the notification.
Now, this Bill seeks to give effect to the above amendments, alterations
and additions to the said sections and schedules.
——
1
The Andhra Pradesh Value Added Tax Act, 2005 (Act 5 of 2005)
provides for levy of Value Added Tax (VAT) on sale or purchase of goods
has been brought into force with effect from 01-04-2005 in the place of
the A.P. General Sales Tax Act, 1957, which has been repealed under the
said Act. Certain provisions of the Act 2005 namely registration of Dealers
U/s 17 and Rule making powers U/s 78 of the Act were brought into force
w.e.f. 31-01-2005.
According to sub-section (4) of Section 2 of the Act, ‘Assessing
Authority’ means an officer authorized by the Commissioner, where as rule
59 of the rules framed U/s. 78 of the Act which came in force also on
the 31st January, 2005, prescribed authorities for the purpose of the Act.
It has therefore, become necessary to bring them within the meaning of the
definition of the assessing authorities. Accordingly, it has been decided to
expand the definition of the ‘assessing authorities’ by amending sub-section
(4) of Section 2 to avoid probable legal complications.
According to sub-section (5) of Section 4 of the Act, every dealer shall
pay tax on the sale price of goods specified in Schedule VI at the special
rates and at the point of levy specified therein. All liquors, bottled and packaged
in item (1) of the table under Schedule VI are being levied at the rate of
70% as a special rate at the point of first sale in the State. Thus, subsequent
dt. 24-3-2011.
Commentary on A.P. Value Added Tax 24(M)
sale of liquor are not liable to VAT. As by implication serving of loose liquor
to customers in a bar/restaurant would attract levy of tax at the standard
rate of 14.5% and sale of such loose liquors can be treated as a subsequent
sale, it would amount to double taxation. It has therefore become necessary
to exclude sale price of loose liquor from the taxable turn over with retrospective
effect from 01-04-2005 by amending the definition under clause (38) of
Section 2 of the Act.
According to sub-section (1) of Section 4 of the Act, every dealer
registered or liable to be registered as a VAT dealer, shall be liable to pay
tax on every sale of goods, in the State at the rates specified in the Schedule.
In sub-section (7) thereof, there is a difference between a dealer executing
any works contract for the Government or Local Authority, with that of a
dealer executing works contract other then for Government or Local Authority,
in respect of payment of tax. The former dealer deals with the Government
or Local Authority has to pay tax on the total value of the Contract. Whereas,
the later dealer executing works contract other than the Government or Local
Authority has to pay tax on the total consideration received or receivable for
any specific contract. Further, under clause (d) of sub-section (7), thereof,
a dealer engaged in construction and selling of residential apartments etc.,
may opt to pay tax by way of composition at the rate of 4% of twenty
five percent (25%) of the consideration received or receivable or the market
value fixed for the purpose of stamp duty whichever is higher subject to
such conditions as may be prescribed. According to this provision sub-
contractor of the Contractors who opt for composition scheme, have to pay
tax which amounts to double taxation. In this connection, a Committee of
Officers, Works Contractors and Tax Practitioners constituted by Government,
have made the following recommendations,-
1 . Removal of distinction between Government contracts and Private
contracts.
2. Sub-contractors of contractors who opt for composition scheme may
be exempted from taxes to avoid double taxation.
3. Inter-state purchases and purchases from un-registered dealers by
the works contractors under composition may be exempted by deleting the
relevant provisions in clause (e) of sub-section (7) of Section 4 of the APVAT
Act, 2005.
4. Limiting ITC to 75% instead of 90% (now) in non-composition cases
to safeguard Government revenue interest.
24(N) Statement of Objects and Reasons
5. To enact a new composition scheme for works contract involving

“Printing” works.
Government after considering the said recommendations and suggestions
made by the Committee, decided to amend the relevant provisions of
Section 4, suitably.
According to sub-section (10) (a) of Section 4, every person, who,
for an agreed commission brokerage, buys or sells on behalf of any principal
shall be liable to tax. It has been specifically decided to exempt, an agent
selling agricultural produce on behalf of agriculturist principal basing on the
representations made by the Market Yard Commission Agents, from payment
of tax, by suitably amending the said provision and consequential amendment
to Section 17 (5) retrospectively w.e.f. 24-09-2008.
Bus/Taxi-Cab Operators have represented that the vehicles provided on
hire to I.T/Other companies are being subjected to both ‘Service Tax’ as
well as VAT at standard rate by treating the transaction as a transfer of
‘right to use goods’. After prolonged discussion of the issue with the
concerned Associations, it is proposed to introduce a composition scheme
to levy tax @ 4% on such transactions without the benefit of input tax credit.
This scheme may be given retrospective effect from 01-04-2005 (date of
introduction of VAT Act) to settle all pending grievances/litigations. Hence,
an amendment is proposed to Section 4 (8) of the said Act.
Consequent to the amendments envisaged to Section 4 of the Act and
related provisions dealing with the claims of Input Tax Credit (ITC) on the
tax paid on purchases made by the works contractors, the provision of Section
13 also needs to be changed in tender with the amended provisions of
Section 4 of the Act. Hence, amendments to the sub-section (5) (a), (g)
and (j) and insertion of a new clause (i) corresponding to sub-section (11)
of Section 4 and sub-section (7) of Section 13 of the Act are needed and
accordingly incorporated in the Bill.
As per the provisions of Section 21 of the APVAT Act, 2005, best
judgment assessment can be made within four years of due date of return.
Sub-section (1) of Section 21 prescribes that the period, for which appeal
is pending before the High Court or Supreme Court or stay is granted by
the High Court or Supreme Court, has to be excluded for reckoning limitation
period for making an assessment. There is no similar Provision in respect
of proceedings pending before the Sales Tax Appellate Tribunals.
Commentary on A.P. Value Added Tax 24(O)
Therefore, an amendment is proposed to sub-section (7) of Section 21

of the Act.
According to sub-section (2) of Section 22 or as the case may be under
Section 40, if any dealer fails to pay any tax assessed or penalty or any
other amount within the time prescribed, he shall pay, in addition to the amount
of such tax or penalty or any other amount, interest calculated at the rate
of one percent per month for period of delay from such prescribed date
for its payment.
Of late the interest rate in the economy has gone up and most of the
financial institutions are charging interest in excess of 13% upto 15% on
working capital loans depending upon the credit worthiness of the borrowers.
Hence, in order to disincentivise the retention of tax collected by the dealers
with themselves for their business purposes it is imperative to increase the
interest rate from one percent per month to one and quarter percent per month
on delayed payment of tax dues by the dealers. Accordingly, amendments
have been proposed to relevant Sections 22 and 40 of the Act.
Vide Act No. 4 of 2009, an amendment was made to Section 33 providing
for payment of fifty percent of tax, penalty, interest or any other amount
as ordered by the Appellate Authority under Section 31 of the Act. Similar
provision is proposed to be inserted for appeals being filed before the Appellate
Deputy Commissioner under Section 31 of the Act. Hence, an amendment
to this section is proposed.
A number of appeals are pending disposal before the Appellate Deputy
Commissioners of Commercial Taxes Department as the validity of the Andhra
Pradesh Tax on Entry of Goods into Local Areas Act, 2001 has been struck
down by the Hon’ble High Court. The State has filed a Special Appeal against
the decision of the Hon’ble High Court before the Hon’ble Supreme Court
and obtain orders to the effect that no refunds be allowed pending disposal
of the SLP Therefore, it is expedient that the period of pendency of these
and similar other cases before the Courts of Law/Tribunal shall be excluded
for the purpose of reckoning the period of limitation of finalization of
assessments prescribed under the Act. Hence, an amendment is proposed to
sub-section (4) (a) of Section 31 of the Act.
As per the present provisions of Section 32, suo moto revision of an
assessment, where the issue involved in such revision is identical to the issue
under appeal pending before the Sales Tax Appellate Tribunal cannot be
undertaken by the Departmental Officers. In view of the past experience
involved in the disposal of appeals by the Sales Tax Appellate Tribunal, such
a provision precludes taking of any action by the Department. Hence the
24(P) Statement of Objects and Reasons
relevant provision is being amended suitably. However, a discretion to the

Departmental Officers to defer such cases, basing on the merits of the case,
is being proposed by making suitable amendment to sub-section (7) of Section
32.
In the interest of trade and industry, consumers and the State and also
keeping in view of the rates of taxes adopted by the neighbouring States,
the Government has been considering proposals of the Commissioner of
Commercial Taxes for making changes in the entries listed in various schedules.
In order to effect such changes, notifications have been issued under Section
79 (1) of the Act from time to time. In the recent past Government have
decided to notify the following changes to Schedule-IV (items taxed @ 4%.)
(a) in Entry 19, for the words “and Auxines”, the words “Plant
Harmones, Gibberillines, Auxines and plant growth promoters or regulators”
have been substituted with a view to include similarly placed goods.
(b) in Entry 100, the entry, “Winding wire made of Copper or enameled
Copper” has been notified at item No. 234, vide G.O.Ms.No. 461, Revenue
(CT.II) Department, dt. 19-05-2010 to avoid trade diversion.
(c) after Entry 124, a new entry 125, has been notified vide G.O.Ms.No.
361, Rev. (CT.II) Dept., dt. 24-04-2010:
“Lime, burnt Lime, Lime Stone, Products of Lime, Dolomite and other
White washing materials including Cem powder other than White Cement”
being items of common consumption.
(d) after Entry 125, a new entry 126 has been notified vide G.O.Ms.No.
726, Revenue (CT. II) Dept., dt. 02-08-2010:
“126. Purified Packaged drinking water in bulk containers/Cans and
Sachets but excluding aerated, mineral, distilled, medicinal, ionic, battery and
de-mineralized water” in order to provide protected water in rural areas at
reasonable prices.
(e) in entry No. 102, after serial number 50, issued notification vide
G.O.Ms.No. 1351, Rev. (CT. II) Deptt. dt. 10-11-2010, including the parts
of the Heavy Engineering Equipment/Machinery at Sl.No.51 to 57 of Schedule-
IV of the APVAT Act, 2005.
Hence, appropriate amendments have been proposed under the provision
of sub-section (2) of Section 79 of the Andhra Pradesh Value Added Tax
Act, 2005.
The Bill seeks to give effect to the above decisions.
——
Commentary on A.P. Value Added Tax 24(Q)
VALUE ADDED TAX (AMENDMENT) ACT, 2012

STATEMENT OF OBJECTS AND REASONS
1[Amendment Act 11 of 2012]
The Andhra Pradesh Legislature enacted the APVAT Act, 2005 with effect
from 1-4-2005 for levy and collection of value added tax on sales of goods.
Under the said Act goods liable for tax are included in six Schedules. Schedule-
I consisting of goods exempted from tax, Schedule-II consisting of goods liable
for Zero rate of tax and eligible for input tax credit, Schedule-III consisting of
goods liable for tax @ 1 %, Schedule-IV consisting of goods liable for tax @
4%, Schedule-V consisting of goods which are not included in any of the other
Schedules, liable for tax @ 14.5% and Schedule-VI consisting of goods liable
for tax at the special rates.
Government of India has started phasing out CST from the financial year
2007-2008. In 2007-08, it was brought down from 4% to 3% and in 2008-
2009 from 3% to 2%. Since the introduction of GST was delayed, the rate of
CST has not been further brought down subsequently. The GOI has been
compensating the State for loss of revenue on account of reduction of CST.
In order to reduce its compensation burden, the GOI advised the States to raise
the lower slab of VAT from 4% to 5%. Hence, the State Government have
increased VAT rate to 5% from 4% on goods enlisted in Schedule-IV to the
APVAT Act.
The commodities cotton/man-made/woolen fabrics and textile made-ups
etc., and Sugar, were exempt from VAT as the said goods were included in the
First Schedule to the Additional Duties of Excise (Goods of Special Importance)
Act, 1957.
The Government of India omitted the commodities 'Textiles' and 'Sugar',
from the purview of levy of Additional Duties of Excise by amending the First
Schedule to the Additional Duties of Excise (Goods of Special Importance) Act,
1957 vide Section 75 read with the Thirteenth Schedule of Finance Act 8 of
2011 with a view to leave the space open for the State Governments to tax
these items under VAT.
Since the Government decided to continue VAT exemption for fabrics,
made-ups and garments made of khadi cloth corresponding amendment was
also made to entry 49 of Schedule-l of the APVAT Act, 2005.
Government have decided to exempt VAT on 'Zari', which is used in the
handloom sector as an input material and on textile goods produced and sold
by Powerloom units, at the first point of sale. Accordingly, notifications were
issued.
Andhra Pradesh Power Development Company Limited (APPDCL), engaged
in power generation, has been granted lower rate of tax @ 5% for goods
purchased by it on par with other similar State Public Sector Units (PSUs).
dt. 22-3-2012.
24(R) Statement of Objects and Reasons
Pipes of all varieties including GI pipes, CI pipes, ductile pipes and PVC
pipes, but excluding RCC and PCC pipes and their fittings, were earlier liable
to tax @ 14.5%. In order to avoid trade diversion to other neighbouring States
and to made the rate of tax on par with other States, it is decided to reduce
the rate of tax to 5% on RCC and PCC pipes and Cement poles without input
tax credit eligibility on Cement purchases in Andhra Pradesh.
Non-woven fabrics were earlier taxable @ 14.5% where as finished goods
made of non-woven fabrics were taxable @ 5%. Also other kinds of packing
material e.g., PVC sacks, PP Woven Fabrics are also taxable @ 5%. In
neighbouring States of Tamilnadu and Karnataka the rate of tax is @ 5% and
zero respectively. Hence, to avoid trade diversion it is decided to levy VAT rate
@5% on non-woven fabrics.
The Government of India omitted all tobacco products from the purview
of levy of Additional Excise Duty to enable the States of levy VAT on such
products. Andhra Pradesh State has been imposing VAT @14.5% on tobacco
products except bidi. Since, several States have increased VAT rate on tobacco
products which are demerit goods, ranging from 17% to 25%, the Government
decided to increase the VAT rate on the same to 20% from 14.5%.
Accordingly, certain alterations, additions and deletions have been made to
the Schedules I, IV and VI by issuing notifications under sub-section (1) of
sub-section (1) of Section 79 during the next session of the State Legislature
following the date of the said notification to give effect to the alterations,
additions or deletions as the case may be, of the Schedules specified in the
Notification.
Now, this Bill seeks to give effect to above amendments to the said
Schedules.
VALUE ADDED TAX (SECOND AMENDMENT) ACT, 2012
The Andhra Pradesh Value Added Tax Act, 2005 (Act 5 of 2005) has been
brought into force with effect from 01-04-2005 for levy and collection of tax
on sale of goods.
Government of India has proposed to introduce the GST and has started
phasing out Central Sales Tax (CST) from the financial year 2007-2008. In
2007-2008, it was brought down from 4% to 3% and in 2008-2009 from 3%
to 2%. Since the introduction of GST was delayed the rate of CST has not been
further brought down. Subsequently, the Government of India has been
compensating the States for the loss of revenue on account of reduction of
dt. 22-3-2012.
Commentary on A.P. Value Added Tax 24(S)
CST. With a view to reduce its compensation burden the Government of India
advised the States to raise the lower slab of VAT from 4% to 5%.
Keeping the above suggestion of the Government of India in view, some
States like Maharashtra, Tamilnadu, Karnataka, Rajasthan, Gujarat, Madhya
Pradesh, Chhattisgarh and Uttar Pradesh have already increased the VAT rate
for the goods listed in Schedule-IV of the Andhra Pradesh Value Added Tax Act,
2005 from 4% to 5%. The State Government, with a view to augment its
revenue, issued a notification vide G.O.Ms.No.1718, Revenue (CT.II) Department,
dt. 13-09-2011 (w.e.f. 14-09-2011), increasing the rate of tax from 4% to 5%
in respect of goods included in Schedule-IV of the APVAT Act, 2005.
Apart from the goods listed at Schedule-IV, at present a VAT rate of 4%
is leviable under sub-sections (4), (7), (8B), (9), (11) of Section 4 and sub-
section (6) of Section 13 and sub-section (3-A) of section 22 of the APVAT
Act, 2005 as follows:-
Section-4(4) On purchase price of goods purchased from an
unregistered dealer, used as inputs for goods exempted
from tax and stock transfers/Consignment sales to
places outside the State.
Section-4 (7)(b) Works contract for the Government or local authority
& Section-22(3A). under composition scheme.
Section-4(7)(d) Works Contract for Residential buildings / Commercial
Complexes under composition scheme.
Section-4(8B) Amount received/receivable towards transfer of Right
to use goods.
Section-4(9)(b) & (d) Hotels other than Star Hotels/Restaurants etc., having
turnover between Rs. 5 lakhs and Rs. 1.50 Crore.
Section-4(11) Printers under composition scheme.
Section-13(6) Limit on input tax credit on transfer of taxable goods
outside the State.
Hence, in order to bring the above mentioned tax-rates in harmony with
that of the goods included in the Schedule-IV of the Act, it was decided to
amend the said provisions of the Act accordingly.
As the Legislature of the State was not then in session and the Governor
of Andhra Pradesh was satisfied that circumstances exist which render it
necessary for him to take immediate action, the Governor promulgated the
Andhra Pradesh Value Added Tax (Second Amendment) Ordinance, 2011 (A.P.
Ordinance No. 9 of 2011). A Bill to replace the said Ordinance could not be
introduced in the Legislature during the Session immediately after promulgation
of the Ordinance, which lasted for short period. As the said Ordinance ceased
to operate with effect from 12-01-2012 by efflux of time as provided under
24(T) Statement of Objects and Reasons
Article 213(2) (a) of the Constitution of India and so as to have the continuity
of law, it has become necessary to promulgate another Ordinance on the lines
of the said Ordinance 9 of 2011. The Governor of Andhra Pradesh has
promulgated the Andhra Pradesh Value Added Tax (Amendment) Ordinance,
2012 (A.P. Ordinance No. 3 of 2012) on the 2nd February, 2012.
This Bill seeks to replace the said Ordinance.
VALUE ADDED TAX (THIRD AMENDMENT) ACT, 2012
The Andhra Pradesh Value Added Tax Act, 2005 (Act 5 of 2005) has been
brought into force with effect from 1-4-2005 for levy and collection of tax on
sale of goods.
Under Section 4(9)(d) of the Andhra Pradesh Value Added Tax Act, 2005,
dealers having annual turnover above Rs. 5 lakhs and less than Rs. 1.50 crores
shall pay tax @ 5% of the taxable turnover of sale of supply of goods, being
food or any other article of human consumption or drink served in restaurant
eating houses etc.
Under Section 17(7) of the Andhra Pradesh Value Added Tax Act, 2005
very small dealers having annual turn-over up to Rs. 5 lakh are exempted from
tax liability. Such dealers are also not required to register themselves with the
Commercial Tax Department. The small dealers, having annual taxable turnover
exceeding Rs. 5 lakhs and upto Rs. 40 lakhs, have an option to register themselves
as Turn-over Tax (TOT) dealers and pay TOT @ 1%. These provisions in the
VAT Act, 2005 are intended to eliminate or reduce the cost of compliance of
very small and small dealers respectively on the one hand and also minimize the
administrative cost of the department involved in tax collection on the other.
The above mentioned threshold limits were fixed as on 1st April, 2005.
Certain Merchant Associations have represented to Government to enhance
these limits keeping in mind the cost of inflation.
After taking into account the representation of the said Associations it is
proposed to raise the tax exemption limit for annual turnover to Rs. 7.50 lakh
from the existing limit of Rs. 5 lakhs. Similarly the maximum threshold limit for
annual turnover in respect of Turn-over Tax liability is proposed to be raised
to Rs. 50 lakhs from 40 lakhs.
This Bill seeks to achieve and the above objective.
-------
dt. 22-3-2012.
THE A.P. VALUE ADDED TAX ACT, 2005
[Act No. 5 of 2005]1
The following Act of the Andhra Pradesh Legislative Assembly which
was reserved by the Governor on the 16th March, 2005 for the consideration
and assent of the President received the assent of the President on the
25th March, 2005 and the said assent is hereby first published on the
28th March, 2005 in the Andhra Pradesh Gazette for general information.
An Act to provide for and consolidate the law relating to levy of
value added tax on sale or purchase of goods in the State of Andhra
Pradesh and for matters connected therewith and incidental thereto.
Be it enacted by the Legislative Assembly of the State of Andhra
Pradesh in the Fifty sixth Year of the Republic of India as follows:
CHAPTER I
Preliminary
Notes
Title:– Title of the Act confirms the subject matter contained in the
legislation. The key words used in the title should be given the widest meaning.
Here, the Value Added Tax is a new expression not known earlier in the Indian
Legislative History. Though, in several respects, it is a replacement in a different
form of the existing sales tax, it substantially differs from it in the matter
of the incidence of tax. It is levied at all sale points not on the total amount
of the price at which it is sold but on the difference of the amount between
the purchase and sale value of the goods which amount is called value addition
and accordingly the tax is called Value Added Tax.
Since, the procedure and jurisprudence that govern the administration
of sales tax continue to be the same in the case of Value Added Tax the
precedents so far developed in relation to sales tax legislation may with
appropriate variations apply to Value Added Tax.
Needless to say, that tax legislations shall be construed strictly in the
same manner as the laws applicable to the penal enactments. Unless, a dealer’s
liability is fixed in terms of the Act and within its scope coersive measures
for collecting the tax cannot be resorted to. Penalising or prosecuting any
person for violating any of the provisions of the Act do not arise unless
the violations come within the parameters of the offence.
By introducing the novel procedure of advance rulings which could be
obtained by any dealer from the authority comprising of high officials designated
under the Act, the rigours of the Act may be taken as softened.
1. Published in the A.P. Gaz. Pt. IV-B, Ext. No. 6, dt. 28-3-2005.
Note:– As amended upto and inclusive of A.P. Act No. 13 of 2012.
25
26 Commentary on A.P. Value Added Tax [Sec. 2
1. Short title, extent and commencement:– (1) This Act may be

called the Andhra Pradesh Value Added Tax Act, 2005.
(2) It extends to the whole of the State of Andhra Pradesh.
(3)(a) Sections 1,2,17,18 and 78 shall be deemed to have come
into force with effect from 31st January, 2005 ; and
(b) the remaining provisions shall come into force on such date1 as
the Government may, by notification, appoint.
Notes
The Act applies to the whole of the State of Andhra Pradesh including
cantonments, ports and tribal areas. When it is said that the Act comes into
force on the date notified, it does not mean that any steps to be taken as
preparations to bring the Act into force shall not be taken prior to that date.
The notification bringing the Act into force may be made either before the
date fixed or on the date fixed but not later than the date fixed. The ordinance
provided to enable the Government to bring certain provisions of the Ordinance
into force so as to enable the Government to make such preparations, as
registration of dealers and making of rules. The notification shall be in English
language and may also in Telugu. The notification shall be published in the
Official Gazette of Andhra Pradesh. Publication in District Gazette or publication
in any other media including the press, radio and television, however, exhaustive
their coverage may be, is no publication in the eye of law if the notification
is not published in State Gazette.
The Act may be prospective or retrospective. It may be retrospective
when the Act replaces Ordinances issued earlier. But no rule can be made
operative retrospectively. Asian Peroxides Ltd., v. State of A.P., (2011) 52
APSTJ 239 = 2011 (4) ALD 693 (DB).
2. Definitions:– In this Act, unless the context otherwise requires–
(1) ‘Additional Commissioner’ means any person appointed to be
an Additional Commissioner of Commercial Taxes under Section 3A;
(2) ‘Appellate Deputy Commissioner’ means any person appointed
under Section 3A to be an Appellate Deputy Commissioner or any other
officer not below the rank of Deputy Commissioner authorized by the
Commissioner to be an Appellate Deputy Commissioner;
(3) ‘Appellate Tribunal’ means the Appellate Tribunal appointed
under Section 3;
1. Andhra Pradesh Value Added Tax Act, 2005 (Act No. 5 of 2005) – Implementation
date – Notification – Issued.
[G.O.Ms. No. 386 Rev. (CT-II) Dept., dated 30-3-2005]
In exercise of the powers conferred by sub-section (3) (b) of Section 1 of the Andhra
Pradesh Value Added Tax Act, 2005 (Act No. 5 of 2005), the Governor of Andhra
Pradesh hereby appoints 1st April, 2005 as the date on which the provisions of Andhra
Pradesh Value Added Tax Act, 2005, shall come into force except the provisions
mentioned in sub-section (3)(a) of Section 1 of the said Act.
Sec. 2] Preliminary 27
(4) ‘Assessing authority’ means any officer of the Commercial Taxes

Department authorized by the Commissioner 1[or as may be prescribed,]
to make any assessment in such area or areas or the whole of the State
of Andhra Pradesh;
(5) ‘Assistant Commissioner’ means any person appointed to be
an Assistant Commissioner of Commercial Taxes under Section 3A;
(6) ‘Business’ includes:
(a) any trade, commerce or manufacture or any adventure or concern
in the nature of trade, commerce or manufacture whether or not
such trade, commerce, manufacture, adventure or concern is
carried on or undertaken with a motive to make gain or profit
and whether or not any gain or profit accrues there from;
(b) Any transaction in connection with, or incidental or ancillary to,
such trade, commerce, manufacture, adventure or concern and
(c) Any transaction in connection with commencement or incidental
or ancillary to the commencement or closure of such trade,
commerce, manufacture, adventure or concern.
Explanation:– For the purpose of this clause–
(i) the activities of raising of manmade forests or rearing of seedlings
or plants shall be deemed to be business;
(ii) any transaction of sale or purchase of capital goods pertaining
to such trade, commerce manufacture, adventure or concern shall
be deemed to be business;
(iii) A sale by a person whether by himself or through an agent of
agricultural or horticultural produce grown by himself or grown
on any land whether as owner or tenant in a form not different
from the one in which it was produced, save mere cleaning,
grading or sorting does not constitute business.
(7) ‘Casual trader’ means a person who, whether as principal, agent
or in any other capacity, carries on occasional transactions of a business
nature involving the buying, selling, or distribution of goods in the State,
whether for cash or for deferred payment, or for commission, remuneration
or other valuable consideration.
(8) ‘Commissioner’ means any person appointed by the Government
to be the Commissioner of Commercial Taxes under Section 3A;
(9) ‘Commercial Tax Officer’ means any person appointed to be
Commercial Tax Officer under Section 3A;
(10) ‘Dealer’ means any person who carries on the business of
buying, selling, supplying or distributing goods or delivering goods on hire
purchase or on any system of payment by instalments, or carries on or
1. Ins. by Act No. 21 of 2011, w.e.f. 15-9-2011.
executes any works contract involving supply or use of material directly

or otherwise, whether for cash or for deferred payment, or for commission,
remuneration or other valuable consideration, and includes:
(a) A company, a Hindu undivided family or any society including
a co-operative society, club, firm or association which carries
on such business;
(b) a society including a co-operative society, club, firm or association
which buys goods from, or sells, supplies or distributes goods
to its members;
(c) a casual trader, as hereinbefore defined;
(d) any person, who may, in the course of business of running a
restaurant or an eating house or a hotel by whatever name called,
sells or supplies by way of or as part of any service or in any
other manner whatsoever, of goods, being food or any other
article for human consumption or any drink whether or not
intoxicating;
(e) any person, who may transfer the right to the use of any goods
for any purpose whatsoever whether or not for a specified period
in the course of business to any other person;
(f) a commission agent, a broker, a delcredere agent, an auctioneer
or any other mercantile agent, by whatever name called, who
carries on the business of buying, selling, supplying or distributing
goods on behalf of any principal; 1[or principals].
Explanation I:– Every person who acts as an ‘agent of a non-
resident dealer’, that is, as an agent on behalf of a dealer residing outside
the State, and buys, sells, supplies or distributes goods in the State or
acts on behalf of such dealer as,
(a) a mercantile agent as defined in the Sale of Goods Act, 1930
(Central Act III of 1930), or
(b) an agent for handling goods or documents of title relating to
goods, or
(c) an agent for the collection or the payment of the sale price of
goods or as a guarantor for such collection or payment and every
local branch of a firm or company situated outside the State,
shall be deemed to be a dealer for the purpose of the Act;
Explanation II:– Where a grower of agricultural or horticultural
produce sells such produce grown by himself on any land in which he
has an interest whether as owner, usufructuary mortgagee, tenant or
otherwise, in a form different from the one in which it was produced
1. Added by Act No. 28 of 2008, w.e.f. 24-9-2008.
after subjecting it to any physical, chemical or any process other than

mere cleaning, grading or sorting, he shall be deemed to be a dealer for
the purpose of the Act;
Explanation III:– The Central Government or the State Government
which, whether or not in the course of business, buys, sells, supplies or
distributes goods, directly or otherwise, for cash or for deferred payment
or for commission, remuneration or other valuable consideration shall be
deemed to be a dealer for the purposes of the Act;
Explanation IV:– Each of the following persons and bodies,
whether or not in the course of business, who sells or disposes of
any goods including unclaimed or confiscated or unserviceable goods or
scrap, surplus, old, obsolete, or discarded material or waste products
whether by auction or otherwise, directly or through an agent for cash,
or for deferred payment or for any other valuable consideration shall be
deemed to be a dealer to the extent of such disposals or sales, namely:
(i) Port Trust;
(ii) Municipal Corporations, Municipal Councils, and other local
authorities;
(iii) Railway authorities;
(iv) Shipping, transport and construction companies;
(v) Air transport companies and air-lines including National Airport
Authority;
(vi) Transporters, holding permits for transport vehicles granted under
the Motor Vehicles Act, 1988 (Central Act 59 of 1988) which
are used or adopted to be used for hire;
(vii) Andhra Pradesh State Road Transport Corporation;
(viii) Customs Department of the Government of India administering
the Customs Act, 1962 (Central Act 52 of 1962);
(ix) Insurance and financial corporations or companies and Banks
included in the Second Schedule to the Reserve Bank of India
Act, 1934 (Central Act 2 of 1934);
(x) Advertising agencies;
(xi) Any other Corporation, company, body or authority owned or
set up by or subject to administrative control of the Central
Government or any State Government.
Explanation V:– Save as otherwise expressly provided for under
the Act, the word ‘dealer’ shall include a VAT dealer and a TOT dealer;
(11) ‘Deputy Commercial Tax Officer’ means any person appointed
to be a Deputy Commercial Tax Officer under Section 3A;
(12) ‘Deputy Commissioner’ means any person appointed to be

a Deputy Commissioner of Commercial Taxes under Section 3A;
(13) ‘Exempt sale’ means a sale of goods on which no tax is
chargeable, and consequently no credit for input tax related to that sale
is allowable;
(14) ‘Exempted Turnover’ means the aggregate of sale prices of
all goods exempted under the Act and full or part of the actual value
or fair market value of all transactions not taxable under the provisions
of the Act, including transactions falling under Section 6A of the 1[Central
Sales Tax Act, 1956;]
(15) ‘Fair market value’ means the price that the goods would
ordinarily fetch on sale in the open market on the date of sale or dispatch
or transfer of such goods;
(16) ‘Goods’ means all kinds of movable property other than
newspapers, actionable claims, stocks, shares and securities, and includes
all materials, articles and commodities including the goods as goods or
in some other form, involved in the execution of a works contract or
those goods used or to be used in the construction, fitting out, improvement
or repair of movable or immovable property and also includes all growing
crops, grass and things attached to or forming part of the land which
are agreed to be severed before sale or under the contract of sale;
(17) ‘Goods vehicle’ means any motor vehicle constructed or adapted
for the carriage of goods, or any other motor vehicle not so constructed
or adapted when used for the carriage of goods solely or in addition
to passengers and also includes every wheeled conveyance;
(18) ‘Government’ means the State Government of Andhra Pradesh;
(19) ‘Input tax’ means the tax paid or payable under the Act by
a VAT dealer to another VAT dealer 2[whether directly by himself or
through his agent on his behalf] on the purchase of goods in the course
of business;
(20) ‘Joint Commissioner’ means any person appointed to be a
Joint Commissioner of Commercial Taxes under Section 3A;
(21) ‘Notification’ means a notification published in the Andhra
Pradesh Gazette and the word ‘notified’ shall be construed accordingly;
(22) ‘Output tax’ means the tax paid or payable by a VAT dealer
2
[whether by himself or through his agent] on the sale of goods to another
VAT dealer or any other person;
1. Subs for the words “Sales Tax Levy Validation Act, 1956” by AP Act No. 23 of 2005,
w.e.f. 29-8-2005.
(23) ‘Place of business’ means any place where a dealer purchases

or sells goods and includes:
(a) any warehouse, godown or other place where goods are stored
or processed or produced or manufactured; or
(b) any place where a dealer keeps his books of accounts; or
(c) any place where business is carried on through an agent by
whatever name called, the place of business of such agent;
(24) ‘Prescribed’ means prescribed by the Rules made under the
Act;
(25) ‘Purchase Price’ means the amount of valuable consideration
paid or payable by a person for any purchase made including any sum
charged for anything done by the seller in respect of the goods at the
time of or before delivery thereof;
Explanation I:– Where the purchase is effected by way of transfer
of property in goods (whether as goods or in some other form) involved
in the execution of works contract, purchase price shall mean the total
consideration for the works contract, and for the purpose of levy of tax
purchase price shall be taken to mean the price as may be determined
in accordance with the rules, by making such deductions from the total
consideration for the works contract as may be prescribed;
Explanation II:– The amount of duties levied or leviable on the
goods under the Central Excise Act, 1944 (Central Act 1 of 1944), or
the Customs Act, 1962 (Central Act 52 of 1962) shall be deemed to
be part of the purchase price of such goods, whether such duties are
paid or payable by or on behalf of the seller or the purchaser or any
other person;
Explanation III:– Purchase price shall not include tax paid or
payable by a person in respect of such purchase;
(26) ‘Return’ means any return required to be furnished under the
Act or the Rules made thereunder;
(27) ‘Rules’ means rules made under the Act;
(28) ‘Sale’ with all its grammatical variations and cognate expressions
means every transfer of the property in goods [whether as such goods
or in any other form in pursuance of a contract or otherwise] by one
person to another in the course of trade or business, for cash, or for
deferred payment, or for any other valuable consideration or in the supply
or distribution of goods by a society (including a co-operative society),
club, firm or association to its members, but does not include a mortgage,
hypothecation or pledge of, or a charge on goods.
Explanation I:– A delivery of goods on the hire purchase or any
system of payment by instalments shall, notwithstanding the fact that the
seller retains the title in the goods, as security for payment of the price,
be deemed to be a sale.
Explanation II:– (a) Notwithstanding anything contained in the
Indian Sale of Goods Act, 1930 (Central Act III of 1930) a sale or
purchase of goods shall be deemed, for the purpose of the Act to have
taken place in the State, wherever the contract of sale or purchase might
have been made, if the goods are within the State,–
(i) in the case of specific or ascertained goods, at the time the
contract of sale or purchase is made ; and
(ii) in the case of unascertained or future goods, at the time of their
appropriation to the contract of sale or purchase by the seller
or by the purchaser, whether the assent of the other party is
prior or subsequent to such appropriation;
(b) Where there is a single contract of sale or purchase of goods
situated at more places than one, the provisions of Clause (a) shall apply
as if there were separate contracts in respect of the goods at each of
such places.
Explanation III:– Notwithstanding anything contained in the Act
or in the Indian Sale of Goods Act, 1930 (Central Act III of 1930),
two independent sales or purchases shall for the purposes of the Act,
be deemed to have taken place,–
(1) When the goods are transferred from a principal to his selling
agent and from the selling agent to his purchaser, or
(2) When the goods are transferred from the seller to a buying agent
and from the buying agent to his principal, if the agent is found in either
of the cases aforesaid,–
(i) to have sold the goods at one rate and to have passed on the
sale proceeds to his principal at another rate ; or
(ii) to have purchased the goods at one rate and to have passed
them on to his principal at another rate ; or
(iii) not to have accounted to his principal for the entire collections
or deductions made by him, in the sales or purchases effected
by him on behalf of his principal ; or
(iv) to have acted for a fictitious or non-existent principal.
Explanation IV:– A transfer of right to use any goods for any
purpose (whether or not for a specified period) for cash, deferred payment
or other valuable consideration shall be deemed to be a sale.
Explanation V:– Notwithstanding anything contained in the Act or
in the Indian Sale of Goods Act, 1930 (Central Act III of 1930) the
sale of goods includes the supply, by way of or as part of any service
or in any manner whatsoever, of goods, being food or other article for

human consumption or any drink (whether or not intoxicating) where such
supply or service, is for cash, deferred payment or other valuable
consideration and such supply of any goods shall be deemed to be a
sale of those goods by the person making the supply of those goods
to the person to whom such supply is made.
Explanation VI:– Whenever any goods are supplied or used in
the execution of a works contract, there shall be deemed to be a transfer
of property in such goods, whether or not the value of the goods so
supplied or used in the course of execution of such works contract is
shown separately and whether or not the value of such goods or material
can be separated from the contract for the service and the work done.
Explanation VII:– Notwithstanding anything contained in the Indian
Sale of Goods Act, 1930 (Central Act III of 1930), a sale or purchase
of goods shall, for the purposes of the Act be deemed to have taken
place where in the course of any scheme whether called as “Lucky Gift
Scheme” or by any other name, any goods are transferred by the person
who runs such scheme to any other person who is a subscriber to that
scheme, provided that all the subscribers to the scheme have agreed to
contribute a specific sum periodically or otherwise, towards the cost of
any article agreed to be sold or given to the winner of the draw held
by the holder of the scheme; and the turnover for the purpose of this
explanation shall be the amount which would have been payable by the
subscriber had he not won the prize till the end of the series of draw;
Explanation VIII:– Every transfer of property in goods by the
Central Government or the State Government for cash or for deferred
payment or for any other valuable consideration, whether or not in the
course of business shall be deemed to be a sale for the purpose of the
Act;
(29) ‘Sale Price’ means–
(a) the total amount set out in the tax invoice or bill of sale; or
(b) the total amount of consideration for the sale or purchase of
goods as may be determined by the assessing authority, if the tax invoice
or bill of sale does not set out correctly the amount for which the goods
are sold; or
(c) if there is no tax invoice or bill of sale, the total amount charged
as the consideration for the sale or purchase of goods by a VAT dealer
or TOT dealer either directly or through another, on his own account
or on account of others, whether such consideration be cash, deferred
payment or any other thing of value and shall include;
(i) the value of any goods as determined by the assessing authority,–
VAT–3
(a) to have been used or supplied by the dealer in the course of

execution of the works contract; or
(b) to have been delivered by the dealer on hire purchase or any
other system of payment by instalments; or
(c) to have been supplied or distributed by a society including a
Co-operative Society, Club, firm or association to its members,
where the cost of such goods is not separately shown or indicated
by the dealer and where the cost of such goods is separately
shown or indicated by the dealer, the cost of such goods as
shown or indicated;
(ii) any other sum charged by the dealer for anything done in respect
of goods sold at the time of, or before, the delivery of the goods;
(iii) any other sum charged by the dealer, whatever be the description,
name or object thereof;
Explanation I:– Subject to such conditions and restrictions, if any,
as may be prescribed in this behalf, any cash or other discount on the
price allowed in respect of any sale and any amount refunded in respect
of articles returned by customers shall not be included in the sale price;
Explanation II:– For the purpose of determination of sale price
and levy of Value Added Tax, the Value Added Tax charged or chargeable
shall not form part of Sale Price;
1
[Explanation III:– For the purpose of determination of sale price
of Foreign Liquor imported by the Andhra Pradesh Beverages Corporation
Limited and levy of Value Added Tax, the ‘Customs Duty’ charged or
chargeable under the Customs Act, 1962 shall not form part of the sale
price.]
(30) ‘Schedule’ means a Schedule appended to the Act;
2
[(30-A) ‘SEZ’ means Special Economic Zone as defined under the
Special Economic Zones Act, 2005 (Central Act 28 of 2005)]
(31) ‘Special Rate of Tax’ means the Rates of tax specified in
Schedule VI.
(32) ‘State’ means the State of Andhra Pradesh.
(33) ‘State Representative’ means an officer of the Commercial
Taxes Department not below the rank of Assistant Commissioner appointed
by the State Government to receive on their behalf notices issued by the
Appellate Tribunal and generally to appear, act and plead on their behalf
in all proceedings before the Appellate Tribunal and includes an officer
authorized to act on his behalf in his absence;
1. Added by Act 9 of 2010, w.r.e.f. 30-1-2010.
(34) ‘Tax’ means a tax on the sale or purchase of goods payable

under the Act and includes,–
(a) a tax on the transfer, otherwise than in pursuance of a contract,
of property in any goods for cash, deferred payment or other
valuable consideration;
(b) a tax on the transfer of property in goods whether as goods
or in some other form involved in the execution of a works
contract;
(c) a tax on the delivery of goods on hire purchase or any system
of payment by instalments;
(d) a tax on the 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;
(e) a tax on the supply of goods by any un-incorporated association
or body of persons to a member thereof for cash, deferred
payment or other valuable consideration;
(f) a tax on the supply, by way of or as part of any service or
in any other manner whatsoever of goods, being food or any
other article for human consumption or any drink whether or
not intoxicating, where such supply or service is for cash, deferred
payment or other valuable consideration;
(35) ‘Tax invoice’ means a sale invoice containing such details as
may be prescribed and issued by a VAT dealer to another VAT dealer;
(36) ‘Tax period’ means a calendar month or any other period as
may be prescribed;
(37) ‘Taxable Sale’ means a sale of goods taxable under the Act
and under the Central Sales Tax Act, 1956 (Central Act 74 of 1956)
and shall include sale of any goods exported outside the territory of India
or sold in the course of export;
(38) ‘Taxable turnover’ means the aggregate of sale prices of all
taxable goods;
Explanation I:– For the purpose of a VAT dealer, it shall not include
the amount of VAT paid or payable, but shall include the sale price of
zero-rated sales.
Explanation II:– The sale price relating to second and subsequent
sale of goods specified in Schedule VI shall not form part of taxable
turnover;
1
[Explanation III:– The sale price, relating to loose liquor, served
to customer in a bar/restaurant which was derived from the goods
1. Added by Act No. 21 of 2011, w.r.e.f. 1-4-2005.
enumerated in item 1 of the Schedule-VI, on which tax at special rates

has been levied and paid in the State, shall not form part of the taxable
turnover.]
1
[(39) ‘Total turnover’ means the aggregate of sale prices of all
goods, taxable and exempted, sold at all places of business of the dealer
in the State, whether directly by himself for through his agent or agents,
including the turnover of sales involved in the transactions falling under
sections 3,5,6A and 8(6) of the Central Sales Tax Act, 1956 and shall
also include the gross consideration received or receivable towards execution
of works contract.]
(40) ‘Turnover tax’ or TOT means a tax on the taxable turnover
of dealers registered or liable to be registered for TOT;
(41) ‘Turnover Tax Dealer’ or TOT dealer means any dealer who
is registered or liable to be registered for TOT;
(42) ‘VAT’ means Value Added Tax on sales, levied under the
provisions of the Act;
(43) ‘VAT dealer’ means a dealer who is registered for VAT;
(44) ‘Vessel’ includes any ship, barge, boat, raft, timber, bamboos
or floating materials propelled in any manner;
(45) ‘Works Contract’ includes any agreement for carrying out for
cash or for deferred payment or for any other valuable consideration,
the building construction, manufacture, processing, fabrication, erection,
installation, laying, fitting out, improvement, modification, repair or
commissioning of any movable or immovable property;
(46) ‘Year’ means the twelve-month period ending on the thirty first
day of March;
(47) ‘Zero rated Sales’ for the purpose of the Act, means a sale
of goods in the course of inter-State trade or commerce, exports to outside
the territory of India including sale in the course of export and sale of
goods to any unit located in Special Economic Zone as may be notified.
Notes
Definitions form an important part in any legislation. Every Act before

it takes up the substantive provisions defines at the beginning all important
words and expressions used in the enactment, the intention being that the
words defined should be understood as having the same meaning given to
them wherever they are used. Each of the words defined bear a significant
meaning in the context they are used.
Section 2(1) Addl. Commissioner; (2) Appellate Dy. Commissioner;
(5) Asst. Commissioner; (8) Commissioner; (9) Commercial Tax Officer; (11)
Dy. Commercial Tax Officer; (20) Joint Commissioner.
1. Subs. by Act No. 28 of 2008, w.e.f. 24-9-2008.
For the purposes of administering the Act, the Government appoints in

exercise of its powers under Section 3A, several officers such as Commissioner
of Commercial Taxes, Addl. Commissioner, Joint Commissioner, Appellate
Deputy Commissioner, Deputy Commissioner, Asst. Commissioner, Commercial
Tax Officer and Deputy Commercial Tax Officers and they are enjoined to
carry out such functions respectively as are conferred on them by or under
the Act. Notwithstanding the provisions made under Section 3A whereby the
Government appoints all these officers by designation, they are also defined
in the definition section as officers appointed by the Government under Section
3A. The definitions are intended to bring out the distinction between officers
so appointed and officers who may be required to be authorised by the
Commissioner to carry out the functions of another defined officers also.
One such case is that of Appellate Dy. Commissioner. He may be one who
is directly appointed by designation as Appellate Dy. Commissioner by the
Government under Section 3A, such officer may also be one of the Dy.
Commissioners who may be authorised by the Commissioner to be the
Appellate Dy. Commissioner. It means, whenever necessary depending upon
the exigencies of service, work and the circumstances, Commissioner is vested
with power to authorise any person of rank of Dy. Commissioner to function
and carry out the duties of Appellate Dy. Commissioner. Such authorisation
may be for purposes of discharging the functions of Appellate Authority in
general or it may be limited to a particular case or a class of cases. Similarly,
Asst. Commercial Tax Officers may be appointed by the Government, in
exercise of the power to appoint any other officer. But, such officers may
be authorised by the Commissioner to function as Assessing Authorities.
Section 2(3) – Appellate Tribunal:– Appellate Tribunal is defined as
the tribunal appointed under the Act. Such appointment is made under Section
3. The jurisdictions and procedures of the Appellate Tribunal are provided
in Section 33. The tribunal shall consist of a Chairman and two other Members,
of whom the Chairman shall be a judicial officer not below the rank of a
Dist. Judge, Grade I and of the two other Members one shall be an officer
of the State Government not below the rank of a Joint Commissioner of
Commercial Taxes and the third shall be an officer of the Indian Revenue
Service not below the rank of an Additional Commissioner. Any vacancy
occurring in the tribunal, may be filled up by the State Government.
Notwithstanding any vacancy the tribunal functions without any break. The
tribunal will not function if more than one vacancy occurs, for the tribunal
is by its nature a multi-member tribunal and can never be a single member
tribunal. There is now no scope for appointing any person who is not a
Government servant as a Member of the Tribunal. The earlier position that
a private person, an expert in Accounts and Auditing may be appointed is
no longer available.
Depending upon exigencies of the work the Govt. may constitute an
Addl. Bench of the Tribunal with three members of whom one shall be a
Dist. Judge Grade-I and other two members of whom one shall be an officer
of the Commercial Tax Dept. of the State Government not below the rank
of a Joint Commissioner of Commercial Taxes and the other shall be an officer
of the Indian Revenue Service not below the rank of Addl. Commissioner.
Where a three member bench finds that there is a conflict in the

judgments of the tribunals rendered earlier, the Senior-most Chairman of the
two benches may, on an application named by the parties or suo motu shall
constitute a bench of not less than five members to resolve the dispute.
(About the powers jurisdiction and the procedure to be adopted by the
tribunal and for other details see notes under Section 3 and Section 33).
Section 2(4) – Assessing Authority:– Assessing authority shall be an
official of the Department. He shall be authorised to make assessments. The
Commissioner will fix the territorial jurisdiction with reference to which he
functions and all the assessees doing business within the prescribed territory
shall have to approach the assessing authority so authorised. The Commissioner
may authorise such person to make assessments in more areas than one or
over the entire State of Andhra Pradesh. The Commissioner may fix also
the limits of the turnover for the assessing authority and such limits may
be fixed for different assessing authorities depending on their cadre. For
example, the authorisation may limit the turnover to a particular amount in
respect of primary authority i.e. the Asst. Commercial Tax Officer and a higher
turnover for Dy. Commercial Tax Officer and a further higher level for
Commercial Tax Officer. The assessing authority is an independent authority
and shall make assessments in accordance with the law, the general circulars
and instructions which may be issued by the Commissioner and shall not
consult or depend upon any other person or authority while making assessments.
Section 2(5) – Asst. Commissioner:– See Section 2(1) above.
Section 2(6) – Business:– The word ‘business’ is a wide expression.
It is defined to include several activities which are generally understood as
constituting business activities. A trade is business so is commerce and all
other activities which are commonly called adventures relating to Trade and
Commerce come under business. The activity of manufacturer and all other
activities connected therewith come under business. The business of Agency
is also a business. Stevdoring is also business ; Brokering and discounting
come under business. In substance, all those activities which are avocations
intended to make gain or profit, even if such activities and avocations result
in losses, it is still business. The Act makes it clear that all activities connected
with, incidental to or ancillary to business are also come under the expression
‘business’. Taking business premises on lease for purposes of doing business
and incurring expenditure for that purpose comes under business. Investing
in infrastructure and incurring expenditure for that purpose and any or all
the transactions entered into and fulfil the same for purposes of commencement
of any business or closure of any business also come within the definition
of business. Sale of business assets during insolvency comes within the
expression ‘business’. Activities undertaken after the complete closure of the
business by partners or directors or sharers after the closure of business
do not come within the definition of business for the purposes of this Act.
Growing forests for commercial purposes is business. On the contrary,
sale of agricultural produce grown by a person in the same condition in which
it is grown except that cleaning and grading etc. is not business. Purchase
and sale of capital goods of the business by businessmen during the course
of business comes within the definition of the business.
Section 2(7) – Casual trader:– A casual trader is a person who carries
on occasional transactions of business nature. Occasional transactions could
only mean isolated or chance transactions. If more than one transaction are
indulged in, having a string connecting them or running through them such
transactions cannot be called casual transactions. Having found that one or
two transactions he has fulfilled as beneficial to him, if a person enters into
a third transaction such transactions cannot be called occasional transactions.
Similarly, several persons claiming to be casual traders with a motive to help
other dealers who are registered or unregistered carry on business they cannot
be called casual traders. A single transaction can be treated as doing business
requiring registration under this Act if it is intended or linked to any other
business transaction. A trader dealing exclusively in some specified commodities
only undertakes a single transaction or two in some other class of goods
even though unconnected with his normal trader, such trader cannot be
classified as the casual trader.
The Act says that the casual trader need not get himself registered and
he should at the same time is held liable to pay tax at schedule rates of
1%, 4%, 12½% and special rates. The question is how the tax could be
collected without the trader being registered. Here a reference may be made
to what happens in the case of casual traders coming from outside the State
and doing casual business within the State. In their case the Act provided
that such dealers should intimate the registering authority about their arrival
and the goods in which they propose to deal and other particulars and after
obtaining confirmation of their intimation by the registering authority, they
should commence business and pay the tax at the closure of their business.
It is suggested that the same is the rule which applies to the casual traders
of Andhra Pradesh doing casual business within the State. Therefore a casual
trader accordingly is required to intimate the registering authority, the necessary
particulars of his business and pay tax at scheduled rates on the conclusion
of his business as casual trader.
Section 2(8) – Commissioner:– See Section 2(1) above.
Section 2(9) – Commercial Tax Officer:– See Section 2(1) above.
Section 2(10) – Dealer:– Dealer is a person who carries on business.
Dealer can be a joint family, a trust, association of persons or any association
registered or unregistered, a firm, company, co-operative society or any
authority or State or Department of State. Person may be doing business
of purchasing or selling or supplying or distributing goods. Dealer may be
a hotel, restaurant or eating house which sells, supplies goods to his customers
as sale or as a part of its service. Such goods may include beverages and
drinks whether intoxicated or not. A commission agent by whatever name
he is called who does the business on behalf of the principal or principals
from outside the State is a dealer. In actual business practice the agents are
known by different names depending on the nature of business they discharge
as agents. An agent who brings parties together who collects commission

from both sides or one side is a broker. An agent may be doing his work
for fixed salary or on commission. Delcredere agent i.e. the agent who
guarantees his principal the solvency of the other party and stands as surity
in case such other party commits default is also a dealer. The person who
hires his own goods for use by others or conferring on others the right
to use either for a fixed period or for unspecified periods is a dealer. A
distributor of goods, a mercantile agent as defined in Sale of Goods Act,
an agent who handles goods and documents or title such as Stevedors, railway
agents, persons handling, Railway Receipts are all dealers. The branch offices
of a dealer are dealers. Persons who pay and receive amounts on behalf of
a dealer in the course of the business whether as guarantors or not are also
dealers.
Persons dealing in agricultural commodities eventhough grown on their
own lands or on the lands of others, if they are subjected to any physical,
chemical or any process other than mere cleaning, grading or sorting will
be deemed as dealers. Accordingly, persons dealing with any products made
out of agricultural commodities such as in jaggery are dealers. Persons who
deal in seeds are dealers, the Central and State Governments doing any business
in goods normally done by traders are dealers. Canteens including military
canteens are dealers. The Act has taken care to declare that the sale of
confiscated goods or disposals by them any other goods such as vehicles,
scrap surplus or old, obslete or discarded materials or waste products will
be treated as business sales for the purposes of this Act. The definition of
a dealer particularly specifies the following departments as coming within the
scope of a dealer when they effect sale or disposal of the goods as above
stated. The following are Departments of the Government and Government
institutions which will be treated as dealers in relation to the sale of goods
referred to above. (1) Port Trust; (2) Municipal Corporations; (3) Municipal
Councils; (4) Other local authorities; (5) Railway authorities; (6) Shipping,
Transports and Construction companies; (7) Air Transport Corporations and
Airlines including National Airport Authority; (8) Transporters holding permits
for Transport Vehicles granted under Motor Vehicles Act, 1988 which are
used or adopted to be used for hire; (9) Andhra Pradesh State Road Transport
Corporation; (10) Customs Department of the Government of India administering
Customs Act, 1962; (11) Insurance and Financial Corporation or Companies
and Banks included in the Second Schedule to the Reserve Bank of India
Act, 1934; (12) Advertising agencies; (13) Any other Corporation, Company,
Body or Authority owned or set up by or subject to administrative control
of the Central or any State Government are dealers. Such Departments and
Corporations can be counted as VAT Dealers or TOT Dealers.
The question whether a hospital can be taxed for the supplies of
medicines and other materials it uses in treatment, the Supreme Court answered
that in all cases of composite transaction, the test to determine its taxability
is to determine whether the transaction in substance is a service contract
or business or trade contract. Therefore the services of doctors, hospitals,
advocates and other professionals cannot be taxed under Value Added Tax
Act. Bharat Sanchar Nigam Ltd. v. Union of India, (2006) 145 STC 91.
The Court added: “Of all different kinds of composite transactions the
drafters of 46th Amendment show three specific situations, the works contract,
the hire purchase contract and catering contract to bring out within the fiction
of deemed sale. Of these three the first and the third involve a kind of service
and sale at the same time. Apart from these two cases where splitting and
service and supply has been constitutionally permitted in clauses (b) and (f)
of clause (29A) of Article 366, there is no other service which has been
permitted to be so split. For example, the clauses of Art. 366 (29A) do not
cover hospital services. Therefore, if during the treatment of patients in the
hospital, he or she is given a pill, can the sale tax authorities tax the transaction
as a sale? Doctors, lawyers and other professionals render service in course
of which it can be said that there is a sale of goods when the doctor writes
out and hands over prescription or a lawyer drafts a document and delivers
it to his/her client? Strictly speaking, with payment of fees, the consideration
does pass from patient or client to the doctor or lawyer for documents in
both cases.
The test therefore for a composite contract other than those mentioned
in Art. 366(29A) continues to be – Did the parties have in mind or intend
separate rights arising out of sale of goods? If there was no such intention,
there is no sale even if the contract could be disintegrated. The test for deciding
whether a contract falls into one category or the other is as to what is the
substance of the contract.
Sale of hypothecated property by a Bank comes under business as per
Banking Regulation Act. Hence such transactions are liable to the levy of tax
under VAT. ICICI Bank Ltd. v. Joint Commissioner, Sales Tax Central Section,
Kolkata and others, (2010) 31 VST 178.
It may be noted that sale of used up motor vehicles falling under normal
office uses may not be treated as business sale for purposes of levying tax.
Dealers registered under VAT and TOT are dealers subject to the
exceptions created under this Act. Similarly, all those who come under the
category of dealers mentioned above need not necessarily be registered under
the provisions of this Act as TOT dealers or VAT Dealers.
The definition contained in this Act of the word dealer should have been
simply a person who deals in purchases, sales, transfer of goods, supplies
in any manner to others in the course of what is known as business. The
word ‘person’ and the words ‘sale’ and the ‘goods’ having been defined,
it is really not necessary to give to the word dealer and elaborate definition
with provisos and explanations. This perhaps has become necessary in view
of several contentions raised by the parties as to whether any of the person
referred to above or any of the transaction above stated from within the
meaning of dealer or not have come to be questioned in courts of law at
one time or the other and all objections to include persons occupying different
capacities including State and other Institutions and authorities were rejected
by the courts. Therefore, the long and wide definition given in the Act may
be treated as having been given as an abundant caution.
Financial institutions selling the machinery for purposes of recovering

loan advanced by them are not dealers. Sundaram Finance Ltd. v. State of
Kerala and another, (1965) 17 STC 489.
Section 2(11) – Dy. Commercial Tax Officer:– See Section 2(1) above.
Section 2(12) – Dy. Commissioner:– See Section 2(1) above.
Section 2(13) – Exempt Sale, Section 2(14) – Exempted Turnover:–
Exempt sale and exempt turnovers mean sale and turnover of goods on which
no tax is leviable under the Act. Since, they are exempted from charge to
tax, sale of exempted goods cannot be a subject matter for either giving credit
of input tax or for giving deduction in the output tax. Wherever the sale
price of such goods is not available, their prices shall be ascertained at the
market value as on the date of those transactions. Goods exempt from tax
are listed in the Schedule I to the Act. They are 47 in number. Persons
dealing exclusively in the exempted goods need not get themselves registered
under the Act. If they are dealing in taxable goods also they have to get
themselves registered and maintain separate accounts.
Section 2(15) – Fair Market Value:– Fair market value means, the
price the goods would fetch in open market on the date of the transaction.
In determining the fair price it is not open to refer to their value otherwise
than in terms of the price they would fetch on the date of their purchase
or sale. The goods may have a very high price or too low price on some
other dates and they shall have nothing to do in fixing the fair market value
of the goods for purposes of this Act. Notwithstanding their high utility in
different purposes or uses or at different places the fair market value of the
goods under this Act should be determined in relation to the place and the
circumstances where the purchase and sale have to take place.
Section 2(16) – Goods:– The word ‘goods’ has a specific meaning
imputed to it under this Act. In the first place, they are movable property;
secondly, they are tangible property. They include livestock. Growing crop
and grass and such other things though affixed to the immovable property
if agreed to be severed are goods. Goods include, however, certain specified
intangibles such as goodwill, Copyright and other Intellectual Property Rights.
Goods also include goods involved in execution of works contract, and those
to be used in fitting out, improvement and repair to immovable property. Goods
also include services which are specifically included as goods for purposes
of this Act.
Patents, literary copyright, musical and dramatic copyright, commercial
goodwill, trade marks and trade names are intangible goods. Accordingly
transfer of information from distribution network is covered by VAT and is
taxable. Memex Information Systems (P) Ltd. v. State of Kerala, 143 STC
414.
Actionable claims such as Promissory Notes, Bills of Exchange and Bills
of Lading, Stocks, Shares and Securities are not goods for purposes of this
Act. Trading in or doing business in these items cannot be called as business
and accordingly, purchase, sale, supply or transfer in these items are not
covered for purposes of taxation under this Act.
Revision of broad band connectivity involves transfer of property in

artificially created light energy and transfer of right to use optical fibre cables
network is sale of goods. Bharti Airtel Ltd. v. State of Karnataka, (2009)
22 VST 465 (Kant.).
Section 2(17) – Goods Vehicle:– Goods vehicle is defined as a Motor
Vehicle constructed or adopted for carriage of goods and also the vehicle
which could be used for carrying passengers as well as goods. This definition
has become necessary only for the purposes of knowing whether the transfer
of goods took place with the handing over of goods to the common carrier.
Therefore, animal driven carts or vehicles drawn by humans are not goods
vehicles under this Act.
Section 2(18) – Government:– The word ‘Government’ wherever it
is used in this Act means only the Government of Andhra Pradesh. Where
it is intended to be any other authority such as Union Government it was
so stated as Central Government.
Section 2(19) – Input Tax:– Input Tax means, the tax paid or payable
by a VAT Dealer to another VAT Dealer in the purchase of goods.
Section 2(20) – Joint Commissioner:– See Section 2(1) above.
Section 2(21) – Notification:– Notification means, notification published
in the Andhra Pradesh Gazette and the word ‘notified’ should be construed
accordingly. A notification published in Dist. Gazettes cannot be treated as
a notification duly notified. Wherever the Act provided that a certain matter
of public importance is required to be notified, it must be published in the
Andhra Pradesh Gazette. No other way of publication will make the notification
valid. Wherever it is required to be proved that a particular notification is
published in the Gazette, the only way of proving it is to present the original
gazette of the date in which the notification is published. Where it is prescribed
that a tax rate is either increased or decreased or any other exemption is
granted or withdrawn, it shall be published in the gazette. They will become
operative only on and from the date of the gazette in which it is published.
Sometimes, some interesting question may arise that notwithstanding the
publication in the gazette, if the gazette is not available to the public until
a subsequent date, the concerned notification will become operative from the
date when the concerned gazette is made available. The fact that such
notification was published in local newspapers or that it was Broadcast on
Radio and TV will not make the notification duly published.
All rules made by the Government in exercise of the powers conferred
under Section 87, shall also be published in the gazette.
Section 2(22) – Output tax:– Output tax means, tax paid or payable
by a VAT Dealer on the sale of goods to another VAT Dealer or to any other
person.
In other words, output and output tax mean the value of the goods
sold by a dealer and amount of tax payable by selling dealer on his sales.
Similarly, the input and input tax mean, the value of the goods purchased
by a dealer and the amount of tax paid by him to the dealer who sold him
the goods. To be precise what is output and output tax for the seller are
the input and input tax for the purchasers. These are mere descriptive words.
The tax authorised by Act is only tax on the sale.
Under VAT system the seller of goods is by law entitled to recover
the tax on the goods supplied by him from his purchaser and the seller is
by law directed to certify under the bill called VAT bill that he received tax
from the purchaser. Therefore, it is only when the seller includes in the Bill
issued by him to the purchaser, the tax element, the seller will have the
advantage of collecting the tax from his purchaser. Therefore, it stands to
his benefit if the seller includes the tax in his bill and recovers the same
which tax he himself is primarily liable to pay to the Government. Viewed
in this angle, it is expected that the seller will maintain the accounts truly
and correctly and thereby it is hoped that tax collection will improve.
Similarly, the purchaser under the VAT system is entitled to a set-off
of tax he paid to his seller in the tax he pays on his sale turnover of the
same goods. Therefore, it is to his advantage if the purchaser of the goods
maintain his accounts truly and correctly thereby it is hoped that tax collections
will improve.
The method of calculating input and input tax and the output and output
tax are discussed elsewhere in the Chapter on accounts and assessments.
Earlier, it was a matter of controversy as to whether a dealer was entitled
to charge and recover the tax he himself had to pay to the Government from
his purchaser, whether the tax he collected can be retained by him without
making it over to the Government and whether such retention amounts to
unjust enrichment. And whether the Government having collected tax which
was subsequently declared illegal is liable to refund the same to the dealer
which might prove to be a double advantage to him. Such issues do not
now survive in the context of the Value Added Tax because in the normal
course of trade, the tax element here gets merged with the cost structure
of the goods. Refunds are available only where such refunds are permitted
in accordance with the procedure.
Section 2(23) – Place of business:– Place of business is the place
where the dealer purchases or sells goods and does business as a dealer.
Irrespective of the fact, where negotiations are carried on, the place of business
is the place where registered office is situated. The place where the goods
are stored, sorted, packed, produced or manufactured is also the place of
business, so is the place where the account books are maintained. More
importantly, the place where the Agent of the dealer carries on the business
is also the place of business of the principal. Where the agent is the agent
for several principals, his place of business can be included as the place of
business of all his principals. The definition for the place of business is given
here is for the purposes of implementing several provisions of the Act. If
an inspection takes place, it can be effected at any of the places. But
assessment has to be made by the officer having jurisdiction over the principal
place of business. The registration of the dealer either as a VAT dealer or
as TOT dealer the registration shall be at the office of the registering authority
within whose jurisdiction the principal place is located. The Certificate of
Registration should contain the places where all the branch offices or agencies
are located. Where the agent is registered as a dealer he should specify the
places of business of all his principals. The lorry or any other vehicle in
which the goods under transport are found, is not the place of business.
But extension counters are places of business of the principal dealer. Thus
the registering authority is the authority which registers dealers and grants
them the registration certificate either as TOT dealers or VAT dealers. The
assessing authority is different from the registering authority. The former deals
with assessment and the later deals with registration. In either case the
authorities shall have their respective jurisdictions over the place of business
of the dealers.
Section 2(24) – Prescribed:– Prescribed means, prescribed under the
Rules. Legislature is the Supreme Body to make the law. It has also power
to delegate its authority to any subordinate authority to make rules. Such
rules should necessarily be procedural and they can deal with any of the
matters prescribed in the Act. So, the legislation by a special clause in the
Act, authorised the Government to make rules which deal with certain details
and procedures. Such of those rules as are framed by the Government shall
not be in any manner contrary or inconsistent with the provisions of the
Act. After the rules are framed they should be laid before the legislature.
If the legislature so thinks, it may amend any of the rules so made by the
Government. If the legislature does not amend the rules or if amended, the
form in which they are so amended will be treated as effective and efficacious
as the Act itself. A reading of the several clauses contained in this Section
which authorises the Government to make the rules show that the several
subjects mentioned therein are all procedural and within the scope of the other
sections contained in the Act. The word ‘prescribed’ therefore shall be
understood as the power conferred on the Government to make rules either
under this section or any other section where such authorisation is given
to the Government by using the word ‘prescribed’.
Section 2(25) – Purchase price:– Purchase price has a special meaning
under the Act. It is limited to certain additions and excludes certain items.
In the first place ‘purchase price’ includes all expenditures incurred by the
seller prior to the delivery of goods to the purchaser. Any value addition
made by any process, packaging, etc. and the essential transport involved
therein. The duties of excise and customs shall be included in the purchase
price whether paid or due to be paid. The purchase price shall not include
the tax payable by a person in respect of such purchase.
Section 2(26) – Return:– Return means, the return required to be
furnished under the Act or the rules made thereunder. Section 20 of the Act
speaks of filing of the return by dealer under the Act and in the manner
and time prescribed under the rules. It means, the return shall be filed under
the Act and it shall be filed in the manner and within the time prescribed.
The term ‘return’ includes the returns to be filed by the banks in respect
of bills discounted or negotiated through bank on requisition by any assessing
authority in relation to any goods.
Section 2(27) – Rules:– Rules mean, the rules made under this Act.
Such rules include the rules made by the Government in exercise of its rule
making power vested in it under Section 87. Hence, the rules referred to
here may be rules made by the Government in exercise of such a power
granted to it under the relevant section of the Act and/or the rules made
by the Government in exercise of the powers conferred under Section 87.
The power to make rules include the power to prescribe prosecution
and punishment for breach of rules. Therefore, where the rule does not so
provide for prosecution and punishment for its breach and the Act is also
silent as regards punishment in respect of any violations, the person concerned
cannot be prosecuted.
Section 2(28) – Sale:– To be brief sale means, transfer of property
in movables only. The transfer may be on full consideration paid or payable
or by deferred payment. The transfer may occur in pursuance of a prior
contract or instant sale. The goods sold may be in the same form as contracted
or in a different form. The transfer as a sale may be assumed to occur
when supply of goods is made as in co-operative society, hotel or club as
a part of service or in execution of the works contract. While, mortgage
or hypothecation are not included in sale, the delivery of goods under hire
purchase agreement or hiring goods amounts to sale. Handing over goods
for a time or using it for a limited purpose for consideration amounts to
a sale for purposes of taxation under this Act.
Where goods are ordered to be manufactured in accordance with the
terms and supplied, and in which consideration is paid for different processes
or at different rates, the transaction in question is a sale.
Where machinery and vehicles are supplied without involving any transfer
of goods and transfer of right to use goods is only given and the possession
and effective control remained with supplier, the payments made to contractor
cannot be called any payments made to the right to use. Hence the transaction
is not sale. Mahesh Travels (P) Ltd. v. Oil and Natural Gas Commission,
(2009) 22 VST 103 (Gau.).
See also: R.P. Kakoti v. Oil and Natural Gas Commission, (2009) 22
VST 136.
In cases where, agreement of sale or purchase takes place in one State
and the goods in relation to which the agreement has taken place or situated
in another State sale or purchase in respect of goods if they are available
in specie for transfer at that time or if they are unascertained by that date
but later on ascertained, the place where they are appropriated under the
agreement shall be the place where the sale shall be deemed to have taken
place. Similarly, where there is a single contract in respect of which the
goods are located in different places, it should be assumed that there are
different contracts and the place of sale shall be determined as above, i.e.
the place where the goods in question are located or ascertained.
The question as to whether there are two sales or one sale when the
goods are transferred through agent, if the agent receives goods at one price
and sells them at different price or purchases them in the market at one
price but transfers the goods to his principals at a different rate or where
the agent does not account for sale proceeds to the principal, it should be
held that there are two sales one in favour of the agent and another in favour
of the principal, one purchase by the agent and another purchase by the
principal from the agent. When the agent is found to be acting for a fictitious
principal it should be held that there are two purchases and two sales.
In the case of lucky draw schemes when the winner is the subscriber
the sale as between the dealer contributing the lucky draw scheme and winning
dealer should be deemed to have taken place for the price of the goods delivered
to the later, provided all other subscribers had agreed to pay their subscription
as consideration payable by the winner, had there been no scheme or draw.
It means, though it appears apparently that the lucky draw winner got the
goods for lesser price, for purposes of the Act full value of the goods shall
be specified as the price at which such goods are sold and the turnover
so ascertained for all the goods transferred under the scheme shall be included
in the sale turnover for which tax has to be calculated.
SIM cards are not goods. They are not sold independent of service.
State of A.P. and others v. BSNL, (2011) 53 APSTJ 185.
Section 2(29) – Sale price:– In the first instance, amount set out in
the tax invoice or bill of sale shall be treated as the correct sale price. Question
may arise as to what should be the sale price in case there is no tax invoice
or the bill and when the tax invoice or the bill does not set out the correct
sale price, the assessing authority may determine the sale price by himself.
In the case of works contract, the assessing officer shall take into account
the cost of goods used by the dealer. The cost of goods delivered to the
hirer under the Hire Purchase Agreement shall be the total amount fixed as
hire for the full period. The cost of supplies made by co-operative society,
club or firm or association of persons to its members either as a part of
their service or independently for the prices and also any other sum or sums
the dealer charges for doing anything done in respect of the goods sold at
the time or before delivery and also any other sum or sums the dealer charges
whatever be the description shall be included in the price. The assessing
authority may also take into consideration the goods returned, and refunds
subject to the conditions prescribed therefor. Such return of goods may be
proved by debit and credit notes.
In the case of sale of drugs, or for that matter any other commodities
by a manufacturer/wholesaler/distributor to retailer where MRP is noted in
packages, the rate of tax to be applied can't be with reference to published
MRP which is neither charged nor chargeable by the wholesaler from the
retailer but on the actual discounted price. Rajasthan Chemists Assn. v. State
of Rajasthan, 2006 (147) STC 476.
Subsidy given to the canteen proprietor by the company shall not be
added to the price at which the canteen items are sold to the workers. Indian
Aluminium Company Ltd. v. State of Orissa, (2009) 22 VST 119 (Ori.).
Section 2(30) – Schedule:– Schedule means, the schedule appended to
the Act. For the present there are six schedules. Schedule I contains the
list of exempted goods. They are 47 in number.
The Second Schedule is titled as 'Transactions Zero Rated' and eligible

for input tax credit. They are the goods involved in interstate trade, and imports
into and exports to outside India.
The Third Schedule contains list of goods liable to tax at 1%. They
constitute Bullion, jewellery and precious stones. The Fourth Schedule contains
a list of taxables at 4%. They are 90 items in number, with several sub-
items. The Fifth Schedule contains list of goods taxable at standard rate (RnR)
at 12.5%. They are described as all those goods other than those specified
in Schedules I, II, III, IV and VI. Finally, there is Schedule VI. It lists five
classes of goods. They are all subject to very high rates of tax at the first
point of sale only. The rates specified for them are called special additional
rates.
Whether ‘Rich Whip Topping’ comes within a sweet meat under Schedule
V of AP VAT, it was held that it will fall under Schedule V. Individual items
which constitute a product may come under different schedules. But, if the
product falls under specific schedule, it cannot have the classification under
any or all parts. Product should be taken under the item specified in schedule.
Rich Graviss Products Pvt. Ltd. v. State of A.P., (2012) 54 APSTJ 146.
Section 2(31) – Special rate of tax:– The goods mentioned in Schedule
VI are subject to special rates of tax. Such rates range from 21.33% to
90%. The goods specified in this schedule are five items. Liquors are subject
to 70% since increased to 90% in case of some liquors. Petrol, Aviation Motor
Spirit, Aviation Turbine fuel are subject to 32.55% and Diesel oil is subject
to 21.33%; all taxable at the point of first sale in the State.
Section 2(32) – State:– State means, State of Andhra Pradesh. The Act
uses at several places the expression State Government. It means, the
Government of the State of Andhra Pradesh.
Section 2(33) – State Representative:– State Representative means, the
officer who represents the State of Andhra Pradesh before the Appellate
Tribunal. He is appointed by the Government. He represents the State of Andhra
Pradesh before the Appellate Tribunal only and conducts appeals filed before
it. He is entitled to receive all notices on behalf of the State. It so happens
that if the State prefers a revision against the orders of the tribunal, it is
the State Representative who files such revisions on behalf of the State.
Similarly, it is the State representative who is added as a respondent in cases
where assessees or other parties file the revision petition against the orders
of the Appellate Tribunal. But, he is not the person who either conducts or
pleads in revision cases. He only instructs the advocates appointed by the
Government to conduct sales tax cases at the High Court.
State representative is an officer of the Department holding the position
of Asst. Commissioner. In his absence, another officer of the same cadre
may be appointed to carry out the functions of State representative. Such
authorisation can be issued only by the Government and not by the Commissioner.
Section 2(34) – Tax:– Tax has two meanings. Tax generally and tax
called VAT. The later is charged only on sales. Therefore, the tax may be
(a) tax on transfer of goods from one person to another for value; (b) tax
on goods involved in works contract; (c) tax on delivery of goods on the
hire or hire purchase to the hirer by the owner; (d) tax on right to use
any goods for a specified period or otherwise or for specified purpose; (e)
tax charged on hotels, clubs and associations for the supply of goods to
its members being food or other articles for human consumption or any drink
whether or not intoxicating, to the members as part of the service.
Section 2(35) – Tax Invoice:– Tax invoice is an invoice containing such
details as may be prescribed. It is an invoice issued by a VAT dealer to another
VAT dealer. The details to be furnished in the VAT invoice should necessarily
include tax particulars in the form prescribed. All other invoices issued whether
by VAT dealers or TOT dealers are called "invoices" only.
Section 2(36) – Tax Period:– Tax period has two meanings. It may
be a period of one month as in the case of VAT dealers or three months
in the case of TOT dealers.
Section 2(37) – Taxable sale:– Taxable sale means, sale covered by
this Act and also by the Central Sales Tax Act.
Section 2(38) – Taxable turnover:– Taxable turnover means, the aggregate
of the sale value of all the goods taxable under the Act. As for VAT dealers
the aggregate sale value of all goods excluding the VAT paid or payable. It
shall include the sale price of Zero Rated Sales. As for the TOT dealers,
such aggregate value shall include any VAT paid by them to their sellers from
whom they purchased goods. In the case of dealers dealing with goods
specified in Schedule VI i.e. liquors, petrol and diesel and the like, subject
to special high rates, the turnover of these goods shall not be included in
the total turnover of the dealer.
The Amendment in the Kerala VAT Act which says that "any discount
on price allowed in respect of any sale where such discount is shown
separately in the Tax Invoice and the buyer pays only the amount reduced
by such discount; or any amount refunded in respect of goods returned by
customer shall not be included in the turnover. Though, upheld by the Kerala
High Court, it is submitted that the discounts allowed and the return of goods
received shall be deducted from the sale price under the Scheme of VAT
Act. Otherwise, it will not be possible to continue the trade practice particularly
in the case of chain distribution. Such long established practice is prevalent
not only in India but also abroad. Madras Cement v. AC (Audit Assessment)
CT, Kollam & Others, 2006 (147) STC 26.
Where discount is allowed long after the transaction, tax paid on the
discounted part of sale consideration cannot be claimed as refund.
Section 2(39) – Total turnover:– Total turnover means, the aggregate
of the following:
(1) Sale prices of all goods taxable and exempted. (2) Total of sale prices
of all goods taxable or exempted sold at all branch offices and places where
business is done by dealers. (3) Sale prices of exempted goods. (4) Sale
price of goods under Section 8 i.e. zero rated goods coming under the Central
Sales Tax Act. (5) And the gross consideration received or receivable under
Works Contract.
Section 2(40) – Turnover tax:– Turnover tax is the tax on the turnover
of the TOT dealers. It is not applicable to dealers registered under VAT.
Section 2(41) – Turnover tax dealer:– Turnover tax dealer is one who
is registered as TOT dealer. The Act deals with two types of dealers, dealers
registered under VAT and all other dealers who are registered under TOT.
Those who do not pay VAT shall pay the turnover tax.
VAT–4
Section 2(42) – VAT:– VAT means Value Added Tax. Value Added Tax
is defined to make it clear that it is a tax levied on sales at the point of
sales only and not at the point of purchase on purchases.
Section 2(43) – VAT Dealer:– VAT Dealer is the dealer registered under
VAT registration.
Section 2(44) – Vessel:– The word ‘vessel’ includes a ship, barge, boat,
raft, timber, bamboos or floating materials prepared in any manner. In any
manner may include power driven such as by motor or by electricity or by
any mechanical power or manual. This, however, does not mean motor vehicle
run on roads. The vessel referred to here is a water borne vessel intended
to carry goods or passengers or both.
Section 2(45) – Works Contract:– Works contract is a contract to
carry out any work such as building, processing or manufacturing. Such
work may be for purposes of repairing or fabricating things and materials.
All development contracts on land are works contract.
Even where goods are incorporated in a works contract (building) if they
are declared goods coming under CST, they can be taxes at 3% only and
not at any higher rate applicable to the goods other than the declared goods.
Ifcons Infrastructure Ltd. v. State of Assam, (2007) 9 VST 195.
While granting deduction towards charges paid for using machinery, the
amounts spent for maintenance of machinery and its depreciation shall also
be allowed in works contract. Veeaar Constructions, Hyderabad v. State of
A.P., (2012) 54 APSTJ 53.
Where the works contractor opts to pay tax on composition, he is liable
to pay purchase tax on goods purchased by him from the registered dealers.
Mysore Construction Company v. State of Karnataka, (2009) 24 VST 250
(Kant.).
Works Contract and Contract for Work:— A Contract is a works
contract where goods involved are transferred in the course of work; contract
of work where work of installation etc. predominates. In case where the
contract is for installation of lifts the predominant part is the transfer of lift
while installation is consequential, when lifts are purchased in another state
and central sales tax is paid, the contractor for installation of lifts need not
be registered or pay any tax within the state where lifts are installed. ECE
Industries Ltd. v. State of Punjab, (2008) 14 VST 40 (P&H); See also State
of A.P. v. NTPC, Ltd. AIR 2002 SC 1895 = 2002 (5) SCC 203.
In service contracts like advertising in which books, pamphlets, and other
advertising materials are delivered as goods, there is no transfer of intellectual
property involved, the whole turnover being one and indivisible is transferable
as service under Service Tax and not under Sales Tax/VAT. Image Creators
(P) Ltd. v. CCT, Civil Appeal 252 of 2008, dt. 9-1-2008 (SLP) 6499 of
2004 (SC).
In the case of works contract when it is executed by sub-contractor,
there is only one sale for purpose of tax. That sale is as between the sub-
contractor and the principal. There is thus no occasion for two sales, i.e.
one between the sub-contractor and the contractor and then between the
contractor and the principal. The contractor need not show this sale in his
turnover. State of A.P. v. Larsen & Toubro, (2008) 17 VST 1.
Also refer to the case of Gannon Dunkerley, (1958) 9 STC 353 (SC);
and also the case of Builders Association of India, (1989) 73 STC 730 (SC).
Section 2(46) – Year:– The year is defined as a period of twelve months
ending with 31st March. It is not defined as a financial year; there is a
reason for it. The assessment period for TOT dealers is three months, i.e.
four quarters in a year – April-June, July-September, October-December and
January-March. While the assessment period for VAT dealers is one month
during the period of preceding twelve months.
The Act provides that if the turnover of the TOT dealer exceeds the
threshold limit of Rs. 40 lakhs a year in any one of the above four quarters,
he shall get himself registered as a VAT dealer in that very quarter. Similarly,
if in any month within a period of twelve preceding months, the VAT dealer's
turnover falls below the said threshold limit of Rs. 40 lakhs a year, he is
liable to request the registering authority to cancel his VAT registration and
convert it as TOT registration. Accordingly, whenver the question arises
whether a TOT dealer is liable to get himself registered as VAT dealer or
the VAT dealer's registration shall be converted to TOT registration, the
threshold limit shall be calculated not with his performance during a financial
year but with reference to his performance during the four quarters preceding
the end of a twelve months period for TOT dealers; and in respect of the
VAT dealers the threshold limit shall be calculated on the basis of his turnovers
falling below the threshold limit by any month within the period of 12 months.
Thus, the registrations are granted not on the total turnover of a dealer
for any financial year but as and when the threshold limits are altered during
the course of a year of twelve months. Hence it has become necessary
to define the word ‘year’ as a period of twelve months and not a financial
year.
Section 2(47) – Zero Rated Sale:– Zero rated sales are specified in
Schedule II. They are sales in the course of interstate sales or export sales
coming under Central Sales Tax Act.
Case Law
(1) When the definition of a word is clear, no other meaning can be
assigned to the expression than that is put down in the definition. Punjab
Land Dev. & Reclamation Corporation Ltd. v. Presiding Officer, Labour Court,
1990 (3) SCC 682.
(2) The expression valuable consideration takes its colour from the
preceding expression cash or deferred payment. If such be the case, valuable
consideration can mean only monetary payment in the nature of cash or
deferred payment. This is so far as the expression price or the sale occurring
in the Sales Tax Enactment come for interpretation. Devidas Gopalakrishnan
v. State of Punjab, 1967 (20) STC 430.
(3) Intangible goods like Trademarks, Copyrights, Patents, electricity,
lottery tickets, licences, eximscrips, goodwill, royalty are all taxable as goods.
Vikas Sales Corporation v. Commissioner of Commercial Taxes, 1996 (102)
STC 106 (SC).
Rentals:-- (1) The question is whether the rentals collected by the
Telecommunication Department is taxable under the APGST Act. Union of
India & Others v. Govt. of A.P., Secretary, Revenue Dept. & others, 1999
(1) An.WR 70 (DB) = 1999 (1) ALD 523.
(2) Bankers collecting lease amount from lockers are not liable to tax,
if the safe deposit lockers are embodied in the strong room. They do not
constitute goods for the purposes of sales tax. Moreover, it cannot be said
that where licensee is not put in possession of the property for use, tax
is not leviable on the hire. State Bank of India v. State of A.P. & another,
1988 (70) STC 215.
Transfer of business:-- (1) Transfer of entire business undertaking as
a going concern together with movable properties even if it involves sale of
goods shall not to be regarded as a sale unless the transfer of the undertaking
or a unit is made in the course of business. Transaction of sale entered
into to close down one of the undertakings in its entirety is not a business
incidental or connected with another business being run independently from
the said undertaking. Even if the said sale proceeds are ultimately utilised
for the overall improvement of the business unit retained by the company,
it does not attract the charging section for levying tax. Instances of incidental
or connected activities are given in this judgment. Coramandal Fertilizers Ltd.,
Secunderabad & others v. State of A.P. and others, 1998 (6) ALT 730 =
1998 (6) ALD 752 (FB).
Sale Price:-- (1) Sale price is the price which the purchaser pays. What
is included in the sale price is not a matter of concern for which the goods
are purchased by the purchaser. The detriment to the purchaser is same
whether any part of it goes to the seller or to anybody else. Questions sometime
arise whether any items such as rusum or charity if charged on the purchaser
and he pays such amount as the total consideration for which the goods
are purchased could be included in the sale price over which only tax should
be calculated. In order to clear this ambiguity the Act says that except those
items specified in the Act as those which should not form part of the sale
consideration, the entire amount for which the bill is made should be treated
as sale consideration. State of Andhra v. K. Srirama Murthy, 1958 (2) An.WR
298 = 1958 (9) STC 547 = AIR 1959 AP 21. This was reversed in AIR
1962 SC 1585.
(2) Incentive bonus does not form sale consideration for purposes of
Andhra Pradesh Value Added Tax if the rice is sold in open market, not to
FCI or other State agencies. Sri Kali Vara Prasad Rice Traders v. Union
of India and others, (2012) 54 APSTJ 196.
(3) Where the sale was for destination and delivery at the buyers place
freight should be included in the sale price. M/s. A.P. Paper Mills Ltd. v.
State, 1972 (2) An.WR 5 (SN).
Dealer:-- (1) Dealer who does not conform to the mandatory provisions
such as making an application in the form prescribed is not entitled to
exemption. He cannot therefore claim that since he is under a specific provision
of law is entitled to exemption, he shall be granted the exemption. State
of A.P. v. M/s. Kasam Ayub, 1959 (1) An.WR 402 = 1959 (10) STC 190.
(2) Srisailam Devastanam disposing of scrap of motor parts and human
hair is not a dealer. State of A.P. v. Sri Bramaramba Mallikarjuna Swamy
Devastanam, Srisailam, 1989 (73) STC 321.
(3) Port Trust supplying water to the vessels visiting the port is not
a dealer liable to tax. Board of Trustees, Visakhapatnam Port Trust v. CTO.,
Visakhapatnam, 1978 (1) An.WR 492 = 1979 (43) STC 36.
(4) Naval Dockyard running canteen as required under the Factories Act
of 1948 is not a dealer doing business and accordingly not liable to pay tax.
M/s. Base Repair Organisation (Now Naval Dockyard) Visakhapatnam v. State
of A.P., 1983 (1) An.WR 314.
(5) Cattle and livestock are movable goods. Andhra & Tamilnadu Livestock
Exporters and Importers Assn. v. State of A.P., W.P.No. 3895/74, dt. 10-
9-1976.
(6) Where suppliers are made to the members of the club, the question
of no profit or no loss does not arise. They are sales. Jubilee Hills International
Centre represented by D. Seshagiri Rao, Secretary, Jubilee Hills, Hyderabad
and others v. Commercial Tax Officer, 1992 (2) ALT 725.
When Nuclear Fuel Complex itself does not do any business its canteen
shall not be treated as a dealer for purposes of Sales Tax. NFC Canteen
Managing Committee v. State of A.P. (2007) 44 APSTJ 153.
Agricultural Produce:-- (1) Turnover of agricultural and horticulture
produce grown by the Assessee mean the produce of the land resulting from
the application of human effort to the land in the shape of manuring, filling,
ploughing, planting, sowing, watering, weeding, procuring and harvesting etc.
Forest trees of spontaneous growth cannot be regarded as agricultural or
agricultural produce grown on land. M. Ramakrishnaiah v. State of Andhra,
1956 ALT 620 = 1956 An.WR 717 = 1957 AP 28.
(2) Growers of sugarcane who convert sugarcane into jaggery and sell
jaggery are dealers. M/s. G. Sriramulu Naidu v. C.T.O., 1975 (35) STC
531.
Agent:-- (1) Where there is no privity of contract between the principals
of the Agent on either side, such Agent is an independent dealer. G. Venkata
Subramanyam & Co., Guntur v. State of A.P., 1956 ALT 51 (NRC).
(2) Agent buying and selling goods on behalf of several principals whose
turnover does not exceed the minimum is not liable to tax. When principal
is not liable to tax, agent also would not be liable to tax. State of A.P.
v. G. Hanumanta Rao, TRC No.293/85, dt. 24.1.1989.
(3) Assessee purchased goods in the State through commission agents.
The purchase is made on behalf of the principals. Principals cannot be treated
as separate from or de hors the transaction by which the assessee obtained
title to the goods. K. Ramulu v. State of A.P., 1968 (1) An.WR 284.
Interstate sale:-- (1) If the movement of the goods from one State
to the other was in pursuance of or in fulfillment of the terms of the contract
for supplying of goods, the movement incidental to the contract is well within
the scope of Section 3(A). State of A.P. v. Andhra Co-op. Spinning Mills,
Guntakal, 1979 (1) An.WR 155.
(2) Shipping documents of title not transferred before the goods are
crossed customs barrier in India. Sales here fall under Section 5 liable to
be taxed under State Act and not under Central Sales Tax Act. M/s. Minerals
& Metals Trading Corporation v. State of A.P., 1989 (72) ATC 29.
Contract of service:-- (1) Printing cinema tickets on the paper supplied
by the party does not come within the scope of fitting out, improving and
repairing of the material used for printing. Unless, a contract pertains to
fitting out, improving or repairing any movable property it cannot come within
the meaning of works contract. SRP Works and Ruby Press v. State of
A.P., 1972 (1) An.WR 247 = 1972 (30) STC 195.
Sale:-- (1) Supply of food to employees by the hotel does not amount
to sale and is not excisable to sales tax. State of A.P. v. Hotel Lakshmi
Bhavan, 1973 (33) STC 444.
(2) Sale taking place in one assessment year can be taxed in the subsequent
year. Shah Premchand Deepchand & Co. v. State of A.P., 1983 (55) STC
397.
Two views:-- (1) Where on a reasonable interpretation of taxing enactment
two views are possible, then one favouring the assessee should be adopted.
Andhra Steel Corpn. Ltd., Visakhapatnam v. State, 1980 (2) ALT 352.
(2) In taxing statutes, if a reasonable doubt arises as to construction
of certain expression, the construction most beneficial to the subject is to
be adopted. But, this cannot be extended to cases where the words are
reasonably capable of only one meaning and they are unequivocal. That
principle would govern only when the words are susceptible of two meanings.
Motilal Hariprasad Bros. Oil Mills v. State of A.P., 1958 (2) An.WR 699
= 1959 (10) STC 20.
Mandatory provision:-- (1) Mandatory provision must be observed or
fulfilled strictly. It is sufficient if a provision which is directory is observed
or fulfilled substantially. Dy. Commissioner of Commercial Tax v. P.
Lakshminarayana Swamy, 1958 ALT 700 = 1956 (7) STC 560 (FB).
If an officer files a writ petition, he should file on behalf of the State.
Commercial Tax Officer, Benz Circle, Vijayawada v. Corporation Bank, Benz
Circle Branch, Vijayawada and Another, (2012) 54 APSTJ 42.
When an assessment is proposed to be made on the basis of the report
of Vigilance and Enforcement Department, a copy of the report shall be
furnished to the assessee. Sri Uma Maheshwara Rice and Flour Mill,
Vetlapalem, East Godavari District and others v. Commercial Tax Officer,
Peddapuram and others, (2012) 54 APSTJ 51.
Writ petition against show-cause notice is not maintainable. Schindler India
(P) Ltd., Secunderabad v. Commercial Taxes Officer, (INT), Secunderabad
Division, Secunderabad and another, (2012) 54 APSTJ 152.
When the dealer closed his shop and shifts to another State and gives
his new address, to finalise assessment on affixture of notice on the office
which was closed, offends all values as regards the service of notice.
Contractors (India) (P) Ltd., Kolhapur, Maharashtra v. Commercial Tax
Officer, Aryapuram Circle, Rajahmundry, (2012) 54 APSTJ 168.
When the order passed is ab initio, it is void from the date it was issued
and not prospectively after the order is declared void. KEC International Ltd.,
Mumbai v. State of A.P., (2012) 54 APSTJ 244.
When an advance tax is ordered to be refunded, such refundable amount
is not liable to be forfeited on the ground of unjust enrichment. Ircon
International Ltd., Nandyal, Kurnool District v. The Commissioner of Commercial
Taxes & Another, (2012) 54 APSTJ 255.
Any tax due to Government is adjustable against any amount refundable.
Bismillah Oil Industries, Yemmiganur, Kurnool District v. The Commercial Tax
Officer, No.I, Adoni, (2012) 54 APSTJ 257.
What happens after

the A.P. Value Added Tax Act, 2005
comes into force from 1.4.2005?
1. The whole of A.P. General Sales Tax Act of 1957 ceases to be in

operation from that day but continues to be operative in respect of
all transactions occurring prior to this date and all pending proceedings
will continue as if the Act has not been repealed. And in its place
the new Act A.P. Value Added Tax Act, 2005 begins to operate.
2. All those dealers whose turnover in taxable goods is Rs. 5 lakhs or
less are totally exempt from tax. These dealers may be called exempt
dealers.
3. All those dealers whose taxable turnover in goods exceeds Rs. 5 lakhs
to Rs. 40 lakhs shall pay tax at the rate of 1%. These dealers are
called TOT dealers.
4. All those dealers whose taxable turnover exceeds Rs. 40 lakhs shall pay
tax at the rates prescribed for different classes of goods specified in
respective schedules. These dealers are called VAT dealers. The tax
which they pay is called VAT.
5. Exempted dealers need not get themselves registered.
6. TOT dealers also need not get themselves registered afresh under this
Act if they are already registered under APGST Act.
7. VAT dealers who are not already given TIN No. shall arrange to get
themselves registered, the application for which shall be made 15 days
prior to the date of coming into force of this Act. After the Act
comes into force as and when the estimated turnover of a dealer exceeds
the threshold limit of Rs. 40 lakhs, he should get himself registered
by the date on which he expects his turnover to exceed Rs. 40 lakhs
or as soon as this event occurs.
8. Casual dealers are liable to get their intimations recorded with the
assessing authority before they commence the business.
9. Where a VAT dealer sells goods in the course of interstate trade or
export trade, he is not liable to pay any tax on his sale turnover.
10. Where the VAT dealer sells goods in the course of interstate trade or
export trade to any other VAT dealer who actually exports, he shall
issue VAT Invoice showing tax at zero rate.
11. Where the VAT dealer sells goods to another VAT dealer, he shall issue
VAT Invoice showing the tax (output tax) at rates applicable to the
goods as per schedule, which tax will be counted as input tax for
the purchasing VAT dealer.
12. Where the VAT dealer sells goods purchased by him from another VAT
dealer under the VAT Invoice he is entitled to deduct the input tax
from the VAT he is liable to pay on his sale.
13. Where the VAT dealer sells goods manufactured by him, he is entitled
to deduct the input tax he paid on the raw material from the output
tax payable on manufactured goods, to arrive at the net VAT he will
have to pay.
14. Where the VAT dealer sells goods manufactured by him out of raw
materials which are exempt from tax, he is liable to pay full output
tax at the rate prescribed where such manufactured goods are taxable.
15. Where the VAT dealer sells goods manufactured by him out of raw
material taxable at a higher rate than the rate prescribed for the
manufactured goods, he is entitled for full input tax credit,
notwithstanding the fact that the VAT payable is lower.
16. Where the VAT dealer sells goods imported by him, he shall pay VAT
on his turnover of such goods at rates applicable as per schedules and
is not entitled to any deductions towards any input tax and he should
in his turn issue VAT invoice to the purchaser if he is a VAT dealer.
17. Where the VAT dealer is a works contractor, he is entitled to the credit
of input tax he pays in relation to the goods used in the execution
of the works and shall pay the net VAT thereon, unless he opts for
composition to pay on the value of the contract at fixed rates.
18. Where a VAT dealer who sells goods on hire purchase, he shall pay
VAT on the total amount of instalments fixed.
19. Where the VAT dealer delivers goods to licensed users he shall pay
VAT on the total amount receivable as licence fees for the period to
which it is licensed.
20. Where the VAT dealer purchases capital goods from another VAT dealer,
the input tax paid is adjustable in VAT he should pay after the
commencement of manufacture on the sale of goods so manufactured.
21. Where the VAT dealer purchases from another VAT dealer goods for
use in the office, he is not entitled to any deduction or concession
towards any input tax.
22. Where the VAT dealer disposes of goods otherwise than by sale within
the State or outside, he need not pay any VAT for such disposal of
goods does not amount to a sale within the meaning of the Act.
23. Where the VAT dealer sells goods to the named international institutions
and foreign bodies which are exempted from paying VAT, the dealer
shall issue VAT invoice so that those institutions may claim refund.
24. Where the VAT dealer sells goods purchased by him from TOT dealers
or exempted dealers, he is not entitled to any deduction towards any
input tax, in the VAT payable by him.
25. Where the VAT dealer sells contraband goods or any other goods in
which he is not authorised to deal, he is liable to pay VAT on such
sale turnover at rates applicable.
26. Where the VAT dealer sells goods under lucky draw schemes, he shall
pay VAT for the value of goods on delivery to the person who gains
by lucky draw. The VAT dealer shall not issue VAT invoice nor
the person getting delivery of goods is entitled to VAT invoice.
27. Where the VAT dealer sells goods purchased from a casual dealer, he
is not entitled to any deduction towards input tax. Even though casual
dealers get their intimation is recorded with the assessing authority,
they are not entitled to issue VAT invoice. Where there is no VAT
invoice there is no input tax credit.
28. Where VAT dealer collects fees for supply of audio visual equipment
which was provided by third party who only operates it and possession
and control of equipment is not given to the customer, the VAT dealer
shall pay tax on the amount collected from the customer for use of
the equipment.
29. If the VAT dealer is enjoying tax holiday, the same is converted into
tax deferment.
Casual Trader
Casual trader shall apply for registration as casual trader fifteen days
before he commences business. Since, he is not a VAT dealer, he cannot
claim input tax credit. He cannot issue VAT invoice. Therefore, his
purchasers cannot claim any input tax credit.
However, the casual trader shall pay turnover tax at 1% if he comes
within the class of TOT dealers. He shall pay tax at VAT rates if he
comes within the class of VAT dealers.
Transfer of right to use goods
Section 2(28) of the Andhra Pradesh Value Added Tax Act, 2005
defines the word ‘sale’ in all its dimensions contemplated under the
Contract Act and the Sale of Goods Act. The said definition is extended
to: (1) transactions covered by Works Contract; (2) hire purchase agreements;
(3) supply of food and drinks by hotels; (4) supply of food, drinks and
other articles by Club to its members and others; (5) transfer of right
to use goods (all of which are treated as deemed sales). In the case of
the last item of deemed sale which is taxable under VAT is the transfer
of right to use goods and not the use of goods.
The following three illustrations explain clearly the transfer of the
right to use goods: (1) if a hotel which is the owner of its meeting hall
supplies the video and audio equipment to its customers who hold seminars
and meetings, and charges for its user supplied to the hotel owner by
a third party, from whom the hotel has obtained the equipment on lease,
the amount of charges the hotel receives from its customer comes under
transfer of right to use goods. The amount so realised is chargeable to

tax under VAT Act. (2) Similarly, when the Electricity Board supplies
to its customers the Meters and instals them at the premises of the customer
and charges certain amount towards the supply of Meters, the amount
so received by the Electricity Board from its customers is chargeable to
tax under the VAT Act. (3) The third illustration is the transaction in
which the Stevedore charges his customer for the use of vehicles he procures
from their owner for transporting goods from the Steamer to Warehouse.
The amount received by him from the customer is taxable under VAT
Act under the Heading ‘Transfer of Right to Use Goods’.
Tax on the transfer of right to use goods is different from the tax
on the service rendered under Service Tax Act. The latter is charged on
the service rendered to the customers of the services which are specified
by the Central Government. If the dominant purpose of contract is
rendering of service to the customer, service tax alone is attracted. If the
dominant purpose of the transaction is to allow the customer the use of
goods, the tax leviable is the tax under VAT. Service tax is a Central
subject while VAT is a State subject. They are mutually exclusive and
cannot encroach upon or overlap the other. In the three illustrations given
above, it is clear that rendering of service is not the objective in cases
where use of goods is permitted. In the latter case the object of the
transaction is to allow the customer the use of goods only and it does
not involve rendering of any service.
Documents to be presented at the

Check Post
The driver of the vehicle or the person accompanying the goods under
transport must produce the following documents before the Check Post
Officer:
(1) Bills covering the goods under transport, the Way Bill or the
‘C’ Form whichever is relevant, would prove that the goods under transport
are duly accounted for in the Books of Accounts of the owner of goods
who transports them and necessary arrangements for payment of tax were
made or paid.
(2) Entry Slip or Exit Slip as the case may be.
(3) If the lorry driver is required to produce the Trip Sheet, he may
produce the same.
(4) Assessment orders can be made and tax collected by the authorised
Assessing Officer of the locality where the check post is located. The Check
Post Officer cannot make any assessment or levy penalty.
Sec. 3] Appellate Tribunal and Appointment of Officers 59
(5) The Trip Sheet shall be provided by the driver. It is a document

required to be maintained under M.V. Act. The proof of goods under
transport are the same goods claimed to be under transport as evidenced
by the other documents, can be established only by the Trip Sheet.
The absence or incomplete Trip Sheet would be a circumstance to
raise the objection that the goods under transport are not duly accounted
for.
CHAPTER II
Appellate Tribunal and Appointment
of Officers
3. Appellate Tribunal:– (1) The Government shall appoint an
Appellate Tribunal consisting of a Chairman and two other members to
exercise the functions conferred on the Appellate Tribunal by or under
the Act. The Chairman shall be a judicial officer not below the rank of
a 1[District Judge Super Time Scale/District Judge Selection Grade] and
of the other two members, one shall be an officer of the State Government
not below the rank of a Joint Commissioner of Commercial Taxes, and
the other shall be an officer of the Indian Revenue Service not below
the rank of an Additional Commissioner.
(2) Any vacancy in the membership of the Appellate Tribunal shall
be filled up by the Government.
(3) Notwithstanding anything contained in sub-section (1), the
Government may at any time, by order, constitute an additional Bench
of the Tribunal, consisting of a Chairman who shall be a 1[District Judge
Super Time Scale/District Judge Selection Grade] and two members of
whom one shall be an Officer of the State Government not below the
rank of a Joint Commissioner of Commercial Taxes and the other shall
be an officer of the Indian Revenue Service not below the rank of an
Additional Commissioner to function at such place and for such period
as may be specified therein.
(4) Where any orders passed by the Benches specified in sub-
sections (1) and (3) are in conflict with each other on same issue the
senior Chairman of the two Benches, on application or suo-moto shall
constitute and preside over a Full Bench of not less than five members
in the manner specified in the regulations made under sub-section (5) and
the decision of such bench shall be final.
1. Subs. for "District Judge Grade-I" by Act No. 34 of 2006, w.r.e.f. 1-4-2005.
(5) The Appellate Tribunal shall, with the previous sanction of the
Government make regulations consistent with the provisions of the Act
and rules made thereunder, for regulating its procedure and the disposal
of its business. Such regulations shall be published in the Andhra Pradesh
Gazette.
1
[(6)(a) The functions of the Appellate Tribunal may be exercised,–
(i) by a Bench consisting of all the members of the Appellate
Tribunal; or
(ii) by a Bench consisting of two members constituted by the Chairman
; or
(iii) by a Bench consisting of the Chairman and another member as
constituted by the Chairman ; or
(iv) by a Bench consisting of the other two members in case the
Chairman is absent or on leave or transfer or in case of the
office of the Chairman is vacant otherwise ; or
(v) by a single member of the Appellate Tribunal constituted by the
Chairman in cases where the turnover does not exceed rupees
five lakhs :
Explanation:– The single member referred to in item (v) above
may be either the Chairman himself or any other member.
(b) where an appeal or application is heard by all the three members
of the Appellate Tribunal, and the members are divided in opinion, on
any point or points such point or points shall be decided in accordance
with the opinion of the majority ;
(c) where an appeal or application is heard by a Bench consisting
of two members whether it consists of the Chairman or not, and the
members are divided in opinion, on any point or points, such point or
points shall be referred to the Appellate Tribunal consisting of all the three
members;
(d) if any case which comes up before a single member (who is
not the Chairman) or a Bench (of which the Chairman is not a member)
involves a question of law, such single member or Bench may in his or
its discretion, reserve such case for decision by a Bench of which the
Chairman shall be a member.]
Notes
Section 33 of the Act makes detailed provisions on the jurisdiction and
powers of the Appellate Tribunal. The present Sec. 3 provides for the
constitution and appointment of the Appellate Tribunal. The Tribunal is called

Sec. 3] Appellate Tribunal and Appointment of Officers 61
Appellate Tribunal. It is defined to be a high powered tribunal to meet the

wide ranging issues the tribunal is required to consider. Hence it is constituted
with personnel having substantial experience in divergent fields such as law,
administration and matters pertaining to revenue. Mostly, the tribunal acts as
a forum for second appeals against the orders of the appellate officers. It
can entertain and hear first appeals against the orders of revision made by
certain specified officers. Such a tribunal must necessarily be a judicial
authority.
The Appellate Tribunal shall consist of three members. The tribunal shall
be presided over by a judicial member who is of the cadre of Grade I Dist.
Judge. He is called the Chairman of the Tribunal. The other member shall
be a person from the Sales Tax Department of a Cadre of Joint Commissioner,
who is next in rank and experience to that of the Head of the Department
who is the Commissioner of Commercial Taxes. The third member shall be
a person belonging to Indian Revenue Service not below the rank of Additional
Commissioner of the Department. The third member accordingly does not
belong to the Commercial Tax Department. He should be one belonging to
the Department of Revenue and Finance. He may be from the office of the
Accountant and Auditor General or may be from the Excise and Customs
Department. There is no provision to appoint retired persons as Members
of the Tribunal.
Where a District Judge is appointed as Chairman he shall be designated
before or at the time of appointment as District Judge Super Time Scale/
District Judge Selection Grade.
If the Government is of opinion that the constitution of the Addl. Bench
is necessary to dispose off the cases, it may appoint an Addl. Bench consisting
of three members constituted and appointed in the same manner as that of
the Principal Tribunal. The Additional Bench may be constituted for a period
to deal with any class or classes of cases and shall sit at a place specified.
The Addl. Bench may have a concurrent jurisdiction and it shall operate as
a coordinate Bench with the principal appellate tribunal. Under these
circumstances, it would have been better if the Chairman of the Principal
Tribunal is a person senior to the judicial member of the Addl. Bench.
The Appellate Tribunal may formulate its own procedure including that
of the Addl. Bench for disposal of cases. The regulations so made shall have
the prior approval of the Government and they should be published in the
Gazette. These regulations shall come into force only after they are published
in the Gazette.
(For further details, see Section 33 under the heading Appeal to Appellate
Tribunal and also Section 2(3) Definitions).
Where the tribunal permitted the state to withdraw the appeal filed by
it on the ground of some defect say, the lack or absence of sanction order,
it is presumed that it had permitted the withdrawal with a right to file another
appeal after curing the defect. Such power of the tribunal can be read into
the general power “to make any such order as it may deem fit”. G.N. General
Mills v. State of Punjab & others, (2008) 16 VST 566 (P&H).
3A. Appointment of Officers:– The State Government, may, appoint1

a Commissioner of Commercial Taxes and as many Additional
Commissioners of Commercial Taxes, Joint Commissioners of Commercial
Taxes, Appellate Deputy Commissioners of Commercial Taxes, Deputy
Commissioners of Commercial Taxes, Assistant Commissioners of
Commercial Taxes, Commercial Tax Officers and Deputy Commercial Tax
Officers as they think fit, for the purpose of performing the functions
respectively conferred on them by or under the Act. Such officers shall
perform the said functions within such area or areas or the whole of the
State of Andhra Pradesh as the Government or any authority or officer
empowered by them in this behalf may assign to them.
Notes
The Head of the Department is the Commissioner and the lowest grade
officer in the department is the Dy. Commercial Tax Officer. They carry
out the functions assigned to them under the Act within the financial and
territorial jurisdiction prescribed for them. Then certain officers are designated
the prescribed authorities. They carry out the functions exercisable by such
authority. If an officer is prescribed for dealing with matters arising out of
registration of dealers those who are not designated for that purpose cannot
deal with matters coming under registration. If an officer is authorised to
make assessments those officers who are not conferred with such powers
by the Commissioner shall not make any assessment. Each of the officers
shall carry out and perform all such functions as may be assigned to them
by their superiors. Here the superior officers, however, are not conferred
with any power to interfere with the assessment proceedings pending with
the subordinates what this section means is that the authority which has power
to transfer assessments can transfer the assessment file to another officer
of the same cadre or any other superior officer.
Where delegation of powers is made by one superior authority or the
officer to another who is lower, the order of delegation must be in writing.
Shyamal Dharma v. State of Gujarat, (2010) 31 VST 525.
CHAPTER III
Incidence, Levy and Calculation of Tax
4. Charge to tax:– (1) Save as otherwise provided in the Act,
every dealer registered or liable to be registered as a VAT dealer shall
be liable to pay tax on every sale of goods, in the State at the rates
specified in the Schedules.
2
[(2) Every dealer, who has not opted for registration as a Value
Added Tax dealer and who is registered or liable to be registered for
Turnover Tax, shall pay tax at the rate of one percent (1%) on the taxable
turnover in such manner as may be prescribed.]
1. See Noti. in G.O.Ms.No. 1163, Rev. CT-II, dt. 14-8-2006, w.e.f. 1-4-2005, at p.1014.
2. Subs. by Act No. 4 of 2009, w.e.f. 1-5-2009. vide G.O.Ms.No.495 Rev. CT-II Dept.,
dt. 30-4-2009.
Sec. 4] Incidence, Levy and Calculation of Tax 63
(3) Every VAT dealer shall pay tax on every sale of goods taxable
under the Act on the sale price at the rates specified in the Schedules
III, IV and V, subject to the provisions of Section 13.
(4) Every VAT dealer, who in the course of his business purchases
any taxable goods from a person or a dealer not registered as a VAT
dealer or from a VAT dealer in circumstances in which no tax is payable
by the selling VAT dealer, shall be liable to pay tax at the rate of 1[five
per cent (5%)] on the purchase price of such goods, if after such purchase,
the goods are–
(i) used as inputs for goods which are exempt from tax under the
Act, or
(ii) used as inputs for goods, which are disposed of otherwise than
by way of sale in the State or dispatched outside the State
otherwise than by way of sale in the course of inter-State trade
and commerce or export out of the territory of India; or
(iii) disposed of otherwise than by way of consumption or by way
of sale either within the State or in the course of interstate trade
or commerce or export out of the territory of India:
2
[Provided that wherever a common input is used to produce goods,
the turnover, taxable under this sub-section, shall be the value of the inputs,
proportionate to the value of the goods, used or disposed of in the manner
as prescribed under this section:
Provided further that in respect of purchase of goods specified in
Schedules III and VI, the VAT dealer shall be liable to pay tax at the
rates specified for such goods in the respective Schedules.]
(5) Every dealer shall pay tax on the sale price of goods specified
in Schedule VI at the special rates and at the point of levy specified
therein.
(6) Every casual trader who sells goods within the State and any
dealer covered under Explanations III and IV of Clause (10) of Section
2 shall pay tax on the sale price of such goods at the rates specified
in the respective Schedules.
(7) Notwithstanding anything contained in the Act:–
(a) every dealer executing works contract shall pay tax on the value
of goods at the time of incorporation of such goods in the works
executed at the rates applicable to the goods under the Act:
Provided that where accounts are not maintained to determine the
correct value of goods at the time of incorporation, such dealer
1. Subs. for "four per cent (4%)" by A.P. Act No. 12 of 2012, w.e.f. 14-9-2011.
shall pay tax at the rate 1[specified in Schedule-V] on the total

consideration received or receivable subject to such deductions as
may be prescribed;
2
[(b) Every dealer executing works contract may in lieu of the amount
of tax payable by him under clause (a) opt to pay by way of
composition at the rate of 3[5%] of the total amount received or
receivable by himself towards execution of the works contract either
by himself or through sub-contractor subject to such conditions as
may be prescribed:
Provided that the sub-contractor, executing works contract on behalf
of the contractor, who opts to pay tax under this clause, shall be
exempted from levy of tax.]
(c) 4[xxx]
5
[(d) Every dealer engaged in construction and selling of residential
apartments, houses, buildings or commercial complexes may, in
lieu of the amount of tax payable by him under clause (a) opt
to pay tax by way of composition at the rate of 3[5%] on twenty
five percent (25%) of the amount, received or receivable towards
the composite value of both the land and building or the market
value fixed therefor for the purpose of stamp duty, whichever is
higher, subject to such conditions as may be prescribed.
Provided that no tax shall be payable by the sub-contractor of a
works contractor, who opts to pay and paid tax under this clause
on the turnover relating to the amount received as a sub-contractor
from such main contractor towards the execution of works contract,
whether wholly or partly, subject to the production of evidence to
1. Subs. for “12.5%” by Act 9 of 2010, w.e.f. 26-4-2010, Vide G.O.Ms.No.366,
Rev. (CT-II) Dept., dt. 24-4-2010.
2. Subs. by Act 21 of 2011, w.e.f. 15-9-2011, Prior to its substitution it read as below:
“(b) any dealer executing any works contract for the Government or local authority
may opt to pay tax by way of composition at the rate of 4% on the total value of
the contract executed for the Government or local authority [xxx]”.
3. Subs. for “4%” by A.P. Act No. 12 of 2012, w.e.f. 14-9-2011.
4. Omitted. by Act 21 of 2011, w.e.f. 15-9-2011, Prior to its omission it read as below:
“(c) any dealer executing works contracts other than for Government and local authority
may opt to pay tax by way of composition at the rate of 4% of [xxx] of the total
consideration received or receivable for any specific contract subject to such conditions
as may be prescribed.”
5. Subs. by Act 21 of 2011, w.e.f. 15-9-2011, Prior to its substitution it read as below:
“(d) any dealer engaged in construction and selling of residential apartments, houses,
buildings or commercial complexes may opt to pay tax by way of composition at the
rate of 4% of twenty five percent (25%) of the consideration received or receivable
or the market value fixed for the purpose of stamp duty whichever is higher subject
to such conditions as may be prescribed.”
prove that such main contractor has exercised such option in respect
of the specific work and subject to such other conditions as may
be prescribed;]
1
(e) [xxx]
2
(f) [any dealer registered or is liable to be registered] for TOT and
executing any works contracts shall pay tax at the rate of 1% on
total value of the goods at the time of incorporation of the goods
used :
Provided that where accounts are not maintained to determine the
correct value of the goods at the time of incorporation, such dealers
shall pay tax at the rate of 1% on the total consideration received
or receivable subject to such deductions as may be prescribed.
3
[xxx]
4
[(g) notwithstanding anything contained in clauses (a) to (f) above, no
tax shall be leviable on the turnover of transfer of property in goods
whether as goods or in some other form involved in the execution
of works contract, if such transfer from the contractor to the
contractee constituted a sale in the course of interstate trade or
commerce under Section 3 or a sale outside the State under Section
4, or a sale in the course of import or export under Section 5
of the Central Sales Tax Act, 1956;
(h) no tax shall be payable under 5[clause (a)] of this sub-section on
the turnover relating to amounts paid to a sub-contractor as
consideration for the execution of works contract whether wholly
or partly subject to the production of proof that such sub-contractor
is registered as a VAT dealer under the Act and the turnover of
such amount is included in the return prescribed filed by such sub-
contractor.]
"(e) any dealer having opted for composition under [clauses (b) or (c) or (d)], purchases
or receives any goods from outside the State or India or from any dealer other than
a Value Added Tax dealer in the State and uses such goods in the execution of the
works contracts, such dealer shall pay tax on such goods at the rates applicable to
them under the Act and the value of such goods shall be excluded [from the total
turnover] for the purpose of computation of turnover on which tax by way of
composition at the rate of four per cent (4%) is payable.]
2. Subs. for "any dealer who is liable to be registered" by Act 21 of 2011, w.e.f. 15.9.2011.
3. Proviso omitted by Act No. 5 of 2007, w.r.e.f. 1-9-2006.
5. Subs. by Act No. 21 of 2011, prior to substitution it read as below:
"clauses (a) or (b) or (c)" w.e.f. 15-9-2011.
VAT–5
(i) 1[xxx]
(8) Every VAT dealer who transfers the right to use goods taxable
under the Act for any purpose, whatsoever, whether or not for a specified
period, to any lessee or licensee for cash, deferred payment or other
valuable consideration, in the course of his business shall, on the total
amount realized or realizable by him by way of payment in cash or
otherwise on such transfer of right to use such goods from the lessee
or licensee pay a tax for such goods at the rates specified in the Schedules.
2
[(8A) Notwithstanding anything contained in sub section (8), a producer
of a feature film, who transfers the right to use the film to the distributors
or the exhibitors for the purpose of exhibiting such films in the theatres,
may opt to pay tax by way of composition as may be prescribed.
Explanation:— Wherever tax is paid under sub-section (8A) by any
producer in respect of any film, the subsequent transfer of right to use
such film for exhibition in the theatre shall not be liable to tax under sub-
sections (8) and (8A)]
3
[(8B) any dealer other than the producer of a feature film may, in
lieu of the tax payable by him under sub-section(8), opt to pay by way
of composition an amount of tax at the rate of 4[5%] of the total amount,
received or receivable by him towards transfer of right to use any goods
subject to the conditions, as may be prescribed.
Provided that, wherever the tax is paid under this sub-section, the
subsequent transfer of right to use such goods shall not be liable to tax
under sub-section (8)]
5
[(9) Notwithstanding anything contained in this Act,-
(a) every dealer, being a star hotel, having a status of three star and
above, as recognized by competent authority prescribed by the
Government of India, shall pay tax at the rate 6[specified in Schedule-
V] of the taxable turnover of the sale or supply of goods, being
“(i) no tax shall be payable under clause (d) of this sub-section on the turnover relating
to the consideration received as a sub-contractor if the main contractor opted to pay
tax by way of composition subject to the condition that the sub-contractor shall pay
tax in respect of any goods purchased or received from outside the State of Andhra
Pradesh or from any person other than a Value Added Tax dealer in the State on the
value of such goods at the rates applicable to them under the Act.”
5. Subs. for sub-section (9) by Act No. 4 of 2009, w.e.f. 1-5-2009.
6. Subs. for “of twelve and half percent (12.5%)” by Act 9 of 2010, w.e.f. 26-4-2010.
food or any other article for human consumption or drink, served

in restaurants attached to such hotels or anywhere whether indoor
or outdoor;
(b) every dealer, being a Hotel other than those mentioned in clause(a),
shall pay tax at the rate of 1[five percent (5%)] of the taxable
turnover of the sale or supply of goods, being food or any other
article for human consumption or drink, served in restaurants attached
to such hotels or anywhere whether indoor or outdoor;
(c) every dealer, other than those mentioned in clause (a) and clause(b)
and whose annual total turnover is rupees one Crore and fifty lakhs
(1.5 Crore) and above shall pay tax at the rate 2[specified
in Schedule-V] of the taxable turnover of the sale or supply of
goods, being food or any other article for human consumption or
drink, served in restaurants, sweet-stalls, clubs, any other eating
houses or anywhere whether indoor or outdoor or by caterers;
(d) every dealer, other than those mentioned in clause (a) and clause
(b) and whose annual total turnover is more than 3[rupees seven
lakhs and fifty thousand] and less than rupees one Crore and fifty
lakhs (1.5 Crore) shall pay tax at the rate of 1[five percent (5%)]
of the taxable turnover of the sale or supply of goods, being food
or any other article for human consumption or drink served in
restaurants, sweet-stalls, clubs, any other eating houses or anywhere
whether indoor or outdoor or by caterer.
Explanation:— For the purposes of the computing the total turnover
under this sub-section, the sales turnover of all business units in common
premises sharing the common kitchen or common employees shall be
added to the sales turnover of the business unit having higher turnover.]
4
[(10) (a) Notwithstanding anything contained in the Act or any other
law for the time being in force, every person who, for an agreed
commission brokerage, buys or sells on behalf of any principal who is
a resident of the State shall be liable to tax under this Act at the rate
or rates leviable threunder in respect of such purchase or sale, notwithstanding
that such principal is not a dealer or that the turnover of purchase or
sale relating to such principal is less than the minimum specified in sub-
sections (2), (3) and (4) of section 17;
5
[Provided that the agent selling agricultural produce on behalf of
the agriculturist principal, shall be exempted from payment of tax subject
to such conditions as may be prescribed.]
1. Subs. for “four percent (4%)” by A.P. Act No. 12 of 2012, w.e.f. 14-9-2011.
2. Subs. for “of twelve and half percent (12.5%)” by Act 9 of 2010, w.e.f. 26-4-2010.
3. Subs. for “Rs. five lakhs” by Act 13 of 2012.
(b) The principal shall not be liable to tax on his turnover in respect
of which the agent is liable to tax under clause (a) and the burden of
proving that the turnover has been subjected to tax at the hands of his
agent under the said clause shall be on such principal.]
1
[(11) Every dealer, who is engaged in the integrated activity of
printing and supplying the printed materials may, in lieu of the amount
of tax payable under the Act, opt to pay by way of composition an amount
of tax at the rate of 2[5%] on sixty percent (60%) of the total value
of such supplies received or receivable, irrespective of the fact whether
such supplies involve sale or works contract or job work subject to such
conditions as may be prescribed.]
Notes
Incidence of tax means, the transactions which attract the charge of

tax. It also means, the persons on whom the liability to pay tax rests.
The rate of tax fixed on the date of transaction – If it is a case of
auction sale, it is determined as on the date when the auction is confirmed.
Subsequent formalities will not shift the date if the rate is later on changed
after the confirmation. Divisional Forest Officer v. Assessing Authority, H.P.,
(2009) 26 VST 579.
Value Added Tax authorises charge of tax on sales only. It also prescribes
that where tax cannot be collected at sale point, the tax which could have
been charged at sale point can be recovered at the purchase point. The rates
of tax at which the goods are made subject to at the point of sales are
specified in Schedules. Each of the schedules has heading which mentions
the rate of tax. Second Schedule speaks of transactions which are zero rated
and eligible for input tax credit. Third Schedule contains list of goods taxable
at 1%, Fourth Schedule contains the list of goods taxable at 4%, Fifth Schedule
describes goods taxable at standard rate of 12.5%, Sixth Schedule specifies
goods subject to tax at special rates. First Schedule covers items which are
exempt from tax.
When Circulars changed the rate of tax to a higher rate, they should
operate prospectively only and shall not be made retrospective, nor do they
operate retrospectively. R.K. Corporation v. Govt. of Karnataka and another,
(2009) 21 VST 386.
Tax law must be specific. Tax cannot be imposed by clarification.
Commissioner of Trade Tax v. Ayodhya Distillery, (2009) 19 VST 251 (SC).
There are only two classes of dealers; those who are registered as VAT
dealers and others who are registered as TOT dealers. Those who are
registered as VAT dealers shall pay tax on the sales affected by them, and
those who are registered as TOT dealers shall pay tax on their turnover of

2. Subs. for "4%" by A.P. Act No. 12 of 2011, w.e.f. 15-9-2011.
sales. Therefore, all the dealers registered under the Act pay either the tax
which is called Value Added Tax or the Turnover Tax.
VAT dealers are those whose taxable turnover in a period of 12 months
exceeds Rs. 40 lakhs and TOT dealers are those whose taxable turnover in
any period of 4 months in 12 preceding months exceeds 5 lakhs but not
Rs. 40 lakhs. In other words, all those dealers whose turnover is between
Rs. 5 lakhs and Rs. 40 lakhs are TOT dealers. While, the VAT dealers pay
tax on goods at the rates specified in the Schedules III, IV, V and VI, TOT
dealers pay tax at a fixed rate of 1% on their taxable turnover. This distinction
is very important in the scheme of VAT taxation. Small traders whose turnover
in a period of 12 months is less than Rs. 5 lakhs need not have to register
themselves. They are exempted from paying any tax. They need not maintain
the accounts in a manner highly disciplined as in the case of bigger dealers
having larger turnovers. Turnover tax applicable to TOT dealers is very easy
to compute. There is no need to maintain separate accounts for each one
of the several classes of goods subject to different rates of taxation. There
is no need for the TOT tax payers to certify the tax paid by them or include
the tax separately in their bills. The tax component of the total price at which
they sell goods need not be mentioned in Bills. The administration of turnover
tax being easier it relieves the department of considerable burden of maintaining
assessment records of a large number of dealers whose assessments may
be managed in a summary manner.
Under the Value Added Tax system, VAT dealers are primarily liable to
pay the tax on their sales only. But, there are certain circumstances in which
VAT dealers pay on their purchases. Such circumstances are described below:
(1) Where a VAT dealer uses the goods purchased by him from a person
or dealer not registered under the Act, as inputs for the goods which are
exempt from tax, a provision is made to collect tax on the purchase value
of goods so that the goods concerned may not escape from the levy of
tax altogether. There, the person selling the goods to VAT dealer being an
unregistered may not have paid any tax either at the point of his own purchase
or at the point of his sale. For e.g. a VAT dealer purchases paper which
is taxable as general goods at 4% under Item 46 of IV Schedule from a
dealer who is not registered. He uses them for manufacturing books which
are exempt under Item 5 of I Schedule. The VAT dealer in such case, has
to pay purchase tax on the value of paper purchased by him at 4%.
(2) Where the VAT dealer uses the goods purchased by him from a
person or dealer not registered under the VAT as inputs in goods which are
(a) disposed off by him otherwise than by a sale within the State or (b)
dispatches them to outside the State or (c) dispatches them to outside the
country otherwise than as a sale, he shall pay the purchase tax on the goods
purchased by him. Here, the disposal of goods shall not be by sale but for
purposes of use which may be for purposes of direct consumption within
or outside the State or outside the country. Such disposal for use should
be one which in no circumstances be treated as falling within the expression
of the business, trade or commerce. For example, if the VAT dealer purchases
wheat flour which is taxable at 4%, uses it for manufacture of biscuits which
are disposed off freely within the State or outside the State or outside the
country, the VAT dealer is liable to pay purchase tax at 4% on the value
of the flour he has purchased. In other words, where the VAT dealer uses
the goods he purchased, which did not suffer tax earlier, for manufacturing
goods which he disposes off freely or for charity to consumers within the
State, outside the State or outside India, he shall have to pay in the form
of purchase tax on the goods purchased by him at the first instance as inputs
in the manufacture of goods.
In the case of goods specified in Schedule VI, all dealers both VAT
and TOT shall pay tax on the sale value of the goods specified in that Schedule
at the special high rates prescribed therein. This schedule has 5 items. They
are taxable at the point of first sale only, but at different rates. Liquors
are taxable at 70% on their sale value, if the cost is less than Rs. 700/-
per case and at 90% if the cost is more than Rs. 700/- per case, petrol,
Aviation Motor Spirit, Aviation Turbine Fuel other than diesel, are taxable at
32.55% and diesel oil at 21.33%. In these cases, a question may arise who
is the first seller. In the case of liquors, dealers selling them to the Andhra
Pradesh Beverages Corporation are not to be deemed the first sellers and
they are all exempted. Sale by the Andhra Pradesh Beverages Corporation
shall be treated as first sale and Andhra Pradesh Beverage Corporation, as
the first seller is only liable to pay tax at the special high rates. The idea
here appears to be that it would be easier to collect the tax on the entire
turnover of liquor marketed by A.P. Beverages Corporation which holds the
monopoly. As on today, every person manufacturing liquors shall sell all their
stocks to A.P. Beverages and that Corporation alone shall sell the liquor to
the trader. In all other cases, where liquor is distributed by any person other
than A.P. Beverages Corporation, such distributors shall be the first sellers
liable to pay tax. Similarly, in the case of dealers who import liquor from
outside the State or import liquor from outside India, when they sell liquor
to others, they are the first sellers in the State liable to pay tax on their
sales at the special high rates. It may be noted here that no person is entitled
to import liquor except through A.P. Beverages Corporation.
Thus, the incidence of tax in the case of liquors distributed by the Andhra
Pradesh Beverages Corporation, is on the A.P. Beverages Corporation. In the
case of liquors, manufactured and sold or imported from outside the State
or outside India the incidence of tax is on those dealers who sell liquors.
In the case of casual dealers they have to pay tax on the goods sold
by them at VAT rates applicable to such class of goods. Irrespective of the
fact, whether the value of the goods sold by them is 5 lakhs and above
or 40 lakhs they have to pay sales tax at VAT Rates only. If the casual dealer
sells Rs. 5 lakhs worth of Aluminium vessels he shall pay tax at the rate
of 4%, the rate applicable to goods under Schedule IV and if he sells Rs.
40 lakhs worth of Jewellery he shall pay tax at the rate of 1% which is
the rate specified under Schedule III. If the casual trader sells garden umbrellas
worth Rs. 5,50,000/- he has to pay tax at the standard rate of 12.5%, the
rate applicable to goods under Schedule V, since the garden umbrellas are
not specified in any of the schedule.
Thus, in the case of casual dealers, the tax incidence falls on such
dealer who is not an exempt dealer and the incidence is on the sale of goods
at the rate specified in the schedule.
As for the works contractor he shall pay tax at the rate of 12.5% in
accordance with the provisions made therefor. Where the works contract is
for mere service and does not involve any use or transfer of goods he need
not pay any tax, since there is separate enactment whereby tax is levied and
collected on services. In case where works contract involves use of materials
or transfer of goods, the turnover has to be ascertained in accordance with
the rules prescribed therefor and tax is charged and collected accordingly.
Where the works contractor who is registered as a VAT dealer executes
certain works for the Government or local authority he may opts to pay
tax at the compounded rate of 4% on the total value of the contract and
where he so opts the Government may collect it at source and remit it to
the Department.
Where the works contractor who is a VAT dealer executes certain works
he shall pay tax on the value of the goods used by him in the execution
of the works, if he maintains the true and correct account of the goods
so used, at the respective rates and where the accounts are not so maintained
he shall pay tax at the rate of 12½% on the total value of the contract.
Where works contractor who is a VAT dealer executes the work for
any person other than the State Government or local authority he may opt
to pay tax at the compounded rate of 4% on the 50% of the total consideration.
The Schedules contained HSN Code No. – Goods produced out of
products mentioned in HSN Code are not taxable under the relevant entry
if such goods are different. M.P. Agencies v. State of Kerala, (2010) 28
VST 44.
Where the works contractor who is a VAT dealer constructs and sells
residential accommodation, he may opt to pay the tax at the compounded
rate of 4% on the 25% of the value of the premises fixed by the Government
for the purposes of stamp duty.
Where the works contractor who is a TOT dealer executes any works
contract he shall pay the tax at the rate of 1% on the total value of the
goods used in the contract where he maintains an account; and where he
does not maintain the accounts to determine the correct value of the goods
used in the contract he shall pay tax at the rate of 1% on the total consideration
of the contract.
Where the VAT dealer leases or licences any goods which are taxable
under this Act, he shall pay tax on the total consideration for which such
use of goods is leased or licenced at the rates applicable to the goods so
leased or licenced.
Where works contract can be split into the execution of works and
supply of goods separately, composition can be permitted to that part which
relates to work. Orchid Designs Pvt. Ltd. v. Commercial Tax Officer, (W.C.T.
Ernakulam), (2010) 27 VST 295.
If the goods used in the Works Contract are involved in inter-State

transport, no tax is payable by the contractor. Hence the question of any
deduction towards input tax arises. Patel Engineering Ltd., v. State of A.P.,
(2010) 51 APSTJ 150.
When once the assessment order is passed, the only remedy is appeal.
No application for revision before Assessing Authority lies. Sai Madhav Biotech
v. Asst. Commnr. (CT) (LTU), (Int.), Warangal = 2010 (6) ALD 18 (DB)
= (2010) 51 APSTJ 50.
As per the amended Sections 4(9) and 4(10) of the Act two more classes
of dealers are specified as to how the tax liability shall be calculated. In the
case of hotels of Class Three Star and above, their turnover relating to the
food and drinks and other articles of human consumption shall be taxable
at 12.5% and in the case of other hotels, their turnover relating to food and
drinks and other articles of human consumption is taxable at 4%. In the case
of other Restaurants, Sweets Stalls, Clubs and Eating Houses, if their turnover
exceeds 1.5 crores, the rate of tax is 12.5% while the rates of tax payable
by such institutions is 4% if their turnover is between ‘5 lakhs and 1.5 Crores.
Here, the Club means the Members Club as well as Institutional Club. The
other class of dealers who are commission agents, tax shall be levied on
the total volume of transactions irrespective whether their principals are liable
to pay any tax, at the rates specified in Schedules. The principals are freed
from paying any tax on their turnover of goods on which commission agent
pays the tax.
5. Act not to apply to sales or purchases outside the State,
in the course of import or export, etc.:– Nothing contained in the Act
shall be deemed to impose or authorise the imposition of a tax on the
sale or purchase of any goods, where such sale or purchase takes place,–
(a) outside the State; or
(b) in the course of the import of the goods into, or export of the
goods out of the territory of India; or
(c) in the course of inter-State trade or commerce.
Explanation:– The provisions of Chapter II of the Central Sales
Tax Act, 1956 (Central Act 74 of 1956), shall apply for the purpose
of determining when a sale or purchase takes place in the course of inter-
State trade or commerce or outside a State or in the course of import
or export.
Notes
Thus far, about the charge to tax under Section 4 on several types
of dealers and the rates of tax payable by them and at what point of the
sale. The Act by Section 5 makes a declaration that nothing contained herein
shall be construed as enabling the Government to impose tax on sales of
goods coming within the scope of Central Sales Tax Act. It means, transactions
of sale over which Central Sales Tax is leviable, no tax can be levied under
the Value Added Tax Act. Whether the transaction of sale comes within the
scope of Central Sales Tax Act or not, has to be determined in relation to
the provisions contained in that Act. If the transaction is one where the sale
takes place outside the State or where sale takes place within the State the
goods concerning which move in pursuance of a prior agreement of sale,
from this State, the transaction is an interstate sale in relation to which tax
is leviable under Central Sales Tax Act. The rate of tax was originally 1%
which was raised to 2% and 3%. The present rate of Central Sales Tax
is 4%. The tax so levied and collected by the Sales Tax Department on behalf
of the Central Government is appropriated to respective States where it is
collected. It is proposed to replace the Central Salex Tax Act by VAT. Till
that happens all transactions which are in the nature of interstate sales or
export sales or import sales are exempt from the Value Added Tax Act.
6. Tax on packing material:– Where goods sold or purchased
are contained in containers or are packed in any packing material liable
to tax under the Act, the rate of tax applicable to such containers or
packing material shall, whether the price of the containers or packing
material is charged for separately or not, be the same as the rate of tax
applicable to such goods so contained or packed, and where such goods
sold or purchased are exempt from tax under the Act, the containers or
packing material shall also be exempted.
Notes
There has been considerable controversy over the problem whether the
packing material used for purposes of packing the goods sold, shall be taxed,
if so, at what rate? Section 6 now has cleared all the doubts existing on the
issue of packing material. This section has made it clear whatever be the cost
of packing materials, their nature and whether the cost of packing material
is included in the price or separately charged, the value of the packing material
shall be charged at the rate applicable to the goods for which the packing
material is used. The packing material includes all types of containers also.
Whether the packing material as goods are taxable independently under any
of the schedules or not, or whether the rates at which they should be taxed
are higher or lower than the rate applicable to the goods for which the
packing materials are used, they are chargeable for purposes of Value Added
Tax at the rate at which the goods are taxed.
If the value of packing materials whatever be their cost, is included
in the price of goods, the question as to how the packing materials have
to be charged does not arise. If it is not so included, but separately charged
in the bill, the value of packing materials shall be charged at the rate applicable
to the goods.
If the goods for which the packing material is used are exempt from
tax the cost of packing material shall be treated as exempt from the levy
of tax under this Act.
Empty liquor bottles purchased from hawkers by dealers in bottles who
sold them to Andhra Pradesh Bewerage Corporation are liable to be taxed
as simple packing material at 4% under Item 90 of Schedule IV and not
packing material carrying liquor to be charged as liquor. When once bottle
and liquor are separated, the bottles are liable to be charged as packing material.
Sree Manasa Enterprises v. C.T.O., Nampally, Hyderabad, (2010) 27 VST
473.
7. Exemptions:– The goods listed in Schedule I to the Act shall
be exempt from tax under the Act.
Notes
Value Added Tax is designed to simplify the tax system. Under the
General Sales Tax Act there were a number of exemptions. They differ in
nature. Some of them are granted to individual assessees. For some there
were reduction in rates called concessional rates. There were tax holidays.
There were differments in the collection of tax. There were also cases where
Government treated the tax as loan granted to the assessee providing him
a facility to pay the tax at a later date. All such exemptions are not possible
to be granted under the present scheme of levying and collecting Value Added
Tax. The tax structure here cannot be individualised. Nor can the charge
or collection or its incidence be altered. Therefore the Act has given exemptions
commodity wise and the exemption is permanent till it is altered prospectively
by another legislation. There is no power with any authority or with the
Government to grant exemption to any person or on any transaction from
the incidence and collection of tax.
Where damaged rice is sold by Food Corporation as a cattle feed, it
is exempt from tax if cattle feed is an exempted item under the Act. Garg
Cattle Feed Industries v. Food Corporation of India, (2009) 23 VST 94.
Schedule I contains a list of goods exempt from tax. The number of
items mentioned in the list are 47. Apart from the exemption granted under
Schedule I there are no other exemptions provided in the Act. These exemptions
are not conditional. They are absolute. Exempted means exemption for all
purposes. Since there is a likelihood of the dealers dealing in both exempted
and taxable commodities, it is mandatory that the dealers should maintain
separate account for the exempted goods.
Exempted means, that the goods are exempted both at the sale point
as well as at the purchase point. When such goods are not taxed at both
the points there does not arise any question of any input tax or output tax
in relation to exempted goods.
1
[7-A. Exemption of Tax on sale of goods for certain purposes
to an unit located in any Special Economic Zone:— Notwithstanding
anything contained in this Act, no tax under this Act shall be payable
by any dealer in respect of sale of any goods made by such dealer to
a registered dealer for the purpose of setting up operation, maintenance,
manufacture, trading, production, processing, assembling, repairing,
reconditioning, re-engineering, packaging or for use as packing material
or packing accessories in an unit located in any Special Economic Zone
or for development, operation and maintenance of Special Economic Zone
by the developer of the Special Economic Zone, if such registered dealer
has been authorised to establish such unit or to develop, operate and
maintain such Special Economic Zone by the authority specified by the
Central Government in this behalf.]
8. Zero-rated sales:– Subject to the conditions in Sections 9 and
13 of the Act, the following shall be zero-rated sales for the purpose
of the Act and shall be eligible for input tax credit,–
(a) Sale of taxable goods in the course of inter-state trade and

commerce falling within the scope of Section 3 of the Central
Sales Tax Act, 1956;
(b) Sale of goods falling within the scope of sub-sections (1) and
(3) of Section 5 of the Central Sales Tax Act, 1956;
(c) 1[xxx]
Notes
Zero rated sales are sales effected in the course of interstate trade and
export trade. They are covered by the Central Sales Tax Act. The Central
Sales Tax is levied and collected separately by the State Government on behalf
of the Union and the proceeds are assigned to the State. Dealers in goods
involved in interstate sales and the export sale do not issue VAT Invoices
since there is no tax credit of the tax paid under the Central Sales Tax Act.
Therefore, there is no incidence of Value Added Tax on the goods imported
or exported. However, since sale of such goods within the State after import
is treated as sale for purposes of this Act and such after sale is liable to
be taxed, the dealer who effects such sale will have to issue VAT Invoice
to his purchasers to whom the tax component paid under such invoice becomes
an input tax eligible for tax credit.
When a dealer is exempted from paying purchase tax and sales tax,
the seller to the exempted dealer cannot be taxed to sales tax in the goods
sold to the exempted dealer. Vijaya Lakshmy Enterprises, Vijayawada v. State
of A.P., (2012) 54 APSTJ 39.
9. Input tax credit for dealers for goods in Schedule VI:– Every
dealer, who is liable to pay tax on the sale of goods specified in Schedule
VI, shall be eligible for input tax credit subject to the conditions in Section
13 of the Act and in the manner prescribed.
Notes
The goods specified under Schedule VI are goods subject to some high
special rates. They belong to the category of liquors, petrol and diesel. The
rates of tax applicable to them range from 21.33% to 90%. They are taxable
at the first point of sale. The act itself fixes the first point of sale, as the
point where the Andhra Pradesh Beverages Ltd. sells those goods in the case
of liquors etc. and the oil companies in the case of petrol etc. They are
taxable at the first point of sale. The Act itself fixes the first point of sale
as the point where the Andhra Pradesh Beverages Corporation or canteen stores
department while selling liquors and the Indian Oil Companies in the case
of petrol etc., Since the turnover in liquors and oils shall not be included
in the turnovers of any other dealer, it naturally follows that all those dealers
who precede or succeed the said first sellers are not liable to pay any tax
under the Act.
10. Turnover tax:– (1) Any dealer who is not registered or does
not opt to be registered as VAT dealer shall not be entitled to claim input
tax credit for any purchase, and shall not be eligible to issue a tax invoice.
(2) Any dealer who is registered as a VAT dealer shall not be liable
to Turnover Tax from the effective date of such registration.
1. Item 'C' which read as "Sale of goods to any unit located in Special Economic Zone"
deleted by Act No. 28 of 2008, w.e.f. 1-6-2008.
Notes
Turnover tax is payable by the TOT dealers. They are dealers whose
turnover is above Rs. 5 lakhs and below Rs. 40 lakhs. Since they are not
registered as VAT dealers they are not entitled to any input tax credit. They
are accordingly not entitled to issue any tax invoices. The tax payable by
TOT dealers on their taxable turnover of sales is 1%. The tax component
involved in the sale of goods effected by the TOT dealers cannot be called
output tax, nor it can be called input tax for their purchasers even when
the later are VAT dealers. The incidence of tax under this section is pure
and simple sales tax on sale of goods and it has to be absorbed by the sellers
themselves and cannot be transferred to or claimed by the seller from the
purchasers. The TOT dealer need not take stock inventory of the goods held
by him by 31st March, 2005. Such stock taking needs to be done by the
VAT dealers only, to whom the tax paid under the APGST Act is refundable
to them.
11. Calculation of Tax payable:– (1) Subject to sub-section (2),
the VAT payable on a sale liable to VAT shall be calculated by applying
the rate of tax specified in the Schedules, on the sale price of goods.
(2) Where the sale price of goods is inclusive of VAT, the amount
of VAT shall be determined in accordance with the formula prescribed.
(3) Where a dealer is liable to pay turnover tax under sub-section
(2) of Section 4, the tax shall be calculated by applying the rate of Turnover
Tax specified therein on the taxable turnover.
Notes
Calculation of Value Added Tax is very simple. It is computed on the
price at which the goods are sold at the rates specified in appropriate schedules.
Where the Schedule mentions the goods as taxable at 4%, such goods sold
by VAT dealer are liable to be taxed at that rate. Similarly, where the tax
mentioned in the schedule is one per cent, the goods are taxable at that rate.
Where the schedule mentions the rate of tax as 70%, the tax shall be calculated
on the price of the goods sold at 70%. The difficulty arises only in the case
where the bill does not specify clearly the price but gives several of its
components. In such cases, the correct price at which the goods are sold
will have to be ascertained as for the rules framed in this regard. For instance,
the bill mentions discount such discount may be permitted to be deducted
from the sale price provided it can be supported by a trade custom well
established or by an agreement between the parties. Such discount is permissible
only when it is proved to have been actually granted to the purchaser. Similarly,
there may be certain items which though permissible or added or deducted
in accordance with certain local practices. The tax authorities will normally
ignore them for the purposes of ascertaining the real price for which the
goods are sold. Ascertainment of correct price is relevant for the purposes
of fixing the amount of input tax and the output tax. Under the scheme
of the legislation only such amount which is mentioned in VAT Invoice as
output tax and which is paid by the seller to the Government, is the output
tax for which the purchaser becomes entitled to tax credit as his input tax
when he sells goods.
Questions may arise whether the decisions of courts in relation to several
entries in the schedules by the High Court bind the Government. For instance,
in the case of Vermicelli whether it is the same as Maida. The A.P. High
Court held that Vermicelli is another form of Maida and hence it shall fall
under the goods described as Maida. The Department had accepted this
decision to read Vermicelli as Maida. Depending upon the context and the
exact description of the article, where the same or similar words are already
interpreted, there is nothing wrong in adopting the precedents set up by the
A.P. High Court under Sales Tax Act as applicable to the VAT as well.
In the case of TOT dealers, the calculation of tax is made on his total
taxable turnover at the fixed rate of 1% whatever be the category of class
of goods they belong. However, the TOT dealers are not liable to pay any
tax if the goods dealt by them are exempted goods.
Under the VAT system all items added in the bill including postage and
transport shall be treated as value addition and the final price is the price
on which tax has to be calculated.
12. VAT payable:– The VAT payable by a VAT dealer or VAT
credit or refund due to a VAT dealer for a tax period shall be calculated
in accordance with the formula prescribed.
Notes
This is a crucial section in the Value Added Tax Act. Under this section,
the principles and the formula to be adopted for fixing the amount of Value
Added Tax payable by a VAT dealer to the Government and the amount of
Value Added Tax credit which could be claimed by the purchaser while paying
the Value Added Tax in his turn on his sales and the amount of refund which
he could claim at the time of assessment either in cash or by adjustment
are explained. The rules necessary for this purpose shall be looked into for
a proper appreciation of intricacies involved in the above matters.
VAT payable means, the tax payable on the relevant turnover of the goods
sold by the VAT dealer which he pays to the Government.
The VAT credit means, the amount of tax the VAT dealer has paid to
his seller at the time of purchasing the goods and which he claims as a
credit in the tax he should pay to the Government on his sales. VAT refunds
means, the amount the VAT dealer claims as a refund which represent the
difference between the tax he paid as input tax and the tax he should pay
as the output tax.
Some of the rules involved in calculation of the VAT payable may be
stated. In arriving at the sale price if the goods are subjected to any special
additional tax the same shall be included in the price. While determining the
sale price of goods involved is the works contract the value of the goods
actually used in the contract and the benefit of goods transferred to the
principal only should be taken into consideration. Where that is not clear the
Commissioner of Commercial Taxes may fix a proportion of the value of
works contract as representing the price of goods involved in it.
13. Credit for input tax:– (1) Subject to the conditions if any,
prescribed, an input tax credit shall be allowed to the VAT dealer for
the tax charged in respect of all purchases of taxable goods, made by
that dealer during the tax period, if such goods are for use in the business
of the VAT dealer. No input tax credit shall be allowed in respect of
the tax paid on the purchase of goods specified in Schedule VI.
(2)(a) A dealer registered as a VAT dealer on the date of
commencement of the Act, shall be entitled to claim for the sales tax
paid under APGST Act, 1957 (Act VI of 1957) 1[on the stock held
in any form in the State] on the date of commencement of the Act subject
to the conditions and in the manner as may be prescribed:
Provided that such goods should have been purchased from 1.4.2004
to 31-03-2005 and are goods eligible for input tax credit.
(b) Subject to the conditions if any, prescribed, input tax credit shall
be allowed to a VAT dealer on registering as VAT dealer if any input
tax is paid or payable in respect of all purchases of taxable goods, where
such goods are for use in the business as VAT dealer, provided the goods
are in stock on the effective date of registration and such purchase
occurred not more than three months prior to such date of registration.
(3) A VAT dealer shall be entitled to claim,–
(a) input tax credit under sub-section (1), on the date the goods
are received by him, provided he is in possession of a tax invoice;
(b) input tax credit or sales tax credit under sub-section (2), on the
date of registration, provided he is in possession of
documentary evidence therefor.
(4) A VAT dealer shall not be entitled for input tax credit or sales
tax credit in respect of the purchases of such taxable goods as may be
prescribed.
(5) No input tax credit shall be allowed on the following:
(a) Works contracts where the VAT dealer pays tax under the provisions
of clauses (b), 2[xxx] and (d) of sub-section (7) of Section 4;
(b) transfer of a business as a whole;
(c) sale of exempted goods except when such goods are sold in the
course of export or exported outside the territory of India;
(d) exempt sale;
(e) Transfer of exempted goods on consignment basis or to
branches of the VAT dealer outside the State otherwise than by
way of sale;
3
[(f) the purchase of any goods by an agent for supply of such goods
to his resident principal]
1. Subs. for "on the stock held in the State" by Act No. 34 of 2006, w.r.e.f. 1-4-2005.
2. The expression "(c)" omitted by Act No. 21 of 2011, w.e.f. 15-9-2011.
3. Added by Act 28 of 2008, w.e.f. 24-9-2008.
1
[(g) the transactions on which VAT dealer pays tax under sub-section
(8A) 2[or sub-section (8B)] of Section 4 of the Act;
(h) the supply or sale of goods, on which a VAT dealer pays tax under
clauses (b) and (d) of sub-section (9) of section 4 of the Act.]
3
[(i) transactions on which tax is paid or payable under sub-section(11)
of Section 4.]
4
[(5-A) Notwithstanding anything contained in sub-section (5), the
resident principal, who receives the goods purchased on his behalf by
his agent, is eligible to claim input tax credit on such goods subject to
the possession of a declaration in the Form, as may be prescribed.]
(6) The input tax credit for transfer of taxable goods outside the
State by any VAT dealer otherwise than by way of sale shall be allowed
for the amount of tax in excess of 5[5%].
(7) Where any VAT dealer pays tax under clause (a) of sub-section
(7) of Section 4, the input tax credit shall be limited to 6[75%] of the
related input tax.
(8) Where goods purchased by a VAT dealer are partly for his
business use and partly for other than his business use, the amount of
the input tax credit shall be limited to the extent of input tax that relates
to the goods used in his business.
(9) A Turnover Tax dealer or a casual trader shall not be entitled
to claim input tax credit.
(10) Any dealer covered by Explanations III & IV of clause (10)
of Section 2 shall not be eligible for input tax credit against or relatable
to sale of un-serviceable goods or scrap, surplus, old, obsolete or
discarded material or waste products whether by auction or otherwise.
(11) Any VAT dealer who purchases any taxable goods from a dealer
covered under sub-section (10) above, shall be eligible for input tax credit,
on production of documentary evidence that tax has been charged.
Notes
Input tax credit is available only to those dealers who sell the goods to
others in course of their business. Input tax credit is permissible if the goods
purchased by the dealer are used for the manufacture of other goods and
when such goods are taxable and not when they are exempt from Tax. The
latter provision is necessary because if input tax is given credit in respect

2. Ins. by Act 21 of 2011, w.r.e.f. 1-4-2005.
4. Ins. by Act 28 of 2008, w.e.f. 24-9-2008.
6. Subs. for the expression “90%” by Act No. 21 of 2011, w.e.f. 15-9-2011.
of goods which are used in manufacture of goods exempt from tax, the
Government will have to refund the input tax to such manufacturer which
is not permissible or feasible.
The input tax credit is also not permissible in the case of goods for which
special high rates are fixed under Schedule VI.
In order to give benefit to those VAT dealers who use for their business
the goods purchased by them on the date prior to the coming into force
of this Act, a special provision has been made where the VAT dealer paid
the tax on the purchases made by him on transactions within one year prior
to commencement of the Act and where the goods so purchased are in stock
as and by the date when the Value Added Tax comes into force, the tax
paid on their purchases is made available towards input tax credit.
The VAT dealer cannot claim input tax credit unless he is in possession
of the Bills issued by his seller showing the tax particulars. Tax paid at the
purchase point on pre-VAT transactions is not refundable if the goods covered
by it are capital goods.
No input tax credit is allowable in respect of the transfer of goods on
consignment basis or where transfer of goods is made to the branches outside
the State. VAT credit is also not permissible where the VAT dealer transfers
his whole business and is also in cases where sales effected are of the goods
exempted from tax. Situations may arise where goods purchased by VAT dealer
are partly used for a business and partly for purposes other than business.
In such cases, the input credit is permissible only to the extent of the goods
used for the business only. For example, if the dealer has purchased Rs.
50,00,000/- under a single bill taxable at 4% and uses goods worth Rs.
25,00,000/- for the business and uses the other Rs. 25,00,000/for purposes
other than business, he is entitled to the input tax credit for the goods used
by him is the business or sold i.e. on Rs. 25,00,000/- only at 4% amounting
to Rs. 1,00,000/-. Calculation of net VAT payable by a VAT dealer in respect
of some 88 types of transactions are given at the end. See pages 565 to
597.
Needless to say, that input tax credit is not permissible in the case of
sale turnovers of casual traders and TOT dealers.
If the Sales Tax Credit is claimed beyond limitation and where petitioner's
representation to extend the period is rejected, no writ lies for compelling
the authority to extend the time. PCH Business v. Principal Secretary, Rev.
Dept. (CT) Govt. of A.P., 2006 (144 ) STC 104.
In case where the assessee has various divisions or has various manufacturing
processes for manufacture of different goods, he has to calculate the input
as credit for different divisions separately. He shall not club the turnover of
all divisions and claim the input tax on all goods whether they are used in
the manufacture of related processes of manufacture or not. Hindustan Uniliver
Ltd., Medchal v. State of A.P., (2009) 49 APSTJ 266 A.P.
Input tax credit is allowable even in the case the seller to the assessee
is either exempt, has not paid or when his registration is cancelled. Harsh
Jewellers, Hyderabad v. Commercial Tax Officer, Punjagutta Circle, (2012)
54 APSTJ 133.
14. Tax invoices:– A VAT dealer making a sale liable to tax to
another VAT dealer shall issue at the time of sale, a tax invoice in such
form as may be prescribed.
Notes
The Act made it mandatory for all VAT dealers to issue what is called
VAT Invoice, which is also called tax invoice. Tax Invoice is different from
a bill which is normally issued by sellers. The VAT Invoice should contain
all the particulars necessary for identifying the seller as well as the purchaser
and full information about the price of all the commodities sold under the
invoice and the rate of tax and the amount of tax payable by the seller to
the government. This bill is something like an authorisation to the purchaser
that he could claim the VAT payable or paid under this Invoice to the
Government as input tax. Any error or mistake deliberate or otherwise in
the tax invoice would be treated seriously. No infraction in the contents or
the issuance of tax invoice will be condoned. Therefore, in preparing, issuing
authenticating tax invoice the VAT dealers should exercise utmost care and
caution. Similarly, the VAT dealers using the tax invoice for input tax credit
should also exercise due caution so that no incorrect adjustments or refunds
are claimed. The VAT Invoice should be in the form prescribed and all the
columns in the form shall be filled and no column should be left blank.
15. Power of State Government to grant refund of tax:– (1)
The Government may, if it is necessary so to do in the public interest
and subject to such conditions as it may impose, by a Notification, provide
for grant of refund of tax paid to any person, on the purchases effected
by him and specified in the said Notification.
(2) Any Notification under sub-section (1) may be issued so as to
be retrospective to any day not earlier than the appointed day and such
Notification shall take effect from the date of its publication in the Gazette
or such other earlier or later date as may be mentioned therein.
(3) An application for refunds shall be made in duplicate to the
Commissioner within a period of six months from the date of purchase
or as the Government may prescribe in the notification and it shall be
accompanied by the purchase invoice in original.
Notes
Circumstances may arise where the Government in recognition of certain
problems which need to be solved and in public interest direct by a notification
refund of tax paid by any person. Such refunds are permitted only in respect
of any person on the purchases made by him. This notification cannot be
treated as an exemption under the Act. The refund permissible here is to
the individual or it may be for certain class of individuals. While refunding
the tax the Government may order such refund retrospectively from an anterior
date. Accordingly, the notification may mention the date from which it will
come into effect. It is permissible for the Government to fix such date which
is earlier to the date of notification or subsequent to such date. The refund
notification in substance appears to be one which is issued in accordance
with the policy of giving relief of refund in a specified case or specified
cases.
Persons claiming refund shall make an application in accordance with
the rules framed for this purpose. The application shall be in duplicate. The
VAT–6
application should be addressed to the Commissioner and it should be made

within six months from the date of purchase. The application should be
accompanied by the purchase invoice in original. Since, the refund is permissible
in respect of Value Added Tax and also of the turnover tax, the purchase
invoice to be enclosed in original shall be the tax invoice in the case of VAT
and may be mere purchase invoice in the case of turnover tax.
The refund permissible is only of the tax paid on purchase and not
on sale. This is so because any refund of tax paid on sale will defeat the
purposes of the Act and the scheme of taxation under the VAT Act.
Refund of tax in the scheme of VAT system shall not be permitted if the
scheme were to work successfully. Whether the refund is ordered at the point
of purchase to the purchaser who purchases goods including the VAT already
paid by the seller from whom the goods are purchased, or whether the refund
is ordered to benefit the seller who is lawfully liable to pay tax, it amounts
to a refund which affects the revenue of the State. Moreover, if the refunds
are granted to the purchasing dealer, the same amounts to conferring on him
a gift or a largesse. In this context, ordering refunds is likely lead to a large
scale abuses.
The Government appears to exercise this power in a large number of
cases on the ground that the persons concerned are having high reputation
or are said to be carrying out charitable works or endeavours of national
importance. Some of the trusts to whom the refunds are directed include
Satyasai Trust and Ramananda Theertha Trust. Those who are granted such
refunds include the Airport authorities also. What exactly happens in all these
cases is that the tax the seller of goods to the exempted institutions had
already paid to the Government, is directed to be refunded by the Government
to the purchaser who are expected to absorb the tax element within their
business or avocation. It is therefore suggested that to grant liberally the
exemptions under Section 15 may distort the tax system. What is called a
mere refund of tax means otherwise also an exemption which is an anathema
to VAT.
An order of winding up is necessary before initiation of recovery
proceedings against Director of Private Limited Company. Sunil Kumar Agarwal,
Hyderabad v. The Commercial Tax Officer, Rajendra Nagar Circle, Hyderabad
& Ors., (2011) 53 APSTJ 143.
16. Burden of proof:– (1) The burden of proving that any sale
or purchase effected by a dealer is not liable to any tax or is liable to
be taxed at a reduced rate or eligible for input tax credit shall lie on
the dealer.
(2) Where a dealer issues or produces a false bill, voucher, declaration,
certificate or other document with a view to support or make any claim
that a transaction of sale or purchase effected by him or any other dealer,
is not liable to tax or liable to be taxed at a reduced rate, or eligible
for input tax credit is guilty of an offence under Section 55 of the Act.
Notes
Disputes or doubts may arise in respect of a transaction of sale or
purchase affected by a dealer whether such a sale or purchase is liable to
the incidence of tax. In addition, disputes and doubts may arise whether any
sale or purchase is liable to be taxed at a rate fixed under the one schedule
or a different schedule. When the Act speaks of reduced rate it should

only be taken to mean a rate of tax other than the rate at which it is
proposed to be taxed, since, that should be taken as the meaning of
reduced rates because the Act nowhere contemplates reduction of tax. The
schedules fixed the tax rates. They are unalterable. There is no question of
any dealer being taxed at any reduced rate. Further, a dispute or doubt may
arise also in some cases as to whether any sale is eligible to input tax credit.
In all these cases, the burden of proving that a sale or purchase is not liable
to any tax under the Act or a sale or purchase is liable to be taxed at
a rate other than the rate at which it is proposed to be taxed, or that
a particular sale is eligible to the input tax credit shall lie on the dealer.
If the dealer produces prima facie reliable evidence in his favour, the
burden of proving the case otherwise shifts to the department.
Here, the burden of proof may be discharged either by documentary
evidence or by a proper interpretation of the legal provisions. The former
is called an issue of fact and the latter is an issue of law.
Sub-section (2) of the Section lays down a rule that if any dealer
produces a false bill, voucher, declaration, certificate or other document with
a view to support his case or sustain any claim which is not true or correct
such dealer shall be treated as having committed an offence for which penalty
can be levied under Section 55.
Unless the dealer proves that tax has been paid at the entry stage by
showing opening and closing stock, tax deduction cannot be claimed. The
burden of proof of the payment of tax by the previous dealer shall be
discharged to the satisfaction of the assessing authority. Plywood Traders,
Hyderabad v. State of A.P., (2012) 54 APSTJ 140.
Case Law
Newspapers:-- (1) Turnover of discarded and accumulated newspapers
by newspaper publisher is liable to be taxed, since they are not newspapers.
M/s. Ushodaya Enterprises Ltd., Visakhapatnam v. Commissioner of Commercial
Taxes, A.P., Hyd., 1998 (3) ALT 96 = 1998 (3) ALD 478 (DB).
Sale of business:-- (1) Sale of business during the proceedings for
dissolution of partnership or winding up before the actual closure of business
and dissolution, is liable to be taxed as this event occurred prior to the actual
closure of business and the proceeds of the sale are used in the winding
up proceedings. State of A.P. rep. by State Rep. before STAT, Hyderabad
v. M/s. Colorama Printers (P) Ltd., Hyd., 1998 (2) An.WR 230 (DB) = 1998
(3) ALD 220.
(2) The contention that what was sold was business which cannot be
termed as business goods, is not liable to be taxed is incorrect. When there
is a transfer of the whole undertaking there is transfer of goods and the
value of whole business so transferred is liable to be taxed. M/s. Coramandal
Lubricants, Visakhapatnam v. Commissioner of Commercial Taxes, A.P.,
Hyderabad, 1996 (1) ALT (Tax) 173 (DB) (A.P.).
Procurement amounts to sale:- (1) Rice procurement made in pursuance
of orders issued under the Essential Commodities Act is not compulsory
acquisition as there was a wide latitude between the parties to bargain though
minimal as regards the variety, quality, classification, etc. Sri Dhanalakshmi
Kanyakaparameswari Rice Mill v. C.T.O., Chilakaluripeta & Others, 1999

(1) ALT 468 (DB) = 1999(1) ALD 495.
Sale by bank no sale:- (1) Banks granting loan to their customers
for purchasing certain goods and in order that the loan amount is properly
utilised, banks placed orders directly for supply of goods to the loanees. The
goods are not for the use of banks. In such circumstances, the exemption
granted to the nationalised banks cannot be applied to these transactions as
the goods were actually supplied to the loanees for their use. M/s. Hyd.
Industries Ltd., Hyd. v. State of A.P. rep. by State rep. before STAT, 1996
(1) ALT (Tax) 333 (DB) = 1996 (2) ALD 441.
Sale of confiscated goods:- (1) Sale of confiscated goods and such
others affected by Central or State Governments, can be taxed under the
APGST Act. This case contains an exhaustive discussion on the subject
of the sale of confiscated goods. AIR 1986 SC 1085 followed by Union
of India, Ministry of Finance v. State of Andhra Pradesh rep. by Commissioner
of Commercial Taxes, A.P., Hyd. & Another, 1996 (2) ALT 929 = 1996 (3)
ALD 28.
Packaging material:- (1) There is difference between containers sold
as such and the containers sold along with contents. The packing material
sold with the goods shall be taxed at the same rate as that of the material
packed and filled. Otherwise, the packing material if sold separately will be
taxed at the appropriate rate applicable to them. M/s. Raasi Cement Ltd. rep.
by its M.D. Sri N.K.P. Raju & Others v. Com. Tax Officer, Miryalguda,
Nalgonda Dt., 1997 (2) An.WR 749 (DB).
(2) Levy of tax on the same commodity at different rates depending
on whether it is sold with packing material or without packing material is
not discriminatory, since, differential rates are adopted to avoidance of tax
and check evasion. In this case, cement is sold in the packed condition is
taxed at 16% and in unpacked condition the tax rate is 20%. The differential
rate is held valid. Associated Cement Companies Ltd. v. Govt. of A.P., Revenue
Dept. & another, 2000 (5) ALT 634 = 2000 (5) ALD 685.
(3) Where the agreement is to sell the goods in packed condition the
seller would naturally take into account while quoting the price the cost of
packing material and container. Hyderabad Deccan Cigeratte Factory v. State
of A.P., 1965 (1) An.WR 82.
(4) Secondary packing material can only be treated as container and will
be taxed under Entry 10 of Schedule I. State of A.P. rep. by State, A.P., Hyd.
v. Durga Wines Industries, Vijayawada, 1998 (1) An.WR 452 (DB).
Empty and used bottles (liquor) are liable to be taxed as packing material
under Section 4(3) read with Item 90 of Schedule IV at 4% under VAT Act.
Sree Manasa Enterprises, Peerzadiguda, Ranga Reddy District and others v.
Commercial Tax Officer, Nacharam Circle, Hyderabad and others, (2009) 49
APSTJ 222.
Categories of dealers:- (1) Where dealers are classified into three
categories for purposes of applying three rates of additional tax, it is not
permissible to divide the three categories for granting benefit of lesser rate
of tax. M/s. Tablets India Ltd., Vijayawada v. State of A.P., rep. by State
Rep. before STAT, Hyd., 1995 (2) An.WR 421.
Shifting of incident of tax:- (1) Shifting of tax from sale point to

purchase point is well within the power of the Government nor such shifting
would be ultra vires of Section 15 of the Central Sales Tax Act. M/s. Haryana
Steel Industries, Secunderabad rep. by its Proprietor Sri Ajay Kumar Bhansa
v. Govt. of A.P. rep. by its Secretary & others, 1995 (2) ALT 659 (DB).
Legislative policy:- (1) When the legislature for one reason or the other
thought it fit to introduce single point taxation on purchases of hides and
skins, it was also anxious to see that the said dealings did not escape taxation.
In the case of multi-point, they are caught at one or the other points whereas
in the case of single-point taxation once they escape, they escape forever.
It is therefore necessary that in the interest of State exchequer some controlling
provisions should be made to catch it in the act of taxation. With that view,
under the Act and the rules made thereunder it is made incumbent on a dealer
to obtain a licence, if he seeks to take an advantage of the single point taxation
so that the licenced dealer may be under the control of the Taxing Authority
and not in a position to escape taxation. If the dealer is not willing to take
out a licence, the rule of multi-point taxation is made applicable to his
transaction. The differentiation is therefore between licensed dealer and unlicensed
dealer and is presumably made to achieve this object. There is no discrimination.
Syed Mohd. Co. v. State of Andhra, 1956 ALT 706 = 1956 An.WR 298.
(2) Levy of differential rates of tax on higher and lower turnovers of
the same commodity is not discriminatory, where such discriminatory rates
are levied on hotels having higher turnover in food and drink and those hotels
like wayside shops. K. Chandraiah v. State of Andhra, 1957 ALT 30 = AIR
1957 A.P. 216 = 1957 (2) An.WR 18 = 1957 (8) STC 33.
Assessment under Central Sales Tax Act & APGST Act:- (1) Dealer
in declared goods is liable to pay Central Sales Tax eventhough he has not
collected the same from the buyer. M/s. Meenakshi Corpn. v. Dy. Commissioner,
1978 (40) STC 101.
(2) Dealer assessed to Central Act can be assessed to tax under the
A.P. Act on the same turnover, such dealer can claim refund of tax levied
under the APGST Act if conditions of Rule 27A are satisfied. Shameem &
Co. v. DCTO, 1967 (1) An.WR 215.
Manufacturing unit:- (1) Having his manufacturing unit means having
his own manufacturing unit. Petitioners who are getting their biscuits made
in other factory cannot be treated as person having manufacturing unit. Having
the manufacturing unit also means having control over the manufacturing unit
with exclusive control over it. Emjak Industries Ltd., Hyd. v. Comml. Tax
Officer, Company Circle, Abids Division, Hyd. & others, 1994 (3) ALT 565.
Lessees not purchasers:- (1) Lessees of limestone are not purchasers
of limestone. Therefore, the levy of sales tax on royalty amount is not legal.
It would be in the nature of lease amount or rent or share in the owners
produce as the case may be and royalty is not the sale price. Associated
Cement Co. Ltd. v. Govt. of A.P., 1985 (1) ALT 216 = 1985 (58) STC
223.
Liability to pay tax:- (1) Liability to pay tax springs from charging
section which imposes the obligation to pay tax. It is not dependent upon
the assessment. However, unless, that liability is quantified, the liability cannot
be enforced. K. Kannaiah v. Dy. Commercial Tax Officer, 1964 (15) STC
689 = 1964 (2) An.WR 16.
Works contract:- (1) Works contracts are class by themselves and the
imposition of different rates of tax for goods involved in works contract is
not discriminatory. Media Communications rep. by its Proprietor I.V. Subba
Raju, Visakhapatnam v. Govt. of A.P. 1998 (2) An.WR 232 (DB).
(2) Sale of secondary articles by works contractor forms part of taxable
turnover. State of A.P. v. G. Dunkerley & Co., 1965 (16) STC 120.
(3) Where the contractor is required to pick up Mohwa Flower and
supply it to the Government on a contract is not a labour contract but a
contract for supply of goods which amounts to a sale excisable to sales tax.
State of AP v. K. Suryanarayana, 1961 ALT 957.
(4) Supply and stocking of stone ballast to railways is not a works
contract but a contract of sale. M/s. A. Seshagiri Rao & Co. v. State of
A.P., 1973 (1) An.WR 111 = 1973 (32) STC 51. See 1979 (2) An.WR
62.
(5) Whether there is a transfer of right to use or not is a question which
has to be decided in each case having regard to the terms of the contract.
Providing machinery of whatever description to the contractor in connection
with the execution of works does not amount to transfer of right to use the
machinery. M/s. Rashtreeya Isput Nigam Ltd. v. C.T.O., 1990 (1) An.WR 183
= 1990 (77) STC 182 = 1990 (1) ALT 273.
(6) Withholding of bills of the contractor unless he produces his clearance
from Commercial Tax Department is not valid. Prakasam v. The Director
of Social Welfare & others, W.P.No.2947/86, dated 24.4.1986.
Transportation charges incurred for bringing the goods to the work site,
cost of establishment relatable to the supply of materials and other charges
incurred till the goods are incorporated shall be included while calculating
the purchase value of goods in works contract. State of A.P. and others
v. Seven Hills Constructions, Penumantra, West Godavari District and others,
(2012) 54 APSTJ 1.
Burden of proof:- (1) The burden of proof is on the dealer to prove
that he is not the last dealer. However, it is not absolute, if he can show
that he has sold the goods to another dealer. The fact that the other dealer
has not shown this transaction, in his records does not amount to any failure
to discharge the burden placed on him. It is then for the department to prove
any other circumstances which would show that the dealer is in fact the
lost dealer himself. C. Ramanjaneya Groundnut Factory, Kadiri and others
v. CTO, Kadiri and another, 1996 (1) ALT (Tax) 306 (DB) AP = (1996)
103 STC 297.
TAX FRACTION
Tax fraction is a mathematical formula. The expression ‘tax fraction’
occurs at two places in the Rules. They are applied to two different
situations. The first situation is when a VAT dealer sells goods consisting
of taxable as well as exempted goods, what is the exact amount of input
tax to which he is entitled to the adjustment in his output tax. The
second situation is when the VAT dealer sells goods inclusive of tax what
should be the output tax he shall pay.
The first situation may be illustrated as follows:
If the total value of taxable sales exclusive of VAT ranges from 5
to 95% of the value of total sales exclusive of VAT the calculation of
input tax may be made according to the following formula.
A x B/C where A means, the total amount of input tax as for the
VAT invoices; B is the total value of taxable sales including zero rated
sales and C means, the total value of sales including exempt sales. In
other words, the formula means that the amount available for tax credit
in such cases is not the total input tax but only an amount out of input
tax which is proportionate to the total value of taxable sales to the total
value of all the sales. For example: If the total amount of input tax at
Rs. 10 lakhs and the taxable sales constitute 60% of total sales, the net
input tax permissible would be 60% of Rs. 10 lakhs i.e. Rs. 6 lakhs only.
The second situation may be illustrated similarly as follows:
If the total amount of output tax in respect of goods taxable at
4% it should be multiplied by a fraction R/R+100 where R is the rate
of tax. For e.g.: if the rate of tax is 4%, it should be multiplied by
4/4+100 i.e. 4/104=1/26. Therefore, where the total output tax is Rs.
4 for 100 it becomes 3.85. Similarly, if the rate of tax is 12.5% the
fraction would be 12.5/12.5+100=12.5/112.5=1/9. For e.g.: If the rate
of tax is 12.5% and the turnover in these goods is 100 the tax fraction
to be applied for arriving at the tax element in the bill which included
the tax shall be 1/9 of Rs.100/- i.e. Rs. 11.1. Hence, if the total amount
of the bill inclusive of tax is Rs. 10 lakhs, the tax element here will
be Rs. 1,11,000 only and not Rs. 1,25,000/-.
REFUND
There are only four situations when refund of tax can be claimed.
They are:
1. Where the excess of input tax over the output tax continues in favour
of the VAT dealer for more than 24 consecutive months, the dealer
can claim refund of such excess in the latest VAT return he files.
The refund claim shall be paid within three months from the date of
the receipt of the claim.
2. Where in any assessment, re-assessment or any assessment made
consequent on the orders of the appellate authority, appellate tribunal
or High Court in pursuance of the orders made by that Court in revision
or appeal or review any refund is ordered such refund shall be made
by the Department irrespective of whether a claim is made therefor
or not.
3. Where any VAT is paid on a transaction coming under the Central
Sales Tax Act, the same can be claimed as a refund if the tax due
under the Central Sales Tax is paid. Here also, the refund claim can
be raised in appropriate VAT return and the amount shall be refunded
within three months.
4. Specialised agencies of the United Nations Organisation and Consulates
or Embassies of any Foreign country located in India and the
International Crop Research Institute for Semi-arid Tropics, Hyderabad
are granted the facility of claiming refund of the tax included in the
VAT invoices of the dealers from whom they purchase taxable goods
for their own use. Accordingly, these organisations when they raise
the claims for refund, they shall be promptly refunded.
INPUT TAX CREDIT ON STOCKS ON

HAND BY 31-3-2005
Input tax credit is permissible on stocks held by the close of 31st
March, 2005 if such stocks are purchased on or after 1st April, 2004
and remain unsold by the end of March 31, 2005. The input tax on
such stocks shall be calculated at the rates applicable as per the schedules
of the VAT Act. And if the rate for the said goods is higher than the
VAT rate under APGST Act, it shall be reduced to VAT rate; if such
rate is lower than the VAT rate so much tax as calculated at such lower
rate only would be the input tax. The Government, however, announced
that it would permit the entire tax suffered by the dealers in relation
to the stocks as on 31.3.2005 as input tax credit irrespective of the nature,
incidence and rates of tax under APGST Act – an announcement which
appears to be contrary to the letter and spirit of the VAT system and
to the letter and spirit of the AP Value Added Tax Act.
It is therefore necessary that all VAT dealers applying for registration
shall have their closing stocks on 31st March, 2005 ascertained, recorded
and verified in due time. It would be convenient for such dealers, that
if they while purchasing goods as and from 1st April, 2004 obtain bills
in which the tax component is specifically and separately mentioned.
CHAPTER IV
REGISTRATION
17. Registration of Dealers:– (1) Every dealer other than a casual
trader shall be liable to be registered in accordance with the provisions
of the Act.
(2) Every dealer commencing business and whose estimated taxable
turnover for twelve consecutive months is more than 2[Rs.50,00,000/-
(Rupees fifty lakhs only)] shall be liable to be registered as a VAT dealer
before the commencement of business.
1
[(3) Every dealer whose taxable turnover in the twelve preceding
months exceeds 2[Rs.50,00,000/- (Rupees fifty lakhs only)] shall be
registered as a Value Added Tax dealer.]
(4) Every dealer whose taxable turnover during the period from 1st
January 2004 to 31st December 2004 is more than Rs.40,00,000 (Rupees
forty lakhs only), shall be liable to be registered as a VAT dealer.
(5) Notwithstanding anything contained in sub-sections (2), (3) and
(4), the following classes of dealers shall be liable to be registered as
VAT dealers irrespective of their taxable turnover namely,–
2. Subs. for “Rs. 40,00,000/-” by Act No. 13 of 2012, w.r.e.f. 20-4-2012.
Sec. 17] Registration 89
(a) every dealer importing goods in the course of business from outside
the territory of India;
(b) every dealer registered or liable to be registered under the Central
Sales Tax Act, 1956 (Central Act 74 of 1956), or any dealer making
purchases or sales in the course of inter-state trade or commerce
or dispatches any goods to a place outside the State otherwise than
by way of sale;
(c) every dealer residing outside the State but carrying on business within
the State and not having any permanent place of business;
(d) every dealer liable to pay tax on goods listed in Schedule VI.
(e) every commission agent, broker, delcredere agent, auctioneer or any
other mercantile agent by whatever name called, who carries on
the business of buying, selling, supplying or distributing goods 1[on
behalf of any principal or principals,] 2[except the agent, selling
agricultural produce on behalf of agriculturist principals.]
(f) every dealer availing sales tax deferment or sales tax holiday;
(g) every dealer executing any works contract exceeding 3[Rs.7,50,000/
(Rupees seven lakhs and fifty thousand only)] for the Government
or local authority or every dealer opting to pay tax by way of
composition on works contract.
4
[(h) every dealer liable to pay tax under sub-section (9) of Section 4
of the Act.]
5
[(i) every dealer opting to pay tax under sub-section (8A) of
Section 4.]
(6)(a) any dealer effecting sale of goods liable to tax under the Act
and who is not otherwise liable to register may also opt for registration
as a VAT dealer and such registration shall be subject to such conditions
as may be prescribed;
(b) any dealer intending to effect sale of goods liable to tax under
the Act, and who is not otherwise liable to register, may also opt for
registration as a VAT dealer and such registration shall be subject to such
conditions as may be prescribed.
1. Subs. for "on behalf of any non resident principal" by Act 28 of 2008
w.e.f. 24-9-2008.
3. Subs. for “Rs. 5,00,000/-” by Act 13 of 2012, w.r.e.f. 20-4-2012.
(7) Every dealer not registered or not liable for registration as VAT
dealer and who sells any goods and has a taxable turnover exceeding
1
[Rs. 7,50,000/- (Rupees seven lakhs and fifty thousand only)] in a period
of twelve consecutive months or has reason to believe that his taxable
turnover in a period of twelve consecutive months will exceed Rs.5,00,000/
(Rupees five lakhs only), shall apply for registration as TOT dealer in
the manner prescribed.
(8) Subject to the provisions contained in sub-section (5), every
dealer who held a registration certificate under the Andhra Pradesh General
Sales Tax Act, 1957 shall be deemed to be registered as TOT dealer
under the Act provided the dealer had a taxable turnover exceeding
Rs.5,00,000/- (Rupees five lakhs only) but below Rs.40,00,000/- (Rupees
forty lakhs only) during the period from 1st January, 2004 to 31st
December, 2004 and had not discontinued his business or his Registration
Certificate had not been cancelled during that period.
(9) Where a registered dealer dies or transfers or otherwise disposes
of his business in whole, the successor or the transferee, unless already
in possession of registration shall be liable to be registered under the Act.
(10) An application for registration shall be made to the authority
prescribed, in such manner and within such time as may be prescribed.
(11) If the authority to whom an application is made under sub-section
(10) is satisfied that the application is bonafide and is in order and in
conformity with the provisions of the Act and the rules made thereunder,
he shall register the applicant and grant him a certificate of registration
in the prescribed form.
Notes
There are only two classes of dealers under this Act who are required
to be compulsorily registered. They are VAT dealers and TOT dealers.
Turnover is primarily the determining factor for a dealer to register himself
as a VAT dealer or a TOT dealer.
In the case of a dealer whose estimated taxable turnover for the coming
12 consecutive months is likely to exceed Rs. 40 lakhs, he should get himself
registered as a VAT dealer, before he commences the business. Similarly,
the dealer whose turnover in the preceding three months period exceeds Rs.
10 lakhs and expects the turnover to exceed Rs. 40 lakhs in a year he should
get himself registered as VAT dealer on the happening of any one of the
two contingencies. This is the position about the registration of dealers after
the Act comes into force. The position there after is, all the dealers whose
taxable turnover during the period of 12 months prior to its commencement
was more than Rs. 40 lakhs shall get themselves registered as VAT dealers.
Whatever be the turnover: (a) dealers importing goods from outside the
territory of India; (b) dealers liable to be registered under the Central Sales
Tax Act, 1956; (c) dealers residing outside the State but carrying on business
within the State; (d) dealers doing business in goods listed in Schedule VI
1. Subs. for “Rs. 5,00,000/-” by Act 13 of 2012, w.r.e.f. 20-4-2012.
such as liquors, petrol, etc.; (e) Commission Agent and the like etc. doing
business in the State on behalf of non-resident principal; (f) and dealers availing
industrial incentives in the form of tax deferment are all liable to get themselves
registered as VAT dealers.
The Act, however, gives an option to the dealers who are not liable to
be registered and dealers not engaged in the business of goods which are
not liable to tax to get themselves registered as VAT dealers, provided their
application for registration is bona fide and is not intended to help any other
dealers to the detriment of public interest. If any registration is given to such
dealer it should be made subject to appropriate conditions as regards filing
of statements and returns.
Now coming to the TOT registration, dealers whose taxable turnover
exceeds Rs.5 lakhs in a period of 12 consecutive months or has reason to
believe that such turnover is likely to exceed five lakhs shall get himself
registered as TOT dealer. Here, all dealers who were already registered under
the A.P. General Sales Tax Act, 1957 which is now repealed shall be deemed
to have been registered as TOT dealers provided their turnover is above Rs.
5 lakhs but which does not exceed Rs. 40 lakhs for the year ending 31st
March, 2004, provided further such dealer is continuing in business and his
Registration Certificate under the APGST Act was not cancelled. Under Rule
28 of the APGST Rules the Department has already classified the existing
dealers into two categories. 1. Whose turnover is above 5 lakhs to 40 lakhs
and 2. those dealers who have a turnover above 40 lakhs and they were
given general registration number and TIN Registration No. successively.
Therefore it is not now necessary for those who are already enjoying the
status as holders of general registration number (GRN) and TIN No. to register
themselves afresh.
The registration under this Act is a formality so long as the application
for registration is bona fide and is in conformity with the provisions of this
Act. The Registering Authority shall normally grant the registration. The
application should be in the proper form. It must be one in which the
information necessary is fully supplied. Grant of registration shall be the rule;
rejection is an exception. Where the application for registration is proposed
to be rejected the dealers must be given an opportunity of making a representation.
When the Certificate of VAT Registration is granted, the authority granting
the registration shall issue the Certificate of VAT Registration to the dealer
applying for it. The registration shall be in force until it is cancelled. It is
not necessary for the VAT dealer to renew it every year.
Registration Certificate do not stand cancelled on the death of a dealer
if his widow is granted a fresh Registration Certificate. She should be treated
as deemed dealer between the date of death of the original registered dealer
and subsequent registration in the name of the successor. Mrs. Narmada v.
Assistant Commissioner, C.T., Washermanpet, (II) Assessment Circle, Chennai,
(2009) 26 STC 354 (Mad.).
Local purchase agent for the outside principal purchases goods inside the
State he should register himself as a dealer and pay the tax. Rapi Commission
Agency vs. State of U.P., (2006) 147 STC 566.
18. Tax payer Identification Number and General Registration

Number:– (1) The authority prescribed shall issue a registration identification
number known as:
(a) Taxpayer Identification Number (TIN) to a dealer registered as
VAT dealer;
(b) General Registration Number (GRN) to a dealer registered as
TOT dealer.
(2) Every VAT dealer or TOT dealer who is allotted a Taxpayer
Identification Number (TIN) or General Registration Number (GRN) shall
indicate such number on all returns, forms, tax invoices or any other
documents used for the purposes of the Act.
Notes
While granting the Certificate of Registration, the authority shall allot
what is called Taxpayer Identification Number (TIN) to the dealer applying
for VAT Registration and General Registration Number (GRN) to the dealer
registered as TOT dealer which should be invariably quoted in all the forms,
tax invoices, and all other documents used for the purposes of this Act. These
numbers bear as much importance in the proceedings under Value Added Tax
as the PAN Number allotted to the Assessees under the Income Tax Act.
The number TIN and GRN are essential for tracing the transactions. Therefore,
failure or omission to use the number in invoices and bills is an offence
for which a penalty can be levied under Section 54.
Where a dealer intends to commence business and desires to have the
input tax credit during the period of planning in respect of the purchases
he makes, he may apply for registration as VAT dealer. On the dealer getting
Certificate of Registration he shall comply with all the requirements including
maintenance of accounts as if he is a VAT dealer. This registration is called
a registration for start-up business. The period permissible for VAT Registration
for start of business is two years. Any person who is setting up an industry
for manufacturing goods which are subject to VAT may apply for registration
from a date two years prior to the date when his business is likely to be
operative. The only advantage the VAT Registration is that the dealer so
registered can have the benefit of input tax credit for the purchases made
by him and used in the course of setting up of the business. The dealer
who obtained VAT Registration for start of business will become a regularly
registered VAT dealer from the time he commences the business newly
established. The registration granted under this provision will cease to be
operative after two years. If by that period, the new business does not come
into existence the dealer shall have to refund all the benefits he had enjoyed
during the period where that registration was in operation. The Commissioner
who issues registration may impose certain conditions at the time of granting
VAT registration for start up business. He may in this discretion vary the
conditions but he is not entitled to extend the period of two years for which
the registration is granted.
19. Cancellation and Amendment of Registration:– (1) Any VAT

dealer or TOT dealer registered under Section 17 of the Act shall apply
for cancellation or amendment of registration, in such circumstances as
may be prescribed.
(2) The authority prescribed may, for good and sufficient reasons
cancel, modify or amend any certificate of registration issued by him:
Provided that no order shall be passed under this sub-section without
giving the dealer a reasonable opportunity of being heard.
Notes
The Certificate of Registration shall contain all the essential particulars
such as the name and address of the dealer, the composition and the
constitution of the dealer, whether he is an individual, joint family, society,
association of persons, club, hotel, trust, or partnership, company or a
Government, local authority, autonomous body or public company. The Certificate
also contains the particulars of the nature of business and the commodities
in which the dealer is engaged as well as the particulars of all the places
of the business of the dealer. If there occurs any change in these particulars
the registered dealer shall make an application for effecting the changes in
the certificate within 14 days from the date when the change occurs, whereon
the registering authority carries out the required changes. If the change relates
to a total conversion of the constitution of the dealer from one to another
such as from individual to partnership or from partnership to company, the
existing certificate will be cancelled and a new certificate is issued. So also
is with partnerships, when the composition of partnership within occurs, the
old certificate is cancelled and a new one is issued. In addition to these
cases, where the certificate is required to be cancelled on the ground of change
in the constitution of the dealer, the certificate may also be cancelled in the
circumstances where there is a cessation of business. If the cessation occurs
on account of the death of the dealer his legal representative shall apply for
cancellation of the registration. Where the dealer is a Government or the
local authority or a semi-Government Body, the application for cancellation
for registration shall be made within four weeks. Further, the registered VAT
dealers whose turnover during the preceding three months does not exceed
1/4th turnover fixed as threshold for registration or whose turnover during
the preceding 12 months does not exceed the threshold may also apply for
cancellation provided that such application is made only after the expiry of
two years from the date of the certificate of registration first granted to him
and which is now sought to be cancelled. There are a few more contingencies
in which the registering authority may by itself cancel the registration, if the
registering authority finds that the dealer should not have been granted the
registration in the first instance or finds that the dealer has no fixed place
of abode or residence or that the dealer has not kept proper records relating
to the business being carried on by him or has not submitted reliable tax
returns or was irregular in submitting tax returns or in the opinion of the
registering authority, the dealer is not a fit and proper person to be registered
as a dealer.
Certificate of Registration cannot be cancelled on the ground that the
place of business is unsuitable for doing business. Puspa Lohia v. Sales Tax
Officer, Durgapur Range and others, (2009) 21 VST 233.
In all these cases, the authority may cancel the registration as applied
for if it is satisfied that they are valid reasons for such cancellation. When
the authority proposes cancellation of the registration it should give the show
cause notice, receive representations thereon from the dealers and give them
reasonable opportunity to substantiate their defence against the proposed action.
The authority should observe all principles of natural justice before the
cancellation is ordered.
Certificate of Registration cannot be cancelled on the ground that the
cheque issued by the dealer is returned. It cannot be treated as a good and
sufficient reason. Where any tax deferment is granted for a particular period,
if there be any changes made in respect of eligibility during the period, the
deferment cannot be denied on the ground of any default in the new terms,
unless prior notice is given of the new terms even though such changes
relate to procedure. My Home Industries Ltd. v. Assistant Commissioner (LTU),
Nalgonda, (2010) 31 VST 128.
Where the cancellation is ordered, the dealer shall discharge all his
obligations to which he is subjected to as a registered dealer and shall pay
or refund all the amounts which he is liable to pay or refund. In case where
there occurs any transfer of capital goods the tax payable thereon shall be
calculated on the value of goods determined as for market rates, and not
mere payment of input tax ascertained at the time of their purchase. In case
of all other goods, the tax payable shall be the amount of input tax credit
received by the VAT dealer on such goods.
An appeal lies against the decision of the authority ordering cancellation
or refusing to cancel registration.
The cancellation of registration shall normally take effect from the end
of period for which it is granted and not earlier. The authority cancelling
the registration has power to fix the date from which cancellation would take
effect which can be the date on which such period expires or subsequent
to that date.
Where the order of cancellation of Registration is made at the instance
of an outside authority such as the Information Commission, without giving
an opportunity to show cause or without considering the objections the order
is liable to be quashed. Prathan Automobiles v. Deputy Commissioner of
Commercial Taxes, W.P. No. 31588 of 2007 dt. 24-10-2007 (Mad.).
Case Law
For reference only:-- (1) Tax liability and the registration; the former
does not depend upon the later whether a dealer is registered or not the liability
to pay tax arises the moment his business attracts tax liability. State of Orissa
v. Vijayalaxmi Trading Company, 1973 (31) STC 438.
Registration:-- (1) Those who are required to be compulsorily registered
shall apply for registration. If the authority does not grant or otherwise remain
silent for thirty days, he is deemed to have been granted the Certificate of
Registration from the date of his application for registration by the authority.
M/s. Santosh Wines v. Asst. C.T.O., 1995 (1) APLJ 193.
(2) Where the registration of the first seller is cancelled and has
accordingly become unidentifiable and the assessing authority proposed to
withdraw the exemption available to the second seller, the mere fact that the
registration has been cancelled would not make the first seller a non-existent
dealer. The burden of proof which the assessee has to discharge is indeed
satisfied when he showed that the goods were purchased by him from a
dealer who was identifiable. The proposed reassessment is faulted on the
ground that a dealer does not cease to be identifiable merely because his
registration was cancelled. Re-assessment may be permissible only if the earlier
dealer is fictitious or totally unidentifiable. State of A.P. rep. by State rep.
before STAT, Hyd. v. M/s. Manohara Trading Co., Nandyal, 1997 (2) An.WR
123 (DB) = 1997(2) ALD 564.
(3) Where the application for registration is made and the same is not
disposed of within thirty days and the time is spent by the authority on
enquiring matters not relevant and also no notice of enquiry was issued before
the expiry of thirty days, the applicant should be treated as having been
registered. The whole procedure i.e. enquiry including notice calling for further
particulars and their compliance should all be completed within thirty days
if the applicant should be deemed to have become a registered dealer. Where
notice is issued within time further enquiry must be completed within a
reasonable time which shall not be more than 30 days. M/s. Sudhakar Oil
Traders, Hyd. rep. by its Proprietor, P. Sudhakar v. Asst. C.T.O., Osmangunj
Circle, Hyd., 1995 (2) ALT 570 (DB).
(4) Provision requiring registration under APGST Act of hire-millars is
not violative of the right to carry on business. M. Pullaiah v. State, 1968
(21) STC 291.
Advantages of getting registered as TOT Dealer
or VAT Dealer
1. If a dealer gets himself registered as TOT dealer he gains advantage

of paying tax at 1% only on his entire taxable turnover.
2. If a dealer gets himself registered as VAT dealer he gains advantage
of all the tax he pays at the time of purchase as input tax adjusted
in the tax he shall have to pay on his taxable sale turnover. In other
words, he gets tax credit and if the tax credit accumulates for more
than 24 months he gets such excess tax credit a refund.
3. The dealer whose turnover of all goods including exempted goods is
less than 5 lakhs a year, he need not get himself registered as TOT
dealer or VAT dealer and he need not also pay any tax whatsoever.
However, he is advised to maintain accounts to prove that his turnover
is less than 5 lakh s in a year.
Time within which the VAT and TOT dealers
shall get themselves registered under the
A.P. Value Added Tax Act, 2005
Since, the Act is an enactment which brings about a transition of

one type of tax system to another, it is necessary to make suitable provisions
as to how and in what circumstances dealers shall have to be registered
for the purposes of the Act. Firstly, there are dealers who are already
registered under the Andhra Pradesh General Sales Tax Act and paying
tax thereunder. Such of those dealers who are so registered and where
their total taxable turnover is Rs. 40 lakhs or less in a year, they are
classified as TOT dealers. They need not get themselves registered afresh
under the present Act. But, such of them whose taxable turnover in
the year is more than Rs. 40 lakhs and who have already been granted
TIN Nos. need not have to register themselves as VAT dealers.
The question now is, as and from the commencement of the Act
how to register hereafter, the dealers as VAT dealers or TOT dealers.
Broadly speaking, the following will be the categories of dealers who need
to be registered as VAT dealers.
1. Dealers whose taxable turnover in the last twelve months preceding
the date of commencement of the Act is above Rs. 40 lakhs; there is
no difficulty in registering them based on the record of their turnovers
disclosed in the assessment orders made under the APGST Act. The
application for registration shall be made by a date 15 days earlier
to the date when the Act comes into force. It means, the date of
application for registration in this case is 15th March, 2005.
2. Dealers who are registered under APGST Act and who after the coming
into force of the Act become liable to be registered as VAT dealers
on account of their turnovers being or likely to exceed Rs.40 lakhs
in the year shall apply for registration within 15 days prior to the
commencement of the Act.
3. The dealer who becomes liable to be registered under VAT after the
Act has become operational if his turnover in any period of 12 earlier
consecutive months exceeds Rs. 40 lakhs or his turnover in any period
or periods of three months during the said earlier period of 12 months
exceeds Rs. 10 lakhs and expects that his turnover in a year is likely
to achieve Rs. 40 lakhs shall make an application for registration on
the happening of the relevant transaction which brings the turnover
to the levels above stated.
4. The dealer who starts business for the first time after coming into force
of the Act, if he estimates his turnover for the subsequent 12 months
may exceed Rs. 40 lakhs is liable to be registered as VAT dealer. The
application for registration shall be made before the commencement of
the business.
5. Similarly, dealer who starts business for the first time after coming
into force of the Act if he estimates his turnover to be more than
Rs. 5 lakhs and which may not exceed Rs. 40 lakhs shall get himself
registered as TOT dealer before starting the business. Such application
for registration shall be made 15 days prior to the commencement of
the business.
6. Dealer who intends to set up a business at a future date requiring
a long time for preparations therefor may apply for VAT registration
limited to a period of two years if after expiry of that period the dealer
fails to commence business, the registration shall stand cancelled unless
the Commissioner otherwise directs.
The use of the expressions ‘three months’ and ‘twelve months’ appear
to create some confusion. The necessity for using these expressions arose
because the tax period under the VAT Act is not the financial year but
a period of one month in the case of VAT dealers and three months in
the case of TOT dealers and returns shall have to be filed by them
accordingly for each month or for each period of three months as the case
may be. So, in order to get the dealers registered as VAT or TOT dealers
it has become necessary to speak of their turnover periods as a period of
one month and three months. For example, if a dealer finds his three
months turnover exceeding Rs. 10 lakhs in May taking into account the
turnovers of the March of the previous Financial Year and the two months
turnover of the present Financial Year or if his turnover in the last eleven
months of the earlier Financial Year together with the turnover of the
first month of the current Financial Year exceeds Rs. 40 lakhs he is obliged
to file for registration as VAT dealer.
Registration under the VAT Act is a legal necessity. If a dealer
does not apply for registration, the prescribed authority has got powers
to get the dealer registered as VAT dealer. Unless, a dealer is registered
as a VAT dealer he cannot confer the benefit of input tax to the subsequent
VAT dealer and the subsequent VAT dealer cannot have the benefit of
tax credit of his input tax. This being the crucial part of the whole
scheme of VAT system, to get oneself registered as a VAT dealer is as
much a mandatory obligation on the dealer as it is the duty of the prescribed
authority to get every eligible dealer registered as VAT dealer.
Since, the penalties and punishment in case of prosecution provided
for failure to register or delay in registration are stringent it is advised
that dealers who are likely to become TOT dealers and the dealers who
are TOT dealers likely to become VAT dealers shall make applications for
appropriate registrations promptly and within time. So is the case with
casual dealers who should apply for registration before they take up business
and all such dealers as those engaged in interstate transactions, those
engaged in import-export transactions, those dealing in goods listed in
Schedule VI such as liquors and petrol, those who are acting as agents
for non-resident principal shall get themselves promptly registered before
they commence business irrespective of the turnovers. The table at page
287 may be referred to for the exact dates by which the application for
registration may be made. And the table at pages 291 and 293 may be
referred to for the exact date when the registration may become effective.
Classes of dealers how and when they interchange
from one to the other
Illustrations:
1. Exempted dealer.
2. When exempted dealer becomes TOT dealer.
3. When exempted dealer becomes VAT dealer.
4. When TOT dealer becomes VAT dealer.
5. When VAT dealer reverts to TOT dealer.
VAT–6
I. Exempted dealer:
The taxable turnover of a dealer does not exceed Rs. 5 lakhs. It consists
of goods taxable at 1%, 4% and 12½%. He is not liable to register
himself as a dealer. He is not liable to pay any tax. He is exempted
dealer.
(a) His turnover exceeds Rs. 5 lakhs by Rs. 50,000/-. It includes a turnover
of Rs. 50,000/- in exempted goods. In this case also the dealer need
not get himself registered nor is he liable to pay any tax. The taxable
turnover is the turnover excluding exempted goods. So by a deduction
of Rs. 50,000/-, the dealer’s turnover is Rs. 5 lakhs only. Therefore,
he continues to be an exempted dealer.
(b) His turnover exceeds Rs. 5 lakhs by Rs. 10,000/-. But he has given
a discount of Rs. 10,000/- on the sale value of the goods. Here also,
the dealer is not liable to get himself registered as TOT dealer nor
is he liable to pay any tax. Real discount normally allowed by a
dealer to his customers is deductible from the price of the goods sold
by him.
(c) His turnover is Rs. 5 lakhs only. But he is found to have sold liquors
to an extent of Rs. 1 lakh taxable at the special rate of 70%. This
dealer is liable to get himself directly registered as VAT dealer and
pay the tax on his entire turnover for, the dealers selling goods subject
to special tax rates are required to be registered compulsorily as VAT
dealers irrespective of their turnovers at the rates prescribed.
(d) His turnover is Rs. 5 lakhs only. But he is found to have sold goods
in the course of Interstate Trade/Import-Export Trade to an extent of
Rs. 50,000/-. This dealer is liable to get himself registered directly
as VAT dealer irrespective of turnover and pay tax on his entire
turnover for, dealer selling goods involved in transactions covered by
Central Sales Tax Act should get themselves compulsorily registered
as VAT dealers irrespective of the turnover and pay the tax at the
prescribed rates.
(e) His turnover totally consists of exempted goods. In such circumstances,
whatever be his turnover even if it exceeds Rs. 5 lakhs or Rs. 40 lakhs
and above he need not get himself registered in any of two categories,
i.e. TOT or VAT and such dealer in exempted goods is not liable
to pay any tax. He continues to be an exempted dealer.
(f) His turnover of goods exceeds Rs. 5 lakhs by Rs. 25,000/- he becomes
TOT dealer. Hence, he is liable to get himself registered as TOT dealer
and pay tax at 1% without any reference to the rates at which such
goods are taxable in the hands of VAT dealer.
II. TOT dealer:
A dealer has turnover which exceeds Rs. 5 lakhs. It consists of goods
taxable at 1%, 4% and 12½%. He is liable to get himself compulsorily
registered as TOT dealer and pay tax at the Flat rate of 1% irrespective
of the above rates which are applicable to VAT dealers only.
(a) His turnover exceeds Rs. 40 lakhs by Rs. 2 lakhs more. It consists
of goods taxable at 1%, 4% and 12½% and also goods exempted from
payment of any tax. The turnover of exempted goods is Rs. 5 lakhs.
The dealer is not liable to get himself registered as VAT dealer since,
the turnover of goods exempted from tax shall not be counted for
arriving at taxable turnover. If Rs. 5 lakhs is deducted from Rs. 42
lakhs, the resultant turnover being Rs.37 lakhs falls below the threshold
turnover of Rs. 40 lakhs. However, it is optional to him to opt for
VAT registration. It is also permissible for the prescribed authority
to get him registered as a VAT dealer. In case, such dealer even while
his turnover is below Rs. 40 lakhs is registered as a VAT dealer, he
shall pay tax on his turnover at the rates specified for viz. 1%, 4%,
12½% and not at the Flat rate of 1% applicable to TOT dealers.
(b) His turnover does exceed Rs. 40 lakhs by Rs. 1 lakh. But, he has
given a discount to his customers amounting to Rs. 1,25,000/-. In
such case, his taxable turnover does not exceed Rs. 40 lakhs and he
is not bound to get himself registered as VAT dealer and accordingly
not liable to pay tax at the rates applicable to VAT dealers and continue
to pay tax at the Flat rate of 1% only on his taxable turnover. Here
also, it is optional for the dealer to opt for VAT registration and it
is also permissible for the prescribed authority to get such dealer
registered as VAT Dealer in which case he has to pay tax at the VAT
rates on his turnover, even when the taxable turnover falls below Rs.
40 lakhs.
(c) His turnover is Rs. 40 lakhs only. But, he is found to have sold
goods to the extent of Rs. 5 lakhs in the course of Interstate Trade
and in transactions of Import and Export of goods covered by the
Central Sales Tax Act. This dealer is liable to get himself registered
as VAT dealer for, dealers selling goods involved in transaction covered
by the Central Sales Tax Act shall get themselves registered compulsorily
as VAT dealers and pay tax at VAT rates and not at the Flat rate
of 1%.
(d) His turnover exceeds Rs. 40 lakhs by Rs. 50,000/- he becomes a VAT
dealer. He has no option to remain as TOT dealer. He should get
himself registered as VAT dealer and pay tax at VAT rates and not
at the Flat rate of 1%.
III. VAT dealer:
(a) A registered VAT dealer has a turnover of Rs. 50 lakhs consisting
of goods taxable at zero rate (covered by CST Act) and goods taxable
at 1%, 4%, 12½% and also exempted goods valued Rs. 10 lakh.
Excluding the turnover of exempted goods the dealer's turnover is Rs.
40 lakh. Even then, since he is dealing in zero rated goods, he has
to necessarily be registered as VAT dealer only. In such case he shall

pay tax on goods taxable at 1% at the rate of 1%, goods taxable at
4% at the rate of 4% and the goods taxable at 12½% at the rate
of 12½%.
(b) When a VAT dealer’s turnover falls below Rs.40 lakhs, he may get
his registration as VAT dealer cancelled in which case he may be
registered as TOT dealer. He will then be entitled to pay tax on
his entire turnover at the Flat rate of 1%.
(c) The dealer who has no turnover in any goods other than those involved
in transactions covered by Central Sales Tax Act, he is liable to be
registered as VAT dealer irrespective of the turnover and continued
to be so registered so long as he has the turnover referable to the
transactions under Central Sales Tax Act.
(d) A non-resident dealer who is carrying on business in Andhra Pradesh
and or through an agent who is a resident of the State and carrying
on business on behalf of the non-resident dealer, is liable to be registered
as VAT dealer irrespective of the turnover and continued to be so
registered so long as the non-resident dealer does any business in Andhra
Pradesh.
(e) A dealer who is availing any tax incentives or tax holiday shall get
himself registered as VAT dealer and shall continue to be so registered
so long as he is availing such incentives or enjoying the benefit of
tax holiday.
CHAPTER V
PROCEDURE AND ADMINISTRATION OF TAX
Returns and Assessments
20. Returns and Self Assessments:– (1) Every dealer registered
under Section 17 of the Act, shall submit such return or returns, along
with proof of payment of tax in such manner, within such time, and to
such authority as may be prescribed.
(2) If a return has been filed within the prescribed time and the return
so filed is found to be in order, it shall be accepted as self-assessment
subject to adjustment of any arithmetical error apparent on the face of
the said return.
(3)(a) Without prejudice to the powers of the authority prescribed,
under sub-section (3) of Section 21, every return shall be subject to
scrutiny to verify the correctness of calculation, application of correct rate
of tax and input tax credit claimed therein and full payment of tax payable
for such tax period.
(b) If any mistake is detected as a result of such scrutiny made as
specified in clause (a), the authority prescribed shall issue a notice of
Sec. 21] Procedure & Administration of Tax 101
demand in the prescribed form for any short payment of tax or for recovery
of any excess input tax credit claimed.
(4) Every dealer shall be deemed to have been assessed to tax based
on the return filed by him, if no assessment is made within a period of
four years from the date of filing of the return.
Notes
There is nothing like provisional assessment or final assessment of tax

under this Act. Full confidence is placed on the assessees and it is hopefully
expected that all the returns required to be filed under the Act will be correct
and true. This hope has a reason because it is felt that there is in the system
of Value Added Tax a self policing mechanism. Unless the dealer discloses
the source of goods he purchased and obtains the VAT Invoice he in his
turn is not entitled to the deduction of input tax in the amount of tax he
himself has to pay on his sales. It is in this context, all the returns filed
by the assessees are taken on record. And if no separate orders of assessments
are made within four years from the date of filing of the returns, it is presumed
that the assessment has become final. The department no doubt has a right
to verify the correctness of calculations of the turnover tax disclosed in the
returns, the correct rates of tax applicable to the goods and the correctness
of the input tax credit claimed by the assessee. If on such verification, it
is found that the tax is paid under the return is less than what is correctly
due, the assessing authority may issue demand notice for the amount which
was short paid. In such circumstances, the assessing authority will give
reasonable opportunity to the assessee before a fresh demand is raised. This
section will apply only to cases where errors need to be corrected but not
to cases where incorrect and false returns are made.
If procedure for assessment is prescribed by rule, no tax can be levied.
Maxworth Plywoods Pvt. Ltd. v. Asst. Commnr. (CT), Visakhapatnam, (2010)
51 APSTJ 147.
Assessment is a quasi-judicial matter. The order of assessment shall be
in the nature of judgment, fully reasoned. Provisions of Order XX, C.P.C.
will apply. Pest Control (India) Pvt. Ltd. v. Asst. Commnr. (CT) (INT), Hyd.
(2010) 51 APSTJ 230 = 2011 (6) ALD 640 (DB).
Where assessment order is challenged in appeal, it merges with the
appellate order. Hence, the assessment order ceases to exist. In such
circumstances, there does not arise any question of revising a such non-
existent order. Amaleswari Constructions v. CTO, Malakpet Circle, Hyd. (2010)
51 APSTJ 19.
Oil seeds are taxable at the purchase point of oil mills. In all other cases
at the point of purchase by the last dealer. If the oil miller is exempt, he
shall pay the tax if he sells the groundnut instead of using it for extracting
oil. Sri Krishna Trading Company, Proddattur v. State of A.P., (2012) 54
APSTJ 239.
21. Assessments:– (1) Where a VAT dealer or TOT dealer fails
to file a return in respect of any tax period within the prescribed time,
the authority prescribed shall assess the dealer for the said period for
such default in the manner prescribed.
(2) If a VAT dealer or TOT dealer submits a return along with

evidence for full payment of tax, subsequent to the prescribed time the
assessment made under sub-section (1) may be withdrawn without prejudice
to any interest or penalty leviable.
(3) Where the authority prescribed is not satisfied with a return filed
by the VAT dealer or TOT dealer or the return appears to be incorrect
or incomplete, he shall assess to the best of his judgement within four
years of due date of the return or within four years of the date of filing
of the return whichever is later.
(4) The authority prescribed may, based on any information available
or on any other basis, conduct a detailed scrutiny of the accounts of any
VAT dealer or TOT dealer and where any assessment as a result of such
scrutiny becomes necessary, such assessment shall be made within a period
of four years from the end of the period for which the assessment is
to be made.
(5) Where any wilful evasion of tax has been committed by a dealer,
an assessment shall be made to the best of his judgement by the authority
prescribed within a period of six years of date of filing of the return or
the first return relating to such offence.
(6) The authority prescribed may reassess, where an assessment was
already made under sub-sections (1) to (5) and such assessment understates
the correct tax liability of the dealer, within a period of four years from
the date of such assessment.
1
[(7) Where an assessment has been deferred by the Commissioner
under sub-section (5) of Section 32 or as the case may be, by the
Appellate Tribunal under the proviso to sub-section (4) of Section 33
on account of any stay granted by the Appellate Tribunal, or as the case
may be the Andhra Pradesh High Court or Supreme Court respectively,
or whereas appeal or other proceedings is pending before the Appellate
Tribunal or the High Court or Supreme Court involving a question of law
having a direct bearing on the assessment in question, the period during
which the stay order was in force or such appeal or proceedings was
pending shall be excluded in computing the period of four years or six
years as the case may be for the purpose of making the assessment.]
(8) Where an assessment made has been set aside by 2[any Court
or as the case may be the Appellate Tribunal], the period between the
date of such assessment and the date on which it has been set aside
shall be excluded in computing the period of four years or six years as
the case may be, for making any fresh assessment.
1. Subs. by Act 21 of 2011, w.e.f. 15-9-2011. Prior to its substitution it read as below:
"(7) Where any assessment has been deferred on account of any stay order granted
by the High Court or where an appeal or other proceedings is pending before the High
Court or Supreme Court involving a question of law having a direct bearing on the
assessment in question, the period during which the stay order was in force or such
appeal or proceedings was pending shall be excluded in computing the period of four
years or six years as the case may be for the purpose of making the assessment",
2. Subs. for the words "any Court" by Act 21 of 2011, w.e.f. 15-9-2011.
Notes
This section deals firstly, with cases where no return is filed within
the prescribed time in which case, the assessing authority may straight away
make an assessment order and issue a notice of demand. The procedure
prescribed for making this assessment is to take into consideration the monthly
returns filed by the assessee during the last 12 months and arrive at the
average of the tax paid for a month. If this average is less than the tax
paid for the 12th month, the latter tax should be taken as the average and
the annual tax calculated by multiplying by twelve. The assessing authority
will then raise a demand for the tax so arrived at together with an amount
equivalent to 50% of such tax as penalty. If after such demand is raised
the assessee appears and files a return on the basis of which a new assessment
is made, the assessment made earlier would be treated as withdrawn.
Secondly, where no return is filed by a VAT dealer who has not been
registered and files an application for registration as a VAT dealer in VAT
Form 11 declaring his previous year turnover, he may be assessed to tax
for the previous year at the standard rate of tax and subjected to a penalty
of 50% of the amount of tax determined as due. This section appears to
penalise the dealer who fails to get himself registered as soon as he has reason
to believe on the basis of his quarterly turnover within the time prescribed
therefor. It is so because, on account of his failure to register himself duly
in the previous year as VAT dealer and issue appropriate VAT Invoices the
business might have been got distorted. Since, VAT Registration is compulsory
and grant of registration is mandatory, the present provision of penalising the
dealer by imposing on him tax and penalty for failure to get himself registered
in the previous year as a VAT dealer appears to be justified, eventhough, it
appears to be a little inequitable to punish a dealer merely for not having
got registered himself earlier. The law in this regard is very strict. Every
dealer who believes that he has a turnover in goods which is likely to reach
the threshold turnover should mandatorily get himself registered as VAT dealer
and it is the duty of the Registering Authority to get all such dealers registered
on threats of prosecution and penalty. Therefore, whether a dealer who applies
voluntarily for registration as a VAT dealer or who has been required by the
authority to get himself registered as VAT dealer on the ground that his turnover
is likely to exceed or has exceeded the threshold limits he is certainly liable
to be assessed for the previous year and is also made liable to the penalty.
Since, it is an offence for a dealer who should have been registered
as a VAT dealer not to get himself registered, the penalty levied under this
provision does not in any manner effect the prosecution which may be
launched against him.
Thirdly, where after the return is filed if the assessing authority receives
any information or information obtained from any inspection, the assessing
authority may make a fresh or re-assessment. Such assessment can be made
within a period of four years from the end of period for which the assessment
is made. If, such information or enquiry shows that the assessee has wilfully
evaded the tax, a re-assessment can be made within a period of six years
from the date of filing the returns. It means, where wilful evasion is the
cause of making fresh assessment the period for making such assessment
is six years.
Where return is filed under Section 21, the subsequent assessment made
thereon is not the best of judgment assessment. Kanchi Bakers and Sweets
v. Asst. Commissioner, Villivakkam Asst. Circle, Chennai, (2009) 23 VST 283.
Fourthly, the authority which makes the assessment or re-assessment
under any one of the three contingencies mentioned in this section shall be
the assessing authority only.
While computing the period of four years or six years as the case may
be, the period during which any stay granted by the High Court or Supreme
Court was in operation shall be excluded. Similarly, if the making of the
assessment is deferred by reason of the question of law involved in the
assessment is the same as one under consideration of the High Court or
Supreme Court, the period during which the deferment order was in operation
shall be excluded. In the same manner, if the assessment order made under
this section is set aside by the higher authorities or the courts, the period
between the date on which the order of assessment was made and the date
when it was set aside shall be excluded in computing the period of four
years and six years prescribed for making re-assessment by the assessing
authority in the four contingencies enumerated above.
An Assessment Order made without reference to the explanation submitted
by the assessee to the show-cause notice is liable to be set aside. Sangam
Health Care Products v. C.T.O., Hyd., 2006 (144) STC 328.
Protective assessment can be made against third party if he is the person
who is or is actually participating in the business of his binami. This, however,
does not permit the assessing authority to rope in the surety unless it is proved
that he is otherwise the actual dealer. Vasanta Anivardhan v. State of Kerala,
(2008) 18 VST 97. (Ker.).
When once audit assessments are made after the accounts are audited
by the Department it is not opened to the authorities to call for repeat audits
for the same period. Nayak Variety Stores v. Commissioner of Sales Tax, dt.
11-9-2008, Orissa.
Where the authority to order audit, for instance, the Deputy Commissioner,
has ordered audit and consequently the audit is conducted, the Deputy
Commissioner who order the appropriate authority including the authority
which conducted the audit, to make the assessment by a separate order. The
audit contemplated under VAT Act is different from the audit by qualified
auditors. The particulars of audit to be conducted under Value Added Tax
Act are given in the VAT Audit Manual. Balaji Flour Mills, Chittoor & Ors.
v. Commercial Tax Officer (II), Chittoor, (2011) 52 APSTJ 85.
No appeal lies to the Tribunal on the mere endorsement. Arora Enterprises
v. State of A.P. (2010) 51 APSTJ 11.
Though the Deputy Commissioner and Appellate Deputy Commissioner
are co-ordinate authorities, Deputy Commissioner (Assessment) shall follow
the directions of the Appellate Deputy Commissioner. Arora Enterprises v. Dy.
Commnr. of Commercial Taxes, Abids Divn., Hyd. (2010) 51 APSTJ 20 =
2011 (1) ALD 69 (DB).
Dealers who do not respond to notices and those who do not exhaust
the remedies available under the VAT Act are not entitled to approach the
High Court under Art. 226 of the Constitution.
If the dealer responds to show cause notice, he is treated as having
submitted to the jurisdiction of the authority issuing show cause notice.
M/s. Jasper Industries (P) Ltd., v. Asst. Commnr. (CT) Audit, (2010) 51 APSTJ
108.
Payment and Recovery of Tax
22. Due date for payment of Tax:– (1) The tax payable in respect
of a tax period along with a return and the tax assessed under the Act
shall be payable in such manner and within such time as may be prescribed.
(2) If any dealer fails to pay the tax due on the basis of return
submitted by him or fails to pay any tax assessed or penalty levied or
any other amount due under the Act, within the time prescribed or specified
therefor, he shall pay, in addition to the amount of such tax or penalty
or any other amount, 1[interest calculated at the rate of one and quarter
(1.25%) percent per month] for the period of delay from such prescribed
or specified date for its payment. The interest in respect of part of a
month shall be computed proportionately and for this purpose, a month
shall mean a period of 30 days.
2
[(3) The Central Government or the State Government or an
industrial, commercial or trading undertaking of the Central Government
or of the State Government or a local authority or a statutory body or
a company registered under the Companies Act, 1956 or any other person
notified by the Commissioner, shall deduct from out of the amounts payable
by them to a dealer in respect of works contract executed for them, an
amount calculated at such rate as may be prescribed and such contractee
deducting tax at source shall remit such amount in the manner prescribed:
Provided that no deduction shall be made from any amounts paid
as consideration to any sub-contractor if tax was already deducted by
the contractee.
3
[(3-A) Notwithstanding anything contained in sub-section (3), in the
case of a dealer, executing works contract for Government or Local
Authority, wherever tax at the rate of 4[5%] is added separately to the
estimated value of the contract, such tax shall be collected by the
contractee and remitted in the manner as may be prescribed.]
1. Subs. for the words “interest calculated at the rate of one percent per month” by Act
21 of 2011, w.e.f. 15-9-2011.
2. Subs. for sub-sections (3) and (4) by Act No. 5 of 2007, w.r.e.f. 1-9-2006.
1
[(3-B) Every Film Processing Laboratory by whatever name it is
called shall collect tax at source at the rates as may be prescribed for
this purpose, from the film producers opting for payment of tax under
sub-section (8A) of section 4 and remit the tax so collected on the
immediate next working day from the date of such collection in the manner
as may be prescribed.]
(4) Any authority or person deducting any sum in accordance with
2
[sub-section (3) or sub-section (3-A) or sub-section (3-B)], shall pay
within the prescribed time, the sum so deducted to the credit of the State
Government. If the authority or the person does not deduct or after
deducting fails to pay tax as required by this section, he shall be deemed
to have not paid the tax within the time under the provisions of the Act.
In such case all the provisions of the Act including the provisions relating
to interest shall apply mutatis mutandis to such unpaid tax.]
(5) Where a VAT dealer paid entry tax on any goods under Andhra
Pradesh Tax on Entry of Motor Vehicles into Local Areas Act, 1996
(Act 26 of 1996) and Andhra Pradesh Tax on Entry of Goods into Local
Areas Act, 2001 (Act 40 of 2001), such amount shall be adjusted against
VAT payable provided the credit for input tax is not restricted under 3[xxx]
(6)(a) The Deputy Commissioner, on an application made by a VAT
dealer or any other dealer, permit the payment of any tax, penalty or
other amount due under the Act in such instalments within such intervals
and subject to such conditions, as he may specify in the said order, having
regard to the circumstances of each case;
(b) Where such payment in instalments is permitted, the dealer shall
pay in addition to such tax, penalty, instalment or other amount, 4[interest
calculated at the rate of one and quarter (1.25%) percent per month]
for the amount for the period from the date specified for its payment
on the instalments so permitted.
(7) 5[xxx]
Notes
The tax period for VAT dealer is one month. He should file tax return
within 20 days after the end of every month. While filing the return the dealer
2. Subs. for “sub-section (3)” by Act No. 4 of 2009, w.e.f. 1-5-2009.
3. The words "the provision of sub-section (4) of" omitted by Act 23 of 2005,
w.r.e.f. 29-8-2005.
4. Subs. for the words "interest at the rate of one percent per month" by Act 21 of
2011, w.e.f. 15-9-2011.
5. Omitted by Act No. 5 of 2007, w.r.e.f. 1-9-2006.
should pay the tax and enclose with the tax return the proof of payment
of tax. Tax may be paid in the treasury or by D.D. or by cheque. In the
case of TOT dealers the tax period is three months. The return should be
filed within 30 days from the date by which the tax period expires. The
return should be accompanied by proof of payment. When it is said that
the return should be filed between the prescribed time, it means, it can be
filed on any date within that period. If the return is filed without proof of
payment of tax it may be paid on or by the last date fixed for filing the
return. No interest shall be charged for the days between the date of filing
the return and the date by which the return ought to be filed. The expression
within the time means, it cannot be under any circumstances beyond the
time. Therefore, if the last date for filing the return falls on any public holiday
or Sunday it won’t extend the time. The dealer should file the return earlier
to such last date. If such date happens to be a holiday, it is not open to
him to plead that since the last date for filing the return happens to be a
holiday he is entitled to submit the return and pay the tax after the period
fixed. In calculating the number of days i.e. the 20 days in case of VAT
dealers and 30 days in the case of TOT dealers the days should be counted
from the first of the next month, eventhough, such first day happens to be
a holiday. If there is any delay in the payment of tax disclosed in the return
beyond the time fixed the dealer shall pay in addition to the tax interest at
the rate of 1% per month or any part thereof.
There are two enactments: (1) A.P. Entry Tax on Motor Vehicles into
Local Areas Act, 1996 (Act 26 of 1996) and (2) A.P. Tax on Entry of Goods
into Local Areas Act, 2001 (Act 40 of 2001) under which a dealer is required to
pay tax on entry of goods brought into Andhra Pradesh. The question is
whether such tax can be included towards tax credit when the goods are sold in
the same condition as they were brought in. The answer is that all amounts paid
under these two enactments should be counted as input tax credits. This tax
credit is not available to those VAT dealers who pay tax under provisions of
Clauses (b), (c) and (d) of sub-section (7) of Section 4 viz., works contractors,
or those who transfers the business as a whole or those who export goods, or
those who effect the sale of exempted goods, or those who do the business of
running business as restaurant or eating house. The tax here really amounts to a
refund of tax paid by the dealer under those enactments, since, the amounts
paid thereunder reduced the net VAT payable by the VAT dealers.
Proceedings for recovery can be instituted against sick industry unless
BIFR treats the matter pending before it. Kumar Metallurgical Corporation
Ltd., v. DCTO, Nalgonda and another, (2012) 54 APSTJ 189.
23. Liability of executor, administrator, legal representative:–
(1) Where any dealer doing business in respect of which tax is payable
under the Act, is dead, the Executor, Administrator, Successor in title or
other legal representative of the deceased dealer shall, in respect of such
business, be liable to submit the returns due under the Act and to
assessment under Section 21 and to pay out of the estate of the deceased
dealer, the tax, interest and any penalty assessed or levied as payable
by the deceased dealer.
(2) The provision relating to appeals and revisions shall be applicable

to assessment made under sub-section (1) as if the Executor, Administrator,
Successor in title or other legal representative were himself the dealer.
(3) The provisions of sub-sections (1) and (2) shall apply mutatis
mutandis to a partnership firm of which the managing partners have died.
Notes
If the dealer is dead his successors shall be deemed to be the dealers
for the purposes of payment of tax to the extent of the property of the
deceased in their hands. Such successor may be the heir of the deceased
dealer or the executor, administrator or any other legal representative who
comes to hold the charge of the business of the deceased dealer. Such person
is also liable to submit returns and is also liable to pay tax, penalty and interest
as may be levied in respect of the business of the deceased dealer. He is
entitled to all the rights the deceased may have in the matter of filing appeals
and revisions and also liable to be proceeded against in such proceedings.
The same is the case with the partnership firm in which persons in charge
of business have died.
24. Liability of partnership firms:– (1) Where any firm is liable
to pay any tax or other amount under the Act, the firm and each of the
partners of the firm shall be jointly and severally liable for such payment.
(2) Where any business carried on by a firm or a Hindu Undivided
Family or an Association has been discontinued or dissolved, the authority
prescribed shall make an assessment on the taxable turnover and determine
the tax payable as if no such discontinuance or dissolution had taken place
and all the provisions of the Act including provisions relating to levy of
penalty or any other amount payable under any of the provisions of the
Act shall apply, to such assessment.
(3) Every person who was at the time of such discontinuance or
dissolution, a partner of the firm, or a member of such Hindu Undivided
Family or Association and the legal representative of any such person
who is deceased, shall be jointly and severally liable for the amount of
tax, penalty or any other amount payable, and all the provisions of the
Act shall apply to any such assessment or levy of penalty or any other
amount.
(4) Where such discontinuance or dissolution takes place after any
proceedings in respect of any year have commenced, the proceedings
may be continued against the VAT dealer or TOT dealer referred to in
sub-section (2) from the stage at which such proceedings stood at the
time of such discontinuance or dissolution and all the provisions of the
Act shall apply accordingly.
(5) When any private company is wound up and any tax assessed
on the company under the Act 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 the private company at any time during the period
for which the tax is due, shall be jointly and severally liable for the payment
of such tax, 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.
NOTES
It is a well accepted rule that partners of the firm are liable to pay the
taxes due to the Government jointly and severally. No question of sleeping or
active partners arises. However, it is necessary that all the persons who are
shown and proved to be the partners shall be disclosed in the registration
obtained as a VAT or TOT dealer. It is only such partner who shall be held
responsible for the payment of tax. Where the dealer is a Hindu undivided
family and the business thereof is closed or where the dealer is a firm, the
business of which is dissolved, the assessing authority may make an assessment
as if there is no cessation of business or dissolution of firm and the tax due
thereunder can be recovered jointly and severally from all the partners and all
the members of the family or the members who are partners jointly and
severally. The same is the case with dealer which is an association of persons.
In case, the successor has continued the business the subsequent assessment
shall commence with the date from which the successor has come into
management. In case, where dealer is a private limited company and the said
company is wound up, any tax assessed on the company for any period prior to
or subsequent to dissolution can be recovered from persons who are Directors
jointly and severally alongwith the company. If it is proved that there was a
gross neglect, misfeasance or breach of duty on their part in relation to the
affairs of the company the tax may be recovered personally from the Directors.
25. Tax as an arrear of land revenue:– If the tax assessed or
penalty levied or interest payable under the Act, or any amount of tax
including deferred tax which is treated as a loan extended by the Government
to the dealer and any installment thereof, are not paid by a dealer within
the time specified therefor, the whole of the amount then remaining unpaid
may be recovered as if it were an arrear of land revenue.
Notes
This section declares that amounts due to the Sales Tax Department
whether they be of tax, penalty or interest or any other sum determined as
due to the Government from the dealer should be treated as an arrears of
land revenue. This declaration is necessary for the purposes of invoking the
summary powers of recovery of the amounts due to the Department. Normally,
amounts other than land revenue due to the Government cannot be recovered
under the summary procedure unless the amount due is declared as an arrears
of land revenue. Such amount may be recovered by the revenue authorities
on a requisition sent to them by the other departments. In the case of Income

Tax, the Tax Recovery Officer is designated as a Revenue Recovery Officer
thereby conferring on him all the powers exercisable by a Revenue Officer
under the Revenue Recovery Act. Therefore, it was not necessary for the
Income Tax Department to request the revenue officers to recover tax arrears
from defaulters. The Tax Recovery Officer of Income Tax Department will
recover the amounts in summary way exercising all the powers available under
the Revenue Recovery Act. Similarly, in the case of recovery of moneys
due from the defaulting dealers, the Act has made it clear that the amounts
may be recovered in a summary fashion and for this purpose, Section 28
of the Act has designated a Deputy Commissioner of Commercial Taxes as
the Collector and vested on him all the powers for summary recovery available
under the Andhra Pradesh Revenue Recovery Act, 1864; and where such
powers are exercised by the Deputy Commercial Tax Officer he would do
so under the control and superintendence of the Deputy Commissioner and
not to any superior authorities of the Revenue Department.
26. Preferential claims to assets:– Notwithstanding anything
to the contrary contained in any law for the time being in force, any
amount of tax, including deferred tax which is treated as a loan
extended by the Government to the dealer, penalty, interest and any
other sum payable by a VAT dealer or TOT dealer or any other dealer
under the Act, shall be the first charge on the property of the VAT dealer
or TOT dealer or any other dealer as the case may be.
Notes
This section creates a charge on the properties of the dealer in respect

of all the amounts due from him. This is a legal charge automatically created.
The moment the demand is raised, it becomes a preferential claim in all
execution proceedings which may be initiated or pending against the dealer
in any civil court or before any judicial or quasi-judicial authority. This charge
is however subject to any lawful earlier charge created by mortgage.
Protection against arrest is not available to an insolvent when he is
prosecuted for an offence under VAT Act. P.A. Shahbudeen v. District
Collector, Ernakulam, Cochin and others, (2010) 28 VST 91 (Ker.).
27. Transfers to defraud revenue void and Provisional
Attachment of Property:– (1) Where during the pendency of any
proceedings under the Act, or after the completion thereof, any VAT dealer
or TOT dealer or any other dealer creates a charge on, or parts with
the possession by way of sale, mortgage, gift, exchange or any other mode
of transfer whatsoever, or any of his assets in favour of any other person
such charge or transfer shall be void unless he proves that such charge
or transfer was not with the intention to defraud any tax or any other
sum payable.
(2)(a) where, during the pendency of any proceeding for the assessment
or reassessment of any tax or turnover tax which has escaped
assessment, the authority prescribed is of the opinion that for
the purpose of protecting the interests of the revenue it is
necessary so to do, may with the previous approval of the
Commissioner, by order in writing, attach provisionally in the
prescribed manner any property belonging to the dealer;
(b) every such provisional attachment shall cease to have effect after
the expiry of a period of six months from the date of the order
made under clause (a):
Provided that the Commissioner may, for reasons to be recorded
in writing, extend the aforesaid period by such further period or periods
as he thinks fit, so, however, that the total period of extension shall not
in any case exceed two years.
Notes
If after, any proceedings under this Act for assessment including filing of
the return or recovery are initiated, the dealer alienates his property by sale,
mortgage, gift, exchange or by any other manner with a view to defraud, the
Government of the Revenue, this section declares all such alienations as void
and shall not have any effect as against any claim of the department. In order
that bona fide transfers are protected, the Act provided that all such transactions
shall not be treated as void, if the dealer has obtained any previous permission
from the assessing authority to alienate his property, such transaction also will
not be treated as alienations made to defraud the Government. Where the
Commissioner apprehends and has a reason to believe that the dealer is about
to transfer or has transferred any of his assets with a view to defraud the
Government, he may for reasons to be recorded in writing order an attachment
of such assets. The Commissioner may issue the order of the attachment
which will be valid initially for a period of six months and such provisional
attachment may be continued for any further period or periods on grounds
recorded. The order of attachment in no case extends beyond two years. If
within the said period the proceedings pending against the dealer results in final
quantification of the amounts due, the provisional attachment may be made
absolute attachment. Otherwise, the provisional attachment stands vacated
after two years. Such provisional attachment shall be repeated by a fresh order
on the ground that the proceedings against the dealer are still continuing or any
new proceedings are started.
The fixation of maximum period of two years appears to be deliberate,
for the Act at some places mentions that proceedings initiated shall be
completed within two years, See Section 31(4).
28. Powers of Deputy Commissioner under Revenue Recovery
Act:– (1) A Deputy Commissioner shall have the powers of a Collector
under the Andhra Pradesh Revenue Recovery Act, 1864 (Act 2 of 1864)
for the purpose of recovery of any amount due under the Act.
(2) Subject to the provisions of sub-section (3), all Deputy Commercial
Tax Officers shall, for the purpose of recovery of any amount due under
the Act, have the powers of the Mandal Revenue Officer under the Andhra
Pradesh Rent and Revenue Sales Act, 1839 (Act 7 of 1839) for the
sale of property distrained for any amount due under the Act.
(3) Notwithstanding anything contained in the Andhra Pradesh Rent
and Revenue Sales Act, 1839 (Act 7 of 1839) the Deputy Commercial
Tax Officer in the exercise of the powers conferred by sub-section (2)
shall be subject to the control and superintendence of the Deputy
Commissioner.
Notes
See under Section 25.
When the assessee seeks time for filing necessary declarations and the
assessing officer finalises the assessment without making any order as regards
time requested, the order offends principles of natural justice. Recon Oil
Industries (P) Ltd., Hyderabad v. Commercial Tax Officer, Special Commodities
Circle, Saroornagar Division, Hyderabad, (2012) 54 APSTJ 167.
29. Recovery of tax from third parties:– (1) The Commissioner
or any other authority prescribed may at any time or from time to time,
by notice in writing (a copy of which shall be forwarded to the dealer
at his last address known to such authority) require any person from whom
money is due or may become due to the defaulter, or any person who
holds or may subsequently hold money for, or on account of the defaulter,
to pay to such authority, either forthwith if the money has become due
or is so held, within the time specified in the notice but not before the
money becomes due or is held, so much of the money as is sufficient
to pay the amount due by the defaulter in respect of arrears of tax, interest,
penalty or the whole of the money when it is equal to or less than that
amount.
1
[Provided that in case of banks, the amount due to the defaulting
dealer includes the amounts payable to the dealers by virtue of the
overdraft facility.]
(2) The authority prescribed may, at any time, or from time to time,
amend or revoke any such notice or extend the time of making any
payment in pursuance of the notice.
(3) Any person making any payment in compliance with the notice
under this section shall be deemed to have made the payment under the
authority of the defaulter and the receipt of the authority prescribed shall
constitute a good and sufficient discharge of the liability of such person
to the extent of the amount referred to in the receipt.
(4) Any person discharging any liability to the defaulter after receipt
of the notice referred to in this section, shall be personally liable to the
1. Proviso added by Act No. 28 of 2008, w.e.f. 24-9-2008.
authority prescribed to the extent of the liability discharged or to the extent

of the liability of the defaulter for the amount due under the Act, whichever
is less.
(5) Where any person to whom a notice under this section is sent
proves to the satisfaction of the authority prescribed that the sum demanded
or any part thereof is not due by him to the defaulter or that he does
not hold any money for or on account of the dealer, then nothing contained
in this section shall be deemed to require such person to pay the sum
demanded or any part thereof, to the authority prescribed.
(6) Where any person to whom a notice under sub-section (1) is
sent, fails to pay to the authority prescribed the sum demanded or any
part thereof as required in the said notice, such sum shall be recoverable
from such person as if it were an arrear of land revenue due from him.
(7) The provisions of this section shall be without prejudice to any
action that may be taken for the recovery of the money due from the
dealer.
Notes
This section provides for what are called garnishee proceedings. The
Commissioner or the authority proceeding with the recovery of any amount
due from the defaulting dealer, may proceed to recover the same from third
parties owing moneys to the defaulter, requiring such third party to pay over
such amount to the Government instead of to the defaulter. This power can
be exercised against third parties who may become debtors subsequent to
the initiation of proceedings for recovery against the defaulter. All the powers
normally exercisable by the court in execution proceedings against the garnishee
under CPC are exercisable by the Commissioner or any other authority
proceeding with recovery proceedings. Such authority may receive the amounts
from the third party and credit it to the account of the defaulter and issue
receipt to the third party on behalf of the defaulter. If the authority is satisfied
with the explanation submitted by the third party to the effect that he does
not hold any money or owe any money to the defaulter or that the money
available with him is not liable to be refunded to the defaulter, the authority
may close the proceedings against the third parties. If the authority is not
satisfied with the explanation furnished by the third party the authority may
proceed with the recovery from the third party as if the third party is the
defaulter. In doing so, he may hold the third party personally responsible
if he has disposed of such amounts otherwise than paying it over to the
Government. The proceedings initiated against the third party as above are
not a substitute to the proceedings for recovery initiated against the defaulter.
Both the proceedings can be continued simultaneously.
Recovery proceedings for tax cannot be initiated for recovery of disputed
tax till the application for condonation of delay is ordered or rejected. It means
that recovery proceedings cannot be initiated in respect of disputed tax in
appeal till the appeal is disposed of. Sirpur Paper Mills Ltd., Hyderabad v.
Commissioner of Commercial Taxes & Others, (2011) 53 APSTJ 175.
VAT–8
A shareholder of a company fell due to tax in respect of a business

done by him as sole proprietor, Company cannot be treated as garnishee and
the arrears due from the shareholder cannot be recovered from the bank
account of the company. Bans Constructions Ltd., Chittoor District and
Another v. Commercial Tax Officer, II, Chittoor and others, (2012) 54 APSTJ
165.
30. Recovery of tax when business transferred:– Where ownership
of the business of a dealer registered under the Act and liable to pay
tax is transferred, any tax or any other amount payable under the Act
in respect of such business and remaining unpaid at the time of the transfer,
may without prejudice to any action that may be taken for its recovery
from the transferor, be recoverable from the transferee as if the transferee
were the dealer liable to pay such tax or other amount.
Notes
This section provides that all amounts due from the transferor may be
recovered from the transferee. Even under the normal law, the transferee
of the business enterprise is liable to all the debts owed by the owners of
the business which was transferred. In addition to transferee becoming liable
for all the business subsequent to the transfer, transferee is liable to all the
taxes which are due in respect of the previous business. This section makes
it clear without any ambiguity that notwithstanding the liability created on
the transferee, the transferor will continue to be liable for those tax arrears.
Appeals and Revisions
31. Appeal to Appellate Authority:– (1) Any VAT dealer or TOT
dealer or any other dealer objecting to any order passed or proceeding
recorded by any authority under the provisions of the Act other than an
order passed or proceeding recorded by an Additional Commissioner or
Joint Commissioner or Deputy Commissioner, may, within thirty days from
the date on which the order or proceeding was served on him, appeal
to such authority as may be prescribed:
Provided that the Appellate Authority may within a further period
of thirty days admit the appeal preferred after a period of thirty days
if he is satisfied that the VAT dealer or TOT dealer or any other dealer
had sufficient cause for not preferring the appeal within that period:
1
[Provided further that an appeal so preferred shall not be admitted
by the appellate authority concerned unless the dealer produces the proof
of payment of tax, penalty, interest or any other amount admitted to be
due, or of such instalments as have been granted, and the proof of payment
of twelve and half percent of the difference of the tax, penalty, interest
or any other amount, assessed by the authority prescribed and the tax,
1. Subs. by Act 21 of 2011, w.e.f. 15-9-2011.
penalty, interest or any other amount admitted by the appellant, for the
relevant tax period, in respect of which the appeal is preferred.]
(2) The appeal shall be in such form, and verified in such manner,
as may be prescribed and shall be accompanied by a fee which shall
not be less than Rs. 50/- (Rupees fifty only) but shall not exceed Rs.
1,000/- (Rupees one thousand only) as may be prescribed.
(3)(a) Where an appeal is admitted under sub-section (1), the
appellate authority may, on an application filed by the appellant and subject
to furnishing of such security or on payment of such part of the disputed
tax within such time as may be specified, order stay of collection of balance
of the tax under dispute pending disposal of the appeal;
(b) against an order passed by the appellate authority refusing to order
stay under clause (a), the appellant may prefer a revision petition
within thirty days from the date of the order of such refusal to the
Additional Commissioner or the Joint Commissioner who may subject
to such terms and conditions as he may think fit, order stay of
collection of balance of the tax under dispute pending disposal of
the appeal by the appellate authority;
(c) notwithstanding anything in clause (a) or (b), where a VAT dealer
or TOT dealer or any other dealer has preferred an appeal to the
Appellate Tribunal under Section 33, the stay, if any, ordered under
clause (b) shall be operative till the disposal of the appeal by such
Tribunal, and, the stay, if any ordered under clause (a) shall be
operative till the disposal of the appeal by such Tribunal, only in
case where the Additional Commissioner or the Joint Commissioner
on an application made to him by the dealer in the prescribed
manner, makes specific order to that effect.
(4) The appellate authority may, within a period of two years from
the date of admission of such appeal, after giving the appellant an
opportunity of being heard and subject to such rules as may be prescribed,–
(a) confirm, reduce, enhance or annul the assessment or the
penalty, or both; or
(b) set aside the assessment or penalty, or both, and direct the authority
prescribed to pass a fresh order after such further enquiry as may
be directed; or
(c) pass such other order as it may think fit.
1
[(4A) Where any proceeding under this section has been deferred
on account of any stay orders granted by the High Court or Supreme
Court in any case or by reason of the fact that an appeal or other

proceeding is pending before the High Court or the Supreme Court
involving a question of law having a direct bearing on the order proceeding
in question, the period during which the stay order is in force or the period
during which such appeal or proceeding is pending, shall be excluded,
while computing the period of two years specified in sub-section (4) for
the purpose of passing appeal orders under this Section.]
(5) Before passing orders under sub-section (4), the appellate authority
may make such enquiry as it deems fit or remand the case to any
subordinate officer or authority for an inquiry and report on any specified
point or points.
(6) Every order passed in appeal under this section shall, subject
to the provisions of Sections 32, 33, 34 and 35 be final.
Notes
The first appeal against primary authority, whether it is Dy. Commercial
Tax Officer or Commercial Tax Officer lies to the Appellate Dy. Commissioner
of Commercial Taxes. The orders which are appealable may relate to assessment
or any other matter such as registration. Such orders must be final orders
and not any interim directions relating to the assessment and registration. An
order to produce books cannot be an order against which an appeal lies.
An order to penalty can be the subject matter of appeal even without filing
an appeal against assessment. The appeal shall be filed within 30 days from
the date of service of the order and the Appellate Dy. Commissioner may
if sufficient cause is shown admit the appeal condoning the delay. Government
is not permitted to plead that the appeal involved heavy amount as a ground
for condonation of delay in filing appeal. (2009) 22 VST 377. Before the
appeal is taken on record as admitted, the appellant should show that he has
filed the entire tax admitted by him; if the assessing authority itself has granted
any instalments in the payment of the tax determined, the appellant should
file proof of payment of the instalments which fell due by the date of filing
of the appeal alongwith the admitted tax and 12½% of the amount disputed
in the appeal. Payment of admitted tax and 12.5% of the deposit tax shall
be made by the time the appeal is filed. Payment after the appeal either within
the time for appeal or within the period during which the appeal is under
examination for being admitted or while the application for condonation of
delay is under consideration, is not a valid payment. Ankamma Trading Co.,
Takkallapadu and others v. The Appellate Deputy Commissioner, (CT), Guntur
and others, (2011) 53 APSTJ 1. If after admitting the appeal on proof of
payment of the entire admitted tax or instalments which fell due together
with 12½% of the disputed tax, the appellate Dy. Commissioner may on an
application made by the appellant for stay of the other disputed tax, order
of stay for collection of such balance disputed amount on such terms as
he may think proper or even without any terms or conditions. If the appellate
Dy. Commissioner refuses to stay recovery of such balance of disputed tax,
the appellant may file a revision application before the Additional or Joint
Commissioner for granting an order staying the recovery of such balance,
whereon the Addl. Commissioner or Joint Commissioner may order stay the
collection of tax pending disposal of the appeal before the Appellate Dy.
Commissioner on such terms as may be appropriate. The terms which may
be imposed in such circumstances may be that the appellant be required to
furnish security or sureties to the entire extent of the tax due or may also
require the dealer to pay the balance of tax in instalments. The security required
can be of the third party or personal surety. The order made by the Addl.
Commissioner or Joint Commissioner while disposing off the revision petition
may be extended to the period during which the appeal is pending before
the sales tax appellate tribunal in case where such appeal is filed. The
application for extending the benefit of stay to the period during which the
further appeal is pending before the appellate tribunal shall be made only after
the assessee files the appeal before the appellate tribunal.
The High Court of Andhra Pradesh has clarified that when the stay of
collection of balance tax is granted by the appellate authority, it may not be
continued when the appeal is pending before STAT. In such cases the appellant
should approach the Additional Commissioner or Joint Commissioner for an
order of stay pending appeal before STAT but when the stay of collection
of tax or penalty is ordered by the Additional or Joint Commissioner at the
first appeal stage, it may automatically be continued during the period when
the appeal before STAT is pending. Kandukuri Silks and Readymades, v.
Commercial Tax Officer, (2009) 49 APSTJ 205.
The orders which may be made on application for stay of recovery
of tax pending appeal shall be reasoned order. Where an application for
condonation of delay in filing appeal is pending, no order of stay of collection
of tax can be granted by the Appellate Court without hearing the other side.
Gangadhara Industries v. State of A.P., (2010) 51 APSTJ 15.
The Appellate Dy. Commissioner has all the powers normally exercisable
by such authority. The Appellate Dy. Commissioner may confirm, reduce,
enhance or annul the assessment altogether or the penalty imposed or both.
He may even as he was confirming the assessment or even as he was
enhancing the assessment, reduce the penalty. It is open to him likewise to
enhance the penalty while reducing the assessment.
The appellate authority while annulling the assessment in other words,
setting aside the assessment, if the circumstances of the case so warrant
remand the case for further enquiry and direct it to make fresh assessment.
The Appellate Dy. Commissioner has power of ordering further enquiry by
the same authority against which the appeal is filed or any authority on any
specified point and submit a report. Where upon the Appellate Dy. Commissioner
may finally dispose off appeal. While exercising the power to order fresh
or further enquiry on any point or points the appellate authority may entrust
the task to any other authority subordinate to it. Such subordinate authority
need not necessarily be the assessing authority. The Appellate Dy. Commissioner
may himself make fresh assessment if the circumstances so warrant.
The appellate authority may depending on the circumstances of the case
make any further orders as it may think necessary. One important thing to
be noted here is that the appellate authority shall dispose of the appeal within
a period of two years from the date when the appeal is admitted. The two
year period shall be counted not from the date when the appeal is filed but
from the date when the appeal is admitted i.e. after the completion of the
formalities required with regard to the payment of the entire admitted tax
and 12½% of the disputed tax. The fact that the appellant has not paid the
balance of disputed tax after his application for stay was refused, shall not
be a ground for delaying the disposal of the appeal.
The order made by the Appellate Dy. Commissioner will be final to the
extent it is duly and properly made. However, such order is subject to the
Revision by the authorities under Section 32, subject to the orders that may
be made by the Appellate Tribunal under Section 33, subject to the revision
by the High Court under Section 34 and subject to appeal to the High Court
under Section 35.
As far as limitation for appeal is concerned, the assessee shall file the
first appeal within thirty days and within a further period of thirty days,
provided the assessee proves the cause which prevented him from filing appeal
in time. There is no discretion with the appellate authority to condone further
delay in preferring appeal. The contention that the assessee was prevented
from filing appeal for 528 days because of the pendency of the writ petition
in High Court was rejected on the ground that the appellate authority has
no discretion to condone the delay in excess of thirty days after the limitation
period of initial thirty days. Agarwal Industries (P) Ltd., Anr. v. Appellate
Deputy Commissioner, (CT), (2011) 52 APSTJ 128. Hence in such circumstances
the assessees are advised to file appeal within the further period of 30 days
and request the appellate authority to await the disposal of writ petition.
When there is alternate remedy available, it is not possible to invoke
special jurisdiction of the High Court. Even the commencement of proceedings
in the direction of appeal (such as presentation of representation before
appellate authority) amounts to seeking remedy by way of appeal. Hence the
assessee who moved the appellate authority is disabled to file Writ Petition
under Article 226. Economic Transport Organisation Ltd., Hyderabad v.
Government of Andhra Pradesh & Anr., (2011) 53 APSTJ 37.
32. Revision by Commissioner and other prescribed authorities:–
(1) The Commissioner may suo moto call for and examine the record
of any order passed or proceeding recorded by any authority, officer or
person subordinate to him, under the provisions of the Act, including sub-
section (2) and if such order or proceeding recorded is prejudicial to
the interests of revenue, may make such enquiry, or cause such enquiry
to be made and subject to the provisions of the Act, may initiate
proceedings to revise, modify or set aside such order or proceeding and
may pass such order in reference thereto as he thinks fit.
(2) Powers of the nature referred to in sub-section (1) may also
be exercised by the Additional Commissioner, Joint Commissioner, Deputy
Commissioner and Assistant Commissioner in the case of orders passed
or proceedings recorded by the authorities, officers or persons subordinate
to them:
1
[Provided that the power under sub-section (1) or (2) shall not be
exercised by the authority specified therein in respect of any issue or
1. Subs. by Act 21 of 2011, w.e.f. 15-9-2011.
question which was decided on appeal by the Appellate Tribunal under

Section 33;]
(3) In relation to an order of assessment passed under the Act, the
powers conferred by sub-sections (1) and (2) shall be exercisable only
within a period of four years from the date on which the order was served
on the dealer.
(4) No order shall be passed under sub-section (1) or (2) enhancing
any assessment unless an opportunity has been given to the dealer to
show cause against the proposed enhancement.
(5) It shall be lawful for the Commissioner to defer any proceeding
under this section by the reason of the fact that an appeal or other
proceeding is pending before 1[the Appellate Tribunal or the High Court
or the Supreme Court] involving a question of law having a direct bearing
on the order or proceeding in question.
(6) Where an order passed under this section has been set aside
by any court or other competent authority under the Act for any reason,
the period between the date of such order and the date on which it has
been so set aside shall be excluded in computing the period of four years
specified in sub-section (3), for the purpose of making a fresh revision,
if any, under this section.
(7) Where any proceeding under this section has been deferred
on account of any stay order granted by 2[the Appellate Tribunal or
the High Court or the Supreme Court] in any case, or by reason
of the fact that an appeal or other proceeding is pending before 1[the
Appellate Tribunal or the High Court or the Supreme Court] involving
a question of law having a direct bearing on the order or proceeding
in question, the period during which the stay order was in force or
such appeal or proceeding was pending shall be excluded in computing
the period of four years specified in sub-section (3), for the purposes
of exercising the power under this section.
Notes
Every statute provides a power of revision with the superior authorities
on the orders made by their subordinates. This power is different from the
powers of adjudicating appeals.
An order made by the Dy. Commercial Tax Officer is revisable by all
the superior authorities commencing from his immediate superior Commercial
Tax Officer upto the Commissioner of Commercial Taxes. So is the order
made by the Joint Commissioner who is the immediate subordinate to the
Commissioner, revisable by the Commissioner of Commercial Taxes. However,
if a revision is undertaken say, by the Dy. Commissioner of Commercial Taxes,
no other officer subordinate to him can take up the revision of the order
1. Subs. for the words "the High Court or Supreme Court" by Act 21 of 2011, w.e.f.
15-9-2011.
made by the Dy. Commercial Tax Officer. It also means that there cannot
be two or more revisions simultaneously by different superior authorities.
However, the order made in revision by the Dy. Commissioner can further
be revised by any of his superiors. The rule however is the revision contemplated
under this section is suo motu revision. Further, it can be exercised only
where the revising authority is satisfied that the order of the subordinate is
prejudicial to the interests of the revenue. The parties have no right to move
the revisional authority at their own instance. The powers of revision are
not exercisable where the subject matter of revision is under the consideration
of the appellate tribunal or on a matter on which the appellate tribunal has
already rendered judgment. There is one more restriction on the exercise of
powers of revision. The powers of revision are exercisable by the revising
authorities within four years from the date on which the orders sought to
be revised was served on the dealer. The period of four years shall be calculated
not with the reference to the year or period of assessment but from the
date the order is served on the dealer. In cases where it is not advisable
to complete the revision proceedings during the period when the same or
similar matter is pending consideration of the High Court or the Supreme
Court, the Commissioner may order deferment of the revision till the High
Court or the Supreme Court disposes of the matter; in which case the period
between the date when the deferment is ordered and the day when the order
of deferment is withdrawn by the Commissioner shall be excluded in the
computation of four years. It is advisable in such circumstances the dealer
may be informed of the deferment and its withdrawal. Similarly, where the
order sought to be revised was set aside by any court or other competent
authority, the period between the date of such order and the date on which
it was set aside shall be excluded while computing the period of four years.
Similarly, in cases where the proceedings in revision are themselves stayed
by the High Court or Supreme Court the period during which the stay order
was in force shall be excluded in computing the period of four years. It
may be noted here that the expression stay order was in force means, the
period between the date of order and the date when it expired. The question
of the knowledge or otherwise or the communication of the order by the
courts does not arise. In cases where there was no stay but the Commissioner
of Commercial Taxes deferred the proceedings in revision on ground that
the same matter was pending in the High Court or Supreme Court the period
to be excluded shall be the period during which the deferment order was
in force. Here also, the question of communication or the question of late
knowledge is not relevant for the purposes of computing the period of four
years. Still there is one more contingency not provided in these provisions
i.e. can the period of four years be excluded in completing the revision in
case where there is neither a stay order of the superior court in operation
or where deferment order not made by the Commissioner in cases where
the issue before the Commissioner and the issue pending in Supreme Court
is the same. The answer to this question should be in the negative. The
mere fact, that a similar matter is pending in the High Court or in Supreme
Court will not debar the revising authority to revise the matter in accordance
with the law. If in such cases, where the revision is made it will be valid
if the ultimate order of the High Court or of the Supreme Court supports
the revision. If the ultimate order of the High Court or Supreme Court does
not support the order made by the Commissioner in revision, the same can
be questioned in appropriate proceedings.
The power to postpone or defer the revision pending before him can
be exercised only by the Commissioner and the Deputy Commissioner while
acting as revisional authority has no such power to defer the revision on
the ground that similar question is pending in the High Court. Kirby Building
System India Ltd., v. Deputy Commissioner (CT), (2012) 54 APSTJ 44.
Where an assessment order only is sought to be revised on a certain
point after an appeal is filed against it on some other points is disposed of,
the four year period of limitation commence from the date when the original
assessment order is served on the assessee and not when the appellate order
dealing with other points is served. It means the period of limitation shall
commence only on the date of the order dealing with the subject-mater is
served.
Revisional jurisdiction is barred when the same question is pending before
STAT. Reliance Petro Marketing Pvt. Ltd., v. CTO, (2012) 54 APSTJ 99.
Suo motu revision by the superior authority shall not be taken up at
the instance of the authority making the order. This is so because the revision
must be bona fide and it shall not be to the prejudice of the right accrued
to the dealer.
Since original order of assessing authority merges with appellate authority,
the authority revising cannot review the original order. In such cases the
revision authority shall revise the appellate order. Union of India v. Inani
Carriers, (2009) 22 VST 44 (Raj.).
When the assessing authority accepts a certain declaration and grants
the relevant exemption under consignment sale, he cannot subsequently revise
the assessment by rejecting the declaration. This is a case of negligence by
the assessing authority and not a fit case for revision by the assessing authority.
Jitendar Roller Flour Mills, v. AC (CT) LTU, (2012) 54 APSTJ 252.
The expression prejudicial to the interests of the revenue needs some
clarification. It must be recorded by the revising authority the exact loss of
revenue likely to be suffered by the State. Unless, the allegation is so framed
quantifying the amount of loss which actually occurred it may not be possible
for the assessees to file appropriate defence. Hence, the expression should
be understood not in a hypothetical sense but in concrete terms applicable
to the assessee. An allegation that what is done in the case if applied to
other assessees it may result in prejudice to the interests of revenue cannot
be sustained.
The fact that revision order is not served within a reasonable time is
a circumstance which can be taken into consideration in holding that the order
made was not dated as alleged. Vamsi Art Printers (P) Ltd. v. CTO, (2007)
44 APSTJ 50. Same order cannot be revised repeatedly by different revisional
authorities. Nutrine Confectionary v. State of A.P., (2010) 51 APSTJ 55.
Re-assessment cannot be resorted to in case of lack of negligence of
the assessing officer. Banyan Enterprise, v. CTO, (2012) 54 APSTJ 122.
Deputy Commissioner directed audit of accounts by Deputy Commercial

Tax Officer. It means, he should undertake audit and report the results of
the audit to the Deputy Commissioner. When the direction is confined to
audit only, it is not open to Deputy Commercial Tax Officer who conducted
the audit of accounts, to make consequential assessment. The Deputy Commercial
Tax Officer here has no jurisdiction to make assessment consequent on audit
without a special or additional order to make assessment. Hence the assessment
order made by the Deputy Commercial Tax Officer who audited the accounts,
are set aside. The Deputy Commercial Tax Officer is directed to file a report
of the audit before the Deputy Commissioner. Dekars Fires and Security
Systems Pvt. Ltd., v. The Deputy Commissioner, (CT), (2011) 53 APSTJ 45.
Powers of revision can be exercised even in cases of registration and
the certificate issued thereunder. Suguna Poultry Farm Ltd., v. State of A.P.,
(2010) 51 APSTJ 91.
33. Appeal to the Appellate Tribunal:– 1[(1) any dealer objecting
to an order passed or proceeding recorded:-
(a) by any authority, on appeal under Section 31; or
(b) by the Additional Commissioner or Joint Commissioner or Deputy
Commissioner under sections 21 or 32 or 38; or
(c) by any authority following the ruling or order passed under Section
67;
may appeal to the Appellate Tribunal within sixty days from the
date of service of the order or proceeding on him.]
(2) The Appellate Tribunal may within a further period of sixty days
admit the appeal preferred after the period of sixty days specified in sub-
section (1), if it is satisfied that the dealer had sufficient cause for not
preferring the appeal within that period:
1
[Provided that no appeal against the order passed under
Section 31 shall be admitted under sub-section (1) or sub-section (2)
of this section unless it is accompanied by satisfactory proof of the payment
of fifty percent of the tax, penalty, interest or any other amount as ordered
by the Appellate Authority under Section 31:
Provided further that no appeal against the order passed under
sub-section (2) of section 32 shall be admitted under sub-section (1) or
sub-section (2) unless it is accompanied by satisfactory proof of the
payment of the tax, penalty, interest or any other amount admitted by
the appellant to be due or of such instalments as might have become
payable, as the case may be, and twenty five percent of the difference
of the tax, penalty, interest or any other amount ordered by the revisional
authority under sub-section (2) of section 32 and the tax, penalty, interest
or any other amount admitted to be due and paid by the appellant:
Provided also that no appeal against the order passed by any
authority by following the ruling or order, issued under Section 67, shall
be admitted under sub-section (1) or sub-section (2) unless it is accompanied
by satisfactory proof of the payment of the tax, penalty, interest or any
other amount admitted by the appellant to be due or payable, or of such
instalments thereof, as might have become payable, as the case may be
and the proof of payment of fifty percent of the difference of the tax
penalty, interest or any other amount, levied by the authority by following
the ruling, issued under Section 67, and the tax, penalty, interest or any
other amount admitted to be due and paid by the appellant:
Provided also that the authority prescribed shall refund the said
amount of twelve and half percent or twenty five percent or fifty percent
of the difference of tax, penalty, interest or any other amount assessed
by the authority prescribed or revisional authority as the case may be
and the tax, penalty, interest or any other amount admitted and paid
by the appellant, with interest calculated at the rate of 12% per annum
if the refund is not made within 90 days from the date or receipt of the
order passed under section 31 or Section 33.]
(3) The appeal shall be in the prescribed form, shall be verified in
the prescribed manner, and shall be accompanied by such fee which shall
not be less than one hundred rupees but shall not exceed two thousand
rupees as may be prescribed.
(4) The Appellate Tribunal may, after giving both parties to the appeal
a reasonable opportunity of being heard–
(a) confirm, reduce, enhance or annul the assessment or the penalty
or both; or
(b) set aside the assessment or the penalty, or both, and direct the
authority prescribed to pass a fresh order after such further
inquiry as may be directed; or
(c) pass such other order as it may think fit:
Provided that if the appeal involves a question of law, a decision
on which is pending in any proceeding before the High Court or the
Supreme Court, the Appellate Tribunal may defer the hearing of the appeal
before it, till such proceeding is disposed of.
(5)(a) Before passing any order under sub-section (4), the Appellate
Tribunal may make such inquiry as it deems fit or remand the case to
the appellate authority against whose order the appeal was preferred or
to the authority prescribed concerned, for an inquiry and report on any
specified point or points.
(b) Notwithstanding anything contained in sub-section (4), where the
VAT dealer or TOT dealer or any other dealer who has filed an appeal
under this section to the Appellate Tribunal fails to appear before the
Appellate Tribunal either in person or by counsel when the appeal is called
on for hearing, it shall be open to the Tribunal to make an order dismissing
the appeal:
Provided that the Appellate Tribunal may, on an application made
by the dealer within thirty days from the date of communication of the
order of dismissal and on sufficient cause being shown by him for his
non-appearance when the appeal was called on for hearing, re-admit the
appeal on such terms as it thinks fit, after giving notice thereof to the
authority against whose order or proceeding the appeal was preferred.
(6)(a) Where a VAT dealer or TOT dealer or any other dealer,
objecting to an order passed or proceeding recorded by a Deputy
Commissioner under Section 21 or 32 has preferred an appeal to the
Appellate Tribunal, the Additional Commissioner, or the Joint Commissioner
may, on an application filed by the dealer, subject to such terms and
conditions, as he may think fit, order stay of collection of the tax under
dispute pending disposal of the appeal by the Appellate Tribunal;
(b) The payment of tax and penalty, if any, due in accordance with
the order of the first appellate authority or of the Deputy Commissioner
under Section 21 or in revision under Section 32, in respect of which
an appeal has been preferred under sub-section (1), shall not be stayed
pending disposal of the appeal.
(7) Except as provided in the rules Appellate Tribunal shall not have
the power to award costs to either of the parties to the appeal.
(8) Every order passed by the Appellate Tribunal under sub-section
(4) shall be communicated by it to the dealer, the authority against whose
order the appeal was preferred, the Commissioner and such other authorities
as may be prescribed.
(4) shall, subject to the provisions of Section 34 be final.
Notes
Appeal to the appellate tribunal is the second appeal. The fact that
the appellate tribunal comes as a forum for second appeal, its jurisdiction
is not in any manner restricted. It can go into the findings of the lower
authority on questions of fact and also on questions of law. Apart from
the orders relating to assessments the orders arising out of registration,
amendment and cancellation when made by Commercial Tax Officer and Dy.
Commissioner are appealable to the tribunal. Orders made by the Jt.
Commissioner, Addl. Commissioner, Dy. Commissioner under the powers of
revision vested in them under Section 32 are appealable to the tribunal. Orders
of refund made under Section 38 by any authority are appealable first to
the Dy. Commissioner and thereafter to the appellate tribunal. Only dealers
can file the appeal to the appellate tribunal. Any party interested in the orders
may also file the appeal. The dealer registered or unregistered can file the
appeal. A person interested or affected by the orders such as those who
are effected by recovery proceedings can also file the appeal. Dealers other
than those who are parties in the proceedings such as the purchaser from
the VAT dealer who is or who becomes entitled to input credit can file the
appeal. Where State is the party in the appeal filed by the dealer, the State
will be represented by the State Representative before the appellate tribunal.
The State Representative is the person authorised to file further appeals or
revisions before the High Court.
Sales Tax Tribunal even where it is confirming the order appealed against
shall write a reasoned order. Cryptic orders are liable to be set aside. Mohd.
P.V. v. State of Kerala, (2009) 26 VST 512.
The jurisdiction of the tribunal in disposing of the appeal being wide
enough covering questions of fact as well as of law, it has while exercising
the powers to set aside, amend the proceedings appealed against, can remand
the appeal to the authority to make further enquiries and pass appropriate
orders. Though the appellate tribunal can receive additional evidence it has
no power to require the assessing authority to submit any finding to the
tribunal. The tribunal has power to award costs to either of the parties,
if the rules authorise.
The appeal before the tribunal should be filed in the prescribed form
and shall be accompanied by the prescribed fees. The appeal should be filed
within 60 days from the date on which the order appealed against is served
on the appellant. There is power with the appellate tribunal to condone the
delay on sufficient cause being shown and admit the appeal. The delay can
be condoned only on an application made for the purpose explaining the cause
for delay and when the period of delay does not exceed 60 days.
The appellate tribunal has power to dismiss the appeal if the applicant
or his counsel fail to appear on the date of hearing and it has also power
to restore the appeal provided an application for restoration is made within
30 days from the date of the communication of the order of ex parte dismissal.
Accordingly, the tribunal has no power to entertain successive applications
for restoration. The Appellate Tribunal has no power to dispose of the appeal
on merits after hearing only the State Representative before the tribunal. The
dismissal for default of the appeal will not bar the revisional authorities to
revise the order against which the appeal is filed.
The appellate tribunal can suo motu defer the hearing before it, in cases
where the issues of law involved in the appeal are pending consideration before
the High Court. Since, the orders made by the Appellate Tribunal on questions
of law are expected to be respected by all the authorities under the Act,
it is specifically provided here that a copy of the final order of the tribunal
shall be communicated to the Commissioner of Commercial Taxes. Appellate
Tribunal is competent to entertain and hear appeals arising out of revisional
proceedings.
Where as a consequence of difference of opinion between two Members,
Full Bench only should hear the matter. It is not permissible to refer the
case to a third member and adopt the same i.e. the order of the third members
as the decision of the Three Member Full Bench. Goel Spinning & Weaving
Mills v. State of Haryana & others, 2006 (147) STC 664 (P&H).
Two very important questions may arise in the context of appeal. The
first question is whether the right of appeal is substantial right or a mere
procedural right. The Supreme Court held in Hoosein Kasim Dada (India)
Ltd. v. State of M.P. & Ors., (1933) 4 STC 114 as follows:
“The right of appeal is not merely a matter of procedure. It is a matter
of substantive right. The right of appeal from the decision of an inferior tribunal
to a superior tribunal becomes vested in party when the proceedings are first
initiated and before a decision is given by the inferior court.
A pre-existing right is not destroyed by amendment if the amendment
is not made retrospective by express words or necessary intendment. The
fact that pre-existing right of appeal continues to exist must in turn necessarily
imply that the old law which created the right of appeal must also exist to
support the continuation of that right. As the old law continues to exist for
the purposes of supporting the pre-existing right of appeal, that old law must
govern the exercise of and enforcement of that right of appeal and there
can then be no question of amended provision preventing the exercise of
that right.
A provision which is calculated to deprive the assessee of the unfettered
right of appeal cannot be regarded as mere alteration in procedure. For purpose
of accrual of the right of appeal, the critical and relevant date is the date
of initiation of the proceedings and not the decision itself”.
The second question is when the proceedings are said to be initiated
in a matter of tax law. The Supreme Court answered in the same judgment
that initiation of proceedings commence with the notice to file the return or
the filing of the return.
Even though the expression ‘sufficient cause’ must be liberally interpreted,
it does not permit negligence or inaction or want of bona fides. State of
A.P. v. Mayuri Flim Distributors, Hyderabad, (2012) 54 APSTJ 135.
34. Revision by High Court:– (1) Within ninety days from the
date on which an order under sub-section (4) of Section 33 was
communicated to him, the VAT dealer or TOT dealer or any other dealer
or the authority prescribed in this behalf may prefer a petition to the High
Court against the order on the ground that the Appellate Tribunal has
either decided erroneously, or failed to decide, any question of law:
Provided that the High Court may admit a petition preferred after
the period of ninety days aforesaid, if it is satisfied that the petitioner
had sufficient cause for not preferring the petition within that period.
(2) The petition shall be in the prescribed form, shall be verified
in the prescribed manner, and shall, where it is preferred by the dealer,
be accompanied by a fee of rupees five hundred.
(3) If the High Court, perusing the petition, considers that there is
no sufficient ground for interfering, it may dismiss the petition summarily:
Provided that no petition shall be dismissed unless the petitioner has
had a reasonable opportunity of being heard in support thereof.
(4)(a) If the High Court does not dismiss the petition summarily,
it shall, after giving both parties to the petition, a reasonable opportunity
of being heard, determine the question or questions of law raised and
either reverse, affirm, or amend the order against which the petition was
preferred, or remit the matter to the Appellate Tribunal with the opinion
of the High Court on the question, or questions of law raised, or pass
such other order in relation to the matter as the High Court thinks fit.
(b) Where the High Court remits the matter to the Appellate Tribunal
under clause (a) with its opinion on the question or questions of law raised,
the Appellate Tribunal shall amend the order passed by it in conformity
with such opinion.
(5) Before passing an order under sub-section (4), the High Court
may, if it considers it necessary so to do, remit the petition to the Appellate
Tribunal and direct it to return the petition with its finding on any specific
question or issue.
(6)(a) Notwithstanding that a petition has been preferred under sub-
section (1) tax shall be paid in accordance with the assessment made
in the case:
Provided that the High Court may, in its discretion permit the
petitioner to pay the tax in such number of instalments, or give such other
direction in regard to the payment of tax as it thinks fit:
Provided further that if, as result of the petition, any change becomes
necessary in such assessment, the High Court may authorise the authority
prescribed to amend the assessment, and on such amendment being made
the excess amount paid by the dealer shall be refunded to him without
interest, or the further amount of tax due from him shall be collected in
accordance with the provisions of the Act, as the case may be.
(b) The payment of tax and penalty, if any due in accordance
with the order of the Appellate Tribunal in respect of which a petition
has been preferred under sub-section (1) shall not be stayed pending the
disposal of the petition, but if such amount is reduced as a result of such
petition, the excess tax paid shall be refunded in accordance with the
provisions of the Act.
(7)(a) The High Court may, on the application of the dealer or the
authority prescribed review any order passed by it under sub-section (4)
on the basis of facts which were not before it when it passed the order;
(b) The application for review shall be preferred within such time,
and in such manner as may be prescribed and shall, where it is preferred
by the dealer, be accompanied by a fee of rupees one hundred.
(8) In respect of every petition or application preferred under sub-
section (1) or sub-section (7), the costs shall be in the discretion of the
High Court.
Notes
The orders of the Appellate Tribunal can be challenged in revision before

the High Court. The ground on which the revision can be maintained is while
making the order the Appellate Tribunal has either decided erroneously or
has failed to decide any question of law. These words indicate that revision
to be maintainable in the High Court shall be on questions of law only. If
the Appellate Tribunal has erroneously decided a question of law that could
be ground for revision. If the Appellate Tribunal has omitted to decide a
question of law relevant to its decision then also a revision can be filed.
Questions of law arising in indirect way may not be a ground for revision
but a wrong decision on facts which has a direct bearing on the question
of law may be a ground for revision. The revision before the High Court
should be filed within 90 days from the date on which the order of the
tribunal was communicated. The High Court may at the first hearing, where
both the parties are represented and are given opportunity of hearing may
dismiss the revision summarily, if it finds there is no sufficient ground for

interfering with the order of the Appellate Tribunal. If the High Court admits
the revision, it may proceed with a detailed hearing. If after the hearing,
the High Court is of the opinion that the question of law decided by
it may be applied to the facts of the case, the High Court may remand
the case to the tribunal for making appropriate order in accordance with
the order of the High Court. While disposing of the revision, the High Court
may require the tribunal to submit its findings on any point not decided by
it earlier. The Appellate Tribunal shall in accordance with the requisition of
the High Court forward its finding after making such enquiry as it deems
necessary and after hearing the parties.
Pending revision before the High Court it is open to the High Court
to stay or refuse to stay any proceedings for realisation of any tax or penalty
due from the dealer. So however, that there was any enhancement of tax
or penalty by reason of the impugned order of the Appellate Tribunal, the
High Court shall not grant any stay to that extent and at the same time if
by reason of the impugned order of the Appellate Tribunal the dealer is entitled
to refund, the court may direct that the refund shall be made without any
objection.
The revision to the High Court under this section may be moved by
the dealer or by the Government.
The order made by the High Court in revision may be reviewed by
the court where application is made by either of the parties on a ground
that the facts now available were not before the court and had the court
been appraised of such facts the decision of the court would have been
different.
35. Appeal to High Court:– (1) Any VAT dealer or TOT dealer
or any other dealer objecting to an order relating to assessment passed
by the Commissioner suo-moto under Section 32 or 38 may appeal to
the High Court within sixty days from the date on which the order was
communicated to him:
Provided that the High Court may admit an appeal preferred after
the period of sixty days aforesaid, if it satisfied that the dealer had sufficient
cause for not preferring the appeal within that period.
the prescribed manner and shall be accompanied by such fee which shall
not be less than rupees five hundred but shall not exceed rupees two
thousand as may be prescribed.
(3) The High Court shall, after giving both parties to the appeal,
a reasonable opportunity of being heard, pass such order thereon as it
thinks fit.
VAT–9
(4) The provisions of sub-sections (4), (7) and (8) of Section 34

shall mutatis mutandis apply in relation to appeal preferred under sub-
section (1) as they apply in relation to petition preferred under sub-section
(1) of Section 34.
Notes
There are two types of orders under the Act against which lies an appeal
direct to the High Court. The first type of orders are those made by the
Commissioner of Commercial Taxes suo motu under Section 32. The second
type of orders are the orders made under Section 38 by the Commissioner
for refund. In both these cases, the time within which the appeal should
be filed is 60 days from the date on which the order concerned is communicated
to the dealer. This appeal is disposed of in a manner and in accordance with
the procedure as may be prescribed for disposal of the revision petition by
the High Court. Here also, application for review of the orders made by the
High Court under this section is permissible.
36. Petitions, Applications to be heard by a Bench:– Every
petition, application or appeal preferred to the High Court under Section
34 or 35 shall be heard by a Bench of not less than two judges, and
in respect of such petition, application or appeal, the provisions of Section
98 of the Code of Civil Procedure, 1908 (Central Act V of 1908) shall,
so far as may be, apply.
Notes
The revision referred to under Section 34 and the appeal referred to
under Section 35 shall be heard by a Bench consisting of not less than two
Judges. The provisions of Section 98 CPC will apply to the disposal of cases
by the Bench.
37. Limitation in respect of certain assessments or re-
assessments ordered:– Notwithstanding anything contained in Sections
21 and 32 where an assessment, re-assessment, rectification in or revision
of an assessment is made in respect of a dealer or any person, in pursuance
or in consequence of or to give effect to any finding or direction contained
in an order under Sections 31, 32, 33, 34 and 35 or in an order of
any court in a proceeding, otherwise than by way of appeal or revision,
such assessment, re-assessment, rectification in or revision of an assessment
shall be made within three years from the date of receipt of such order
by the prescribed or revising authority as the case may be:
Provided that if such appeal, order or order of any Court has been
subjected to further appeal, either partially or entirely, and if there are
orders of stay prohibiting the authority concerned to pass consequential
orders, the period of three years shall get extended by the period during
which such stay orders were in force:
Provided further that if the subsequent appeal results in modification

of such appeal, order or order of any Court which is subjected to further
appeal, either partially or wholly, the period of three years shall be
computed from the date of receipt of subsequent order of appeal but
not from the date of receipt of the original appeal, order or order of
any Court which was subjected to further appeal.
Notes
The general rule is that any assessment or re-assessment shall be made

within a period of four years or six years; four years in the case of assessment
in which the dealer is not found to have acted in a questionable manner and
six years in the case where the dealer is alleged to have attempted fraud.
This rule will not apply to a case where assessment or re-assessments are
required to be made, in pursuance of any directions made by the authorities
and courts under Sections 31, 32, 33, 34 and 35. In such cases, the period
of limitation is three years from the date of receipt of the orders by the
concerned authorities which are required to make such assessments or re-
assessments. The three years time should be counted from the date of the
receipt of the order which are final where there are successive orders in
the same matter, the three years limitation shall be counted from the latest
of such orders. It means, if the High Court in revision ordered a re-assessment,
the consequential re-assessment shall be made within three years counted from
the date of its communication of the High Court Order. If however, the High
Court had subsequently issued a further direction after reviewing its earlier
orders, the date of communication of the later order would be the starting
point for three years limitation. No excuse can be pleaded or any court can
condone the delay if such re-assessment is made beyond the period. The
authority is not prevented from making order on the last date of limitation
even if that be Sunday or holiday and that the fact that such last day being
a holiday will not extend the time till the next day. It may be noted here
that antidating the order will be an illegality.
Power to defer proceedings or to stay the proceedings shall be exercised
within the period of the time limit prescribed. Such power can’t be exercised
to make the assessment otherwise time barred as valid retrospectively. Shreyash
Industries Ltd. v. State of Punjab, dt. 26-9-2008 (Punjab H.C.).
Refund of Tax
38. Refund of tax:– (1)(a) A VAT dealer effecting sales falling
under sub-section (1) or (3) of Section 5 1[xxx] of the Central Sales
Tax Act, 1956 in any tax period shall be eligible for refund of tax, if
the input tax credit exceeds the amount of tax payable, subject to the
condition that the exports have been made outside the territory of India.
1. The words "and sub-section (6) of Section 8" deleted by Act 28 of 2008 w.e.f. 24.9.2008
The excess of tax shall be refunded within a period of ninety days on

a claim made on a VAT return prescribed to the authority prescribed
subject to the provisions of the Act and the rules made thereunder;
(b) In all other cases, the VAT dealer may make a claim for
refund of any excess credit available at the end of second year after
the commencement of the Act and thereafter in the return to be filed
for the month of March every year if registered as a VAT dealer
for a minimum period of twelve months or in the event of cancellation
of registration. The excess of input tax credit claimed as refund shall
be refunded within ninety days of the date of receipt of the claim.
(c) The claim for refund under this section shall be made on the
VAT return in the form prescribed.
(d) A VAT dealer, who has paid tax in excess of the amount due
for a tax period, may claim a credit in the next tax return.
(2) Where a VAT dealer claiming a refund is required by authority
prescribed to provide accounts or records to substantiate the claim but
fails to do so in a manner satisfactory to the authority prescribed within
seven days of issue of notice, the time period specified in sub-section
(1) for making the refund shall not apply.
(3) Where a claim of a VAT dealer is not accepted either in full
or in part, the authority prescribed, shall send a notice in writing, to the
VAT dealer.
(4) A VAT dealer aggrieved by the decision under sub-section (3),
may file an appeal as prescribed in the Act.
(5) The tax paid under the Act on the purchases made by specialized
agencies of the UNITED NATIONS ORGANISATION and Consulates
or Embassies of any country located in the State, or International Crop
Research Institute for Semi Arid Tropics, Hyderabad shall be refunded
in such manner as may be prescribed.
1
[Provided that, Government may by notification denotify or exclude
any of the Organisations, Consulates or Embassies or any other International
Institutions from the purview of this sub-section making them not eligible
for refund of tax under the Act on the purchases made by them.]
(6) Where the authority prescribed fails to make a refund within the
time specified under sub-section (1), the amount of refund shall carry
simple interest at the rate of one percent per month on the amount of
the refund for the period of delay.
1. Proviso added by Act No. 14 of 2007, w.e.f. 16-4-2007.
(7) A TOT dealer shall be eligible to adjust any excess tax paid
by him in the subsequent returns or may claim refund at the time of
cancellation of registration in the manner prescribed.
1
[(8) The Government may, by notification provide for grant of refund
earlier than the period stipulated in this section, of any excess credit
available, after adjusting the tax payable under the Act or any tax payable
under the provisions of Central Sales Tax Act, 1956 in respect of any
Value Added Tax dealer or any category of Value Added Tax dealers.]
2
[(9) The tax paid under the Act, by the person who is not liable
to be registered as Value Added Tax or Turnover Tax dealer and not
liable to pay tax under the Act, may be refunded in the manner as may
be prescribed.]
Notes
The refund of excess tax arises in the case where goods are exported
outside the State or outside the country. The tax to be refunded in such
cases is the tax paid on the purchase of the goods exported. Moreover, the
tax refundable is the excess over and above the tax paid under Central Sales
Tax Act. Such tax shall be refunded within a period of three months from
the date when the claim is raised. In all other cases, the VAT dealer is entitled
to the refund of an amount which represents the excess credit accumulating
in his account for a period of more than 24 consecutive months. This claim
for refund for excess credit may also arise in the event of cancellation of
registration of the VAT dealer. Where a claim for refund in these two
contingencies is made in accordance with the procedure and in the form
prescribed the refund shall be granted within three months. If there is a dispute
about the quantum of refund the same shall be enquired into by the authority
concerned. If the VAT dealer disputes the order he may file an appeal before
the tribunal. There is also yet another situation where refund is required to
be made in respect of the purchases made by specialised agencies such as
United Nations Organisations, Consulates or Embassies of any foreign country
located within the State or by the International Crop Research Institute for
Semi-arid Tropics, Hyderabad. Such refunds are claimed and made in accordance
with a procedure prescribed therefor.
This section contains an interesting provision. If the authority commences
an enquiry into the claim and requires the claimant to produce accounts or
records to substantiate the claim and if the claimant fails to, so provide the
accounts or records within 7 days of the notice, the three months period
within which refund should be made will not apply. In substance, it means
that where an enquiry is commenced, the commencement of three months
period will shift to the date when the enquiry is concluded and order for
refund issued.
The authority to revise any order relating to refund under Section 38
passed by Deputy Commissioner including an order approving order of the
refund made by him of any subordinate authority, is the Joint Commissioner.
39. Interest on overpayments and late refunds:– (1) Where the
authority prescribed is required to refund an amount of tax to a VAT
dealer or TOT dealer or any other dealer as a result of;
(a) a decision under Section 31 ; or
(b) a decision of the Appellate Tribunal under Section 33 ; or
(c) a decision of the High Court under Section 35,
such refund shall be made within a period of ninety days from the date
of the receipt of the order.
(2) Where refund is not made within the stipulated time, as mentioned
in sub-section (1), the amount of refund shall carry interest at the rate
of one percent per month for the period of delay. The interest in respect
of part of a month shall be computed proportionately and for this purpose,
a month shall mean a period of 30 days.
Notes
This section provides in all the cases where Government has to make
refund the amounts in pursuance of the demand raised under Section 38,
the Government is liable to pay interest at the rate of 1% per month on
the amount of refund for the period of delay.
Where a refund is ordered in appeal, the assessing officer delays to
issue refund order, the interest becomes payable from the 91st day after the
date of the communication of the appellate order to the assessing authority.
Medi Herbs v. CTO, Cuddalore (2010) 31 VST 312 (Mad.).
Interest is payable on delayed refund. Rayalaseema Concrete Sleepers
(P) Ltd., v. CTO, Maharajgunj Circle, Hyderabad and another, (2012) 54
APSTJ 159.
40. Power to adjust, withhold refunds:– (1) The Commissioner
or the authority prescribed shall have the power to adjust any amount
due to be refunded against any tax, penalty and interest outstanding against
a VAT dealer or a TOT dealer or any other dealer.
(2) Where an order giving rise to a refund is the subject matter
of an appeal or further proceeding, or where any other proceeding is
pending, and the authority prescribed is of the opinion that the grant of
the refund is likely to adversely affect the revenue, the authority prescribed
may, with the previous approval of the Deputy Commissioner, withhold
the refund till such time as the Deputy Commissioner may determine.
(3) Where any demand of tax or penalty or both is disputed by

a VAT dealer or TOT dealer before any appellate authority or Sales
Tax Appellate Tribunal or High Court and the demand becomes finally
due either partly or fully an 1[interest at the rate of one and quarter (1.25%)
percent per month] shall be charged from the date such tax or penalty
was originally due.
Notes
The refunds to be made shall not be made straight away on the demand
raised by the dealer. The Government has got a right to withhold refunds
and adjust them against any amounts due and outstanding from the claimant.
The Government can also withhold refunds if it is of the opinion that the
grant of refund is likely to adversely affect the revenue of the State. The
Government can also withhold the refund on the ground that any appeal or
further proceedings under the Act are pending against the claimant.
The authority withholding the refund of tax pending appeal must state
the facts and grounds, how making refund will adversely affect the revenue.
It should state that the respondent (assessee) may not be in a position to
repay the amount if the appeal filed by the Government is allowed, or how
it is difficult for the Government to recover the amount and how the refund
will adversely affect the revenue such as the hugeness of the amount. A
blanket order to withhold refund is liable to be struck down. BSNL., Hyderabad
v. State of A.P. and another, 2009 (49) APSTJ 66. In this case the Andhra
Pradesh High Court directed the refund within four weeks and further ordered
that if there be a further delay, additional interest component shall be recovered
from the officers responsible for such delay.
Apart from the question of payment of interest by the Government on
the refunds claimed under Sections 38 and 39 by the claimants this section
has an additional sub-section whereby it is provided that any amount of tax
or penalty originally imposed and which has become the subject matter of
litigation, the dealer is liable to pay interest at the rate of 1% per month
on such tax or penalty as finally determined as due from the date they were
originally due.
The authority directing withholding of refund must state that making
refund would adversely affect the State exchequer. It must at least state that
in case success in further appeal or revision filed, it would be difficult for
the Government to recover the amount from the assessee. Mere statement
that in the appeal or revision filed the Government has reasonable grounds
for success is not a ground for withholding refund. Bharat Sanchar Nigam
v. State of A.P. and another, (2009) 25 VST 511 (A.P.).
1. Subs. for the words "interest at the rate of one percent per month" by Act 21 of 2011,
w.e.f. 15-9-2011.
Refund of pre-deposits made before filing appeal, after the appeal is

disposed of is governed by the rules of tax refund embodied in Section 40.
33C, Pulp ‘N’ Pack Ltd. v. CTO, (2009) 23 VST 573 (A.P.).
Approval of refund is different from withholding refund. Even in case
where Joint Commissioner is the authority to approve the refund, it is the
Deputy Commissioner who is the authority to approve withholding of refund.
Dr. Reddy Laboratories Ltd., v. AC, CT (LTU), (2010) 51 APSTJ 222.
Case Law
For reference only: [For Chapters V, VI, VII and VIII]

(1) Best of judgment cannot be made without notice to the dealer
informing him about the reasons for non-acceptance of the turnovers disclosed.
Padamchand v. CST, 1986 (62) STC 195 (All.).
(2) Best of judgment assessment should be consistent with the materials
available on record and cannot be arbitrary. Bangasree Bastralaya v. CTO,
1996 (102) STC 221.
(3) Estimate made on basis of electricity consumption. Chand Oil Mills
v. CST, 2001 (124) STC 320 (All.).
(4) Low profit ratio cannot by itself be a reason for rejecting the
correctness of accounts. Vel Metal Industries v. State of Tamil Nadu, 1988
(68) STC 55 (Mad.).
(5) Where the turnovers are accepted just because the prevailing prices
are higher, the assessing authority cannot enhance the assessment. Standard
Sanitation v. CST, (1993-94) 33 DSTC J-121 (DELTRIB).
(6) Where escaped turnover is due to lack of care on the part of the
assessing authority the assessment can be re-opened. TISCO v. State of Bihar,
1999 (114) STC 477.
(7) When computing the admitted tax, regard should be had to the
position taken by the appellant in the memorandum of appeal. The assessing
authority should not be guided in the matter of what has been stated in the
return filed by the assessee. The appellate authority should examine the
memorandum of appeal and determine by reference to the grounds set out
in the memorandum and relief sought in it. Ghanashyam Das Balmukund v.
State of U.P., 1969 (23) STC 282 (All.).
(8) The appellate authority cannot admit any additional evidence without
a specific prayer from the parties. DLST v. Siva Traders, 1990 (79) STC
243 (MP).
(9) If sufficient cause is shown the appellate authority may admit Forms
which are statutorily required to be submitted before the assessing authority.
State of A.P. v. Hyd. Asbestos Cement, 1994 (94) STC 410 (SC).
(10) Sales Tax Appellate Tribunal may not permit additional ground which
was not raised before assessing authority or before the first appellate authority.
Batchu Venkataramanayya & Co. v. State of A.P., 1988 (71) STC 166 (AP).
(11) Trade name of a dealer is not the name of a dealer. Hence,

proceedings can take place only in the name of the dealer describing him
as the Proprietor of the assumed trade name. Deep Electricals v. CST, (1993-
94) 33 DSTC 78 (Del.Trib).
(12) There should be an honest and reasonable belief in the necessity
of conducting a search before a search is undertaken. Such belief may be
based on certain prima facie grounds. Thus far about the jurisdiction to
conduct the search. For seizing the account books or stocks it is open
to the inspecting officer to rely upon the grounds which may be found after
the search has commenced or during its course. State of West Bengal v.
Oriental Rubber Works, 1977 (39) STC 333 (Cal.).
(13) Permission to retain books seized from the dealer beyond the period
prescribed shall not be granted by the superior authorities as a matter of
course. Retention beyond 180 days is held to be not justified. Madhupuri
Corporation v. S.S. Khan, (2001) 250 ITR 565 (Guj.).
(14) Office equipment, household furnishings etc., furniture, stationery,
electrical fittings (lamps, fans, air-conditioners) etc. for the office premises
are not eligible for the benefit of concessional rate of tax under CST Act
by issuing declaration in Form ‘C’. J.K. Cotton Spinning & Weaving Mills,
1965 (16) STC 563 (SC).
(15) Right of the assessee to have his disputed tax demand stayed is
a part of the right to appeal. ITO v. M.K. Mohammed Kunhi, (1969) 17
ITR 815 (SC).
(16) Enforcement of recovery procedures: “Enforcement of recovery
procedures in the hands of over-zealous or corrupt staff may create hardship
to the assessees. Similarly, timid may attempt to utilise these measures for
fear of they being made accountable. Collection of tax arrears may include
penalties, interest, issue of garnishee orders, attachment of bank accounts,
attachment of immovable and movable properties, prevention of foreign travel
and denial of several other facilities in the nature of State patronage and
provisional attachment of properties of persons likely to leave India and persons
likely to alienate their assets in addition. Hence, a discretionary burden is cast
on the officers in this regard lest they may not be accused of as acting
on whims and vagaries, and arbitrariness. Union of India v. Jesus Sales
Corporation, (1996) 4 SCC 69, or accused of being acting in a manner
“Illusory, dishonest, corrupt, mala fide or ulterior purposes or objects”. Challa
Rambhupal Reddy v. C.B.D.T., (1997) 109 ITR 695.
(17) Where facility is withdrawn retrospectively, it cannot be for a
particular period. Tata Motors Ltd. v. State of Maharashtra, AIR 2004 SC
2618.
(18) Tax cannot be deducted by the company in the bills of the works
contractor while making mobilization advance. Hindusthan Constructions Comp.
Ltd. v. State of Haryana, 1998 (109) STC 620.
(19) No tax can be deducted by the company from the bills paid to
sub-contractor. DLF Industries Ltd. v. State of Haryana, 1997 (10) PHT
106 (P&H).
(20) Where service is incidental while sale of goods is pre-dominant,
such a contract cannot be called works contract. Hindusthan Shipyard Ltd.
v. State of A.P., 2000 (119) STC 533 (SC).
(21) Though, a subsequent assessment on best of judgment is permissible,
it becomes impossible if the source of escapement of turnover was the same.
State of Orissa v. Rama Electrical Stores, 1994 (33) STC 430 (Orissa).
(22) A finding or discovery made in the assessment of a particular year
can be a ground for re-opening assessments of earlier years. Ess Ess Kay
Engineering Company (P) Ltd. v. CIT, 2001 (247) ITR 818 (SC).
(23) Where ‘C’ forms filed are not considered at the time of finalising
the assessments such assessment order can be rectified subsequently. Kirloskar
Brothers Ltd. v. State of Tamil Nadu, 1999 (113) STC 496 (Mad.).
(24) Rectification applications can be successively filed and entertained
so long as they are made within the limitation prescribed therefor. Prompt
Steel Divsn. v. State of Punjab, (2001) 18 PHT 184 (STT Pb).
(25) While rectification proceedings are pending, it is found that the
point involved is covered by a judgment of the High Court concerned or
the Supreme Court, the issue then becomes an error apparent on record.
Mysore Cements Ltd. v. Dy. Commssr. of C.T., 1994 (33) STC 464 (Karn.).
It may be noted here in the context of this case that whatever be the
authority discovered or found cannot be a ground for initiating proceedings
for rectification.
(26) It is only after the Revisional Authority records a cogent statement
as to how the assessment order already made is prejudicial to the revenue
of the State, it can proceed with the revision. Where revisional authority took
upon the revision on account of the intimidatory influence of the views
discussed by audit, such revision is invalid. Black Diamond Beverages (P)
Ltd. v. CTO, 1992 (87) STC 43 (WBTT).
(27) Power to bring to assessment the escaped turnover is within the
jurisdiction of the assessing authority. Commissioner has no jurisdiction to
revise such assessment. Reliance Motor Co. (P) Ltd. v. State of Tamil Nadu,
1992 (84) STC 201 (Mad.).
(28) When the appellate authority is dealing with the matter no subordinate
authority shall claim to exercise revisional jurisdiction in respect of same
assessment order. Tel Utpadak Kendra v. Dy. CST, 1981 (48) STC 248
(SC).
(29) Though notice was issued for revision within the period, if the
revision is not completed and final order is made by the last date of limitation,
the order in revision made thereafter is barred by limitation. State of A.P.
v. Toshiba Anand Batteries Ltd., 1995 (96) STC 644 (AP).
(30) For purposes of computing the period of limitation for revision

the crucial date is the date of original assessment order and not any other
order made in appeals and revisions. State of A.P. v. Hotel Ganesh, 1996
(8) PHT 4 (AP).
(31) Sufficient cause has always been understood to be a cause which
is beyond the control of the person concerned and is bona fide. Central
Artillery Command Depot v. CST, (1980) UPTC 233 (All.).
(32) Ignorance of law on the part of assessing authority can be a ground
of interference by the revisional authority. Sushil Flour & Oil Mills v.
Commssr., UT, 1982 (50) STC 222 (P&H).
(33) The question of law will arise in the following circumstances:
(a) Putting an improper construction on statutory language.
(b) Arriving at a finding based on irrelevant material.
(c) Arriving at a finding which is not relevant to the evidence.
(d) Arriving at a finding contradictory to the evidence.
(e) Acting on material partly relevant.
(f) Basing conclusions on surmises and conjectures.
(g) Basing conclusions on imagination and on facts not apparent on
record.
(h) Coming to the determination which no person judicially acting and
properly instructed could arrive. CIT v. S.P. Jain, (1973) 87 ITR
370 (SC).
(34) A question of law will not be said to be arising out of the order
of the tribunal, if it is not challenged by either of the parties before the tribunal.
CIT v. Sindhia Steam Navigation Co. Ltd., (1961) 42 ITR 589 (SC).
(35) A mere non-production of account books cannot be a ground for
rejecting the correctness of other account books. CST v. Malik Singh Int
Bhatia, 1989 (75) STC 381 (All.).
(36) If inspection reveals that the dealer has done business outside his
accounts, the assessing authority is justified in rejecting the accounts. Sagarmal
Narayan Dass v. CST, 1989 (74) STC 266 (All.).
Court direction:– (1) The High Court cannot issue a direction to the
Commercial Tax Officer not to encash the cheque given by the dealer. S.R.
Traders & Bhavani Traders, Tuni v. Asst. Commissioner of Commercial Tax,
No. IV Enforcement Wing, Hyderabad & others, 1993 (3) ALT 242.
Assessment:– (1) Even though the case necessitates re-enquiry, if the
assessment is very old and the amount of tax involved is about Rs. 5,000/
- only, such a case need not be remanded. State of A.P. rep. by State
Rep. before State of A.P., Hyd. v. M/s. T. Radhaiah, 1997 (3) An.WR 85
(DB).
(2) Yearly assessment made on basis of monthly returns without making

provisional assessment month-by-month is valid. P. Venkata Subbaiah &
others v. Govt. of Andhra, 1955 ALT (C/r) 802 = 1955 Andhra 993 = 1956
(7) STC 242.
(3) When dealer furnished all the details, it is for the authority to verify
their correctness. If the authorities are not satisfied they should make an
enquiry for purposes of verification. It cannot revise the order without proper
verification. B. Rajaiah & Sons v. Board of Revenue, 1978 (42) STC 145.
(4) Where a date for filing return is fixed subsequent to inspection and
discovery of secret accounts and when such a return is accepted by the
assessing authority as complete and correct and an assessment is made on
the basis of the return furnished by the dealer, it would be a misnomer to
term the assessment as best of Judgment assessment. M/s. Pasuluri
Satyanarayana Murty v. State of A.P., 1978 (2) An.WR 69.
(5) Where the Act provides that when making the assessment, the
assessing authority may also direct the dealer to pay penalty in addition to
the tax assessed, it is not legal to impose penalty long after the assessment
was made. State of A.P. v. M/s. Venkateswara Oil Producers, Vinukonda,
1992 (1) ALT 10 (NRC).
(6) Where an assessment is made after it is time barred any Amendment
to the Act will not enable taxing authorities to initiate any assessment
proceeding after the Amendment Act came into force. M/s. The Warangal
Dist. Co-op. Marketing Society v. State of A.P., 1983 (54) STC 385.
(7) Turnover in this case is proposed to be added not as a consequence
of any appellate order or as a consequence of discovery of escaped turnover,
but as a consequence of erroneous exemption, beyond four years. In such
cases, the period covered by pendency of any appeal cannot be deducted.
M/s. Andhra Steel Corpn. Ltd., Visakhapatnam v. C.T.O., Company Circle,
Visakhapatnam, (51) STC 265.
(8) Orders made under erroneous view by the Sales Tax Appellate
Tribunal cannot be sustained. Assessing authority imposed penalty at 50%
of the tax. Tribunal under a wrong impression that the penalty levied was
five times the tax, imposed penalty at double the amount of tax. The order
was set aside. Sri Venkateswara Rice & Co., Sulluripet v. State of A.P.,
1983 (54) STC 271.
(9) Best of judgment assessment shall not be arbitrary. The assessing
authority must make genuine effort to estimate what the actual turnover of
the assessee might have been in the context of the circumstances of the
business of the dealer. The enquiry he makes shall not be an empty formality.
The assessee must be given reasonable opportunity to satisfy the authority
that there are also other factors which ought to be taken into account in
arriving at the quantum of suppression. Padmavati Reddy & Rice Co. v.
Asst. Commissioner, 1971 (27) STC 30.
(10) When the law provided that the assessment may be made on the
best of judgment assessment and also provides for levy of penalty both the
proceedings need not be simultaneous. Notice of penalty can be issued after
the assessment on best of judgment is made. Sri Radhakrishna & Co. v.
State of A.P., 1961 (2) An.WR 389 = 1961 ALT 897 = 1962 (13) STC
117.
(11) Re-determination or re-estimation of turnovers can be done only
by the Assessing Authority. It is not open to appellate and revising authorities
to re-determine or re-estimate the turnovers independently. State of A.P.
v. M/s. V. Poturaju & G. Simhachalam, 1963 (2) ALT 201=1963(2) An.WR
326.
(12) The limitation for making the assessment means, that the assessment
must be completed and order issued within the period of limitation. K. Mohd.
Osman Saheb & Co. vs. State of A.P., 1971 (27) STC 303.
(13) The Act contemplates that both the proceedings for assessment
and revised assessment on one side and proceedings for penalty should be
simultaneous. It may be that the assessing authority issuing notice proposing
penalty on the ground that the dealer has wilfully suppressed or concealed
a part of his turnover, that does not mean that the assessing authority has
pre-determined the issue. It is only a prima facie opinion which the assessing
authority is communicating the assessee to enable him to explain or rebut
the same. This position does not invalidate the penalty proceedings. M/
s. Prabhakara Oil Mills v. State, 1976 (38) STC 449 = 1976 (2) APLJ
232.
(14) When the return submitted is late, the assessment made subsequently
without rejecting the return, such assessment is not best of judgment assessment.
State of A.P. v. Pyarelal Malhotra, 1962 (2) An.WR 334.
(15) If assessment is made within the limitation prescribed say, four
years or six years, the same limitation periods apply to levy of penalty. M.
Sainna & G. Narsimhulu v. State, ILR 1971 AP 245.
(16) Where the escaped turnover is less than the taxable limit, the same
can be added to the declared turnover and if such addition results in the
dealer exceeding taxable limit, action can be taken in accordance with law
treating the dealer as having taxable turnover. State of A.P. v. M.A. Rohan,
1977 (2) An.WR 7 = 1977 (1) APLJ 461.
(17) Where certain materials which were not the subject matter of the
assessment and also in appeals and revision, the assessing authority can re-
assess the escaped turnover on the basis of such materials. D. Rattaiah
v. State of A.P., 1986 (1) An.WR 333 = 1987 (65) STC 298.
(18) Test check cum Master role method for making best of judgment
assessment is not legal. Sri Lakshmi Satyanarayana Rice Mill v. State of
A.P., 1970 (25) STC 96.
(19) Where goods are returned by a dealer taxed in assessment year,

deduction of such turnover cannot be claimed in the subsequent year. State
of A.P. v. Sri Vallabh Glass Works Ltd., 1992 (3) ALT 37 (NRC).
Panmasala:– (1) Levy of sales tax on pan masala does not amount
to levy of double taxation merely because its ingredients are taxable under
other entries. By mere mixing ingredients it would result pan masala is not
accepted. It involves a manufacturing process when once a new consumer
product comes into existence from a combination of one or more taxable
goods, the outcome is taxable as a different article under the Act. Kothari
Products Ltd. v. Govt. of A.P. rep. by its Secretary, Rev. (Commercial taxes)
Hyderabad, 1997 (4) ALT 395 (FB) = 1997 (4) ALD 419 = 1997 (3) APLJ
1.
Tax on Bailee:– (1) As per agreement, P & T Department supplied
copper wire in zero value basis to the company for manufacturing cables
from out of the said copper wires and supplying the same to P & T
Department. The company was given profit for the said work of manufacturing
cables. There is no sale bill or any transfer of property in the copper wire
from P & T Department to the company. The fact that the company raised
a loan on the stock of cables makes no difference in the position that the
company remains only a bailee. No sales tax can be levied on the cost
of copper wire either under the A.P.G.S.T. Act or CST Act. State of A.P.
v. Hindustan Cables Ltd., 1995 (1) An.WR 177 (DB) = (1995) 97 STC 231.
Levy of penalty by another officer:– (1) When assessing authority
has not levied penalty, it is not open to the Deputy Commissioner who is
not the assessing authority to levy penalty. Sanmathi Udyog, Hyderabad v.
C.T.O. and another, 2000 (3) ALT 334 = 2000 (2) ALD 625 (DB).
(2) When it is mandatory for the assessing authority to levy penalty,
it is also mandatory for it to levy the penalty in the prescribed measure.
M/s. Srinivasa Oil Mills, Sattenapalli & Others v. State of A.P., TRC No.43/
1980 dated 8.3.1983.
Escaped turnover time limit:– (1) The order of escaped assessment
to be within limitation should not only be made within 4 years from the service
of the original assessment order but should also be served within 4 years
from that date. In this case original assessment order was served on 19.1.1984
escaped assessment order was posted on 8.1.1988, no doubt well within the
time of 4 years but it was served on 9.3.1988 which falls beyond limitation.
It was held that the escaped assessment order is not valid and the assessee
is not bound by it. Sri Balaji Paddy & Rice Merchant, Bhadrachalam v.
State of A.P. rep. by State rep. before STAT, Hyderabad, 1997 (2) An.WR
385 (DB) = 1997 (4) ALD 186.
Notice before levy of penalty:– (1) While levying penalty the assessing
authority shall give a notice to the assessee on the question of levying penalty.
The assessee can plead several defences against the levy of penalty as well
as its quantum. He may plead bona fides, that the mistake is not due to
any wilful conduct and that the mistake must have occurred in spite of diligence
or it was only an error. The assessing authority has to determine the penalty
in the context of the defences raised. In this case, the penalty order was
set aside and the authority was directed to proceed in accordance with Law.
M/s. Maheswari Jewellery Mart, Sivalingam Street, Vijayawada rep. by its
Partner Mr. Praveen Kumar Sabu v. C.T.O., (I & T), Vijayawada, 1998
(2) An.WR 678 (DB).
(2) So however the penalty proceedings cannot be initiated beyond the
time by which best of judgment assessment should have been completed.
State of A.P. v. Rikabchand Sivamal & Co., 1969 (2) An.WR 356 = 1968
(22) STC 304.
(3) For purposes of penalty the expression turnover not disclosed includes
turnover as estimated. Therefore penalty can be levied on the entire turnover
estimated. It cannot be contended that penalty can be levied only on so much
of amount which was not actually disclosed. B. Fakruddin Saheb & Sons
v. State of A.P., 1962 (13) STC 822 = 1962 (2) An.WR 282.
Wrong view of penalty:– (1) The fact that the statute authorises levy
of penalty 5 times the amount of tax assessed does not mean that the full
penalty shall be levied. It is left to the discretion of the authority to levy
penalty of an amount lesser than 5 times. In this case, the penalty was reduced
to 3 times as against 5 times. In consideration of the assessee’s plea that
he bona fidely believed that turnover of matches need not be included in
the taxable turnover. A.N. Cigeratte Trading Co. v. State of A.P. rep. by
State rep. before STAT, Hyd., 2000 (6) ALT 691 (DB).
Assessment against dissolved firm:– (1) Assessment can be made
against the dissolved firm and in such assessment all the partners of the firm
may be made personally liable. M/s. Coramandel Lubricants, Visakhapatnam
v. Commissioner of Commercial Taxes, A.P., Hyderabad, 1996 (1) ALT (Tax)
173 (DB) (A.P.).
(2) Assessment made on dissolved firm after its dissolution is not valid.
T. Ramalingeswara Swamy v. C.T.O., AIR 1969 AP 127=1969(2) An.WR
295.
No estimate for future:– (1) Turnover alleged to have been suppressed
by the time of inspection having been brought to tax, cannot be a ground
to further add double the amount as might have been suppressed during the
subsequent period of year as probable suppression, is not legal. T. Behr
Ramanaiah & Sons, Kotthavalasa, Vizianagaram District v. Commissioner of
Commercial Taxes, A.P., Hyderabad, 1995 (1) An.WR 124 (DB).
Plea of non-collection not tenable:– (1) The plea of the assessee that
he had not collected the tax from purchaser/exporter is not tenable for claiming
exemption from tax when the dealer is liable to pay the tax under Law. A.L.
Kabeer Exports Ltd. v. Commissioner of Commercial Taxes, Hyderabad, 2000

(4) ALT 199 = 2000 (4) ALD 339 (DB).
Export trade:– (1) When the circumstances under which a transaction
may not be held to be an export sale are present, it is not possible to hold
that mere movement of goods out of India amounts to exporting of goods.
The seller of goods completed the sale in Visakhapatnam and the goods which
were warehoused in the customs were handed over to the purchaser viz.,
fishing trawler owner and then the same was transported to the trawlers in
the high sea which is beyond the territorial line of India. Such a transport
cannot be called a transport which was occasioned by a prior agreement.
Mere taking the goods out of India does not amount to exporting the goods.
Hence, the sales cannot be treated as exempt sales. M/s. Spares Corporation,
Visakhapatnam v. State of A.P. rep. by Dy. Commercial Tax Officer,
Visakhapatnam and others, 1995 (1) An.WR 84 (DB) = (1995) 97 STC 645.
Groundnut oil extracted from seeds and extracted from cake:– (2)
Different rates of tax for groundnut oil extracted from groundnut cake already
suffered tax and for the groundnut oil extracted from groundnut already
suffered tax is discriminatory. Rajasri Oils & Extractions, Adoni and others
v. Dy. Commissioner (CT) Kurnool & others, 1998 (5) ALT 9 (FB) = 1998
(5) ALD 209.
Purchased for one purpose, sold for another purpose—no penalty:–
(1) Where goods were purchased for one purpose but are used for a purpose
not prohibited it is not open to authorities to impose any penalty. Craft paper
was purchased not as raw material for manufacture of boxes but only as
packing materials. There is no prohibition that the same shall not be used
for packing chemical manufactured by assessee. The assumption of the
department that if the assessee could have followed a different processes viz.,
buying the boxes instead a paper having made into boxes, it would have
generated more revenue is misplaced. So long as there is no prohibition
the assessee is entitled to arrange his affairs in such a way as to have boxes
made through job work and using the material for the same stated purpose
through a different form, there is no case for the levy of penalty. State
of A.P. rep. by State rep. before STAT, Hyderabad v. M/s. Hyderabad
Chemicals Supplying Ltd., Hyderabad, 1998 (2) An.WR 34 (DB) = 1998 (2)
ALD 489.
Assessing authority:– (1) Where Deputy Commissioner is not designated
in any manner as assessing authority but he is authorized to be an appellate
or revisional authority, it is not open to him to make an assessment or re-
assessment in respect of any escaped turnover. Devar Oil Industries v. State
of A.P., 1960 (2) An.WR 197 = 1961 (12) STC 797.
Deeming provision:– (1) The deeming provision incorporated in the
Act to the effect that sale by forest contractors of the wood purchased by
them in the auction from the forest department shall be treated as first sale
is valid and no objection can be taken against it. M/s. Ramaiah & Sons
v. DCTO, 1976 (2) An.WR 193.
Change of rate during the middle of the year:– (1) Change of rate
of tax during the middle of the year, splitting up assessment year is permissible.
State of A.P. v. Murali Cafe, 1971 (28) STC 399 (FB).
Return of goods:– (1) Goods sold in the previous year returned by
the purchaser in assessment year and the price refunded. The amount so
refunded in the assessment year can be deducted from the gross turnover.
State of A.P. v. Vahini Pictures (P) Ltd., 1962 (13) STC 847 = 1962 (2)
An.WR 421.
Trade Practice:– (1) Trade practice prevalent in a particular business
centre cannot be a law or custom enforceable in a different place. B. Balal
Chand & Co. v. Agricultural Market Committee, 1975 ALT 77 = 1974 (2)
An.WR 113.
Filling of ‘B’ Forms:– (1) Though ‘B’ forms have to be filed along
with the returns, yet if they are not filed they can be filed at any time after
filing returns, but before final assessment. It follows that the use of the
word shall in clause 1 of sub-rule (B) of Section 5(B) is directory and not
mandatory. Admittedly where B forms were filed before the order of
assessment was made, the assessee was entitled to the benefit of concessional
rates under Section 5(B). State of A.P. v. Gayathri Electronics, Hyderabad,
1992 (3) ALT 11 NRC.
Service of notice:– (1) Service of notice on one partner is service
of notice on all the partners. Parasuramaiah in re, 1970 (1) A.P.L.J. 237.
Should not recover tax:– (1) SSI units which were granted tax
exemption are not entitled to collect tax from customers. Sri Parvathi
Parameswar Cables v. Government of A.P., 1995 (1) ALT 727 (DB) = 1995
(1) ALD 522.
Liability of son:– (1) If the father of the applicant was in arrears of
sales tax, the son who applies for independent registration cannot be denied
registration nor can be required to furnish security for the arrears due from
his father. M/s. Sudhakar Oil Trades, Hyderabad rep. by its Proprietor P.
Sudhakar v. Assistant Commercial Tax Officer, Osmangunj Circle, Hyderabad
& another, 1995 (2) ALT 570 (DB).
Demand notice without fixing date:– (1) Demand for payment of tax
shall fix a date for payment which can be a date not before 7 days. Notice
to pay in 3 days is illegal. M/s. Afcons Painting (I) Ltd. v. C.T.O., Siddhipet
& another, 1995 (1) ALT 848 (DB).
(2) Demand notice issued to the defaulter without giving 15 days time
for payment is not valid. Such person cannot be treated as a defaulter for
the purposes of proceeding under summary procedure of recovery. Where
notice issued relates to one of instalments only, proceedings for recovery
VAT–10
of the whole amount are not valid. Adinarayana Corporation v. C.T.O.,

Anakapalli, 1984 (2) An.WR 161 = 1984 (56) STC 230.
Unjust enrichment:– (1) Where assessee has collected sales tax from
his purchaser retention of such amount by the assessee amounts to unjust
enrichment and the assessee is accordingly liable to refund the same with
interest to the Government. The contention of the assessee that he was
entitled to retain the same as such retention was supported by the then existing
decision of the Supreme Court is not tenable as the said decision was reversed
by a later decision of the Supreme Court. The following two are relevant.
The earlier decision of the Supreme Court reported in 85 STC 432 (SC)
is reversed in 96 STC 355 (SC). State of A.P. v. ITC Bhadrachalam Paper
Boards Ltd. & others, 1999 (1) ALT 704 : 1999 (2) ALD 31.
Non-resident cannot escape tax liability:– (1) Persons residing in
Bombay but carrying on business in Andhra State through agents cannot escape
tax liability. G.G. Textile Agency v. Government of A.P., 1959 (1) An.WR
340 = 1959 (10) STC 368.
No restraint on encashment of cheque:– (1) The High Court cannot
issue a direction to the Commercial Tax Officer not to encash the cheque
given by the dealer. S.R. Traders & Bhavani Traders, Tuni v. Assistant
Commissioner of Commercial Tax, No. IV, Enforcement Wing, Hyderabad &
others, 1993 (3) ALT 242.
Recovery of unlawful collections:– (1) Authorising recovery of unlawful
amounts collected by the dealer is ultra vires of the Constitution. V. Adi
Seshaiah & Co. v. State of A.P., 1968 (22) STC 222.
Default in licence fee dealer can’t be treated as unlicensed:– (1)
Where there was an arrear to pay the balance of fees fixed for any licence
the defaulter cannot be treated as unlicensed dealer. K.R. & Co. v. State
of A.P., ILR 1960 (1) A.P. 266.
Crown debt no priority:– (1) Hypothecation is only an extended idea
of pledge and the right created in favour of the creditor to realize the amount
by sale of hypothecated property. Though it is not a statutory right, it has
come to the recognition by the courts considerably from time to time.
Therefore there is a right to the creditor to recover the amount by sale of
the hypothecated properties ; crown debt cannot have a priority against the
debt secured by hypothecation. It is open to the garnishee to have his claims
cleared before the priority of the Government is claimed. The Indian Bank
v. State of A.P., 1993 (2) An.WR 609.
Partnership firm, different entities:– (1) Partnership firms are different
legal entities. Therefore where one firm is a defaulter the assets of another
firm can’t be attached on the ground that one or more partners of the defaulting
firm are partners in the other firm. Central Glass Factory v. Special C.T.O.,
1967 (20) STC 69.
Minor Partner:– Minor partner's properties can be attached towards

the tax due, if he does not repudiate his status within 6 months after he
becomes a major. (2005) 40 APSTJ 12.
Joint Family arrears:– (1) Where business is carried on by Hindu Joint
family all the members of the family are liable to pay arrears of tax after
discontinuance of the business. Ch. Kittaiah v. State of A.P., 1966 (1) An.WR
267 = 1967 (20) STC 73.
Dues of the Company:– (1) Sales tax dues of the Company cannot
be collected from the Director except during winding up proceedings. Suit
for refund of sales tax on the ground that the person or the authority who
made the assessment has no jurisdiction is not maintainable. State of A.P.
v. Sri Krishna Coconut Company, 1960 (1) An.WR 269.
Liability of L.R. to pay penalty:– (1) The legal representatives are
liable to pay penalty levied on the deceased dealer. State of A.P. v. G.
Kasiviswanadham, 1969 (2) APLJ 188.
Revision by assessing authority:– (1) Revision by assessing authority
on the ground that he did not advert to an aspect of the matter on the record
not permissible. Assessing authority can exercise its power of revision only
on fresh matter, which comes to his notice subsequent to assessment.
Amendment of law with retrospective effect or the Judgment of Supreme
Court or High Court can be treated as sufficient matter to exercise power
of revision under Section 14(4) by the assessing authority. M/s. Girdharlal
& Co., Hyderabad v. State of A.P. rep. by State rep. before STAT, Hyderabad,
1995 (1) An.WR 153 (DB) = 1995 (2) APLJ 65.
Stay pending no attachment:– (1) When the appellate authority granted
a conditional stay on terms, it is not open to the assessing authority to make
an order of attachment of the properties of the assessee. M/s. Shah Wallace
& Co. Ltd. Rep. by its President K.P. Jayakar v. C.T.O., Secunderabad &
another, 1995 (2) An.WR 246 (DB).
Appeal only by the aggrieved:– (1) Appeal against the orders made
by the lower authority can be preferred only by the person aggrieved.
Appeal filed by the owner of the building in which the business of assessee
was being carried on, is not maintainable. In this case, the order
made on such appeal by the appellate authority was quashed. Alapati Jalaiah
v. Asst. C.T.O., Guntur & others, 1998 (6) ALT 227 (DB).
Delay should be condoned first:– (1) Where the delay in filing an
appeal is required to be condoned, the appellate authority shall dispose of
the question of delay before taking up the appeal on merits. Hyderabad Wire
& Allied Products & another v. Commissioner of Commercial Taxes, 1999
(1) ALT 417 (DB) = 1999 (1) ALD 487 = (1999) 115 STC 286.
For continuing stay before the tribunal separate application should

be filed:– (1) The stay granted by the Joint Commissioner pending appeal
before the 1st appellate authority will not enure to the benefit of the appellant
during the 2nd appeal before STAT. Another application for continuing the
stay should be filed and order obtained for extension of stay pending 2nd
appeal. BHEL, v. C.T.O., 1999 (1) ALT 85 (DB) = 1999 (3) ALD 722.
No revision on surmises:– (1) Commissioner cannot revise the orders
of the lower authorities on mere surmises on what should have happened
or on assumptions that an element of tax is either embodied or not embodied
on the price of the goods without examining or calling for the relevant
accounts. Hyderabad Wire & Allied Products and another v. C.T.O., 1999
(1) ALT 417 (DB) = 1999 (1) ALD 487 = (1999) 115 STC 286.
Revision by Commissioner not equivalent to constitutional power:–
(1) The power of revision conferred on the Commissioner is not equivalent
to constitutional powers conferred on the Courts. Al-Kabeer Exports Ltd.
v. Commissioner of Commercial Taxes, Hyderabad, 2000 (4) ALT 199 = 2000
(4) ALD 339.
Suo motu power:– (1) Suo motu power of the Commissioner can be
invoked only in the case where the proceedings of subordinate authority is
prejudicial to the interest of revenue. Such powers can’t be exercised at the
instance of the party. State of A.P. v. I.T.C., Bhadrachalam Paper Boards
Ltd. & others, 1999 (1) ALT 704 = 1999 (2) ALD 39.
Date of the order, not the date of service relevant:– (1) When the
revision order of the Commissioner was actually made within the time
prescribed therefor, any explainable delay in the service of the order will not
render the revision order invalid. If the date of such service on the assessee
falls beyond limitation and where no explanation is furnished for delay the
order of the Commissioner must be presumed to have been made not on
the date when it purported to have been made but on a later date which
falls beyond limitation. M/s. Ushodaya Enterprises Ltd., v. Commissioner of
Commercial Taxes, A.P., 1998 (3) ALT 96 (FB) = 1998 (3) ALD 478.
No revision by Co-ordinate authority:– (1) The power to revise orders
by the superior authority can be exercised only against the orders made by
the subordinate only. Revision power can’t be exercised against the orders
made by Co-ordinate authority. Deputy Commissioner can’t revise the orders
of the appellate Deputy Commissioner. Sri Satya Winery & Distilleries Pvt.
Ltd., v. State of A.P., 1999 (3) An.WR 317 (DB) = 1999 (2) ALD 651
= (1999) 114 STC 88.
Deduction of time:– (1) Unless the proceedings pending before the
High Court are directly related to the questions of Law involved in the revision
pending before the Commissioner, the period between the date of institution
of the proceedings in the High Court and the date of their termination cannot
be excluded for purposes of computing the four years period of limitation.
Sagar Industries v. CCT, 1996 (2) ALD 995.
When there is no dispute no remand:– (1) Where there was no dispute
between the parties on any issue the appellate court cannot remand the case
to the assessing authority for any further enquiry. When both the parties agree
that the transaction in question is inter-State sales it is wrong for the tribunal
to conduct a fresh enquiry whether the transaction is an inter-State sale. M/
s. M.C. Dowell & Co. Ltd., Hyderabad v. State of A.P. rep. by State rep.
STAT, Hyderabad, 1995 (2) ALT 189 (DB) = 1995 (1) APLJ 348.
No revision, if question is not raised earlier:– (1) Revision to the
High Court is not maintainable unless the question of law before it is raised
and disposed off by the appellate tribunal. M/s. Telangana Bone Mill &
Fertilizer Co., v. State of A.P. rep. by State rep. STAT, 1995 (1) ALT 679
(DB) = 1995 (1) APLJ 171.
Revision applying different rates can’t be made after 4 years:– (1)
Revision made-over by Deputy Commissioner to tax turnover at different rates
after 4 years. Such revision can’t be brought under the powers of revision
available within six years. Kalappa v. State of A.P., 1983 (54) STC 181
(A.P.).
(2) Revision of tax by the authority competent to revise assessment
on the ground that the rate of tax applicable is higher than what was applied,
the revision should be completed within four years. State rep. v. National
Rubber Manufacturers Ltd., 1978 (42) STC 392.
Right of appeal inherent:– (1) The condition that the entire tax should
be paid for entertainment of the appeal does not annihilate the right of appeal.
Right of appeal is just as statutory right. It is only a right conferred by the
statute. Sri Venkateswara Rice & Flour Mill v. Board of Revenue, 1960
(1) An.WR 324.
Refusal to stay, reasons should be stated:– (1) The appellate authority
or the revisional authority considering the question of stay pending appeal
does not have absolute right to stay or refuse to stay; the jurisdiction conferred
here on these authorities is a duty cast on them. Therefore any order made
in this regard shall disclose the application of mind and reasons for making
the order. Shivanarayana Sadhuram v. Asst. Commercial Tax Officer, 1966
(2) An.WR 445.
Revision cannot go beyond record:– (1) Revisional authority has no
power to correct assessments based on information subsequently gathered
or go behind the record. M. Venkatanarayana v. State of A.P., 1959 (2)
An.WR 467 = AIR 1960 AP 171 = 1959 (10) STC 244.
Tribunal can’t go into matter not disputed:– (1) Where no appeal

was preferred against a part of the turnover the appellate tribunal is not
competent to consider that portion of the original order against which no
appeal preferred. State of A.P. v. Venkata Ramalingeswara Rice Mill, 1977
(39) STC 57 (FB).
Rejection of appeal time bar amounts to confirmation of assessment:–
(1) Rejection of an appeal on the ground of limitation amounts to confirmation
of tax determined by the original order and hence there is determination of
tax by the appellate court. Venkat Subramanyam v. Spl. C.T.O., 1967 (27)
STC 249.
Long delay in service of revision order, assessee not bound by the
order:– (1) Order made in revision within time was not served on the assessee
after a lapse of 10 to 12 months not binding on the assessee. M. Ramakrishnaiah
& Co. v. State of A.P., 1976 (38) STC 637.
Appeal against revision order maintainable:– (1) Appeal lies to the
Tribunal against the order passed by the Deputy Commissioner under revisional
powers. Suryalakshmi Cotton Mills v. Deputy Commissioner, 1969 (23) STC
178.
No revision at the instance of parties:– (1) Revision before the Board
of Revenue at the instance of the parties is not maintainable. Accordingly
the appeal filed against the order of the Board of Revenue rejecting such
application is also not maintainable. Sriramachandra Ginning & Oil Mills
v. State of A.P., 1967 (19) STC 354 = 1967 (2) An.WR 98.
Res judicata has no application:– (1) The principle of res judicata
does not apply in respect of other assessment years. Minerals & Metals
Trading Corporation v. Deputy Commissioner, 1976 (42) STC 372.
Personal hearing before revisional authority not mandatory:– (1)
Giving personal hearing before revisional authority is not mandatory. It depends
on the facts of each case. Sri Venkataramana Manures Co. v. Deputy
Commissioner, C.T. Guntur, 1978 (42) STC 189.
Non-deposit of penalty, appeal can’t be rejected:– (1) When deposit
of penalty is not a condition precedent for entertaining appeal the order of
the Tribunal refusing to entertain the appeal unless penalty is deposited is
not sustainable. M. Bhadrayya v. Sales Tax Appellate Tribunal, 1964 (15)
STC 787 = 1964 (1) An.WR 361.
Condition for payment of tax for filing appeal is not discriminatory:–
(1) The provision that payment of tax is condition precedent for preferring
appeal under Central Sales Tax Act is not discriminatory on the ground that
such a provision is not made in similar other statutes. Mohammad Akhlaq
Ahmed v. State, 1969 (92) An.WR 214 = 1969 (23) STC 204.
Review by High Court:– (1) Review by the High Court shall not be
undertaken on the basis of a judgment pronounced by the Supreme Court
subsequently. Wires International, Vijayawada v. State of A.P., 1977 ALT
70 = 1978 (41) STC 465.
High Court has no power to grant stay pending TRC:– (1) High
Court has power to grant stay of the collection of tax pending tax revision
case. However the High Court may not stay the collection of entire disputed
tax excepting in very grave cases where it feels that there has been a grave
miscarriage of justice. Bharath Litho Press, Nizamabad v. State of A.P.,
1987 (2) ALT 131.
High Court, no power to refund the court fee:– (1) The High Court
can not refund the court fee while remitting the matter to the Board of Revenue.
Refund of court fee is permissible only in suits under Section 64 of the A.P.
Court Fees Act and it does not apply to tax matters. Sriramulu v. Board
of Revenue, AIR 1965 AP 395.
Order of refunds by appellate authority:– (1) Refund of tax granted
by the appellate authority should be made by the assessee in accordance with
rules without any delay, the fact that some revision is pending with some
higher authority is no ground to delay or withhold the refund unless the Deputy
Commissioner issues any directions in this regard. M/s. Golden Bar &
Restaurant & another v. C.T.O., Tanuku and another, 1996 (3) ALT 293
(DB) = 1996 (3) ALD 303.
Special provision for refund:– (1) Where special provisions are made
for the refund of tax and also the circumstances where such refund should
be made with interest, it is not open to the court to grant interest either
by applying the Interest Act or by applying any rules of justice and equity.
Ambika Chemical Products, Eluru v. Commercial Tax Officer, Eluru &
another, 1999 (2) ALT 688 (DB) = 1999 (2) ALD 651 = (1999) 114 STC
88.
Entitlement of refund under APGST v. Demand under CST:– (1)
The mere fact that an Assessee is entitled to refund of tax paid under the
Act does not enable him to resist the demand under Central Sales Tax Act.
Both are independent proceedings. Authorities under the State Act are not
precluded from considering the refund application till assessment under Central
Sales Tax Act are finalized. Sri Krishna Coconut Company v. C.T.O., 1972
(1) An.WR 141 = 1972 (30) STC 461.
Expiry of time for refund, is no limitation:– (1) The period fixed
for tax refund is not a period of limitation. It is only a condition imposed
for obtaining refund of tax. Venkateswara Government Factory v. C.T.O.,
1972 (1) An.WR 200 = 1972 (30) STC 185.
No refund of tax so long as assessment remains uncorrected:– (1)

Refund of tax on the ground of mistake can’t be claimed as long as the
assessment stands. G. Sriramulu v. State, 1972 (30) STC 120.
Withholding of refund:– (1) Refund of tax can’t be withheld unless
such refund is prejudicial to the interest of the revenue and the withholding
of refund shall have the prior clearance of the Deputy Commissioner. M/
s. Nav Swadeshi Oil Mills & Refineries, v. C.T.O., 1987 (64) STC 82.
Refund pending revision:– (1) Direction of the Deputy Commissioner
not to refund the amount until the expiry of limitation for revision does not
prevent the assessing authority from refunding the amount in accordance with
law. M/s. Vijayadurga Rice Mills v. C.T.O., 1994 (2) ALT 289.
Withholding of refund only by order:– (1) Withholding of refund can’t
take place without a specific order from the Deputy Commissioner. M/s.
Carew Philipson Ltd. v. C.T.O., 1994 (2) ALT 359.
Seizure-goods only:– (1) The prime consideration of the Officer ordering
seizure shall be that the goods found are not accounted for by the dealer
in his accounts. Non-registration of the dealer is not a ground and the same
is wholly irrelevant. The seizure so made is without jurisdiction. M/s. Santhosh
Wines v. Asst. C.T.O., 1995 (1) ALT 5 NRC.
(2) The power of seizure is limited to the goods only. The Asst. C.T.O.
has no jurisdiction to detain the lorry. Hence a direction was issued to release
the lorry to the petitioner. S. Syed Hussain v. C.T.O., Madanapalli, Chittoor
Dist. & others, 2000 (3) An.WR 13 (DB).
Use of Devanagari numerals:– (1) Use of Devanagari numerals in
books maintained in Hindi is not permissible. Even where, accounts are
maintained in Devanagari script the numerals used should be international
numerals only. The rule and the direction issued that the numeral should
be in English only can’t be found faulty. The rule is constitutionally valid.
Chompatlal v. State of A.P. & others, (1996) 103 STC 341 = 1996 (2)
ALD 575.
Loss of Way bills:– (1) Loss of Way bill books reported, another way
bill book is issued. However, a penalty to an extent of Rs. 64,000/- was
imposed and further a security by way of indemnity bond was demanded.
When nothing else was found against the dealer, the levy of penalty as well
as the demand for security are totally unauthorized and unjustified. Sri
Muralikrishna Bindi Modern Rice Mill v. C.T.O., 1996 (2) ALT 59 (DB)
= 1996 (2) ALD 16.
Keeping continuous watch not permissible:– (1) Keeping continuous
watch over the business premises is illegal. Such a step is not merely
procedural. It effects substantial rights of parties. Best of Judgment assessment
based on such illegal watch should be set aside. M/s. Udipi Vasantha Vihar
v. Deputy C.T.O., 1969 (2) An.WR 75 = 1969 (23) STC 6.
Reasonable times – meaning:– (1) The words at all reasonable times
indicate not a continuous process throughout the entire day but only at certain
times which in circumstances particular to the case are reasonable. P.
Lakshmana Rao & Sons v. Spl. C.T.O., Vijayawada, 1962 (13) STC 860
= 1962 (2) An.WR 96.
Mill working midnight hours, reasonable time:– (1) If the mill could
work and transact business in the dead of night it should also be construed
a reasonable time for making the inspection or collecting any information by
the officer of the C.T.O. Department. M. Subba Rao v. State, 1971 (2) An.WR
227 = 1972 (30) STC 528.
Powers of seizure, not ultra vires:– (1) Provision of seizure of goods
is not ultra vires of the powers of State legislature. Indian Electricals &
another v. C.T.O., W.P.No. 13360/84 dated 13.08.1988.
Power of confiscation not ultra vires:– (1) Provision for confiscation
of goods is not violative of Article 19(1)(f) & (g) of the Constitution of
India. K.S. Pappanna v. Deputy C.T.O., 1967 (19) STC 506 = 1967 (2)
An.WR 71.
Vehicles proceeding through State:– (1) Vehicles proceeding from
outside the State to a destination to another outside State shall not be detained
unless they raise reasonable doubt relatable to concrete facts indicating
avoidance of payment of tax inside the State. So long as the documents
with the vehicles show that the transfer is from one outside State to another
outside State vehicles shall not be detained. Patel Angadla & Co., Bangalore
v. Asst. C.T.O., Integrated Checkpost, Purushotthamapuram, Srikakulam Dist.
and another, 1997 (3) ALT 353 (DB) = 1997 (3) ALD 682.
Collection of tax at check post:– (1) Collection of tax at the check
post as an anticipatory collection of tax on the presumption that the dealers
are likely to resort to clandestine activities at a later point of time is not
warranted. 1999 (2) ALT 99 (DB) = 1999 (2) ALD 671 = (1999) 214
STC 140.
Beyond reasonable time, detention illegal:– (1) Where there is no
good reason to let in the goods detaining them beyond the time necessary
for checking the goods must be construed as mala fide. State of A.P. v.
Appalaraju & another, 1987 (2) ALT 112 (NRC).
Assessment can’t be challenged in prosecution:– (1) In a prosecution
under this Act the accused can’t challenge the assessment made. The only
issue in the case of prosecution for non-payment of tax is that the assessment
was made against the accused and that he has failed to pay the amount
assessed. No other enquiry is warranted in such cases. Public Prosecutor

v. Bhavigadda Thimmaiah, 1959 ALT 10 = 1959 (10) STC 85 = AIR 1959
AP 207 = 1959 (1) An.WR 119 (FB).
Composition:– (1) Order of the authorities made for composition of
offence at the request of dealer is final and can’t be challenged. Kaki Butchraju
& Son v. State of A.P., 1994 (2) ALT 353.
Mens rea not relevant:– (1) In the prosecution of an assessee who
fails to pay the tax; mens rea is not necessary ingredient. Public Prosecutor
v. M. Ramanaiah, Crl.A.No. 229/71 dated 29.12.1972.
Penalty and prosecution:– (1) Levy of penalty on non-payment of sales
tax is not prosecution. Levy of penalty does not therefore prevent the
authorities to prosecute the dealer for non-payment of tax. M. Sitharamaswamy
& Co. v. C.T.O., AIR 1960 AP 451.
Collection of compounding fee without order illegal:– (1) Collection
of compounding fee without an order or recorded proceedings is illegal. Such
amount shall be refunded to the dealers. M/s. Jeevanlal Jain v. C.T.O., 1992
(3) ALT 484.
Composition, there shall be prior enquiry and determination:– (1)
Composition of offence shall be preceded by an enquiry to determine the
nature of offence. The offer of composition shall not emanate from the
department. B. Venkatappayya & Sons v. C.T.O., 1973 (32) STC 34.
Power to grant exemption includes power to revoke:– (1) Power
to make rules or grant exemption by rules implies power to rescind, revoke,
amend or vary the rules and orders. M/s. ITC Classic Finance Services,
Secunderabad v. Commissioner of Commercial Taxes, A.P., Hyderabad &
others, 1995 (1) ALT 563 (DB) = (1995) 97 STC 330.
Withdrawal of exemption, no estoppel:– (1) Withdrawal of exemption
will not violate either the doctrine of legitimate expectation or the doctrine
of promissory estoppel. M/s. Sri Maruthi Lime Manufacturing Industrial Co-
operative Society Ltd., Kakani, Guntur District rep. by its President v.
Principal Secretary to the Government, Revenue Department, Hyderabad and
others, 1997 (3) An.WR 308 (DB).
Judicial review of High Court normally lies against the decision making
process. Hence the stage when show cause notice is issued does not call
for interference by the High Court. M/s. Jasper Industries (P) Ltd., v. Asst.
Commnr. (CT) Audit, (2010) 51 APSTJ 108.
Error apparent on record means it is not capable of raising any argument
or debate. Arora Enterprises v. Dy. Commnr. of CT, (2010) 51 APSTJ 20
= 2011 (1) ALD 69 (DB).
Notes on Payment of Tax, payment of tax in

instalments and stay of tax recovery pending
appeals and revisions
1. Assessing authority may permit the dealer payment of tax in instalments

while making the order of the assessment.
2. Before appeal is admitted by the appellate Dy. Commissioner:
(i) Admitted tax should be paid or the instalments due should be
paid by the date of appeal.
(ii) 12½% of the disputed tax also shall be paid by the date of filing
the appeal.
(iii) Appellate Dy. Commissioner may stay the payment of balance
disputed tax on taking security. Security is must.
Against the order of the Dy. Commissioner refusing to stay collection
of the balance disputed tax the dealer may file a revision before the Joint
Commissioner or Addl. Commissioner who may either refuse to grant stay
pending appeal before the Appellate Dy. Commissioner or grant stay of
the collection of disputed tax on terms such as furnishing of personal
security or security in third party or property security or bank guarantee
or any other similar security. The Joint Commissioner or Addl. Commissioner
may also grant instalments. This order will continue during the appeal
before the Appellate Dy. Commissioner. In case, a further appeal is filed
against the order of Appellate Dy. Commissioner before the Sales Tax
Appellate Tribunal the stay granted by the Joint Commissioner or Addl.
Commissioner may be extended till the disposal of the appeal before the
Appellate Tribunal on a further application made by the appellant before
the Joint Commissioner or Addl. Commissioner. Here, one more problem
may arise if the circumstances under which the appeal is filed before the
Appellate Tribunal happen to be different from what they were at the
time when the appeal was pending before the Appellate Dy. Commissioner.
(a) Normally, if appeal is allowed by the Appellate Dy. Commissioner
the tax liability will be reduced. If the appeal is dismissed the
tax liability will remain the same. In which case, there may
not be any difficulty in extending the stay orders made by the
Joint Commissioner or Addl. Commissioner to the appeal pending
before the Appellate Tribunal.
(b) In case, the appeal before the Appellate Dy. Commissioner results
in enhancement of tax liability that portion of additional tax
together with the earlier disputed tax in appeal will be the disputed
tax before the Appellate Tribunal. In such case the appellant
before the Appellate Tribunal shall pay that part of the tax which
he does not dispute in appeal as determined by the Appellate Dy.
Commissioner plus 50% disputed tax alongwith the appeal before
Appellate Tribunal. In such circumstances, the extension of the
order staying collection of tax, made by the Joint Commissioner
or Addl. Commissioner shall be suitably amended to cover the
balance of 50% disputed tax before the Appellate Tribunal.
If the appeal before the Appellate Tribunal is an appeal against
the orders of the Addl. Commissioner or Joint Commissioner made
under their revisional jurisdiction, the appellant shall pay 25%
of the tax disputed in the appeal before the appeal is admitted.
3. The conditions about the payment of 12½% of the disputed tax and
the admitted tax by the dealer before the appeal is admitted by the
Appellate Dy. Commissioner, and the condition relating to payment
of 50% of the disputed tax along with the admitted tax before the
appeal is admitted by the Appellate Tribunal are mandatory for admission
of appeals; failure to make such payments will act as a bar against
considering the appeals by the respective Appellate authorities. If the
dealer fails to make payment of other amounts, that will not be a bar
for the appellate authorities to dispose of the appeals on merits. In
such cases, unpaid tax dues will be recoverable or may be recovered
by the authorities concerned notwithstanding the pendency of the
appeals.
4. When the matter reaches the High Court in revision against the order
made by the Appellate Tribunal, the dealer shall pay the tax in
accordance with the orders made by the Appellate Tribunal. However,
the High Court has got the power to grant instalments or give such
directions as regards the payment of tax as the High Court thinks
it proper. It may be noticed here that notwithstanding the wide
discretion conferred on the High Court in this matter, it certainly
does not include any blanket stay and any order that may be made
by the High Court could only be a direction to secure payment of
tax.
5. Where the High Court entertains an appeal against the orders in revision
made by the Commissioner suo motu or orders of the Commissioner
relating to refund of tax, the High Court has the same powers relating
to issuance of directions which it has as a court of revision against
the orders of the Appellate Tribunal.
6. In respect of appeals or revisions relating to matters other than
assessment, the appellate authorities and the High Court have inherent
powers relating to suspension or stay of the orders of lower authorities
as they may think appropriate.
Flow Chart of Events from filing of
Return to recovery of tax
VAT dealer files monthly return by TOT dealer files quarterly return
20th of next month enclosing the by the end of the month
evidence of payment of tax. succeeding the quarterly period
enclosing the proof of payment
of tax.
The return is filed before the The return is filed before the
concerned assessing authority. concerned assessing authority.
Assessing Authorities Jurisdiction

1. Asst. Commercial Tax Officer 1. Assessing authority for TOT
dealers in the circle concerned
as is authorised by Dy.
Commissioner of the Division.
2. Dy. Commercial Tax Officer 2. Assessing authority for VAT
dealers in the circle concerned
as is authorised by the Dy.
Commissioner of the Division.
3. Commercial Tax Officer 3. Assessing authority for VAT
dealers in the circle concerned.
4. Asst. Commissioner of 4. Assessing authority for VAT
Commercial Taxes dealers in respect of division
concerned in large tax payer
unit as is authorised by
Commissioner.
1. On receipt of the return the assessing authority gives acknowledgement.

2. The assessing authority will then scrutinize the return for the purposes
of verifying:
(a) correctness of the calculations; (b) application of the correct rate
of tax; (c) calculation of the input tax credit; and (d) correctness of
the amount payable and the amount paid.
If the assessing authority is satisfied about correctness of the matters
above stated, nothing happens for a period of four years. No order of
assessment will be issued.
If the return is not filed within the period prescribed as above the
assessing authority may make what is called a unilateral assessment based
on the previous record of the assessee and issue a demand notice for payment
of tax and this assessment will stand for a period of four years or six
years if the same is not questioned.
If the assessee files the return after the unilateral assessment is made
by the assessing authority and pays also the tax due as per the return,
the assessing authority shall withdraw the unilateral assessment without
prejudice to any penalty which may be levied on the assessee and the
interest which may be claimed from him.
If the assessing authority on a further scrutiny is not satisfied with
the return or the return appears to him to be incorrect or incomplete
he may make an assessment to the best of his judgment within four years.
The four years period is computed from the date when the return is filed
or within four years from the date when the return is due as the case
may be. The question of computing the period from the date of return
arises only when the return is filed beyond the due date of its filing.
The best of judgment assessment here shall be confined to the period
for which the return is filed. Here, the scrutiny and the best of judgment
are also confined to the assessment record and return only and not beyond.
If on a further detail scrutiny of the accounts and on information
available or on any other basis such as the information obtained from other
sources or by inspection, if the assessing authority is satisfied where making
of an assessment is necessary such an assessment may be made to the
best of judgment within a period of four years. Here, the scope of
assessment can be extended depending on the additional information
available.
If the information available discloses that there is a wilful evasion
of tax on the part of the dealer the best of judgment assessment contemplated
under the above circumstances may be made within a period of six years.
Such assessments and re-assessments can be made by the assessing
authority from time to time as and when additional incriminating
information becomes available subject to the periods of limitation of four
years or six years as the case may be.
First appeal to the Payment of tax

Appellate Dy. Commissioner Appellate authority will not
(a) Against the order of unilateral admit the appeal unless proof of
assessment. payment of the entire undisputed
tax is produced.
First appeal to the Payment of tax

Appellate Dy. Commissioner
(b) Against an order of assessment The appellate authority on an
made on further scrutiny application made by the appellant
making best of judgment may refuse to grant stay of the
assessment within four years. collection of the balance disputed
tax or stay it on taking surety.
(c) Against an order of If the stay is refused, the assessing
assessmentmade to the best of authority may proceed to collect
judgment on further detailed the balance tax. The fact that the
scrutiny and further stay was refused or that proceedings
information made available or for collection of the tax are pending
obtained within four years. will not come in the way of
disposal of the appeal by the
appellate authority.
(d) Against an order of assessment If the appellant feels aggrieved by
to the best of judgment made the order of the appellate authority
within six years on further refusing to stay collection of tax
information made available or or staying the collection on
obtained. conditions, he may file a revision
petition before the Asst.
The appellate authority may
Commissioner of Commercial
confirm, reduce, enhance or
Taxes whereon the Asst.
annul the assessment or penalty
Commissioner may make an
or to remand the case to the
appropriate order which should
assessing authority. The appeal
necessarily include obtaining
shall be disposed of within two
adequate security from the
years.
appellant.
An appeal lies before the Appellate Tribunal:

1. Against the final orders of the Appellate Dy. Commissioner.
An appeal lies before the Payment of tax

Appellate Tribunal Stay of collection of tax pending
appeal before Appellate Tribunal.
(a) Against the final orders of the Where it is an appeal against orders
Appellate Dy. Commissioner. made under Section 31, the
(b) Against the orders made by the appellate tribunal will admit the
Addl. Commissioner or appeal only when proof of payment
Joint Commissioner or Dy. of 50% of the tax ordered by the

Commissioner under Section 21 Appellate Dy. Commissioner.
or Section 32 or Section 38. Where it is an appeal against order
The appellate tribunal may made in revision, the Appellate
confirm, reduce, enhance or annul Tribunal will admit the appeal
assessment or remand the appeal only when proof of payment of tax
to the assessing authority to make admitted and 25% of the difference
a fresh order of assessment or any of the tax ordered by the revisional
such order. authority. Appellate Tribunal has
no power to grant any stay of the
collection of the tax due from the
appellant. The fact that there is
no stay of the collection of tax due
from the appellant or the fact that
the proceeding for collection are
progressing will not come in the
way of the appellate tribunal
disposing of the appeal.
On an application made to the
Asst. Commissioner for staying
the collection of tax or for
extending the stay granted by him
while the appeal was pending with
the Appellate Dy. Commissioner,
the Asst. Commissioner can make
appropriate orders including taking
of security or rejecting stay.
Revision by High Court Stay of collection of

tax pending revision before
High Court
Against the orders made by the The High Court may in its
Appellate Tribunal under Section discretion permit the petitioner to
33(4) on the ground that the pay tax in accordance with the
tribunal has either decided assessment in instalments or give
erroneously or failed to decide any such other directions in regard to
question of law. the payment of tax as it thinks
fit. However, High Court will not
The High Court after determining
grant stay in respect of tax and
the questions of law may reverse,
penalty due in accordance with
affirm or amend the order against the orders of the appellate tribunal
which the revision is preferred or in relation to which the petition
remit the matter to the appellate has been preferred.
tribunal to dispose of the matter
in accordance with the opinion of
the High Court. The High Court
may call for the opinion of the
tribunal on any reference made to
the High Court.
The High Court may review the order made by it under Section 34
(i.e. Tax Revision Case) at the instance of any of the parties.
Appeal to the High Court:

A direct appeal to the High Court lies against the orders made by
the Commissioner of Commercial Taxes under Sec. 32 or under Sec. 38
(Refund Order). This appeal can be disposed of in the same manner as
the High Court disposes of the Tax Revision Case.
Recovery of Tax:
Notwithstanding the pendency of any appeal revision or revision before
the High Court, or the review or appeal before the High Court unless
there are any specific orders of stay all amounts due from the assessee
towards tax, penalty or interest can be recovered if not paid, under the
summary provisions of the Revenue Recovery Act. For this purpose, Dy.
Commercial Tax Officer is designated as the Recovery Officer and he
functions under the supervision and control of the Dy. Commissioner of
Commercial Taxes as if they are a Recovery Officer and Dist. Collector
respectively of the Revenue Recovery Act.
VAT–11
CHAPTER VI
Records and Investigation Powers
41. Issue of Bills:– Every VAT dealer who makes a sale to a

person other than a VAT dealer or every TOT dealer or any other dealer
whose taxable turnover is not less than Rs. 5,00,000/- (Rupees five lakhs
only) in a year, shall issue a bill or cash memorandum in such form and
with such details of tax collected as may be prescribed, for every sale
involving an amount not less than Rs. 100 (Rupees one hundred only):
Provided that every VAT dealer or TOT dealer or any other dealer
shall issue a sale bill in the proforma prescribed, irrespective of the amount
of sale, when demanded by the buyer.
Notes
Issuance of bills is crucial in this tax system. The working of the

Act depends upon the certainty of all dealers issuing bills and on their
preservation. Bills are integral to the maintenance of accounts. Issuance
of and preservation of the bills is a mandatory duty for all dealers whether
they are registered as VAT dealers or TOT dealers. The dealer shall not
refuse to issue bills to whom so ever demands a bill. Breach of this section
is punishable with penalty under Section 55.
42. Records:– (1) Every VAT dealer or TOT dealer shall maintain
the documents and records specified in the rules at the place of business
so registered in the English language or in any of the languages specified
in the Eighth Schedule to the Constitution.
(2) Every person registered under the Act, every dealer liable to
get himself registered under the Act, every agent acting on behalf of a
resident principal and every other dealer who is required so to do by
the authority prescribed by notice served in the prescribed manner, shall
keep and maintain a true and correct account promptly in any of the
languages mentioned in sub-section (1), showing such particulars as may
be prescribed; and different particulars may be prescribed for different
classes of persons or dealers.
(3) The Commissioner may get the books of accounts maintained
by any dealer audited by a Chartered Accountant or a Cost Accountant
or an enrolled Sales Tax Practitioner for any tax period.
Sec. 42] Records and Investigation Powers 163
(4) Records required to be maintained under sub-section (1) shall

be retained for a period of six years after the end of the year to which
they relate or where the assessment is subject matter of appeal or revision
under Sections 31, 32, 33, 34 or 35, the records shall be retained for
a period of six years after the assessment has become final.
Notes
To appreciate the nature of records to be maintained by VAT dealers,

TOT dealers and others who may be required to maintain records it may
be useful here to recollect the essential characteristics of the VAT system
of taxation. It is a multiple point Sales Tax. Every dealer is liable to pay
the tax on his sale turnover at the rates prescribed. The tax which the seller
pays on his turnover is called his output tax. The tax is included in his
sale price. Accordingly, it means that the tax which the seller pays to
Government is collected from the purchaser. Therefore, what is called the
output tax (i.e. tax on his output which means tax on his sales turnover)
is the input tax for the purchaser. When the purchaser in his turn sells
the same goods, he pays the tax on his turnover at the rates prescribed.
Since, the sale value of the goods here naturally happens to be higher, the
tax he pays on his sales will naturally be higher. The fundamental difference
between the existing multiple tax system and VAT is that in the sales tax
the subsequent seller pays, the tax paid by him as input tax at the time of
purchase,is deducted and the balance of tax only which is called the net VAT
is paid to the Government. This process goes on from one seller of goods
to another till it reaches the consumer. The accounts to be maintained by
the dealers shall reflect this whole process.
First: The monthly account of the output tax paid by or payable to
the Government on the sales effected by the VAT dealer and the input tax
he has paid as part of the purchase price on his purchases and the tax credit
he earns by deducting the latter from the former shall be reflected in the
accounts and statements prepared by him. This statement shall also show
whether such tax credit is shown for claiming refund or is shown as for
adjustment in the next accounting period as a carry forward.
Second: A record or file showing all purchases made whether subjected
to tax, zero based or exempt or subjected to high special rates, whether
included in the output tax or not supported by bills etc. shall be maintained
so that none of the purchases are omitted even by inadvertence.
Third: A record of all sales made whether subjected to tax, zero based
or exempt or subjected to high special rates whether included in the input
tax or output tax, shall be shown supported by all bills, etc. so that none
of the sales are omitted even by inadvertence.
Fourth: A record of all debit and credit notes issued and received so
that a proper account of the stocks of goods received and delivered and
a proper calculation of the input and output tax is facilitated.
Fifth: There should be maintained a special record of all transactions
which come under interstate, export and import sales and purchases coming
under Central Sales Tax Act. This is an important record in which all
particulars of invoices, mandatorily required forms, tax receipts and payments
and payment particulars through banks and agreements which prompted the
movement of goods across borders and also custom clearance certificate shall
be given and copies maintained, in the absence of which the claims for refund
will never be granted.
Sixth: Cash records which support each and every transaction dealt
with by the dealer shall be maintained in the manner which presents the correct
picture of the whole business done by the dealer.
Seventh: Computer records, if any.
Eighth: Sometimes, it becomes necessary to quantify the value of a
particular item at a particular sum. This happens in the case of calculation
of input tax of the VAT dealer when he deals with both taxable as well
as non-taxable goods used up in manufacture or otherwise. Whenever such
calculations are made either by assumption or by estimation the record of
such calculations may also be maintained so that it may be of help at a later
date, if memory fails.
Ninth: A record of particulars on the basis of which the VAT dealer
first obtained the registration, needs to be preserved. This is necessary because
the authority granting VAT registration has power to cancel it, if the Registering
Authority at a later date finds that the registration ought not to have been
granted.
Tenth: In any business, stock records are primary documents to measure
the quantum of business, the dealer does.
Eleventh: Stocks are sold only by order which may be in writing or
oral and deliveries made under acknowledgements. In the VAT system,
evidence on these matters is very essential. A record of all such orders
and deliveries fully supported by documents should be properly maintained.
Delivery Notes and Way Bills are very important documents. They should
be preserved in the files.
Twelfth: Record about the staff employed and the work allotted to them
will reveal the nature and value of the processing or manufacture done by
the dealer, for value addition.
Thirteenth: Record of the Trading, Profit and Loss accounts and
Balance Sheet which show the ultimate results of any business are reflected
in the above documents. Unless the accounts and records maintained by

the dealer are truly reflected in these annual statements, the correctness and
completeness of accounts may come to doubt.
Fourteenth: No bank account is complete unless it is supported by
cheque book, counter foils and paying-in-slips. Though, the latter may look
redundant when the authorised pass books are available, such counter foils
and paying-in-slips being an integral part of the bank records shall be preserved
in proper order, in an appropriate file, so that the Amounts paid into can
be and the Amounts withdrawn may be properly identified.
The dealer can maintain his records in any of the official languages
of the State or of the Union. It is better and more convenient if the accounts
are maintained in English. When the accounts are maintained in any language
other than English, the numerals used should be English numerals only.
All these records shall be preserved safe for a period of six years from
the end of accounting period to which they relate. This period of six years
gets extended if the assessment is altered or confirmed by any order of the
Appellate or Revisional Authority or Court. The Six Year Period in such
cases, will re-commence from the date of such final orders, if such order
happens to be made at any time after the Three Year or Six Year Period.
In the case of TOT dealers, the records to be maintained must be relevant
to the business they do. Since the TOT dealers pays tax on the entire turnover
of sales at a fixed rate of 1% what all that is required is a true and correct
picture of all purchases and sales made by the TOT dealer. Hence, it is
enough if the TOT dealers maintain the following records viz.: (1) value of
the goods produced, manufactured, bought and sold; (2) Names and Addresses
of dealers from whom the goods are purchased together with all supporting
documents; (3) Names and Addresses of dealers to whom the goods are
sold together with all supporting documents.
All the accounts maintained by the dealers may be got audited appropriately
either by Chartered Accountants, Cost Accountant or by Sales Tax Practitioner.
The Act recognizes the audit by a sales tax practitioner.
Keeping the records readily available to the authorities and accessible
for inspection at the place of business is as much important as proper
maintenance of records. The question as to when and with what promptness
the entries in the Account Books should be recorded is not relevant from
the purposes of the Act, as it was in the case of orders issued under
enactments relating to essential commodities.
43. Access and seizure of goods, books, records and computers:–
(1) For the purpose of enforcing compliance of the provisions of the Act,
any officer not below the rank of Deputy Commercial Tax Officer shall
Commercial Tax Officer shall have the power of entry, inspection, search
and seizure and confiscation and he:–
(a) shall have, full and free access to any premises, place, goods,
books, record, computer or any electronically stored data at any
time during business hours prescribed under the relevant law for
the time being in force and where no such hours are prescribed
at all reasonable times without any prior notice to any dealer;
(b) may make an extract or copy from any book, record or computer-
stored information to which access is obtained under clause (a);
(c) may seize and confiscate any goods not accounted for and seize
any books or records that, in his opinion, affords evidence that
may be material in determining the liability of any VAT dealer
or TOT dealer or any other dealer under the Act;
(d) may retain any such book or record for a period of one month
for determining the tax liability of a dealer or for any proceedings
under the Act:
Provided that where such books or records are needed for more
than one month, the permission of the next higher authority shall
be obtained for each additional month;
(e) may seize and retain the computer for a period of one month
where a hard copy or computer disk of information stored in
a computer is not furnished, to get the information required:
Provided that where such computer is needed for more than one
month, the permission of the next higher authority shall be
obtained for each additional month; and
(f) shall have power to enter and search any office, shop, godown,
vessel, receptacle or vehicle or any other place of a carrier or
bailee where goods are delivered to such carrier or bailee for
transmission.
(2) For the purposes of sub-section (1), any such officer shall
have power to enter and search at any time during the business hours
prescribed under the relevant law for the time being in force, or where
are prescribed, at all reasonable times, any office, shop, godown, vessel,
vehicle or any other place of business or any building or place where
such officer has reason to believe that the dealer keeps or is, for the
time being, keeping any goods, accounts, registers or other documents
of his business:
Provided that no residential accommodation not being a shop-cum-
residence shall be entered into and searched by any officer below the
rank of Deputy Commercial Tax Officer except on the authority of an
order issued by any officer not below the rank of a Deputy Commissioner
having jurisdiction over the area; or an officer not below the rank of Deputy
Commissioner working in Vigilance and Enforcement Department having
jurisdiction over the entire State of Andhra Pradesh and all searches under
this sub-section shall so far as may be, made in accordance with the
provisions of the Code of Criminal Procedure, 1973 (Central Act 2 of
1974) subject to the rules if any, made in this behalf.
(3) The power conferred by sub-section (2) shall include the power
to break open any box or receptacle in which any goods, accounts,
registers or other documents of the dealer may be contained, or to break
open the door of any premises, where any such goods, accounts, registers
or other documents may be kept:
Provided that the power to break open the door shall be exercised
only after the owner or any other person in occupation of the premises
if he is present therein, fails or refuses to open the door on being called
upon to do so.
(4) The power conferred by sub-section (2) shall also include the
power to,–
(a) seal for a period of not exceeding twenty-four hours, any box,
receptacle, godown or building where any goods, accounts,
registers or other documents of the dealer are, or reasonably
believed to be, kept, if the owner or any other person in
occupation, leaves the premises or refuses to open any box,
receptacle, godown or building or is not readily available;
(b) search any person, other than customer or a visitor, who has
got out of or is about to get into, or is in, any building,
vessel or vehicle, if the officer has reason to suspect that such

person has secreted about any goods, accounts, registers or other
documents.
(5) Any such officer shall have power to seize and confiscate any
goods which are found in any office, shop, godown, vehicle, vessel or
any other place of business or any building or place of the dealer, but
not accounted for by the dealer in his accounts, registers and other
documents maintained in the course of his business:
Provided that before taking action for the confiscation of goods under
this sub-section, the officer shall give the person affected an opportunity
of being heard and make an inquiry in the prescribed manner.
(6) The owner, manager, or any other VAT dealer or TOT dealer
shall provide all reasonable facilities and assistance for the effective exercise
of powers under this section by such officer.
(7) A VAT dealer or TOT dealer whose books, records, or computer
have been removed and retained under sub-section (1) may examine them
and make copies or extracts from them during regular office hours under
such supervision as the Commissioner or inspecting authority as may be
determined.
Notes
Powers of inspection of business premises are normally conferred on

certain prescribed authorities and officers only. In this Act, the authority
to inspect is conferred on all the departmental officers commencing from
Dy. Commercial Tax Officer who is the lowest in the hierarchy of officers
to the Commissioner of Commercial Taxes who is the highest. However,
if premises to be inspected is residential premises the inspecting officer
proposing to conduct inspection is an officer not below the rank of Dy.
Commissioner, he must obtain prior permission of the Dy. Commissioner
having jurisdiction over the area. If the inspection of residential premises
is to be conducted by any Dy. Commercial Tax Officer of the Vigilance
Wing which has Statewide jurisdiction he shall obtain prior permission from
the Dy. Commissioner of the Vigilance Wing. This section does not speak
of there being a reasonable belief on the part of the inspecting officer that
the dealer has been committing or is about to commit any irregularities or
offences. However, it would still be illegal if any officer violates the privacy
of the businessmen without there being any cause for inspection or a belief
about the existence of irregularities. The only guidelines the Act provides
for conducting inspection is that the inspection may be conducted for enforcing
the provisions of the Act. It is true that the Act gives power to conduct
inspection without any notice to the dealer. That does not mean that the
officer can conduct inspection without there being a cause in relation to the
enforcement of several provisions of the Act or any suspicion that they are
being violated. Though, the Act stipulates that inspection shall be conducted
only during business hours, it permits inspection beyond office hours subject
to the condition that the selected time must be a reasonable time. Where
business is being conducted at midnight-hour inspection can legally take place
at that time. No inspection can be conducted in a hurry unless it is clear
that the evidence might disappear if inspection is not conducted at that very
moment. A chance, casual or vindictive inspection is not valid. Finding
a cause after the inspection has commenced cannot be treated as a cause
which has given rise to inspection. Such inspection renders all subsequent
proceedings unlawful.
The dealer shall cooperate and provide full access to the officers
conducting inspection. No obstructions should be created. Inspecting officer
in the first instance shall take abstracts or copies of the document. It is
only when there is a need for seizure of account books and documents the
officer may seize them. Such need may arise by reason of a suspicion that
the dealer may tamper with books if they are retained in his custody or by
reason that their verification is not possible without a detailed scrutiny and
comparison. The account books and documents so seized shall not be detained
with the officer seizing them for more than one month. If further retention
is desired, permission from higher authority shall be obtained for each of
the succeeding months. The Act has not provided any farthest point of time
beyond which the account books and documents shall not be retained by
the officer seizing them. The authority granting extensions shall not grant
extensions as a matter of routine. It should show reasons for granting the
extension. When a computer is seized it could be seized only when a hard
copy of the computer disk is not furnished. If such a copy is not furnished
by the dealer or otherwise could not be obtained by the officer, the computer
may be retained with the inspecting officer in the same manner and duration
as any other account book or document. Such retention of account books,
records and computer shall be in relation to the determination of any tax
liability or in relation to any other proceedings under the Act. Issues connected
with the assessment as well as with the registration are included.
The dealer, where his account books, documents and computer are
seized, he is entitled to take copies of them whenever required while they
were in the custody of the officer seizing them.
Where primary evidence is produced, it is for department to cross verify.
It is therefore not open to direct the assessee to produce such evidence.
(2010) 28 VST 82.
When incriminating material (in the shape of notebooks and slips of paper)
was seized, the authority need not supply such materials before the dealer
produces his regular account books. Lakhi Ram Jain and Sons v. Sales Tax
Officer, Rayagada Circle, Rayagada and Anr., (2009) 21 VST 280 (Ori.).
44. Fair Market Value:– (1) Where the authority prescribed
has reason to believe that any goods of a fair market value exceeding
Rs. 5,000/- (Rupees five thousand only) have been sold or purchased
by a dealer, to or from another dealer or person, as the case may be,

for a consideration which is less than fair market price of the goods and
that consideration for such sale or purchase as agreed to between the
parties has not been truly stated in the invoice or delivery challan or any
other document relating thereto, with the object of facilitating the reduction
or evasion of the tax payable under the Act, the authority prescribed may,
subject to the provisions of this section, initiate proceedings for seizure
and the acquisition of such goods.
(2) The powers conferred under sub-section (1) shall be exercised
by the authority prescribed in respect of goods sold or purchased, which
are in transit or in the possession of the seller or buyer or his agent.
(3) In any proceedings under this section in respect of any goods
which have been sold or purchased for a consideration which is less than
its fair market price, it shall be presumed, unless the contrary is proved,
that the consideration for such sale as agreed to between the parties has
not been truly stated in the invoice, or sale bill or other documents related
thereto with such object as is referred to in sub-section (1).
(4) Before initiating such proceedings, the authority prescribed shall
record his reasons for doing so and no orders shall be passed under
sub-section (1) without giving the VAT dealer or TOT dealer an opportunity
of being heard.
(5) No such proceedings shall be initiated unless the authority prescribed
has reason to believe that the fair market price of the goods exceeds
the consideration therefor by more than twenty per cent.
(6) Where any goods are acquired under this section the authority
prescribed shall pay for such acquisition compensation which shall be a
sum equal to the aggregate of the amount of sale price of the goods
mentioned in the invoice or delivery challan or any document related thereto
and any expenditure incurred on freight or any other incidental expenses
incurred by the VAT dealer or TOT dealer in relation to those goods.
Notes
This section is analogous to Section 269(c) of the Income Tax Act under
which the income tax authorities have power to acquire properties sold by
Sec. 45] Establishment of Check Posts 171
the assessees at a price lower than the market price or stated to have been
so sold at lesser price with a view to avoid payment of tax. The tax authorities
under the Value Added Tax Act also have similar power to acquire the goods
so sold at manipulated lower prices with a view to avoid or evade the payment
of net VAT or claim larger input tax credit. The power to acquire can be
exercised only if the price at which such goods are purchased or sold is less
by atleast 20% of the fair market price. The fair market price is determined
as per its definition contained in Section 2(15). This power of acquiring goods
can be invoked only when they are in actual possession of the purchaser or
seller or when they are in transit. If the goods dealt with reach the hands
of third parties or used up in consumption, proceedings for acquisition of
offending goods cannot be resorted to. After the goods are acquired and
subsequently sold by the authority giving due notice and opportunity of hearing
to the dealer, the price of goods mentioned in the bill plus such expenses as
the dealer might have incurred in handling and transport shall be paid to the
dealer out of the amount realised by sale since there is no confiscation of such
goods. This provision applied to VAT dealer and TOT dealer provided the
value of the goods so improperly dealt with by the dealer must be more than
Rs. 5,000/-.
CHAPTER VII
ESTABLISHMENT OF CHECK POSTS
45. Establishment of Check Posts:– (1) If the Government or

the Commissioner considers it necessary that with a view to prevent or
check evasion of tax in any place or places in the State, it is necessary
so to do, the Government or the Commissioner may, by notification, direct
the setting up of a check post or the erection of a barrier, or both, at
such place or places as may be notified.
(2) At every check post or barrier mentioned in sub-section (1),
or at any other place when so required by any officer empowered by
the Government in this behalf, the driver or any other person in charge
of goods vehicle or vessel shall stop the vehicle or vessel as the case
may be, and keep it stationary as long as may reasonably be necessary,
and allow the officer in charge of the check post or barrier, or the officer
empowered as aforesaid, to examine the contents in the vehicle or vessel
and inspect all records relating to the goods carried, which are in the
possession of such driver or other person in charge for the purpose of
ascertaining whether there has been any sale or purchase of goods carried
and in case there was sale or purchase of the goods carried, whether
such sale or purchase is liable to tax and if so,–
(a) whether such tax has been paid; or

(b) whether the sale or purchase of the goods carried has, for the
purpose of payment of tax, been properly accounted for in the
bills of sale, or delivery notes or such other documents as may
be prescribed.
(3) If on such examination and inspection it appears,–
(a)(i) that the tax, if any payable in respect of the sale or purchase
of the goods carried, has been paid; or
(ii) that the sale or purchase of the goods carried has, for the purpose
of payment of tax been properly accounted for in the documents
referred to in clause (b) of sub-section (2);
the said officer shall release the goods vehicle or vessel with
the goods carried;
(b)(i) that the tax, if any, payable in respect of the sale or purchase
of the goods carried has not been paid; or
(ii) that the sale or purchase of the goods carried has, for the purpose
of payment of tax not been properly accounted for in the
documents referred to in clause (b) of sub-section (2); and
if the said officer is satisfied, after making such enquiry as he deems
fit, that with a view to prevent the evasion of tax payable in respect of
the sale or purchase of the goods, carried, it is necessary to detain the
goods he shall detain the goods and direct the driver or any other person
in-charge of the goods vehicle or vessel to pay such tax, or to furnish
security for an amount equal to two times the amount of tax payable
in such form and in such manner and to such authority as may be
prescribed, on behalf of the person liable to pay such tax.
(4) If the tax is paid or the security is furnished, then the goods
so detained shall be released forthwith.
(5) The driver or any other person in charge of the goods vehicle
or vessel shall, if so required, give his name and address and the name
and address of the owner of the goods vehicle or vessel as well as those
of the consignor and the consignee of the goods.
(6) If the tax directed to be paid or the security directed to be

furnished under sub-section (3) is not paid and furnished and if the said
officer is satisfied, after making such enquiry as he deems fit, that with
a view to prevent the evasion of tax payable in respect of the sale or
purchase of the goods carried, it is necessary to detain the goods, he
shall detain so much of the goods as are approximately equal in value
to the amount of tax directed to be paid or security directed to be furnished
under sub-section (3) as long as may reasonably be necessary:
Provided that no such goods shall be detained by the said officer
for more than three days except with the permission of the next higher
authority.
(7)(a) Where goods are carried without paying tax, if any, payable or
goods are carried without being properly accounted for in the
documents referred to in clause (b) of sub-section (2), the said
officer shall collect the tax payable on the goods so carried and
in addition levy a penalty not exceeding two times the amount
of tax payable on such goods after giving a reasonable opportunity
to the person likely to be affected, against the proposed penalty;
(b) any such officer shall have power to seize and confiscate any
goods where such goods are carried in the goods vehicle without
any documents or covered by fictitious documents:
Provided that before taking action for the confiscation of goods under
this sub-section, the officer shall give the person affected an opportunity
of being heard.
(8) In case the goods detained under sub-section (6) are subject
to speedy and natural decay, and in the case of the goods, where no
claim is made within the prescribed period, the said officer shall, subject
to such conditions as may be prescribed, sell such goods in open auction
and remit the sale proceeds thereof in a Government treasury:
Provided that if the said officer is an officer below the rank of a
Deputy Commercial Tax Officer, the sale under this sub-section shall be
effected by the Deputy Commercial Tax Officer having jurisdiction.
(9) Any person entitled to such sale proceeds shall, on application

to the authority prescribed and upon sufficient proof, be paid the sale
proceeds mentioned in sub-section (8), after deducting the expenses of
the sale and other incidental charges and the amount of tax and penalty
due in respect of the sale or purchase of the goods in question.
Explanation: For the purpose of this section, the explanation ‘said
officer’ means the officer-in-charge of the check-post or barrier or the
officer empowered under sub-section (2).
Notes
The purpose of setting up check-posts is to prevent evasion of tax.

The authority to sanction setting up of check posts is the Commissioner of
Commercial Taxes or the Government. Check post consists of a camp office
and a barrier on the high way. Barrier is the line or obstruction where the
vehicles shall halt and the office is the place where the documents are checked
and the tax is collected, if any or where the goods are detained for taking
further action. It is not necessary that the check post shall be established
all over the State. They are set up at places where tax evasion is likely
to take place and possibilities of tax evasion exists. The check posts may
be established at the entry and exit points of the water ways.
The proceedings which take place at check post has five stages. First:
In case, the Checkpost Officer is satisfied that tax in respect of the goods
under transport is paid he may release the vehicle and the goods. Second:
If the tax is found to have been not paid the checkpost officer may collect
the tax and release the vehicle and goods. Thirdly, if the tax is not paid
and security to the extent of five times the tax is not furnished, the checkpost
officer may seize so much of goods of the value as would cover the tax
and five times of it and release the rest of the goods if any and the vehicle.
In the above three cases, the circumstances which required to be considered
are whether tax due is paid or not and whether the particulars required to
be stated in the documents accompanying the transport are fully stated and
whether the proposed action is intended to serve the purpose of preventing
evasion of the payment of tax. In the next stage, where the tax demanded
is not paid and the security of five times the tax is not furnished and when
it is found that the person is transporting the goods without payment of tax
and without properly accounting the same, the checkpost officer after giving
due notice and opportunity to the dealer may in addition to making an order
of an assessment levy a penalty of five times the tax assessed. The next stage,
if the checkpost officer finds that the goods are being carried without paying
tax and without documents and are being carried on behalf of fictitious persons,
he may proceed to confiscate the goods seized in favour of the Government.
Since, the ultimate object of the detention of goods is to recover the tax due
together with five times of the tax as penalty depending upon the circumstances
of the case, the checkpost officer normally demands in each of the above
stages not only a security for the amount of tax but also for an amount
five times the tax. Taxability of goods shall be determined by the Assessing
Authority and not by the officer at the check post. Commercial Tax
Commissioner, Commercial Taxes, U.P., Lucknow v. Duruwar Sales Corporation,
(2009) 23 VST 49 (All.). When the seized goods are subjected to decay or
where no claim is made for their release or return, the checkpost officer
may sell the seized goods and credit the proceeds to the Government account.
If the checkpost officer is an officer below the rank of Dy. Commercial
Tax Officer, prior permission for sale of seized goods shall be obtained from
the Dy. Commercial Tax Officer having jurisdiction and the person to conduct
auction shall be the Deputy Commercial Tax Officer. Sale of goods shall
be by public auction. If at any time thereafter a claim is preferred for payment
of balance of the amount in excess of the tax and penalty due, such excess
may be paid to the person entitled. If the goods which are confiscated to
the Government, no question of payment to any person the said excess arises.
The tax authority has no jurisdiction to detain the lorry for any period
beyond the time necessary or take action against the offending lorry or its
owner.
In order to seize and detain goods, it should first be shown that the
goods seized are not exempted goods. Flowmore Ltd. and another, Gurgaon
v. Deputy Commercial Tax Officer, Kovvur and others, (2011) 53 APSTJ
235.
46. Power to inspect carrier's places:– (1) Where a carrier or
bailee, to whom goods are delivered for transmission, before delivery is
taken from him, keeps the said goods in any office, shop, godown, vessel,
receptacle, vehicle or any other place, any officer not below the rank
of Deputy Commercial Tax Officer (DCTO), shall have power to enter
into and search such office, shop, godown, vessel, receptacle, vehicle or
other place of business or building or place, and to examine the goods
and inspect all records relating to such goods. The carrier or bailee or
the person in-charge of the goods and records shall give all facilities for
such examination or inspection and shall if so required produce the bill
of sale or delivery note or such other document as may be prescribed
regarding the goods and give his name and address and the name and
address of the carrier or the bailee and the consignee.
Explanation: For the purpose of this section, where goods are
delivered to a carrier or a bailee for transmission, the movement of goods
shall be deemed to commence at the time of such delivery and terminate
at the time when delivery is taken from such carrier or bailee.
(2) Any such officer shall have power to seize and confiscate any
goods which are found in any office, shop, godown, vehicle, vessel or
any other place of business or any building or place of a carrier or a
bailee for transmission where such goods are not covered by any document
or covered by fictitious documents:
Provided that before taking action for the confiscation of goods the
officer shall give the person affected an opportunity of being heard.
Notes
There is one more situation in which the inspecting officer can seize
and confiscate goods. That is a case when the goods are under transport
or in the custody of transporter after they are delivered to him for transport
or when the goods are in the custody of a bailee holding goods on behalf
of the dealer. If such goods on inspection by an officer not below the rank
of Dy. Commercial Tax Officer, are found not to be covered by documents
or are covered by fictitious documents, the inspecting officer may confiscate
such goods after observing the due formalities required to be observed under
the well-known principles of natural justice.
Goods in transit at transporters’ godowns can be seized and confiscated.
Vizovolie Chakasang, Nagaland and another v. The Commercial Tax Officer,
(INT.), Vijayawada and another, (2012) 54 APSTJ 204.
47. Transit Pass:– Where a vehicle carrying goods, coming from
any place outside the State and bound for any other place outside the
State, pass through the State, the driver or other person-in-charge of such
vehicle shall obtain in the prescribed manner a transit pass from the officer-
in-charge of the first check post or barrier after his entry into the state
and deliver it to the officer-in-charge of the last check-post or barrier
before his exit from the State, failing which it shall be presumed that the
goods carried thereby have been sold within the State by the owner or
person-in-charge of the vehicle and accordingly the tax shall be assessed
and penalty, if any shall be levied in accordance with the provisions of
the Act:
Provided that where the goods carried by such vehicle are, after
their entry into the State, transported outside the State by any other vehicle
or conveyance, the burden of proving that the goods have actually moved
out of the State shall be on the owner or person-in-charge of the vehicle.
Explanation:– If a vehicle is hired for transportation of goods by
any person, the hirer of that vehicle shall be deemed to be the owner
of the vehicle.
Notes
This section deals with duties of the persons in charge of the transport
vehicle which runs through the State for a destination outside the State. On
the entry into the State he should obtain a transit pass from checkpost officer
of the first immediate checkpost after his entry into the State and shall reach
the end checkpost without any manner changing the contents of the truck
and handover the transit pass. If by any reason, he unloads the goods into
a different vehicle during the transit through the State, the burden of proving
that the goods which are being transported out of the border are the same
as they were at the time of entry rests with the person in charge of the
vehicle. In case, if he fails to prove this fact, the checkpost officer may
levy and collect the tax and penalty in respect of these goods and recover
the same from him. For purposes of taking proceedings under this section,
if the goods are transported through a hirer who arranged the transport of
goods through truck, such hirer should be treated as the owner of the goods.
Under this section and in Sections 49 and 50 above, the checkpost officer
has no jurisdiction to seize or confiscate the vehicle. He may detain it for
a reasonable time for purposes of preliminary investigation and for purposes
of unloading the goods if seized.
48. Possession and submission of certain records by owners
etc. of goods vehicles:– The owner or other person in charge of goods
vehicle or vessel shall carry with him–
(a) bill of sale or tax invoice or delivery note,
(b) log book or goods vehicle record or trip sheet, and
(c) such other documents as may be prescribed,
relating to the goods under transport and containing such particulars as
may be prescribed and shall submit to the Commercial Tax Officer, having
jurisdiction over the area in which the goods are delivered, the documents
aforesaid or copies thereof within such time as may be prescribed.
Notes
Whenever goods are transported from one place to another within the
State or to places outside the State it is mandatory for the person-in-charge
of the goods vehicle to be in possession of the documents evidencing the
sale of goods and the tax paid or payable thereon. The documents referred
to here are specified in this section as well as in the rules. They are the
bill of sale, tax invoice and delivery note. The tax invoice will show that
the tax is charged to the purchaser along with the price paid or payable by
him. The bill of sale would show that the sale transaction is entered in the
regular books of account of the dealer transporting the goods. The delivery
note while confirming above two facts, will also state in case, where the
goods under transport are not for sale, the particulars of such transport and
delivery. The next document is the log book maintained by the person incharge
of vehicle showing the particulars of the goods under transport and the place
from where the movement started and its destination. Log book is a permanent
record of the movement of vehicle. Maintenance of log book by the person
in charge of the vehicle is mandatory requirement under Motor Vehicles Act.
If the rules prescribe any other documents to be maintained while the goods
are in transport, the same should also accompany the goods.
VAT–12
The petitioner was required to produce way bill by 4 p.m. But, the
way bill was produced two hours later at 6 p.m. Imposition of penalty for
non-production of way bill at the check post in time is not justified. Haradwari
Mal vs. Assistant Commercial Tax Officer, (2006) 147 STC 27.
Bulk request for way bills can’t be refused on the ground that the financial
position of the assessee is not sound, the requirement of continuing business
shall be met. Moreover, no condition for the issue of Way Bills can be imposed.
Narsingh Commodities Pvt. Ltd. & another v. Addl. Commissioner, Sales Tax,
Jarvagan Charge & Others, (2008) 18 VST 41 (WBTT).
CHAPTER VIII
OFFENCES AND PENALTIES
49. Penalty for failure to register:– (1) Any VAT dealer who
fails to apply for registration as required under Section 17 before the
end of the month the application was due and applies during the subsequent
month shall be liable to pay a penalty of Rs.5000/- (Rupees five thousand
only).
(2) Any dealer who fails to apply for registration as required under
Section 17 before the end of month subsequent to the month in which
the obligation arose shall be liable to pay penalty of 25% of the amount
of tax due prior to the date of the registration by the Registering Authority.
There shall be no eligibility for input tax credit for sales made prior to
the date from which the registration is effected.
(3) Any dealer who fails to notify any change in the circumstances
as required under the provisions of the Act or the rules made thereunder,
or who fails to apply for cancellation of registration as required under
Section 19 shall be liable to a penalty of Rs.2,000 (Rupees two thousand
only) for each offence:
Provided that before levying penalty under this Section the authority
prescribed shall give the dealer a reasonable opportunity of being heard.
50. Penalty for failure to file a return:– (1) Any VAT dealer,
who fails to file a return where no tax is due, by the end of the month
in which it was due, shall be liable to pay a penalty of Rs.2,500/- (Rupees
two thousand five hundred only).
(2) Any dealer registered under sub-section (7) of Section 17 who
fails to file a return where no tax is due shall be liable to pay a penalty
of Rs. 500/-. (Rupees five hundred only).
(3) Where a dealer files a return, after the last day of the month
in which it is due, he shall be liable to pay a penalty of fifteen percent
of the tax due:
Sec. 53] Offences and Penalties 179
Provided that before levying penalty under this Section the authority
51. Penalty for failure to pay tax when due:– (1) Where a dealer
who fails to pay tax due on the basis of the return submitted by him
by the last day of the month in which it is due, he shall be liable to
pay tax and a penalty of ten percent of the amount of tax due:
Provided that before levying such penalty the authority prescribed
shall give the dealer a reasonable opportunity of being heard.
(2) If a dealer pays the tax, penalty and interest under sub-section
(1) and subsequently it is found that the tax is not due, then such tax,
penalty and interest shall be refunded to that dealer.
52. Penalty for assessment issued for failure to file a return:–
(1) Where an assessment is made under the provisions of sub-section
(1) of Section 21 for the failure to file a return, a penalty of fifty percent
of the assessed amount shall be imposed.
(2) Where an assessment has been made under sub-section (1) of
Section 21, and the dealer subsequently furnishes a return for the period
to which the assessment relates, the authority prescribed may withdraw
the assessment but the dealer shall be liable to pay penalty under sub-
section (3) of Section 50 and interest as applicable.
53. Penalty for failure to declare Tax Due:– (1) Where any
dealer has under declared tax, and where it has not been established that
fraud or wilful neglect has been committed and where under declared
tax is,–
(i) less than ten percent of the tax, a penalty shall be imposed at
ten percent of such under-declared tax,
(ii) more than ten percent of the tax due; a penalty shall be imposed
at twenty five percent of such under-declared tax.
(2) Where any dealer, prior to the detection by any authority
prescribed, voluntarily declares that tax due for a tax period is under-
declared and he pays the tax due along with interest, no penalty shall
be imposed provided that such declaration is made within the time limit
and in the manner prescribed.
(3) Any dealer who has under-declared tax, and where it is established
that fraud or wilful neglect has been committed he shall be liable to pay
penalty equal to the tax under-declared ; besides being liable for prosecution:
Provided that before levying penalty under this Section, the authority
54. Penalty for failure to use or misuse of TIN & GRN:– Any
dealer who is registered under Section 17 and who fails to use a TIN
or GRN or misuses a TIN or GRN contrary to the requirements of the
Act or rules made thereunder, shall be liable to pay a penalty of Rs.
1,000/- (Rupees one thousand only) for each offence:
Provided that before levying penalty, the authority prescribed shall
give the dealer a reasonable opportunity of being heard.
55. Penalty for issue of tax invoice and for the use of false
tax invoices:– (1) Any VAT dealer, who fails to issue a tax invoice
or an invoice or a bill or cash memorandum as required by Sections 14
and 41, shall be liable to pay a penalty of Rs. 5,000 (Rupees five thousand
only) or 100% of the tax whichever is lower, for each offence.
(2) Any VAT dealer, who issues a false tax invoice or receives and
uses a tax invoice, knowing it to be false, shall be liable to pay a penalty
of 200% of tax shown on the false invoice.
(3) Any TOT dealer or any other dealer who fails to issue a bill
or cash memorandum as required by Section 41 shall be liable to pay
a penalty of Rs.250/- (Rupees two hundred and fifty only):
Provided that before levying penalty under this Section, the authority
1
[(4) (a) Any dealer, who purchases any goods by furnishing a
declaration and uses such goods contrary to such declaration, shall be
liable to pay a penalty of 200% of the tax leviable in the absence of
such declaration on the value of such goods so purchased;
(b) any dealer, who claims that any sale of any goods is liable to
tax at a reduced rate is found to be in possession of any false or fabricated
declaration and pays tax at a reduced rate under the Act, shall be liable
to pay a penalty of 200% of the tax leviable in the absence of such
declaration on the value of the goods, so sold:
Provided that before levying penalty under this sub-section, the
assessing authority shall give the dealer a reasonable opportunity of being
heard.]

56. Penalty for failure to maintain records:– Any VAT dealer

or TOT dealer who fails to maintain proper records in accordance with
the provisions of the Act, is liable to pay a penalty at the rate of Rs.
5,000/- (Rupees five thousand only) for each subsequent offence committed
after a warning is issued in writing for the first offence, without prejudice
to the payment of tax, penalty and interest if any due under the provisions
of the Act :
Provided that before imposing such penalty the authority shall give
the dealer a reasonable opportunity of being heard.
57. Penalty for unauthorized/excess collection of tax:– (1) No
dealer shall collect any sum by way of tax, in respect of sale or purchase
of any goods which are not liable to tax under the Act.
(2) No person, other than a dealer, shall collect on the sale or
purchase of any goods any sum by way of tax from any other person
and no dealer shall collect any amount by way of tax at a rate or rates
exceeding the rate or rates at which he is liable to pay tax under the
provisions of the Act.
(3) Nothing in sub-section (2) shall apply to a person where he is
required to collect separately any amount of tax under the provisions of
any other law for the time being in force.
(4) If any person collects tax in contravention of the provisions of
sub-section (1) or (2) any sum so collected shall be forfeited either wholly
or partly to the Government and in addition he shall be liable to pay
a penalty of an amount equal to the amount of tax so collected:
Provided that the authority prescribed shall not levy penalty if it is
evident that due to bonafide mistake the dealer collected tax in contravention
of sub-section (1) or (2) and the tax so collected in excess has been
remitted to the Government along with the tax payable for that month:
Provided further that the authority prescribed shall while imposing
the penalty or forfeiture, take into consideration the amounts refunded to
the purchaser from out of the amounts collected, by way of tax in
contravention of sub-section (1) or (2) or for the refund of which
satisfactory arrangement has been made.
(5) No order for the forfeiture under this section, shall be made
after the expiration of three years from the date of collection of the amount
referred to in sub-section (4):
Provided that in computing the said period of three years, the period
during which any stay order was in force or any appeal or other proceeding
in respect thereof was pending shall be excluded.
(6) If the authority prescribed in the course of any proceeding under

the Act, or otherwise has reason to believe that any person has become
liable to penalty with or without forfeiture of any sum under sub-section
(4) such authority shall serve on such person a notice requiring him on
a date and at a place specified in the notice to attend and show cause
why a penalty with or without forfeiture of any sum as provided in sub-
section (4) shall not be imposed on him.
(7) The authority prescribed shall thereupon hold an enquiry and shall
make such order as he thinks fit.
(8) No prosecution for an offence under this section shall be instituted
in respect of the same facts on which a penalty has been imposed.
Notes
Penalty can’t be levied at check-post where different interpretation as

to the taxability of the goods and documents provided are possible. Shital
Fibers Ltd. & Another v. State of Punjab & others, (2007) 5 VST 354 (P&H).
Eventhough, several penalty orders are questioned in the same petition,
the court fee payable is that which is payable on one petition provided the
cases and points of law involved are one and the same. Here, the rule provided
states that the Court fees payable is prescribed as that payable by the person
who is an applicant. Leonard Ashok v. Commercial Tax Officer, Chittoor, (2007)
5 VST 635 (Ker.).
Goods under transport cannot be seized on fanciful estimate of their
price as being less than the prevailing market rates. Rastin Re Ali v. Sales
Tax Officer, Dubordih Check Post & Others, (2008) 13 VST 85 (WB TT).
Where there is no provision to confiscate the goods seized, the authority
has the right to dispose off the stock seized only and pay to the person
from whom the goods are seized; if there be any excess over the above
the tax payable in respect of such goods. C. Vinayaka Roadways v. Dy.
Commissioner of Commercial Taxes, Bangalore - (2008) 13 VST 436 (Karn.).
Where a contractor laying the road using the gravel himself quarried
as owner, he need not file VAT invoice before the check post officer and
it is enough if he produces necessary evidence to prove that the said gravel
was not purchased by him from some other dealer. Soman VSCPL, JV v.
State of Rajasthan & others, RLW (2008) 2 RAJ. 1736.
Before collecting tax or penalty the authority shall make an order of
assessment and shall issue show-cause notice as regards the proposed levy
of penalty under Orissa Value Added Tax Act. M.G. Garments v. Sales Tax
Officer, Investigation Unit & others, Orissa H.C. Judgement dated 11.11.2008.
Penalty proceedings are different from best of judgment assessments.
Separate and independent notice is required to be given before penalty is levied.
Delta Lubricants v. Dy. Commissioner of Commercial Taxes, (2006) 147 STC
462 (A.P.).
Imposition of tax and penalty at the entry check post. (Orissa State)
is held illegal for the reason that imposition of penalty is a matter of discretion
which has not been properly exercised and imposition of tax is unauthorised
on a transaction which is admitted an inter-state transaction and it has no
power to rise any presumption of a sale within the State even before they
entered the other State. Assam Transport Service & Another v. State of Orissa,
(2008) 14 VST 557. (Orissa).
Tax and penalty proceedings are different. If the assessee does not file
appeal against assessment order, it does not mean he cannot object to levy
of penalty. Anil Murugan Tailors v. State of A.P., (2010) 51 APSTJ 37.
Confiscation order shall be preceded by Procedure in accordance with
law and that too if the Act specifically provides for confiscation. Maruti Traders
v. D.C.T.O., Kothapeta, (2007) 44 APSTJ 54.
58. Prosecutions for offences:– Any dealer or person who fails
to comply with the requirements under Sections 14, 16, 17, 21, 29, 42,
43, 64 or any other provisions of the Act shall on conviction be punishable
with imprisonment for a term which may extend to three months or with
fine or with both.
Notes
Notice to showcause as to why prosecution shall not be launched based
on Auditor’s Report is valid. Shyam Jafar v. Addl. Commissioner, Sales Tax,
Kolkata, (2008) 11 VST 963 (WBTT).
59. Offences of obstructing the authority:– Any dealer who
obstructs the authority prescribed in the performance of his duties under
the Act shall on conviction be punishable with imprisonment for a term
which shall not be less than one month but which may extend to six months
and with fine.
Notes
Sections 58 and 59 deal with two types of cases: cases in which
prosecution may be launched in a competent criminal court and the offender
is punished with imprisonment or fine or with both on conviction and the
other cases mentioned in Sections 47 to 57 in which penalty can only be
imposed by officers concerned. The fact that penalty has been imposed will
debar prosecution when the same offence is the subject matter of both
proceedings. However, if penalty is not imposed or waived it may become
difficult to sustain the case for prosecution.
Penal provisions shall be reasonable. Heavy penalties disproportionate to
the magnitude of offence offends Arts. 14 and 19 of the Constitution of
India. Such provisions are liable to be struck down. Philips Electronics v.
State of Karnataka, (2009) 21 VST 321.
The following are the offences for which the person or the dealer accused
of acts done in contravention of the several provisions of the Act or any
other provisions of the Act may be punished on conviction to a term which
may extend to three months imprisonment or with fine or with both. The
term of imprisonment may extend for a day or for any period to a maximum
of three months. The fine imposed may also be one rupee or may be any
amount without any limit. The convicting Magistrate may award the punishment
of imprisonment as well as also fine or fine only. The normal practice is
that punishment of imprisonment as well as fine are imposed and such sentence
may also add a proviso that in case fine is not paid the person concerned
may be directed to undergo imprisonment in lieu of fine. However, where
fine is not paid, the imprisonment, the defaulter may be directed to undergo
shall not exceed three months. There are authorities which indicate that
sentencing of a person till the rising of the court may not be proper and
may not achieve the purpose for which the punishment is awarded under
Criminal Law.
Value Added Tax System is called a self policing system, it is so because,
unless the dealers strictly follow the rules, maintain accounts which by nature
are interlinking with one another the dealers do not have a benefit of securing
a rebate towards the tax they had paid earlier to the previous dealer in the
tax they had to pay on their sales. It creates situations for self-discipline
in the business.
The important feature of VAT system is that each one of the defaults
committed by the dealers is visited with prosecutions and fines. Prosecutions
are launched by the Department against defaulting dealers. They are tried by
the Magistrates having territorial jurisdiction over the assessees. In addition
to prosecutions, the assessing authority itself is competent to levy penalties
against defaulting dealers. Viewed in this context, Value Added Tax system
should be classified as an enactment which requires strict compliance of the
provisions by all those who are mandated to carry on their business in
accordance with the law and pay the taxes promptly in their own self interest.
Right from the commencement of registration, till the dealer pays in
full the tax he is liable to pay almost every infraction on his part is punishable
as an offence. Failure to apply for registration, failure to apply for cancellation
of registration when such cancellation is required, are punishable and so also
the failure of the dealer to inform changes in the circumstances of the business
is also similarly punishable. Where a dealer is required to issue tax invoice,
fails to issue tax invoice or issues a tax invoice, otherwise than in the manner
required, the defaulting dealer is liable to be punished. Failure to file a return
will be an offence only if the dealer fails to file a return within fifteen days
from the date when it should be filed. It means, where a return is required
to be filed by the last day of the month next following the quarter will become
punishable only if it is not filed within fifteen days of the date when it is
due. After a notice of demand for payment of tax is issued and the dealer
fails to pay the tax within the time prescribed in the notice, he is liable to
be prosecuted. It is an offence under this Act if the dealer fails to maintain
a true and complete accounts and other records as are prescribed under the
Act. All the dealers are expected to co-operate with the Department by
providing reasonable access and assistance as may be required at the time
of inspection by the authorities. If the dealer fails to provide the assistance

to the officials of the Department inspecting the premises he is liable to
prosecution. The assessing authorities as well as the appellate or revisional
authorities are competent to call upon the dealers to furnish any information
or particulars from the dealer. They may also require the dealer to file all
records available with them as the assessing authority, appellate or revisional
authorities may require. These authorities have also power to call upon such
information, particulars and records from any other person also other than
the dealer. The person failing to furnish the information, particulars and
records, as well as the dealer committing this default are liable to be punished.
The Act provides that no dealer who is not registered under this Act is entitled
to collect any interest over and above the price fixed for the goods sold
towards tax or purporting to be an amount towards the tax. The Act further
provides that a registered dealer shall not collect from his purchaser any tax,
which is higher than the rate prescribed therefor. Where an unregistered
dealer collects any tax, which he is not entitled to, and the registered dealer
who collects any tax at rate higher than the rates prescribed from the purchaser
he shall be liable to be punished. A VAT dealer who misuses the tax payer
identification number with a view to evade the tax or shift liability to pay
the tax is liable to be punished. If any dealer furnishes false and misleading
information or supplies such material he is punishable. If any dealer instead
of providing assistance and co-operation to the authorities carrying on their
duties obstructs them in their performing their duties, he is liable to be
punished. If the dealer or the person accused of the above offences except
the offence of the obstructing the authority from performing the duties when
convicted is liable to be punished with imprisonment which may extend to
three months or with fine or with both.
The Value Added Tax Act of Andhra Pradesh clearly mentions several
offences for which a person can be prosecuted. Apart from them and de
hors those offences it is not permissible to prosecute any person either under
IPC or any other enactment.
Penalty which the authority imposes
Sl. Section Particulars of offence Penalty Amount
No. of the of Rs.
Act
1. 49 Failure of a VAT dealer to apply for Rs. 5,000/-
registration before the end of the month
the application was due.
Failure of a dealer to apply for 25% of tax due
registration before the end of the month
in which obligation arose.

No. of the of Rs.
Act
Failure to notify by the registered dealer For each offence
any change in circumstances or fail to Rs. 2,000/-
apply for cancellation.
2. 50 Failure to file return by VAT dealer by Rs. 2,500/-
the due date.
Failure to file return by any dealer where Rs. 500/-
no tax is due.
If the dealer files return after the due 15% of tax due
date.
3. 51 If the dealer fails to pay tax on the basis 10% of the
of the return submitted by him. amount due
If after the return is filed it is found that Penalty paid
no tax is due. shall be
refunded.
4. 52 Where unilateral assessment is made 50% of assessed
under Section 21. amount.
Where unilateral assessment is 50% on the tax
withdrawn and assessment on belated finally
return is made. determined shall
be levied.
5. 53 Where a dealer under-declares tax :
(i) If the underdeclared amount is less 10% of
than 10% of tax underdeclared
amount may be
imposed
(ii) If the underdeclared tax is more than 25% of the such
10% underdeclared
tax may be
imposed.
Where the dealer voluntarily prior to the No penalty
detection declared and pays the tax.
If such under-declaration is due to any Penalty equal to
fraud or willful neglect. the tax under-
declared.
6. 54 Any dealer who fails to use TIN or GRN Penalty of Rs.
or misuse the TIN or GRN contrary to 1,000/- for each
the requirements of the Act or rules. offence.
7. 55 Failure of the dealer to issue tax invoice Rs. 5,000/- or
or any other invoice as required under 100% of tax
Sections 14 and 41. whichever is
lower for each
offence.

No. of the of Rs.
Act
If any VAT dealer issues false tax 200% of tax
invoice or receives or uses a tax invoice shown in the
knowing it to be false. false invoice.
If TOT dealer or any other dealer fails to Rs. 250/-
issue a bill or cash memorandum as
required under Section 41.
8. 56 Failure to maintain proper records by Rs. 5,000/- for
VAT dealer or TOT dealer. each subsequent
offence after the
first warning.
9. 57 The dealer who collects tax on goods not The amount
liable to tax. collected may be
forfeited and a
penalty equal to
the amount so
collected may be
levied.
A person other than a dealer collects tax The amount
from any other person and a dealer who collected may be
collects tax at rates in excess of the rates forfeited and the
prescribed. penalty equal to
the amount so
collected may be
levied.
Note : Persons authorized to collect tax and persons who collected
tax bona fide and returned the tax collected to the parties or
remit it to the Government shall not be penalized. No
forfeiture of the amount can be effected after the expiry of
three years.
Person in possession of blank ‘G’ Forms is liable to be prosecuted.

2006 (2) ALT Crl. 333 (AP).
When there was a doubt whether a particular transaction is taxable or
not and when such doubt prevails with the authorities also, if tax is imposed
on a further clarification, and the tax authority imposes tax for the period
during which the doubt prevail, the subsequent imposition of tax shall not
attract imposition of penalties. Welcome Hotel v. Commissioner of Central
Excise, Vadodara, (2009) 22 VST 534.
60. Offences by Companies:– (1) Where an offence under the

Act has been committed by 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 the 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:
Provided that, nothing contained in this sub-section shall render any
such person liable to any punishment 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.
(2) Notwithstanding anything contained in sub-section (1), where an
offence under the 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 neglect 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.
Explanation:– For the purpose of this Section,–
(a) ‘Company’ means a body corporate and includes a firm,
association or persons or body of individuals whether incorporated
or not; and
(b) ‘Director’ in relation to a firm means a partner in the firm, and
in relation to any association of persons or body of individuals,
means any member controlling the affairs thereof.
Notes
If the offence is committed by a company every person who is incharge
of the affairs of the company and responsible to the company in the conduct
of business is liable to be prosecuted along with the company. Since imprisonment
cannot be awarded against company, fine only can be imposed in addition
to the fine imposed on the directors. In case, any of such persons claims
to be not liable for prosecution the burden of proving that the offence
committed was without his knowledge and the offence might have happened
in spite of all due diligence to prevent the commission of the offence lies
on such person. Another condition which is referable to the Director, Manager,
Secretary or other officer of the company is that if it is proved that the
offence is committed with the consent or connivance or due to any neglect
of such officer, the offence is deemed to have been committed by such officer.
Here, the company includes a firm, association of persons or body of
individuals whether incorporated or not. Accordingly, it includes all association
of persons whether registered or unregistered under any law and the Director
in all such cases is the partner or any other executive or individual having
the control of the business.
61. Compounding of offences:– (1) The authority prescribed may

accept, from any dealer who has committed an offence under the Act
by way of composition of such offence.
(a) where the offence consists of the evasion of tax, in addition to
such tax, a sum of money equal to the amount of tax subject
to a minimum of Rs. 3,000/- (Rupees three thousand only); and
(b) in other cases a sum of money not exceeding Rs. 3,000 (Rupees
three thousand only).
(2) Any order passed or proceeding recorded by the authority
prescribed under sub-section (1) shall be final and no appeal or application
for revision shall lie therefrom.
Notes
Power to compound the offences is given to the officers dealing with
the case. Therefore, the question of compounding arises only when the matter
is pending with the officers and before they are concluded. It is the officer
dealing with the case who can compound the offence. Whether the offer
to compound should emanate from the offender or from the officer dealing
with the case is not made clear in this section. It is therefore open to the
officer to offer compounding of an offence alternatively it is also open to
the offender to offer compounding of an offence. The section however
prescribes the minimum amount for which compounding may be accepted.
The compounding fees may be an amount equal to the tax subject to a
minimum of Rs. 3,000. Where it is not a case in which tax element is not
involved the compounding fees may not exceed Rs. 3,000/-. Proceedings for
compounding are in the nature of a settlement by compromise. Therefore,
the order recording compromise is not appealable nor any authority can take
the matter in revision. If the compounding fees is not paid prosecution is
only the next step.
Compounding of offences can be offered only after recording a finding
on the nature of the infraction or offence. India Heritage Foundation v. State
of Karnataka & Others, (2008) 18 VST 376 (Karn.)
62. Court for prosecution:– (1) No Court other than the Court
of a Magistrate of the first class shall take cognizance of, or try, an offence
under the Act.
(2) No prosecution for any offence under the Act shall be instituted
except with the written consent of the Commissioner.
Notes
The Court competent to try the offence under this Act is the Magistrate
of the First Class having jurisdiction over the place of the person to be
prosecuted resides or where the offence takes place. The Magistrate only
is competent to take cognizance of the offence. It means, that there should
be a complaint filed before the Magistrate by a person authorised to make
the complaint. No police officer can take cognizance of this offence and
accordingly the police officer has no power to institute any criminal proceedings
against any person. Further, no prosecution can be launched by any authority
without the written consent of the Commissioner of Commercial Taxes. Before
granting the consent, the Commissioner must apply his mind to the facts
of the case and it is only when he is reasonably convinced of the need to
prosecute the dealer or any other person, consent can be granted. Therefore,
consent by the Commissioner would be illegal if the Commissioner's consent
is arrived at in an arbitrary manner. As a matter of fact, no Magistrate can
take cognizance of any offence without a written consent of the Commissioner
of Commercial Taxes accompanying the complaint. Since, the word used in
this section is “instituted”. It means that consent obtained after filing the
complaint will not make the institution of the complaint valid.
63. Power to summon witnesses and production of documents:–
(1) An authority prescribed or an appellate or revising authority or an
inspecting authority or any officer of the Commercial Taxes Department
not lower in rank than an Assistant Commercial Tax Officer shall, for
the purposes of the Act, have all the powers:–
(a) to summoning and enforcing the attendance of any person and
examining him on oath or affirmation; and
(b) compelling the production of any document.
(2) Without prejudice to the provisions of any other law for the time
being in force, where a person to whom a summon is issued either to
attend to give evidence, or produce accounts, registers, records or other
documents at a certain place and time intentionally omits or fails to attend
or produce accounts, registers, records or other documents at such place
or time the authority or officer mentioned in sub-section (1) may after
giving the person concerned a reasonable opportunity of being heard
impose upon him by way of penalty a sum not exceeding Rs. 500/-
(Rupees five hundred only) as it or he thinks fit.
(3) Any officer of the Commercial Taxes Department, not lower in
rank than an Assistant Commercial Tax Officer shall have powers to call
for such information, particulars or records as he may require from any
person for the purpose of assessment, levy and collection of tax under
the Act.
Notes
Power to summon witnesses and documents is a necessary power any
enquiry officer should have. Sometime such powers of summoning will be
comprehensive to cover every step involved till the witnesses summoned appear
and the document summoned is filed. Powers available to a civil court include
powers to take coercive steps against the witness to comply with the
summons. Some enactments provide specifically that the officer summoning

shall have all such powers the civil court can exercise in this regard. Some
other enactments provide that the officer requiring presence of witnesses can
seek the assistance of the civil court in issuing and executing the summons.
A.P. Value Added Act contains a code by itself on this subject. Section 63
gives the outline of the powers exercisable by the officers dealing with dealers
where cases are pending with them and also with others whose presence
may be required for providing any evidence. Inspecting officers having
jurisdiction over the entire State can exercise this power of summoning any
dealer or person residing or doing business anywhere in this State. Summary
powers are available to every authority exercising the original as well as
appellate and revisional powers. The powers exercisable by the appellate
tribunal and the courts are different from the provisions made herein. Rule
61 gives the procedure to be adopted, and content of the summons, the date,
time and place fixed for the appearance of the person or for the production
of the document and the manner of service which may be by registered post
or by personal service. Persons not complying with notice under this Section
63 are liable to pay penalty of Rs. 500/- which may be imposed on him
by the officer issuing summons after due notice and opportunity of hearing
to the person concerned. Apart from the imposition of penalty the officer
may initiate proceedings for prosecution of the person refusing to comply
with the summons and if the person prosecuted is convicted he would be
punished with imprisonment extending upto three months. Such prosecution
is authorised under Section 58 of the Act.
The person summoned for giving evidence shall himself appear before
the authority. The person summoned to file document may cause the document
required to be filed through another person.
A summon which does not fix the date, place and time or a summon
which is worded in a vague manner is not a valid summon. If the time fixed
for appearance is 11 A.M., the person summoned may wait till the closing
hours of the office time. A person summoned to appear at 3 P.M. may
not be accused of having failed to appear at any time earlier by which the
officer claims to have closed the enquiry under consideration. Since the failure
to respond to the summon is visited with a penalty not exceeding Rs. 500/
which may be imposed by the officer issuing summons and also by prosecution
which may end with imprisonment upto three months, it is advisable for the
parties not to avoid the compliance with summons. The summons issued may
be in any matter intended to serve any of the purposes of the Act or it
may be in relation to any assessment. It is no defence in the prosecution
to contend that the information sought for is not relevant for the enquiry.
The offence here is complete when the summon is disobeyed. The information
obtained from the witnesses shall not be disclosed to any third parties and
shall remain confidential. The meaning of the word ‘confidential’ is that even
if any third party gets at such information, it will not be of any use to him
for the information wrongfully obtained is a tainted evidence not admissible
in evidence in any court or tribunal.
64. Power to get information:– (1) Any authority prescribed or

appellate or revision authority may by writing, require any person or
authority to furnish such information, particulars or records available with
the person or authority as will be useful or relevant to any proceeding
under the Act.
(2) The person or authority from whom such information, particulars,
or records are required under sub-section (1) shall furnish, within a
reasonable time, the information particulars or records available.
Notes
See under Section 63.
65. Bar of jurisdiction:– Save as otherwise expressly provided in
the Act, no Court shall entertain any suit, or other proceeding to set aside
or modify, or question the validity of any assessment, order or decision
made or passed by any officer or authority under the Act or any rules
made thereunder, or in respect of any other matter falling within its scope.
Notes
The bar of suit operating in respect of any matters dealt with by the
officers and authorities under the Act is absolute. Suit lies only in matters
where orders are made without following or in defiance of the principles
of natural justice. An order so made is deemed to be no order in the eye
of law. Even then, it is advisable to file the suit only after exhausting all
other and alternate remedies under the Act and after giving two months notice
as required under Section 80 CPC.
66. Appearance before authority:– Any person who is entitled
to appear before any authority other than the High Court in connection
with any proceedings under the Act, may be represented before such
authority–
(a) by his relative or a person regularly employed by him, if such
relative of person is duly authorized by him in writing in this behalf;
or
(b) by a legal practitioner ; or
(c) by a Chartered Accountant within the meaning of the Chartered
Accountants Act, 1949 (Central Act 3 of 1949) ; or
(d) by a Cost Accountant within the meaning of the Cost and Works
Accountant Act, 1959 (Central Act 23 of 1959).
(e) Subject to such conditions as may be laid down by the rules
in that regard by a person who was enrolled as a Sales Tax
Practitioner by such authority on payment of such fees and
possessing such qualifications as may be prescribed.
Sec. 67] General Provisions 193
If such Chartered Accountant or Cost Accountant or Sales Tax

Practitioner is duly authorised in writing in this behalf.
Notes
In all proceedings before the officers and authorities under the Act, the
party concerned has a right to personally appear or he may appear through
a person authorised. If the party is an individual, he can personally appear;
if the party is joint family by the manager of the family; if the party is a
firm, by a partner of the partnership firm; if the party is an association of
persons, any person authorised; if the party is a company, the Director
authorised may appear. The firm and company may authorise in writing any
of its employees to appear. Next, legal practitioner having vakalat may appear
for the party and conduct the case before any authority. Where the person
to appear for the party is the Chartered Accountant or Sales Tax Practitioner,
he shall hold in each case an authorisation specifically executed by the party
in each of the cases separately. This is the position as far as appearances
before Commercial Tax Authorities and Officers and Appellate Tribunal. But
in the case of appearances before the High Court, the party if he is not
personally appearing shall be represented by an advocate only.
The rule which provides for certain classes of dealers shall get their
accounts audited by Chartered Accountants or Cost Accountants and that
Advocates and Sales Tax Practitioners are not competent to conduct audit
or issue certificates, is not discriminatory. Sales Tax Practitioner’s Association,
Maharashtra and another v. State of Maharashtra & Others, (2008) 14 VST
69 (Bom).
CHAPTER IX
GENERAL PROVISIONS
67. Clarification and Advance Rulings:– (1) The Commissioner
may constitute a State level ‘Authority for Clarification and Advance
Rulings’ comprising of three officers not below the rank of Joint
Commissioner to clarify, in the manner prescribed any aspect of the
implementation of the Act.
(2) No application shall be entertained where the question raised
in the application–
(i) is already pending before any officer or authority of the Department
or Appellate Tribunal or any Court;
(ii) relates to a transaction or issue which is designed apparently
for the avoidance of tax:
Provided that no application shall be rejected under this sub-section
unless an opportunity has been given to the applicant of being heard and
where the application is rejected, reasons for such rejections shall be
recorded in the order.
VAT–13
(3) No officer or any other authority of the Department shall proceed

to decide any issue in respect of which an application has been made
by an applicant under this Section and is pending.
(4) The order of the authority shall be binding,–
(i) on the applicant who had sought clarification;
(ii) in respect of the goods or transaction in relation to which a
clarification was sought; and
(iii) on all the officers other than the Commissioner:
Provided the dealer does not file an appeal before Sales Tax
Appellate Tribunal within 30 days of the Ruling in the manner prescribed.
(5) The authority for clarifications shall have power to review, amend
or revoke its rulings at any time for good and sufficient cause by giving
an opportunity to the affected parties.
An order giving effect to such review or amendment or revocation
shall not be subject to the period of limitation.
(6) The Commissioner may also refer any matter for opinion of the
Authority for clarification without prejudice to his authority.
Notes
The procedure of the advance rulings is a new concept in sales tax
legislation ; such procedure no doubt, is available in the Income Tax Act.
The authority to give clarifications and advance rulings may be constituted
by the Commissioner. Such authority is a three member committee, all of
whom shall be officers not below the rank of Joint Commissioners. The
jurisdiction of the authority is to clarify or give a ruling on any aspect of
the implementation of this Act. The issue must be raised by a dealer who
is registered under the Act and not by any other person or any officer. By
the time, the dealer makes an application for advance ruling the issue raised
shall not already be pending before any officer or authority of the Department
or Appellate Tribunal or any Court. The clarification or advance ruling given
by the authority is not binding on the Appellate Tribunal or any other Court.
The application filed by the dealer must not be in the opinion of the authority,
a transaction or issue which is designed apparently for the avoidance of tax.
In other words, it means that the application must be bona fide, not frivolous
and it relates to an issue which already exists or is likely to arise in the
case of the applicant.
Where the application unless is rejected, is pending before the authority
to give advance rulings, no officer or any other authority of the department
shall proceed to decide the issue pending the advance ruling. The clarification
and ruling given by the authority is binding on the applicant who had sought
clarification and the ruling given by the authority is restricted in respect of
the goods or transactions in relation to which the clarification was sought.
The powers given to the authority of advance rulings under clause (5)
may discourage the dealers to invoke the consultative jurisdiction for the fear
that the said authority may suo motu review, amend and revoke the clarifications
given by it at any time in a manner which might disturb the transactions
proceeded with by the dealers with assurance of clarification. There should
have been a further provision in this clause stating that in case such review
takes place, the consequences shall not be retrospective.
The Advance Ruling Authority may review its own order for any good
and sufficient reason. It means that the rules governing powers of review
contemplated under CPC limiting the said power to certain contingencies
specified therein, will not govern the power of review by the Advance Ruling
Authority. It may be on any ground including subsequent knowledge or
information not on record at the time of first ruling.
Advocates can appear before the Committee on Advance Rulings on
behalf of their clients even though there is no lis between any parties at that
stage. Tax practitioners may also appear if so authorised. The employees of
the applicant may also appear to assist the Committee for explaining the
contextual positions involved in the transaction.
The fact that the Rulings of the Committee on Advance Rulings are
binding on dealers and also on all authorities upto the sales tax tribunal, does
not mean that they should not raise the issues before the registering, assessing
authorities and the first appellate authority. As a matter of fact, they should
raise the issue so that the tribunal and thereafter the High Court may not
find fault with them for not raising the issue at the appropriate earlier stages.
For instance, toy balloons though come under sports goods specified in Entry
60 of Schedule IV for which the tax payable is 4%, the Committee on Advance
Rulings opined that toy goods are outside the entry sports goods on the ground
that they are not mentioned in HSN Code and therefore liable to 12½% tax.
If the dealer disputes the ruling he should raise the dispute from the assessment
stage itself.
Order of Advance Ruling Authority is appealable to the Sales Tax Tribunal.
K.S. Biyani & Co. v. Authority for Adv. Ruling & Another, (2005) 1 VST
243.
If a question is asked the answer to which leads to another question,
it is open to questioner to ask them in one question or separately one after
the other. It is not open to the Advance Ruling Authority to say that both
the questions shall form part of one question only and refuse to answer the
subsequently asked question. For instance, if a question is asked, “Whether
a foreign company is covered by service tax? and the answer is positive,
the questionnaire can then subsequently put another question that, if so
“whether a particular service rendered by the said foreign company comes
within the taxable service?”
The authority for advance ruling is bound to answer as many questions
as may arise in the definite circumstances but not to the situations.
Before issuing advance ruling, the authority shall hear the parties and
consider the issues properly since the advance rulings bind the parties as
well as all the subordinate authorities. Azam Laminators (P) Ltd. v. Secretary
to the Govt. & another, Other Tax Appeal No. 7 of 2008, WP (C) No. 25214
of 2007 (B) dt. 10-6-2008, Kerala.
The authority giving advance ruling is bound to give reasons for its
ruling. The Supreme Court held in State of Punjab v. Bhang Singh, AIR
1990 SC 1984 as under:
“That the right to reasons is an indispensable part of sound judicial system
and that reasons must indicate at least the application of mind on the matter
by the authority. Advance rulings are subject to appeal and revision. Unless
reasons are given the appellate and revisional authority will not be able to
judge the legality of the advance ruling.
Advance ruling is not a precedent in the sense that it binds all those
who had similar dispute. It will not bind third parties as between and among
them. The remedy for those who are affected by advance ruling on a specified
subject is to move the Commissioner or raise it only when the matter is
brought to the notice of the Tribunal or High Court. During the period when
the assessment is pending with the Assessing Authority or First Appellate
Authority, the assessee, though precluded from raising the issue may record
his dissent with the ruling of the authority, lest he may not be accused of
not raising it earlier. Anybody (third party) who is affected by the advance
ruling may file a review application before advance ruling authority.
When Advance Ruling is applied by the assessing authority to non-
applicant, such person may directly appeal to the Tribunal without the need
to file first appeal. Tirupati Ceramics, Vijayawada and Anr. v. Deputy
Commercial Tax Officer, (2011) 52 APSTJ 48.
Thus while applicant can file appeal to the Sales Tax Appellate Tribunal
against Advance Ruling, the other dealers can file appeal directly only, if the
assessing authority makes an assessment in accordance with the order of
Advance Ruling Authority, Advance Ruling Authority has jurisdiction to review
its own order. Review can be based on change of opinion. There is no need
for fresh material to be brought on record. Quality Care India Ltd., Hyderabad
v. State of A.P., (2010) 51 APSTJ 1.
68. Ongoing contracts:– (1) Where a contract or an agreement
was concluded between two or more parties before the commencement
of the Act and no provision for tax under the Act was made in the contract,
the selling dealer shall pay tax due on any sale liable to tax made under
such contract after the commencement of the Act.
(2) Where a contract is concluded after the commencement of the
Act, and no provision relating to tax was made in the contract, the contract
price shall be deemed to include tax due under the Act and the selling
dealer shall account for the tax due.
Notes
This is a protective clause in respect of transactions whereunder the
agreements entered into by two or more parties prior to commencement of
the Act and where such agreements do not provide anything in respect of
the tax, the Act says that the selling dealer is responsible to pay tax on the
goods agreed to be sold, when they are actually sold and such dealer can
recover tax from his purchaser. Similarly, in case an agreement is entered
into between two or more parties after the commencement of this Act and
when such agreement does not make any provision relating to tax as to who
should bear the tax, the contract price shall be deemed to include the tax
and the selling dealer only shall pay the tax to the Government. He is not
entitled to recover any amount from his purchaser in order to fix the liability
to pay the tax. In either of the case the contract referred to here shall be
in writing. This section applies to both the TOT and VAT dealers.
69. Tax Deferment:– (1) Notwithstanding anything contained in the
Act, any industrial unit availing a tax holiday or tax exemption on the
date of commencement of the Act shall be treated as a unit availing tax
deferment.
(2) The unit availing into tax deferment as specified in sub-section
(1) shall be eligible to issue tax invoices and to claim input tax credit
subject to provisions of Section 13 of the Act.
(3) The period of eligibility, the method of debiting eligibility amount,
the repayment and any other benefits for all units availing tax deferment
shall be in the manner prescribed.
Notes
This section deals with the cases where the dealers are already enjoying
the tax holiday. Such dealers are not entitled to issue tax invoice or claim
input tax credit. They will however be enabled to issue tax invoice or claim
input tax credit, if they opt to convert the tax holiday into tax deferment.
In such case, the dealers who are enjoying the tax holiday opting to tax
deferment and the dealers enjoying the facility of tax deferment shall be eligible
to issue tax invoices and to claim input tax credit. The period of eligibility,
and the method of debiting the eligibility amount, the repayment and other
benefits may be provided in the manner prescribed.
Tax holiday means, the dealer is granted the facility of payment of tax
for a certain period. Tax deferment means, the recovery of tax is deferred
by adjusting it in the form of a loan to be repayable after a certain period.
Such facilities are available or made available to dealers who are industrial
units.
In a case where benefit of deferment of tax applies, unless a fresh
notification is issued in this regard for its extension after the VAT came into
force, the benefit cannot be continued unless a new application for deferment
is made under the fresh notification. Shimoga Piston Rings (P) Ltd. v. State
of Karnataka, 2006 (144) STC 490.
Limiting the rehabilitation relief to any particular period after it is
commenced is not valid. Commissioner of Commercial Tax, M.P. v. Surab
Metals (P) Ltd., (2009) 24 VST 520 (MP).
VAT Act provided for converting exemption to pay tax as tax deferment.
Accordingly, the successor Government is bound to permit the units enjoying
exemption to convert the same into the scheme of tax deferment. Tata Steel
Ltd. & others v. State of Jharkhand, (2007) 7 VST 109.
Where tax holiday or tax deferment is granted and the same is later
on cancelled, no tax can be collected during the period when the grant was
in operation. But the Government however has power to collect that much
of tax which the dealer collected from the consumers during the period of
the deferment certificate. Panchalingala Carbonic Gas Pvt. Ltd. v. State of
A.P., (2004) 40 APSTJ 41.
Conversion of tax holiday into tax deferment will not involve any violation
of the doctrine of estoppel. Doctrine of estoppel does not apply to statute.
MAKS Casting Pvt. Ltd., v. Govt. of A.P. (2010) 51 APSTJ 189.
70. Protection of acts done in good faith:– (1) No suit, prosecution

or other proceeding shall lie against any officer or servant of the Government
for any act done or purporting to be done under the Act without the
previous sanction of the Government, and no such suit, prosecution or
other proceeding shall be instituted after the expiry of six months from
the date of the act complained of.
(2) No officer or servant of the Government shall be liable in respect
of any such act in any civil or criminal proceeding if the act was done
in good faith in the course of the execution of duties imposed on him
or the discharge of functions entrusted to him by or under the Act.
Notes
This clause is called indemnity clause. It occurs in all enactments. It
gives protection to the officers appointed under the Act in relation to any
acts done by them in course of their duties against any claims which may
be raised by any person including third parties affected by such acts. The
acts done by the officers must be within the jurisdiction and powers conferred
on them; they should have been done in good faith. In addition, the proposed
action either civil or criminal must have been initiated within six months from
the date of the act complained. Whether the action proposed to be taken
against the officer is a civil action for damages or criminal action for
prosecution there shall be a prior sanction of the Government obtained by
the complainant.
71. Submission of returns by banks:– Every scheduled bank
including any branch of such bank or any banking institution in the State
shall, at the request of the assessing authority concerned, submit in each
month a return in the prescribed form, of all bills relating to goods
discounted, cleared or negotiated and the payment and receipts relatable
to the sale or purchase of goods transacted by or through it during the
preceding month, in such manner and within such period as may be
prescribed.
Notes
This section creates a mandatory obligation on the banks to submit to
the assessing authority of the area a statement of all particulars of all bills
discounted or negotiated and payments made or received in relation to any
goods. The statement required to be submitted by banks may be for each
month or several months regularly or continuously. This power of authorities
under the VAT Act is a general power separate and in addition to the powers
for summoning persons to furnish information or documents to give evidence
as provided for under Sections 63 and 64.
72. Provision in the case of defective or irregular proceedings:–
No assessment made, penalty or compounding fee levied or other order
passed by any officer or authority under the Act, shall be set aside merely
on account of any defect or irregularity in the procedure relating thereto,
unless it appears that such defect or irregularity has in fact occasioned
material hardship or failure of justice.
Notes
Instances may occur where there may be defects in the observance
of certain procedures. Such defaults may be of technical nature which in
fact must not have resulted in any prejudice to the dealers or any loss to
the Government. To revise or set aside such proceedings may not serve any
purpose. In such cases, this section provides defects and irregularities committed
by any authority or officer even if they be ex facie and in fact established
the same may be ignored. A similar provision is made in Section 460 of
Criminal Procedure Code which directs that inconsequential defects in following
procedural rules may be ignored.
A notice may not be actually served in the manner required under the
law but the assessee appears and avails opportunity of being heard. If he
subsequently neglects to participate in the hearing there is no material irregularity
in such circumstances the validity of the proceedings is not affected. Where
an alleged irregularity is not questioned at the appropriate time before lower
authorities, such assessee as an appellant in the appeal cannot raise the
irregularity at the appellate stage.
An assessee found to be delaying and often absenting before the authority
cannot complain of any irregularity in the hearing, that he was not given
a reasonable opportunity. It certainly amounts to material irregularity if the
authority depends upon the information secured by it without showing the
same to the assessee even where he is not present. Such irregularity goes
to the root of the matter. In such event, the whole assessment may be
set aside.
The opportunity of hearing shall cover all the matters in dispute. The
fact that the assessee was given opportunity on all matters except one, still
amounts to an irregularity which vitiates the order. There is nothing in law
like giving partial opportunity when there occurs a default in giving full
opportunity.
Under Section 72, the Assessing Authority has power to review its own
judgment. Appeal is not the only remedy. Sai Madhav Bio-tech, Warangal
v. Assistant Commissioner, CT (LTU), Warangal and Anr., (2010) 51 APSTJ 50.
73. Rounding off turnover:– The amount of turnover for any tax
period or for any calendar quarter shall be rounded off to the nearest
multiple of Rs. 10/- (Rupees ten only) and for this purpose if such amount
is not a multiple of Rs. 10/- (Rupees ten only), but is Rs. 5/- (Rupees
five only) or more, the amount shall be increased to the next higher amount
which is a multiple of Rs. 10/- (Rupees ten only) and if such amount
is less than Rs. 5/- (Rupees five only), the amount shall be reduced to
the next lower amount which is a multiple of Rs. 10/- (Rupees ten only);
and the amount so rounded off shall be deemed to be the turnover of
the dealer for the purposes of the Act.
74. Rounding off of tax etc.:– The amount of tax, input tax, output
tax, net tax, interest, penalty, or any other sum and the amount of refund
due under the provisions of the Act, shall be rounded off to the nearest
rupee and for this purpose, if such amount is fifty paise or more it shall
be increased to the next rupee and if such amount is less than fifty paise,
it shall be ignored.
Notes
The rule of rounding off to the nearest rupee applies only in the case
of the amounts which represent input tax, output tax, net tax, interest, penalty
or any other sum claimed as due against the dealer. Where the amount ends
with less than 50 ps. it should be rounded off to the nearest rupee and where
the amount ends with 50 ps. or more it must be rounded off to the next
rupee.
75. Powers of Subordinate officer to be exercised by higher
authorities:– The powers conferred by the Act and the rules made
thereunder on any of the officers appointed under Section 3A may also
be exercised by any of the officers superior to the officers so empowered,
subject to any instructions issued by the Commissioner.
Notes
This section enables the superior officers to perform the functions of
their subordinates. But, such power can be exercised only if the Commissioner
so instructs and subject to the limitation specified in the Commissioner’s
instruction. Under this power superior officers cannot withdraw the assessment
proceedings pending with the subordinate officers.
76. Power to remove difficulties:– (1) If any difficulty arises in
giving effect to the provisions of the Act in consequence of the transition
to the said provisions from the corresponding provisions of the Act in
force immediately before the commencement of the Act, the Government
may, by order in the Andhra Pradesh Gazette, make such provisions as
appear to them to be necessary or expedient for removing the difficulty.
(2) If any difficulty arises in giving effect to the provisions of the
Act (otherwise than in relation to the transition from the provisions of
the corresponding Acts in force before the commencement of the Act),
the Government may, by order make such provisions, not inconsistent
with the purposes of the Act, as appear to it to be necessary or expedient
for removing the difficulty.
Notes
Power to remove difficulties by issuing suitable orders is conferred on
the Government. Such power is conferred to resolve transitional difficulties
which arise during the transition period between the old Act which is repealed
and the new Act which replaced the repealed enactment. The power of the
Government in this regard should be exercised in a manner by which a
difficulty is removed. Normally, such power is conferred for a limited period
say, for one or two years from the date the new Act comes into force.
Under the Value Added Tax Act no such limitation is provided. As and when
the necessity arises to make a provision in the nature of removing a difficulty
arising out of the transition from old to the new Act, the Government can
do so at any time irrespective of limitation. Where the difficulty is referable
to a conflict with a provision of the old Act and the similar provision in
the new Act arising in the transition period, and not independently as a problem,
the Government shall issue necessary orders which will not conflict with the
intendment and purposes of the Act. The power of the Government under
this section is two fold. The Government may issue orders to resolve any
difficulty arising during the transition from the old Act which is replaced
to the new Act which substituted it. The Government may also issue necessary
orders independent of the conflict to resolve any difficulty arising merely in
the implementation of the new Act. There is no time limit for exercising these
powers. This power is distinguishable from the powers the Commissioner
has for giving instructions to subordinate officers about the ways in which
the Act may be implemented.
77. Instructions to Subordinate Officers:– The Commissioner
may, from time to time, issue such orders, instructions and directions not
inconsistent with the provisions of the Act or the rules made thereunder
to his subordinate officers as he may deem fit, for the proper administration
of the Act and such officers and all other persons employed in the
enforcement of the Act, shall comply with such orders, instructions and
directions:
Provided that no such orders, instructions or directions shall be such
as to interfere with the discretion of any appellate authority in exercise
of its appellate functions.
Notes
This section confers powers on the Commissioner, power of interpreting
the provisions of the Act and issue also such direction to all the officers
and authorities under the Act as he deems fit for proper administration of
the Act. This power is referable to the administration of the Act only. The
instructions of the Commissioner may extend to any other officer who happens
to be employed in connection with the enforcement of the Act. The Commissioner
has the power to explain or include whether any of the goods coming under
any of the schedules fall under a different schedule or unscheduled item.
Similarly, he has power to interpret and explain whether any of the unscheduled
item falls in any of the items specified in the other schedules. All officers
are bound to comply with the directions of the Commissioner, including those
whose services are specially brought into and within the scope of the Act.
It is however pertinent to note that the Commissioner has no power to issue
any directions to the appellate authorities in the manner of disposal of appeals
pending before them. The power of the Commissioner to give instructions
to subordinates extends to the power of giving directions to others also who
are not officers of the Department such as banks, clearing agents, stevedoers,
transport contractors and also to police officers engaged for purposes of
enforcement of the provisions of the Act.
Circulars and clarificatory orders issued by the Government or
Commissioner are not binding on Courts and Tribunals but they are binding
on taxing authorities. Choice Plywood Industries vs. State of Kerala, (2006)
147 STC 72.
Circulars and instructions given by the authorities do not bind the judicial
and quasi judicial tribunals. Model Milk Product (P) Ltd. v. Dy. Commissioner
(CT), Abids Division, Hyderabad, (2007) 44 APSTJ 52.
78. Power to make Rules:– (1) The Government may by notification,
make rules to carry out the purposes of the Act.
(2) In particular and without prejudice to the generality of the
foregoing power, such rules may provide for,–
(a) all matters expressly required or allowed by the Act to be

prescribed;
(b) the manner of determination of the amount payable by the dealer
in respect of:–
(i) any transfer of property in goods (whether as goods or in some
other form) involved in the execution of a works contract;
(ii) any delivery of goods on hire purchase or any system of payment
by instalments;
(iii) any 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;
(iv) any transfer of property in goods involved in lucky gift scheme.
(c) the term of office, and the conditions of service, of the members
of the Appellate Tribunal;
(d) the issue of registration to persons engaged in the sale or purchase
of goods, the fees payable therefor and the imposition of conditions in
respect of the same for the purpose of enforcing the provisions of the
Act;
(e) the rectification of mistakes apparent from the record of any
assessment, appeal or revision and the period within which such rectification
may be made;
(f) the administration of the check posts set up and barriers erected
under the Act and the regulation of the work therein;
(g) the disposal of goods confiscated under the Act and of the
proceeds thereof;
(h) the issue of bills or tax invoices or cash memoranda, the class
or classes of dealers who should maintain counterfoils for the same and
the particulars to be shown in and the manner of maintenance of such
counterfoils and the time for which they should be preserved;
(i) the maintenance of purchase bills or accounts of purchases and
sales by dealers carrying on business in specified goods and the time for
which they should be preserved;
(j) the issue of delivery notes in respect of goods delivered, or
transported to retail dealers in pursuance of sales effected to them, the
form and manner of their issue and the time for which they should be
preserved;
(k) the application of the provisions of the Code of Civil Procedure,
1908 (Central Act V of 1908) to the extent specified, in respect of
applications, appeals and other proceedings under the Act;
(l) securing that returns furnished or accounts or documents produced,
or evidence of any kind given under the Act before any assessing authority
or on appeal or revision from any decision of such authority are kept
confidential;
(m) the duties and powers of officers appointed for the purpose of
enforcing the provisions of the Act;
(n) the circumstances in which and the extent to which, fees paid
in pursuance of Section 33 may be refunded;
(o) generally regulating the procedure to be followed and the forms
to be adopted in proceedings under the Act;
(p) the assessment and recovery of tax under the Act in respect
of business which is discontinued or the ownership of which has changed
or in respect of business of a deceased person;
(q) the assessment and recovery of tax under the Act in respect
of business owned by minors or other incapacitated persons or by persons
residing outside the State;
(r) the assessment and recovery of tax under the Act in respect of
business owned by any person whose estate or any portion of whose
estate is under the control of the Court of Wards, the Administrator-
General, the Official Trustee, or any receiver or manager appointed by
or under any order of a Court;
(3) Any rule under the Act, may be made so as to have retrospective
effect.
(4) In making a rule under sub-section (1) or (2), the Government
may provide that a person guilty of a breach thereof, shall, on conviction
by a Magistrate of the First Class, be liable to be punished with fine
which may extend to Rs. 2,000/- (Rupees two thousand only).
(5) Every rule made under the Act, shall immediately after it is made,
be laid before the Legislative Assembly of the State if it is in session
and, if it is not in session, in the session immediately following, for a total
period of fourteen days which may be comprised in one session or in
two successive sessions, and if before the expiration of the session in
which it is so laid or the session immediately following, the Legislative
Assembly agrees in making any modification in the rule or in the annulment
of the rule, the rule shall, from the date on which the modification or
annulment is notified have effect only in such modified form or shall stand
annulled 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.
Notes
The power to make rules includes the power to make rules retrospectively.
The rule which is given retrospective operation shall not have the effect of
divesting any person of any rights already enjoyed. The rules so made may
provide that a breach of the rule could be an offence punishable in a criminal
court. There is however one restriction. The punishment provided for the
offence under the rule so made shall not be imprisonment. The punishment
could only be a fine upto Rs. 2,000/-.
After the rule is made it shall immediately be laid before the Assembly.
If it is in session, if the Assembly is not in session the rules shall be laid
before Assembly as soon as it assembles next time. The rule should be kept
on the table of the house for a total period of 14 days in one or more successive
sessions. If the rule is amended by the legislature, the rule as amended will
be in force from the date of amendment subject to the conditions that whatever
is done under the unamended rule shall be treated a having been validly done.
If a rule effects different dealers differently that can’t be a ground to
declare the Rule discriminatory. Singhal Converter P. Ltd., v. Addl. Commissioner,
Sales Tax, (2008) 18 VST 165 (Orissa).
Rule making power cannot be used to bring in a person who is not
a dealer within the scope of the Act, nor can it be used to bring in the
subject within the tax net which cannot be taxed under the Act. Smti Namita
Paul v. FCI, (2009) 20 VST 799 (Gau.).
Rule making is a legislative function and not any act which is judicial
or quasi judicial. Hence Rules of natural justice will not apply. Maks Costing
(P) Ltd., Uppal Village and others v. Govt. of Andhra Pradesh and others,
(2010) 51 APSTJ 189.
79. Power to amend schedules:– (1) The Government may, by
notification, alter, add to or cancel any of the Schedules.
(2) Where a notification has been issued under sub-section (1) there
shall, unless the notification is in the meantime rescinded, be introduced
in the Legislative Assembly, as soon as may be, but in any case during
the next session of the Legislative Assembly following the date of the
issue of the notification, a Bill on behalf of the Government, to give effect
to the alteration, addition or cancellation, as the case may be, of the
Schedule specified in the notification, and the notification shall cease to
have effect when such Bill becomes law, whether with or without
modifications, but without prejudice to the validity of anything previously
done thereunder:
Provided that if the notification under sub-section (1) is issued when
the Legislative Assembly is in session, such a Bill shall be introduced in
the Legislative Assembly during that session:
Provided further that where for any reason a Bill as aforesaid does
not become law within six months from the date of its introduction in
the Legislative Assembly, the notification shall cease to have effect on
the expiration of the said period of six months.
(3) All references made in the Act to any of the Schedules shall
be construed as relating to the Schedules in force for the time being
amended in exercise of the powers conferred by this Section.
Notes
Schedules form part of the Act. Normally, all amendments to the Act
shall be made only by an amending legislation. However, the Act under this
section delegated this specific power to the Government to amend the
schedules by notifications. The schedules deal with the subject of incidence
of tax, rates of tax and the goods exempted from tax. Even though, the
subject matter of the schedules is crucial to the Act, the power to vary the
schedules is conferred on the Government but on certain conditions. After
the notification is issued amending the schedules, the Government shall
introduce a bill in the legislative assembly if it is in session. If the Assembly
is not in the session, the Bill covering the amendment to schedules shall be
introduced in the next session. If the Bill is not passed by the Assembly
within 60 days from its introduction, the Bill as well as Notification will lapse.
If no Bill is introduced in the Assembly as above in such circumstances also
the notification lapses.
Case Law
Reference only:
Exemption granted for a year, though ordered in the middle of the
year operates from the beginning:-- (1) Where an exemption sought to
be granted for one year the notification for which is issued somewhere during
the year, it should be interpreted that the exemption should be operative
retrospectively from the beginning of the financial year. State of A.P. rep.
by State rep. before STAT, Hyderabad v. M/s. V.B.C. Exporters Ltd.,
Visakhapatnam, 1997 (2) An.WR 282 (DB) = 1997 (2) ALD 524.
Power to remove difficulties limited to difficulties only, not with
interpretations:-- (1) The power to remove difficulties is limited generally
the difficulties arising in the course of working of the Act. Such power can’t
be exercised either to interpret the statute in vacuum or issue directions to
the assessing authorities to make assessments in accordance with the interpretation
placed by the Government. The assessing authorities, appellate authorities and
revisional authorities under the Act or any authority performing quasi judicial
functions are expected to pass objective orders while interpreting the provisions
on their own. B Arunkumar Trading Pvt. Ltd., Mumbai and others v. C.T.O.,
Visakhapatnam & others, 1998 (3) An.WR 784 (DB).
Commissioner’s orders should not be inconsistent with the Act:- (1)
The Commissioner is competent to issue orders, instructions and directions
to his subordinates. Such orders shall not be inconsistent with the provisions
of the Act. The circular issued by the Commissioner which is found to
offend the Rule 6(1)(l) being inconsistent and impossible to give effect was
set aside and an assessment made allegedly under such circular was set aside
and assessing authorities were directed to make fresh assessments without
reference to Commissioner’s Circular. Sri Lakshmi Group of Enterprises,
Huzurnagar & others v. C.T.O., Kodad & others, 1999 (3) An.WR 835.
See also Sri Raja Rajeswari Parboiled Rice Industry and others v. C.T.O.,
Kodad, Nalgonda, 1999 (3) ALT 449 = 1999 (3) ALD 309 = (1999) 115
STC 99.
Retrospectivity shall not legalise illegal levy:- (1) Legislature is not
incompetent to enact retrospectively unless there is a constitutional bar against
such retrospective legislation. To re-validate an illegal levy is not correct. The
length of time covered by retrospective operation is a factor for consideration
and where such time is unreasonably long the retrospectivity may be struck
down as unreasonable.
In this case, retrospectivity being 6 weeks only the court held retrospective
operation of the amendment does not violate either Article 14 or Article
19(1)(g). `Association of pesticides manufactures A.P., Hyderabad & others
v. State of A.P. rep. by Secretary, Revenue & another, 1997 (5) ALT 69
(DB) = 1997 (6) ALD 810.
Legislature is competent to tax both prospectively and retrospectively. But
retrospectivity needs to be justified by substantial reasons to take it out of
its being offensive to Art. 19(1)(g) and Art. 14. If taxing law is beyond
legislative competence, if it is arbitrary, if it does not provide for procedure
for assessment, if it is a cloak adopted for achieving confiscatory purpose
and unreasonable, even the law whether made effective prospectively or
retrospectively can be questioned. Sri Durga Agency v. State of West Bengal,
(2009) 24 VST 428 (WB).
Where suit is maintainable:- (1) When the suit is for setting aside an
assessment on the ground that the officer making the assessment has no
jurisdiction in the context of the provisions of Article 286(1)(A) of the
Constitution of India is maintainable. State of A.P. v. Srikrishna Coconut Co.,
1960 ALT 739=1960(1) An.WR 279.
(2) Framing of a suit as a suit for refund of tax illegally collected does
not save the suit from its non-maintainability. Since, refund can’t be granted
without the assessment order is set aside, the allegations that the tax was
levied wrongly or without justification would not make the suit maintainable.
State of A.P. v. I. Subbayya Chetty & Sons, 1961 ALT 39 = 1961 (1) An.WR
15 = AIR 1961 AP 512 = 1961 (12) STC 257.
Exemption – non-compliance with rules:
(1) Dealer who does not conform with the mandatory provision such
as making an application in the form prescribed is not entitled to exemption.
He can’t therefore claim that since he is under a specific provision of law
entitled to exemption, he shall be granted the exemption. State of A.P. v.
M/s. Khasim Ayub, 1959 (1) An.WR 402 = 1959 (10) STC 190.
(2) Non-compliance with rules disentitles the assessee from claiming
exemption. Heranand Ram Sook v. Province of Madras, AIR 1954 Andh.
7 = 1954 ALT 19.
Publication of rules:
(1) Where the rules prescribed that there should be a prior publication
of the draft rules and after the period prescribed they should be placed on
the table of the Assembly, the rules placed before the Assembly without prior
publication are held to be invalid. B. Sreeramulu Chetty v. State of A.P.,
1958 ALT 282 = 1958 (1) An.WR 268 = 1958 (9) STC 215 (FB).
Rule making power:
(1) Note:– The present clause in the Act, which provides for the power
to the Government to make rules, does not have a clause that the draft rules
should be published before they are placed on the table of Legislature.
(2) When there is a power to make a rule on any matter within the
scope of general power to make rules for the purposes of the Act, the fact
that the subject is not specifically mentioned in the list appended to the rule
making powers will not make the rule beyond the powers of the State
Government. State of A.P. v. G. Kasiviswanatham, 1969 (2) APLJ 188 =
1970 (25) STC 1 = AIR 1970 AP 80 (FB).
Rule made before the Act:
(1) Rules framed before the Act and given effect are valid and they
continue to be valid after the Act came into force. Reliance Automobiles v.
State of Andhra, 1958 (9) STC 295.
Note:— In the case of this Act, rules were framed and published before
the Act came into force to enable the Government to make preparations and
get ready to implement the Act as per Schedules. Such rules are valid.
(2) Levy of tax at some points of sale, some only have benefit of set
off. The scheme of levy at every point of sale other than the first point
of sale with a set off and the last point of sale without set off is quite
rational. M/s. Kotthagudem Beer & Wines v. Government of A.P., 1985
(1) APLJ 573.
(3) Validation with retrospective effect. Even a casual reading of Section
9 would disclose that notwithstanding anything contained in any judgment,
Sec. 80] Repeal 207
all the assessments or re-assessments made during a particular period have
been validated by the Act with retrospective effect. It only means that even
if the assessments were set aside in appeal or quashed in the proceedings
under Article 226 of the Constitution the assessments nevertheless would be
valid. State of A.P. v. S.J. Amichand, 1974 (1) An.WR 351.
(4) Validating provision: Ordinarily Court holds a tax to be invalidly
imposed because the power to tax is wanting or the statute or the rules or
both are invalid or do not sufficiently create jurisdiction. Validation of a tax
so declared illegal may be done only if the grounds of illegality or invalidity
are capable of being removed and the tax thus made legal. The validity of
the validating law depends upon whether the legislature possess the competence
which it claims over the subject matter and whether in making the validation
it removes a defect which the court had found in administering the law and
makes adequate provision in the validating law for a valid imposition of tax.
Where validating Act validated the assessment, there need not be any
fresh assessments for the purposes of invoking demand notices for the pay
back of the amounts refunded by the Government earlier to the assessee.
State of A.P. v. M/s. Parsur Kuppuswamy Chetty & Sons, 1981 (1) ALT
289.
(5) Voluntary disclosure effect: Voluntary disclosure of certain stocks
by assessee under voluntary disclosure of income and wealth Act (VDIW
Act of 1975) addition of such disclosed stock to the total turnover of the
assessee during the relevant period is not legal. B. Satyanarayana Murthy
& Sons v. State of A.P., 1984 (57) STC 274.
Maintainability of suit:
(1) For recovering of tax collected from the dealer after the concerned
goods are exempted, suit is maintainable. State of A.P. v. Ramaiah, 1971
(1) An.WR 112.
Suit for declaration:
(1) A suit for declaration about the status of the dealer whether he
is a firm or joint family etc., is not maintainable since the ascertainment of
the status of the dealer is within the jurisdiction of the authorities under the
Act. Sri Gopal & others v. Spl. CTO (Evasion), 1988 (1) ALT 599 = 1988
(1) APLJ 565.
CHAPTER X
REPEAL
80. Repeal:– (1) The Andhra Pradesh General Sales Tax Act, 1957
(Act VI of 1957) is hereby repealed :
Provided that such repeal shall not affect the previous operation of
the said Act or section or any right, title, obligation or liability already
acquired, accrued or incurred thereunder, and subject thereto, anything
done or any action taken (including any appointment, notification, notice,
order, rule, form, regulation, certificate, licence or permit) in the exercise
of any power conferred by or under the said Act or section shall be
deemed to have been done or taken in the exercise of the powers
conferred by or under this Act, as if this Act was in force on the date
on which such thing was done or action was taken; and all arrears of
tax and other amounts due at the commencement of this Act may be
recovered as if they had accrued under this Act.
(2) Notwithstanding anything contained in sub-section (1), any
application, appeal, revision or other proceeding made or preferred to
any officer or authority under the said Act or section and pending at the
commencement of this Act, shall, after such commencement, be transferred
to and disposed of by the officer or authority who would have had
jurisdiction to entertain such application, appeal, revision or other proceeding
under the Act if it had been in force on the date on which such application,
appeal, revision or other proceeding was made or preferred.
(3) Upon such repeal of the Andhra Pradesh General Sales Tax
Act, 1957 the provisions of Sections 8, 8A, 9 and 18 of the Andhra
Pradesh General Clauses Act, 1891 (Act 1 of 1891) shall apply.
Notes
Andhra Pradesh Value Added Tax Act, 2005 repeals totally the Andhra
Pradesh General Sales Tax Act, 1957. This means, that the Value Added Tax
is a substitute for the Sales Tax. The effect of repeal is that the 1957 Act
ceases to have any effect after the date of its repeal. It was valid up to
that date for all purposes. All matters pending under the Repealed Act will
proceed as if that Act has been in force. All proceedings initiated will continue
till they finally terminate in accordance with the provisions of that Act. The
appeals and revisions may be filed against orders so made treating that Act
has been in force, continue to be filed and disposed of in the manner they
would have been filed under the Repealed Act. Powers of revision exercisable
at any time within four years or six years can also be exercised in the same
manner as they would have been done.
To get over the difficulty of any prosecutions being launched for violation
of various provisions of the repealed Act committed after the said Act is
repealed or imposition of penalties for violations of various provisions of the
repealed Act committed after the said Act as repealed, the Act made a specific
provision that all such prosecution can be launched and penalties can be
imposed as if those offences are committed under the Act. Similarly the
initiation and continuances of the proceedings shall be treated as if they are
being initiated and continued under the Act by officers, authorities and courts
as if they are the proceedings under the Act.
Where provisions of repealed enactment are same as those contained
in repealing statute, the exemption notifications issued under the old Act
continue to be operative evenafter the repeal of the old Act. Eveready Industries
Ltd. v. State of Uttaranchal & others, (2008) 17 VST 18.
Exemptions which have come to be granted as a policy and which come
within the scope of promissory estoppel, granted by the unified State of Bihar,
can’t be revoked by the successor Government of the separated Jharkhand
Sec. 81] Repeal 209
State even on grounds of changed circumstances or financial stringency.

However, such exemptions can be withdrawn if the original grant is conditional
provided the conditionalities are incorporated not only in the policy but also
in the relevant exemption order issued in each case.
Vested rights accrued under the repealed Act continue even after their
repeal. Okey Textiles v. Commissioner of Commercial Tax, (2009) 20 VST
232.
See also: K.B. Tea Products (P) Ltd. v. Siliguri Charge, (2009) 20 VST
933.
Where repealing enactment does not provide for revision but it so
provides subsequently through an amendment, the power to revise the orders
during the interregnum by the revising authority is not valid. International
Metro Civil Contractors v. Dy. Commissioner of Sales Tax/VAT Zone, New
Delhi, W.P. No.5828/2007, dt. 14-3-2008 (Del.)
Under Punjab VAT, when an exemption from payment of tax is granted
to an export unit for 10 years, the exemption is permissible only when the
terms of exemption are satisfied every year. Astra Lightening Ltd. v. State
of Punjab, (2009) 19 VST 100 (Punjab).
Where any rule is amended anything done prior to the amended rule
can’t be treated as invalid. Samrat Granites (P) Ltd. v. Commercial Tax Officer,
(2006) 148 STC (Karn.)
Case Law
Jurisdiction for filing appeal by an assessee who filed return under the
Repealed Act lies with the prescribed appellate authority under the old Act.
2006 (147) STC 218.
After the A.P. VAT Act, 2005 came into force an assessee raised the
contention that the penalty proceedings initiated by the Asst. Commissioner
of Commercial Taxes, Warangal Division under the provisions of the Repealed
APGST, cannot be proceeded with and continued. The Andhra Pradesh High
Court held that whenever there is a repeal of an enactment and a simultaneous
re-enactment, the new Act is considered as an affirmation of the old law,
and the provisions of the Repealed Act continue to be in force uninterruptedly
unless the new Act manifests an intention incompatible with or contrary to
the provisions of the Repealed Act. The confirming judgment of Supreme
Court held that the proceedings for penalty for infractions committed under
the old Act can be initiated and continued even after the new Act has come
into force. Gammon India Ltd. v. Spl. Chief Secretary & others, 2006 (145)
STC 1.
81. Repeal of Ordinance 1 of 2005:– The Andhra Pradesh Value
Added Tax Ordinance, 2005 is hereby repealed.
VAT–14
210 Commentary on A.P. Value Added Tax [Sch. I
SCHEDULE – 1
[See Section 7]
List of Goods Exempt from Tax under Section 7
Entry Description of Goods HSN Code
No. in
Sch.
1 *[Agricultural implements manually operated or animal driven, hand NA
operated sprayers including knapsack/backpak power sprayers (powered
upto 35 cc engines developing 0.8 to 1.4 HP) dusters and parts thereof]
* Subs. by Act No. 28 of 2008, w.e.f. 1-7-2008.
2 Aids and implements used by handicapped persons
1) Orthopaedic or fracture applicances 9021.10
2) Artificial joints 9021.31
3) Hearing aids, excluding parts and accessories 9021.40
4) Other (parts and accessories) 9021.90
5) Braille typewriters (electirc) 8469.20.10
6) Braille typewriters (non-electirc) 8469.30.10
7) Wheel chairs for invalid (not mechanically propelled) 8713.10.10
8) Wheel chairs for invalid 8713.90.10
3 *[Aquatic feed, poultry feed and cattle feed including grass, hay and straw NA
feed supplements or nutrients and soya bean de-oiled cake].
*Subs. by Act 20 of 2009, w.r.e.f. 1-3-2009
4 Betel leaves 1404.90.40
5 Books and periodicals & journals including maps, charts and globes and
atlases. (the words in italics were added by the Act No.23 of 2005 dt. 26th
Oct, 2005 w.e.f. 18.08.2005)
1) Printed books, Brouchers, leaflets and similar printed whether or not in 4901.10.20
single sheet
2) Journals and periodicals (atleast 4 times a week) 4902.10.20
3) Journals and periodicals (other) 4902.90.20
4) Childern's picture, drawing or colouring books 4903
5) Maps and hydrographic or similar charts of all kinds, including 4905
altlases, wall maps, topographical plans and globes, printed
6) Globes, round and inflatable
6 Charkha, Ambar Charkha and Gandhi Topi NA
7 Charcoal 4402
8 Jowar, Maize, Ragi, Bajra, Kodan, Kutki, Barley, Varigalu or variga rice, NA
Korralu or Korra Rice
9 Condoms and contraceptives
1) Sheath contraceptives 4014.10
2) Chemical contraceptive preparations based on hormones, or other 3006.60
products of heading 2937 on spermicides
10 Cotton yarn in hank and silk yarn in hank NA
11 Curd, Lussi, Butter Milk and separated milk NA
12 Earthen pot NA
13 Electrical energy 2716.00.00
14 Firewood other than casuarina poles, eucalyptus logs and cut sizes thereof NA
15 Fishnet and Fishnet fabrics 5608.11.10
16 Fresh milk and pasteurised milk other than UHT Milk and skimmed milk NA
powder
Sch. I] List of goods exempt from tax u/S. 7 211
17 Fresh plants, saplings and fresh flowers NA

18 Vegetables & fruits other than those cured, frozen, preserved, processed, NA
dried, dehydrated or canned.
19 Garlic and Ginger
1) Garlic a) Fresh 0703.20.00
b) Dried 0712.90.40
2) Ginger a) Fresh 0910.10.10
b) Dried unbleached 0910.10.20
c) Dried bleached 0910.10.30
20 Bangles made of shells, glass, lac or any other material other than those NA
made of precious metals
21 Handlooms, parts and accessories thereof and goods produced from NA
handlooms
22 Human blood and blood plasma NA
23 Kumkum, Bindi, Alta and Sindur NA
24 *[Meat, Flesh of Poultry, Fish including dry fish, Prawns, Prawn Seed, NA
Lobsters, Crabs, Shrimps and other sea food except when they are sold in
frozen state or in a sealed container, Eggs, livestock and animal hair.]
* Subs. by Act No. 40 of 2007, w.e.f. 1-4-2005
25 National flag NA
26 *[Organic manures excluding deoiled-cakes] NA
*Subs for “Organic manures” by Act No. 4 of 2009.
w.e.f. 1-9-2008, vide Memo 1766/CT/II(1)/2009 dt. 6-5-2009.
27 Non-judicial stamp paper sold by Government Treasuries, postal items like NA
envelope, post card etc., sold by Government, rupee note, when sold to the
Reserve Bank of India and cheques loose or in book form
28 Raw wool 5101
29 Semen including frozen semen
1) Bovine semen 0511.10.00
2) Frozen semen, other than bovine 0511.99.91
30 Silk worm laying, cocoon and raw silk *[other than raw silk imported 5001&500
from outside the country] 2
* Added by Act No. 34 of 2006, w.r.e.f. 1-7-2006.
31 Slate and slate pencils NA
32 *[Coconut, Tender green coconut and copra] NA
*Subs. for “Tender Green Coconut” by Act 28 of 2008, w.e.f. 1-8-2008
33 Toddy, Neera and Arak NA
34 Unbranded bread NA
35 *[Salt including processed and branded salt.] NA
* Substituted for “Unprocessed and unbranded Salt” by Act No. 5 of
2007, w.r.e.f. 1-9-2006.
36 Water other than
i) Aerated, mineral, distilled, medicinal, ionic, battery, de-mineralised NA
water, and
ii)Water sold in sealed container NA
37 Prasadam, Bhog or Maha Bhog by Religious Institutions NA
38 Plantain Leaves NA
39 Bamboo Matting NA
40 Puffed Rice, Parched Rice, Murmuralu and Atukulu
41 Husk of pulses, paddy, groundnut and wheat bran 2302

except
2302.10 &
2302.20
42 Leaf plates and leaf cups-pressed or stitched and loose and unstitched vistarakulu
43 Unbranded broomsticks
44 *[Seeds for sowing and gardening purpose including the seed or grain corresponding to the
seed sold to the nodal agencies, namely, Andhra Pradesh State Seeds Development
Corporation (APSSDC), Andhra Pradesh State Co-operative Marketing Federation (Andhra
Pradesh Markfed), Andhra Pradesh State Co-operative Oilseeds Growers Federation
(OILFED), the Hyderabad Agricultural Co-operative Association Limited (HACA), National
Seeds Corporation Limited **[National Agricultural Co-operative Marketing Federation of
India Limited (NAFED)] and also including the seed or grain procured by the seed
companies duly following the Seed Certification or Labelling Procedure.]
*Subs.by Act No. 28 of 2008 w.e.f. 1-4-2005.
**Ins. by Act No. 4 of 2009, w.e.f. 1-7-2008 Memo 17661/CT-II(1)/2009, dt. 6-5-2009.
45 *[xxx]*Entry relating to “Cotton fabric ….” omitted by Act 11 of 2012,
w.e.f. 11-7-2011.
46 *[xxx] *Entry relating to”Sugar” omitted by Act 11 of 2012, w.e.f. 11-7-2011.
Cotton terry towels are different from cotton fabrics. Cotton fabrics only are exempt.
Hence cotton terry towels are not exempt. City Tex Private Ltd. v. The Commercial Tax
Office, (2012) 54 APSTJ 83.
*47 (a) Un-manufactured tobacco covered under tariff heading No. 2401 of the Central
Excise Tariff Act, 1985 (5 of 1986);
(b) Bidis (biris) covered under tariff item No. 24031031, 24031039, 24031090 of the
Central Excise Tariff Act, 1985 (5 of 1986).
*Subs. by Act 38 of 2007, w.e.f. 1-9-2007.(vide G.O.Ms.No.1422, Dept. dt.8-11-2007]
48 Rakhi (Added by the Act No. 23 of 2005, dt. 26-10-2005 w.e.f. 01.09.2005)
49 *[Fabrics, Made ups] and garments made of Khadi cloth
*Subs. for “Made ups” by Act 11 of 2012, w.e.f. 11-7-2011.
(The entry in serial No. 49 was added by the Act No.10 of 2006, dt. 4-1-2006 w.e.f.
01.12.2005)
*50 Sugarcane * Added by Act No. 5 of 2007, w.r.e.f. 1-4-2005.
*51 Crochet laces * Added by Act No. 5 of 2007, w.r.e.f. 1-9-2006.
*52 Jaggery (* Added by Act 14 of 2007, w.e.f. 1-1-2007.)
*53 Tamarind (* Added by Act 14 of 2007, w.e.f. 1-2-2007.)
*54 Mesta or Bimli extracted from plants of the species Hibiscus cannabinus and Hibiscus
sabdariffa var.altissima. *Added by Act No. 38 of 2007, w.e.f. 1.6.2007.
*55 Pippalamodi (*Added by Act No. 38 of 2007, w.e.f. 1-6-2007.)
*56 Coir and Coir products excluding rubberized Coir mattresses.
(*Added by Act No. 38 of 2007, w.e.f. 1-6-2007.)
*57 Khandasari sugar (* Added by Act No. 38 of 2007, w.e.f. 18-8-2005.)
*58 The following goods, sold by Canteen Stores Department or the Indian Naval Canteen
Services, either directly or through their unit-run Canteens, to the Army/Navy/Air force
personnel both working and retired and who are eligible for purchasing goods from
them.
1. All kinds of cereals and pulses and products thereof, which are used for cooking
food.
2. Spices, used in cooking, including Chillies power, turmeric powder and other
similar powders, used in cooking.
3. Biscuits, Beverages, Confectionery & Soft Drinks
4. Soups, Squashes Snacks & Cornflakes
5. Tea & Coffee
Sch. I] List of goods exempt from tax u/S. 7 213
6. Pickles, Sausess, Jams & Jellies

7. Milk Powders, Baby Food, Food beverages & Food Energisers
8. Vermicelli & Instant Foods
9. Cooking oils, Vanaspathi & Ghee
10. Honey, Chavanprash, Eno Antiseptic cream & lotions.
11. Starch and Sago
12. Copra, Coconuts and ground-nuts
13. Shaving Blades & Razor sets
14. Shaving creams & After Shave lotions
15. Tooth Brushes, Shaving brushes, Shoe brushes & Toilet Brushes
16. Face creams, Hair creams, & Body creams
17. Dental cream & Tooth powders
18. Perfumes & Deodorant including Agarbatti/ Dhoopsticks
19. Toilet Soaps and Detergent Soaps
20. Toilet power & Detergent powder
21. Hair oils & Shampoos
22. Hair Dye. Sanitary Towels & Toilet papers
23. Fabric care, Starch, Robin Blue & Ranipal
24. Dish Washing Soap, Powder & Scrubber.
25. Wax candles & Agarbathi
26. Pressure Cookers, Milk Boiler & Rice Cooker
27. Vacume Flask, Casserole, Crockery & Glass Ware
28. Electrical Bulbs, Tube light & CFL Lamp
29. Mosquito Repellent, coil, Mat 7 Liquid
30. Torch Cells, Torch cases
31. Room Freshners, Toilet/ Floor Cleaners & insecticides
32. Shoe polish, cloth clips & metal clips
33. Gas stoves, Gas Lighters & Safety matches, cooking ware including cups, Plates
and glasses made of Alluminium paper or plastic
34. Ceiling fans, Table fans, Wall fan, Pedestal Fans
35. Exhaust Fans, Mixers, Juicer Mixer Grinders, Irons
36. Coffee makers, ovens, immersion heater, toasters
37. Instant Geysers, Transistors
38. Water filters & Filter candles.
39. Plastic Buckets, Basins, Drum & Mugs
40. Water Bottles & Water cans
41. Suitcases moulded & soft luggage
42. Sports wear, Golf Balls, shoe track suit, umbrellas & Padlocks
43. Helmets
44. Wrist Watches
45. Food processor microwave ovens
46. Coir products, Coir Mattress
47. Water heaters, Vacume Cleaners, Water Purifier.
48. Mono Block Pumps.
49. Sewing Machines (Hand & Foot)
50. Sun - glasess, Room Coolers.
51. Ready –made garments and hosiery goods.
*[52. Indian Made Foreign Liquor as defined in the Andhra Pradesh Excise Act, 1968
with basic price not exceeding Rs.500/- per case of 9 Nos. of 1000 ml or 12 Nos. of
750 ml/650 ml (Beer) or 24 Nos. of 375 ml/330 ml (Beer) or 48 Nos. of 180 ml or
96 Nos. of 90 ml bottles.
Note:-- For the purpose of this entry basic price means: Ex-factory price+cost of
bottles+cost of packing material+Freight+Insurance+Handling charges and Import
Fee, if any
**[53. Cartridges for rajor set.
54. Shaving Foam/Gel/Soap.
55. Fabric Care brush/Scrubbers.

56. Baby care lotion/cream/oil.
57. Clip for Cloth.
58. Tooth pastes.
59. Liquid Soap.
60. Face Tissue Paper.
61. Body care Talcum Powder, Body Care Jelly, Medicated powder/Face powder.
62. Face Gel/Lotion, Hair Gel/Lotion, Hair Fixer/Hair remover.
63. Cosmetic Lotion/Cream and Make-up Requisites and Winter care products.
64. Disinfectants.
65. Kitchen Accessories and Cooker Accessories.
66. Lunch Box and refill for vaccuum flasks.
67. Knives.
68. Lighting Devices.
69. Oven Grillers.
70. Storage Water Heater.
71. Household Electric Accessories/Voltage Stabilizers.
72. Sewing Machine Accessories.
73. Cloth Hangers.
74. Floor/Metal Polishes.
75. Mirrors.
76. Radio/Cassette Player/CD Player/Recorder/Walkman.
77. Water Containers/Jug.
78. Kitchen Jar, Containers/Plastic Trays, Table/Door Mats/Plastic Mats/ Carpets and
Plastic Items.
79. Plastic Chair/Moulded Furniture, Stool, Pedal Bin.
80. Hair Comb/Hair Brush.
81. Holdalls/Travel Bags/School Bags/Hot Water Bag.
82. Rubber Chappal.
83. Bed Sheet/Covers, Pillow/Pillow Cover, Bath Towels/Hand Towels/ Napkin.
84. Polishing cloth/Duster.
85. Socks/Blankets/Lungi/Hand Kerchiefs.
86. Mosquito nets.
87. Trouser/Pant-Shirt Pieces.
88. Sports Goods.
89. Rope Floor Wiper.
90. Juices.
91. Sharbat, Squashes and Cordials, Tinned food Mixers.
92. Ketchup, Baking Powder, Vinegar, Food Additives, Custard powder.
93. Noodles.
94. Antiseptic Liquid.
95. Note Books, Registers, Pens/Markers/Greeting Cards/Fevicol.
96. Balms, Antiseptic Applications, Medicines, Tonics, Band Aid and Digestives.
97. Cutleries.
98. Brief Cases.
99. Instant Foods.] *Subs. by Act 9 of 2010, w.r.e.f. 23-11-2010.
**Items 53 to 99 added by Act 9 of 2010, w.r.e.f. 17-2-2010.
Explanation:- The goods mentioned in entries *[45 & 46] of this schedules shall be goods included in
the relevant heads and sub-heads of the 1st Schedule to the Additional Duties of Excise (Goods of
special importance) Act 1957, but does not include goods where no additional duties of excise are
levied under that schedule. * Subs. “45, 46 & 47” by Act No. 37 of 2007, w.r.e.f. 1-4-2007.
CASE LAW
A question is raised where "fresh milk and pasteurized milk" are only exempt under Schedule I, Item
16, is it justified to include "skimmed milk powder and UHT Milk" as taxable at 4% under Schedule
IV, Item 58? The Andhra Pradesh High Court held that whatever be the nature of articles when they
are separately notified the legislative intention to tax skimmed milk powder and UHT Milk cannot be
Sch. III] List of goods taxable @ 1% 215
*[59. Sale of goods to any unit located in Special Economic Zone

59A. All goods sold to unit, operator, developer, Co-developer and Contractors engaged
by them for use in processing area of the respective Special Economic Zones except
the goods listed in rule 20(2) (a) of the Andhra Pradesh Value Added Tax Rules,
2005] *Added by Act 28 of 2008 w.e.f. 1-6-2008.
60. Nawar *Added by Act 20 of 2009, w.r.e.f. 1-5-2009.
*[61. Goods sold to transit passengers both incoming and outgoing, at the duty
free shops established at the Rajiv Gandhi International Airport,
Shamshabad, Ranga Reddy District.]*Added by Act 20 of 2009, w.r.e.f. 24-3-2008.
*[62. Zari] *Added by Act 11 of 2012, w.e.f. 11-7-2011]
*[63. Fabrics, Made ups and garments, produced and sold by the power loom units in the
State to dealers registered under the Act only at the point of sale in the hands of
powerloom units.]
*Added by Act 11 of 2012, w.e.f. 11-7-2011.
SCHEDULE II
[See Section 8]
Transactions Zero-Rated and Eligible for Input Tax Credit
Sl.No. Description
1. Sale of taxable goods in the course of inter-state Trade or Commerce falling with
in the scope of Sec. 3 of the Central Sales Tax Act, 1956
2. Sale of goods falling within the scope of Section 5(1) and Section 5(3) of the
Central Sales Tax Act, 1956.
1 1
3. [xxx] 3A. [xxx]
2
[4. Goods or products specifically marketed with brand "A.P. Girijan Co-operative
Corporation Limited.]
3
5. [xxx]
SCHEDULE III
[See sub-section (3) of Section 4]
List of goods taxable @ 1%
Sl.No. Name of the Commodity
4
[1. Bullion and Specie, Platinum and other precious metals].
5
[2. Articles and Jewellery made of bullion or specie or both and Jewellery
embedded with precious stones and semi-precious stones and gold coated
or gold covered jewellery.]
3. Precious stones, that is to say, Diamonds, Emeralds, Rubees, Sapphires
and semi-precious stones and Pearls.
1. Entries 3 and 3A omitted by Act 28 of personnel both working and retired, who are
2008 w.e.f. 1-6-2008. eligible for purchase from the Canteen Stores
2. Added by Act No. 34 of 2006, w.r.e.f. Department/Indian Naval Canteen Services
1-7-2006. either directly or through their unit run canteens.
3. Omitted by Act No. 15 of 2008 w.e.f. Note:– For the purpose of the entry,–
24.11.2007, earlier the entry Added by Act (1) the basic price means,–
No. 5 of 2007, w.r.e.f. 1-9-2006, and it reads: Ex-factory price + cost of bottles + cost of
5. Sales by the Canteen Store Department packing material + Freight + Insurance +
or the Indian Naval Canteen Services, of Handling charges and import fee, if any;
Liquor whose basic price does not exceed (2) A case means,–
Rs. 500 (Rupees five hundred only) per case 12 Nos. of 1000 ml., 12 Nos. of 750 ml.;
and the goods listed under Schedule-IV of 24 Nos. of 375 ml., 48 Nos. of 100 ml; 96
the Act, to the Army/Navy/Air Force Nos. of 90 ml; Bottles of IML/Wines.
4. Subs for "Bulion and Specie" by Act 10 of 2006
5. Subs for "Articles and Jewellery made of bullion or specie or any other precious metals
and Jewellery embedded with precious stones and semi-precious stones" by Act 23 of 2005,
w.e.f. 1-9-2005.
216 Commentary on A.P. Value Added Tax Sch. IV]
SCHEDULE IV
List of Goods taxable @ 1[5%]
Sl. Entry Description of Goods HSN
No. No. in Codes
Sch.
1 1 Agricultural implements not operated manually or not
driven by animal
(1) Agricultural, horticultural or forestry machinery for 8432
soil preparation or cultivation; lawn or sports-ground
roller
2) Harvesting or threshing machinery, including straw 8433
or fodder balers, grass or hay mowers; machines for (except
cleaning, sorting or grading eggs, fruit or other 8433.51 &
agricultural produce, other than machinery of heading 8433.52
8437
3) Other agricultural, horticultural, forestry, poultry- 8436
keeping or bee-keeping machinery, including
germination plant fitted with mechanical or thermal
equipment; poultry incubators and brooders.
4) Root or tuber harvesting machinery 8433.53
2 2 *Goods of intangible or incorporeal nature as may be
notified from time to time by the State Government and
including,-
(i) Patents
(ii) Trade marks
(iii) Import licences including exim scrips, special
import licenses and duty free advance licenses
(iv) Export Permit or license or quota
(v) Software packages
(vi) Credit of Duty Entitlement Pass Book
(vii) Technical know-how
(viii) Goodwill
(ix) Copyright
(x) Designs registered under the Designs Act, 1911
(xi) SIM cards used in Mobile Phones
(xii) Franchise, that is to say, an agreement by which the
franchisee is granted representational right to sell or
manufacture goods or to provide service or undertake
any process identified or associated with the franchisor,
whether or not a trade mark, service mark, trade name or
logo or any symbol, as the case may be, is involved.
*Subs. by Act No. 28 of 2008, w.e.f. 1-4-2005.
1. Subs. for “4%” by G.O.Ms.No. 58, Rev. CT-II, dt. 25-1-2012, w.e.f. 14-9-2011.
Sch. IV] List of goods taxable @ 4% 217
may be, is involved.

*Subs. by Act No. 28 of 2008, w.e.f. 1 -4-2005.
3 3 All kinds of bricks including fly ash bricks,
refractory bricks
1) Bricks (of siliceous fossil meals) 6901.00.10
2) Blocks (of siliceous fossil meals) 6901.00.20
3) Magnesia carbon bricks, shapes and graphetised 6903.10.10
aumina
4) Building Bricks (Ceramic) 6904.10.00
5) Cement building blocks and bricks 6810.11.00
6) Refractory bricks, blocks tiles and similar 6902.00
refractory ceramic constructional goods, other than
those of siliceous fossil meals or similar siliceous
earths.
7) Bricks and tiles of fly ash 6815.99.10
4 4 Asphaltic roofing sheets 6807
5 5 Earthen tiles other than ceramic and glazed tiles 6905.10.00
6 6 All types of yarn and sewing thread other than cotton
yarn in hank and silk yarn in hank
1) Yarn of carded wool 5106
2) Yarn of combed wool 5107
3) Yarn of fine animal hair (carded or combed) 5108
4) Yarn of wool or fine animal hair, containing 85% 5109
or more by weight wool or of fine animal hair
5) Yarn of coarse animal hair or horse hair 5110
(including gimped horse hair yarn)
6) Flax yarn 5306
7) Yarn of jute or of other textile bast fibers of 5307
heading No. 5303
8) Yarn of other vegetable textile fibres; paper yarn 5308
9) Yarn (other than sewing thread) of synthetic 5509
staple fibres
10) Yarn (other than sewing thread) of artificial 5510
staple fibres
11) Yarn (other than sewing thread) of man made 5511
staple fibres
12) Synthetic filament yarn other than sewing thread 5402
16) Metalised yarn whether or not gimped 5605

17) Gimped yarn and strip 5606
7 7 All utensils including pressure cookers and pans excepting
utensils made of precious metals
(Subs. by the Act No. 23 of 2005, dt.26-10-2005,
w.e.f. 18.08.2005)
8 8 *[Areca nut, betel nut, betel nut powder with additives,

supari and mouth fresheners made of somph (Ani seed) and
coriander powder with additives]
* Substituted by Act No. 5 of 2007, w.r.e.f. 1-4-2005.
9 9 Bamboos, *[Cane (Rattan)], Casuarina poles, eucalyptus
logs and cut sizes thereof *Ins.by Act 9 of 2010,
w.r.e.f. 2-12-2009.
10 10 Bearings of all kinds 8482
11 11 Beedi leaves 1404.90.10
12 12 Transmission rubber belts
1) PVC belt conveyor 3926.90.10
2) Conveyor or transmission belts or belting of vulcanised 4010
rubber
3) Leather belting for machinery 4204.00.40
4) Transmission or conveyor belts or belting, of textile 5910
material, whether or not impregnated, coated, covered or
laminated with plastics, or reinforced with metal or other
material.
13 13 *[Bicycles, E. Bikes,] tricycles, cycle rickshaws & parts
and accessories thereof.
*Subs. for “Bicycles” by Act 34 of 2006, w.e.f. 1-7-2006.
1) Bicycles and other cycles (including delivery tricycles), 8712
not motorized
2) Frames and forks, and parts thereof 8714.91
3) Wheel rims and spokes 8714.92
4) Hubs, other than coaster braking hubs and hub brakes, 8714.93
and free wheels sprocket wheels
5) Brakes including coaster braking hubs and hun braking 8714.94
and parts there of
6) Saddles 8714.95
7) Pedals and crank - gear, and parts thereof 8714.96
8) Other 8714.99
9) New pneumatic tyres of rubber, of a kind used on 4011.50
bicycles
10) Inner tubes of rubber of a kind used on bicycles 4013.20
11) Inner tubes of rubber of a kind used in tyres of cycle 4013.90.50

rickshaws and 3- wheeled powered cycle rickshaws.
14 14 Bitumen
1) Asphalt, natural 2714.90.10
2) Bitumen, natural 2714.90.20
3) Petroleum bitumen 2713.20.00
4) Cut backs, bituminous or a sphalt 2715.00.10
15 15 Branded Bread
16 16 Bulk Drugs
1) Ketones and quinones, whether or not with other 2914
oxygen function and their halogenated, sulphonated,
nitrated or nitrosated derivatives
2) Oxygen function amino-compounds 2922
3) Organic derivatives of hydrazine or of hydro 2928
xylamine
4) Other organo-in organic compounds 2931
5) Hetero cyclic compounds with oxygen hetero- 2932
atoms(s) only
6) Hetero cyclic compounds with nitrogen hetero-atoms 2933
(s) only
7) Nucleic acids and their salts, whether or not 2934
chemically defined; other hetero cyclic compounds
8) Sulphonamides 2935
17 17 Electric Motors and Oil Engines upto a capacity of 10
HP, Centrifugal, Monobloc and submersible pumpsets,
Starters of electric motors and pumpsets, parts and
accessories thereof
*(the words Centrifugal, monobloc and submersible
pumps" Subs. by Act 23 of 2005 dt. 26-10-2005, w.e.f.
18.08.2005)
18 18 *[Coffee including Coffee Seeds, roasted seeds and
coffee powder, Cocoa powder, Chicory, blended or
French coffee.]
* Substituted by Act 5 of 2007, w.r.e.f. 1-9-2006.
19 19 *[Chemical fertilizers, Bio-fertilizers and Bone Meal
including mixtures or Nutrient elements such as Iron
Zinc, Copper and biological derivatives such as
Enzymes, Co-Enzymes **[Plant Harmones, Gibberlines,
Auxines and Plant growth promoters or regulators]]
**Subs for “and auxines” by Act 21 of 2011, w.e.f.
15.9.2011, *(the words Chemical fertilizers substituted
by the Act No. 23 of 2005 dated 26th Oct, 2005 w.e.f.
01.09.2005).
1) Mineral or chemical fertilisers, nitrogenous 3102

2) Mineral or chemical fertilisers, phosphatic 3103
3) Mineral or chemical fertilisers, potassic 3104
4) Mineral or chemical fertilisers contaning two or 3105
three of the fertilisng elements lnitrogen, phosphorus
and postassium, other fertilsers; goods of this chapter
in tablets or similar forms or in packages of a gross
weight not exceeding 10 Kgs.
5) Gibberellic acid 3808.30.30
6) Plant growth regulators 3808.30.40
7) Enzymes 3507
(Except
3507.90.1)
8) Bio-fertilisers 3101
20 20 Pesticides, Insecticides, fungicides, herbicides,
weedicides and other plant protection equipment and
accessories thereof but including drip and sprinkles
irrigation system excluding mosquito reppellants in
any form *(the italic words substituted by the Act 23
of 2005 dt. 26-10-2005, w.e.f. 18.08.2005)
1) Insecticides, fungicids etc., 3808
(Except
3808.10.91
3808.30.30
3808.30.4)
2) Other appliances - Agricultural or horticultural 8424.81.00
(including drip / sprinkler irrigation system)
21 21 *[x x x]
22 22 Cotton waste and Cotton yarn waste 5202
23 23 Crucibles
24 24 Electrodes including welding electrodes and welding 8311
rods
25 25 Exercise Note books including Graph books and 4820
laboratory note books, Office stationery including
computer stationery, writing pads and Account
Ledgers
26 26 Fibres of all types and fibre waste
1) Flax, raw or processed but not spun; flax tow and 5301
waste (including yarn waste and garmetted stock)
* Serial No. 21 omitted by G.O.Ms.No. 812 Rev. CT. II Dept., dt. 13-6-2007.
24 24 Electrodes including welding electrodes and welding 8311

rods
25 25 Exercise Note books including Graph books and 4820
laboratory not books, Office stationery including
computer statiner, writ ing pads and Account Ledgers
1) Flax, raw or processed but not spun; flax tow and 5301
waste (including yarn waste and garmetted stock)
* Serial No. 21 omitted by G.O.Ms.No. 812 Rev. CT. II Dept., dt. 13-6-2007.
2) True hemp (cannabis sativa L), raw or processed 5302

but not spun; tow and waste of true hemp (including
yarn waste and garmetted stock)
3) Sisal and other textile fibres of the genus a gave, 5304
raw or processed but not spun; tow and waste of
these fibres (including yarn waste and garnetted
stock)
4) Coconut, abaca (Manila hemp or Musa textiles 5305
Nee), ramie and other vegetable textile fibres, not
elsewhere specified or included, raw or processed
but not spun; tow noils and waste of these fibres
(including yarn waste and garnetted stock)
5) Flex yarn 5306
6) Synthetic staple fibres, not combed or otherwise 5503
processed for spinning
7) Artificial staple fibres, not carded, combed or 5504
otherwise processed for spinning
8) Waste (including noils, yarn waste and garnetted 5505

stocks) of man-made fibres
9) Synthetic staple fibres, carded combed or 5506
10) Artificial staple fibres, carded, combed or 5507

11) Glass wool or glass fibre 7019.90.10

12) Optical fibres, optical fibres bundles and cables 9001.1
27 27 Ferrous and non-ferrous metals and alloys and
extrusions thereof
1) Ferro-alloys 7202
2) Ferrous optained by direct redictopm pr orpm ore 7203

and other spongy ferrous products, in lamps, pellets
or similar forms; iron having minimum purity by
weight of 99.94% in lumps, pellets or similar forms.
3) Semi-finished products of iron or non-alloy steel 7207

4) Stainless steel in ingots or other primary forms; 7218
semi -finished products of stainless steel
5) Flat-rolled products of stainless steel, of a width 7219

of 600 mm or more
6) Flat-rolled products of stainless steel, of a width 7220

of less than 600mm
7) Bars and rods, hot-rolled, in irregularly wounded 7221

coils, of stainless steel
8) Other bars and rods of stainless steel; angles, 7222

shapes and sections of stainless steel
9) Wire of stainless steel 7223
10) Other alloy steel in ingots or other primary 7224

forms; semi -finished products of other alloy steel
11) Flat-rolled products of other alloy steel, of a 7225

width of 600mm or more
12) Flat-rolled products of other alloy steel, of a 7226
width of less than 600mm
13) Bars and rods, hot-rolled, in irregularly wound 7227
coils, of other alloy steel
14) Other bars and rods of other alloy steel; agles, 7228
shapes and sections, of other alloy steel; hollow drill
bars and rods, of alloy or non-alloy steel
15) Wire of other alloy steel 7229
16) Copper matters; cement copper (precipitateed 7401

copper)
17) Unrefined copper; coppe anods for electrolytic 7402
refining
18) Refined copper and copper alloys, unwrought 7403

19) Copper waste and scrap 7404
20) Master alloys of copper 7405
21) Copper powders and flakes 7406
22) Copper bars, rods and profiles 7407
23) Copper wire 7408
24) Copper plates, sheets and strip, of a thickness 7409

exceeding 0.15 mm
25) Copper foil (whether or not printed or backed 7410
with paper, paperboard, plastics or similar backing
materilas) of a thickness (excluding any backing) not
exceeing 0.15mm
26) Copper tubes and pipes 7411
27) Copper tube or pipe fittings (for example, 7412

couplings, elbows, sleeves)
28) Standard wire, cables, plated bands and the like, 7413
of copper, not electrically insulated
29) Nickel mattes, nickel oxide sinters and other 7501

intermdediate products of nickel metallurgy
30) Unwrought nickel 7502
31) Nickel waste and scrap 7503
32) Nickel powders and flakes 7504
33) Nickel plates, sheets, strip and foil 7506
34) Nickel tubes, pipes and tube or pipes fittings 7507
(for example, couplings, elbows, sleeves)
35) Unwrought aluminium 7601
36) Aluminium waste and scrap 7602
37) Aluminium powders and flakes 7603
38) Aluminium bars, rods and profiles 7604
39) Aluminium wire 7605
40) Aluminium plates, sheets and strip, of a 7606
thickness exceeding 0.2mm
41) Unwrought lead 7801

42) Lead waste and scrap 7802
43) Lead bars, rods, profiles and wire 7803
44) Lead plates, sheets, strip and foil; lead powders 7804
and flakes
45) Unwrought zinc 7901
46) Zinc waste and scrap 7902
47) Zinc dust, powders and flakes 7903
48) Zinc bars, rods, profiles and wire 7904

49) Zinc plates, sheets, strip and foil 7905
50) Unwrought tin 8001
51) Tin waste and scrap 8002
52) Tinbars, rods, profiles and wire 8003
53) Tin plates, sheets and strip, of a thickness 8004
exceeding 0.2 mm
54) Tin foil (whether or not printed or backed with 8005
paper, paperboard, plastics or similar backing
materials), of a thickness (excluding any backing)
not exceeding 0.2mm; tine powders and flakes
55) Tungsten (wolfram) and articles thereof, 8101
including waste and scrap
56) Molybdenum and articles thereof, including 8102
waste and scrap
57) Tantalum and articles thereof, including waste 8103
and scrap
58) Magnesium and articles thereof, including waste 8104
and scrap
59) Cobalt mattes and other intermediate products 8105
of cobalt metallurgy; cobalt and articles thereof,
inclduing waste and scarp.
60) Bismuth and articles thereof, including waste 8106
and scrap
61) Cadmium and articles thereof, including waste 8107
and scrap
62) Titanium and articles thereof, including waste 8108
and scrap
63) Zirconium and articles thereof, including waste 8109
and scrap
64) Antimony and articles thereof, including waste 8110

and scrap
65) Manganese and articles thereof, including 8111
waste and scrap
66) Bertllium, chromium, germanium, vanadium, 8112
gallium, harnium, indium, niobium (columbium),
rhenium and thallium, and articles of these metals,
including waste and scrap.
28 28 Flour, Atta, Maida, Suji, Besan, Ravva, Vermicelli
and semiya (the
words "Vermicelli and semiya" added by the Act No.
23 of 2005 dated 26th Oct, 2005 .w.e.f. 18.08.2005)
1) Wheat or meslin flour 1101
2) Cereal flours other than that of wheat or meslin 1102
3) Flour, meal and powder of the dried leguminous 1106
vegetables of heading 0713, of sago or of roots or
tubers of heading 0714 of the products of chapter 8
4) Cereal groats, meal and pellets; and cereal grains
otherwise worked
i) Groats of wheat 1103.11.10
ii) Meal of Wheat 1103.11.20
iii) Groats and meal of Maize (corn) 1103.13.00
iv) Groats and meal of other cereals 1103.19.00
v) Pellets 1103.20.00
vi) Rolled or flaked grains of Oats 1104.12.00
vii) Rolled or flaked grains of other cereals 1104.19.00
viii) Other worked grains (for example, hulled,
pearled, sliced or kibbled)
a) of Oats 1104.22.00
b) of Maize (corn) 1104.23.00
c) of other cereals 1104.29.00
ix) Germ of cereals, whole, rolled, flaked or ground 1104.30.00
5) Vermicelli and semiya
29 29 Parched and Fried grams or dhalls
30 30 *[x x x]
31 31 Hand Pumps, parts and fittings thereof

(the words "and fittings thereof" added by the Act
No. 23 of 2005 dated 26th Oct, 2005 .w.e.f.
18.08.2005)
1) Pumps for dispensing fuel or lubricants, of the 8413.11
type used in filling stations or in garages
2) Hand pumps (other) 8413.19.10
3) Handpumps, other than those of sub-heading 8413.20
8413 or 8413.19
4) Hand or foot-perated air pumps 8414.20
5) Parts of hand pump for handling water 8413.91.40
32 32 Herb, bark, dry plant, dry root, commodity known as 1211
jari booti and dry flower
33 33 Hose pipes and fittings thereof
1) Tubes, pipes and hoses, of vulcanised rubber 4009
other than hard rubber, with or without their fittings
(for example, joints, elbows, flanges)
34 34 Hosiery goods of all kinds NA
35 35 Rice Bran including de-oiled rice bran
1) De-oiled Rice Bran 2302.20.10
2) Rice bran, raw 2302.20.20
36 36 Ice 2201.90.10
37 37 Incense Sticks commonly known as, Agarbathi, 3307.41
dhupkathi or dhupati
38 38 Industrial cables, (High Voltage cables, XL, PE
Cables, Jelly Filled cables, optical fibre cables)
39 39 IT Products, that is to say
1) Word processing machines and Electronic
typewriters
a) Word processing machines 8469.11.00
b) Electronic typewriters 8469.12.00
2) i) Electronic calculators 8470.10.00
(ii) Other electronic calculating machines

a) incorporating printing device 8470.21.00
b) Other 8470.29.00
c) other calculating machines 8470.30.00
3) Computer systems and peripherals, Electronic
diaries
a) Computer systems, peripherals and parts 8471
b) Electronic diaries
4) Parts and Accessories of HSN 84.69, 84.70 &
84.71 for items listed above
5) DC Micromotors, Stepper motors of an output
not exceeding 37.5 watts.
a) DC Micromotors of an output not exceeding 8501.10.11
37.5 w
b) Stepper motors of an output not exceeding 8501.10.12
37.5 w
6) Parts of HSN 85.01 for items listed above 85.03
7) Uninterrupted power supplies (UPS) and their 85.04
parts
8) Permanent magnets and articles intended to 8505
become permanent magnets (Ferrites)
9) Electrical apparatus for line telephony or line 8517

telegraphy, including line telephone sets with
cordless handsets & telecommunication apparatus
for carries-current line systems or for digital line
systems; videophones
10) Microphones, multi media speakers, 85.18
headphones, Earphones and combined microphone/
speaker sets & their parts
a) Microphones 8518.10.00
b) Multimedia speakers 8518.22.00
c) Headphones etc., 8518.30.00

d) Parts 8518.90.00
11) Telephone answering machines 8520.20.00
12) Parts of Telephone answering machines 85.22
13) Prepared unrecorded media for sound recording

or similar recording of other phenomena, video and
Audio CD's, cassettes and DVD's (recorded and
unrecorded)
i) Prepared unrecorded media for sound 8523
recording or similar recording of other phenomena
ii) Records, tapes and other recorded media (a) 8524.32
for reproducing sound only
b) Other 8524.39
c) Other magnetic tapes of a width not exceeding 8524.51
4mm
d) Other magnetic tapes of a width exceeding 5824.52
4mm but not exceeding 6.5mm
e) Other magnetic tapes of a width exceeding 8524.53
6.5mm
14) IT software of any media
a) Disc for laser reading systems for 8524.31.11
reporducing phenomena other than sound or image
b) Magnetic tapes for reproducing phenomena 8524.40.11
other than sound or image
c) Other soft ware
i) On floppy disc or cartridge tape 8524.91.11

ii) On disc or on CD ROM 8524.91.12
iii) On other media 8524.91.13
15) Transmission apparatus other than apparatus for 85.25
radio broadcasting or T.V. broadcasting,
transmission apparatus incorporating reception
apparatus, digital still image video cameras
a) Transmission apparatus incoporating reception 8525.2
apparatus
b) Communication jamming equipment 8525.10.40

c) Wireess Microphone 8525.10.50
d) Still image video cameras & other video camera 8525.40.00
recorders; digital cameras
16) Radio communication receivers, Radio Pagers 85.27

a) Radio pagers 8527.90.11
b) Demodulators 8527.90.12
c) other 8527.90.19
i) Aerials, antennas and their parts 8529.10
ii) Parts of items at HSN 8525 & 8527 listed above
17) LCD Panels, LED panels and parts thereof 85.31
a) LCD Panels / LED Panels 8531.20.00
b) Parts 8531.90.00
18) Electrical capacitors, fixed, variable or 85.32
adjustable (pre-set) and parts thereof
a) Electrical capacitors, fixed, variable 8532

b) Parts 8532.90.00
19) Electrical resistors (including rheostats & 8533
potentiometers), other than heating resistors
20) Printed Circuits 8534.00.00

21) Switches, Connectors & Relays for upto 5 85.36
AMPS at voltage not exceeding 250 Volts,
Electronic fuses
22) DATA / Graphic Display tubes, other than TV 85.40
Picture tubes and parts thereof
a) Colour 8540.40.00
b) Black & White or other monochrome 8540.50.00
23) Diodes, transistors & similar semi-conductor 8541
devices, photosensitive semi-conductor devices,
including photovoltaic cells whether or not
assembled in modules or made up into panels; Light
emitting diodes; Mounted piezo-electric crystals
24) Electronic integrated Circuts and Micro- 8542
assemblies
25) Signal Generators and parts thereof 85.43

a) Signal Generators 8543.2
b) Parts 8543.90.00
26) Optical fibre cables 8544.7
27) Optical fibre and optical fibre bundles, cables 9001.10.00

28) Liquid Crystal devices, flat panel display 9013
devices and parts thereof
a) Liquid Crystal devices, flat panel display 9013.80.10

deivces
b) Parts 9013.90.10
29) Cathode ray oscilloscopes, spectrum analysers,
cross talk meters, Gain measuring instruments,
Distortion factor meters, Psophmeters, Network &
Logic analyzer & Signal Analyzer
a) Cathode ray oscilloscopes 9030.20.00
b) Spectrum analysers 9030.39.20
c) Other instruments & apparatus, specially 9030.40.00

designed for telecommuni - cations (for example,
cross-talk meters, gain measruing equipments,
distortion factor meters, psophmeters)
The present entry 39 was sustituted by the Act No 23 of 2005 dated 26th Oct
2005 w.e.f 1-9-2005. for the enry "39. IT Products (with HSN Codes), that is
to say—
(1) Word Processing Machines and Electronic Typewriters (84.69)
(2) Electronic Calculators (84.70)
(3) Computer Systems and Peripherals, Electronic Diaries (84.71)
(4) Parts and Accessories of HSN 84.69, 84.70 and 84. 71 for items listed
above (84.73)
(5) DC Micromotors / Stepper motors of an output not exceeding 37.5
Watts (85.01)
(6) Parts of HSN 85.01 for items listed above (85.03)
(7) Uninterrupted Power Supplies (UPS) and their parts (85.04)
(8) Permanent magnets and articles intended to become permanent magnets
(Ferrite’s) (85.05)
(9) Electrical Apparatus for line telephony or line telegraphy, including line
telephone sets with cordless handsets and telecommunication apparatus
for carries-current line systems or for digital line systems; videophones
(85.17)
(10)Microphones, Multimedia Speakers, Headphones, Earphones and
Combined Microphone/Speaker Sets and their part (85.18)
(11)Telephone answering machines (85.20)
(12)Parts of Telephone answering machines (85.22)

(13)Prepared unrecorded media for sound recording or similar recording of
other phenomena (85.23)
(14)IT software on any media (85.24)
(15)Transmission apparatus other than apparatus for radio broadcasting or
TV broadcasting, transmission apparatus incorporating reception
apparatus, digital still image video cameras (85.25)
(16)Radio communication receivers, Radio pagers (85.27)
(i) Aerials, antennas and their parts (85.29)
(ii) Parts of items at 85.25 and 85.27 listed
above (85.29) (17) LCD Panels, LED Panels and parts thereof (85.31)
(18) Electrical capacitors, fixed, variable or adjustable (Pre-set) and parts
thereof (85.32)
(19)Electrical resistors (including rheostats and potentiometers), other than
heating resistors (85.33)
(20)Printed circuits (85.34)
(21)Switches, Connectors and Relays for upto 5 AMPS at voltage not
exceeding 250 Volts, Electronic fuses (85.36)
(22)Data/Graphic Display tubes, other than TV Picture tubes and parts
thereof (85.40)
(23)Diodes, transistors and similar semi-conductor devices;
PHOTOSENSITIVE SEMI-CONDUCTOR DEVICES, INCLUDING
PHOTOVOLTAIC CELLS WHETHER OR NOT ASSEMBLED IN
MODULES OR MADE UP INTO PANELS;
Light emitting diodes; Mounted piezo-electric crystals (85.41)
(24)Electronic Integrated Circuits and Micro – assemblies (85.42)
(25)Signal generators and parts thereof (85.43)
(26)Optical fibre cables (85.44)
(27)Optical fibre and optical fibre bundles and cables (90.01)
(28)Liquid Crystal Devices, Flat Panel display devices and parts thereof
(90.13)
(29) Cathode ray oscilloscopes, Spectrum Analysers, Cross-talk meters,
Grain measuring instruments, Distortion factor meters, Psophometers,
Network & Logic analyzer and Signal analyzer (90.30)."
40 40 Kerosene sold through public distribution system
41 *[xxx] *The Entry “Nawar – 5806.31.20”
omitted by Act 20 of 2009, w.r.e.f. 1-5-2009.
42 42 Napa slabs 6801
43 43 Ores and minerals
44 44 Paper of all kinds and news print 4707, 4801 to
4817
1) Toilet paper 4818.10
2) Hand kerchiefs, cleaning or facial tissues, 4818.20

towels
3) Table cloths and seviettes 4818.30
45 45 [Pipes of all varieties including G.I., C.I., PVC
Ductile RCC and PCC pipes fittings therof and
Cement Poles]
(Substituted for the words "Pipes of all varieties
including G.I. C.I., PVC and Ductile Pipes and
fittings thereof but excluding RCC and PCC pipes
and their fittings” by Act No. 11 of 2012,
w.r.e.f. 24-8-2011.
1) Tubes, pipes and hoses and fittings therefor (for 3917
example Joints, elbows, flanges), of plastics
2) Asbestos cement pipes 6811.30.10
3) Other (50% graphite or other carbon) 6903.10.90
4) Other (50% of alumina or alumina and silica) 6903.20.90
5) Other Pipes 6903.90.90
6) Ceramic pipes, conduits, guttering and pipe 6906
fittings
7) Tubes, pipes and hollow profiles of cast iron 7303
8) Tubes, pipes and hollow profiles, seamless, of 7304
iron (other than cast iron) or steel
9) Other tubes and pipes (for example, welded, 7505
riveted or similarly closed) having circular cross
sections, the external diameter of which exceeds
406.4mm, of iron or steel
10) Other tubes, pipes and hollow profiles (for 7306
example, open seam or welded, riveted or similarly
closed) of iron or steel
11) Tube or pipe fittings (for example coupling, 7307
elbows, sleeves) of iron or steel
13) Copper tube or pipe fittings (for example, 7412
14) Nickel tubes, pipes and tube or pipe fittings 7507
(for Example, couplings, elbows, sleeves)
15) Aluminium tube or pipe fittings (for example, 7609
16) Aluminium tubes and pipes 7608
17) Lead tubes, pipes and tube or pipr fittings (for 7805
example, couplings, elbows, sleeves)
18) Zinc tubes, pipes and tube or pipe fittings (for 7906
19) Tin tubes, pipes and tube or pipe fittings (for 8006
20) Cement Pipes (RCC & PCC), Cement Poles
46 46 Moulded Plastic footwear and Hawai chappals and
straps thereof
(The words "Plastic footwear and Hawai
chappals"
Subs. by the Act No 28 of 2008 w.e.f 1-7-2008.)
1) Water proof footwear with outer soles and
uppers of plastics, the uppers of which are neither
fixed to the sole not assembled by stitching,
riveting, nailing, screwing, plugging or similar
processes
a) Footwear incorporating a protective metal toe- 6401.10.10
cap of rubber
b) Footwear incorporating a protective metal toe- 6401.10.90
cap - other
c) Footwear covering the knee-other 6401.91.90
d) Footwear covering the ankle but not covering 6401.92.90
the knee
e) Other 6401.99.90
2) Other footwear with outer soles and uppers of
plastics
a) Sports footwear 6402.12.90
b) Other than sports footwear 6402.19.90
3) a) Footwear with upper straps or thongs 6402.2
assembled to the sole by means of plugs (Hawai
chappal)
[47 47 Diaries, calendars, annual reports, application
forms, Stationery items like letterheads, visiting
cards, bill books, leaflets, flyers, folders, soft
bound books, center pinned books, hard case
books, computer stationery, posters, Brochures,
CD/DVD Covers, visual aids, danglers, streamers,
envelopes, labels, telephone recharge coupons,
report cards, Tickets, Cheque Books, Demand
Drafts, Coupons and all kinds and classes of forms

including tender and bid documents and similar
printed materials.]
*Subs. by Act 20 of 2009, w.r.e.f. 18-11-2005.
48 48 Printing ink excluding toner and cartridges 3215
49 49 *[x x x]
* The words “processed and branded salt” omitted
by Act 5 of 2007, w.r.e.f. 1-9-2006.
50 50 Pulp of bamboo, wood, waste paper and bagassee
1) Mechanical wood pulp 4701
2) Chemical wood pulp, dissolving grades 4702
3) Chemical wood pulp, soda or sulphate, other 4703
than dissolving grades
4) Chemical wood pulp, sulphite, other than 4704
dissoloving grades
5) Wood pulp obtained by a combination of 4705
mechanical and chemical pulping processes
6) Pulps fibres derived from recovered (waste and 4706
scrap) paper or paper board or of other fibrous
cellulosic material
7) Beet pulp, bagasse and other waste 2302.20.00
*51 *51 Rail Coaches, Engines, Wagons and Parts thereof]
* Subs. by Act 40 of 2007, w.e.f. date to be notified.
52 52 Ready made garments *[xxx];
*The words “bed sheets, pillow covers, towels,
blankets, travelling rugs, curtains, Zari,
embroidery articles and all other made ups”
*omitted by Act 20 of 2009, w.r.e.f. 1-5-2009.
*[53 53 Renewable energy devices and spare parts

including the following :
(i) Portable electrical lamps designed to function 8513
by their own source of energy (for example, dry
batteries, accumulators, magnetos) other than
lighting equipment of heading 8512.
(ii) Lamps 8513.10
(iii) Torch 8513.10.10
(iv) Other flash lights excluding those for 8513.10.20
photographic purpose
(v) Miners safety lamps 8513.10.30

(vi) Magneto lamps 8513.10.40
(vii) Other 8513.10.90
(viii) Parts 8513.90.00
(ix) Pedal Power generator]
* Subs. By G.O.Ms.No. 825, Revenue (CT-II)
Department, dt. 18-6-2007, w.e.f. 1-6-2007.
54 54 Safety matches 3605.00.10
55 55 Sewing Machines and parts and accessories thereof 8452
56 56 Ship and other water vessels
1) Cruise ships, excursion boats, ferry boats, cargo 8901
ships, barges and similar vessels for the transport
of persons or goods
2) Fishing vessels, factory ships and other vessels 8902
for processing or preserving fishery products
3) Yachts and other vessels for pleasure of sports; 8903

row boats and canoes
4) Tugs and pusher craft 8904
5) Light vessels, fire floats, dredgers, floating 8905
cranes and other vessels the navigability of which
is subsidiary to their main function; floating docks,
floating or submersible drilling or production
platforms.
6) Other vessels, including war ships and life 8906
boats other than rowing boats
7) Other floating structures (for eg: rafts, tanks, 8907
coffer-dams, landing stages, bouys and beacons)
8) Vessels and other floating structures for 8908
breading up
57 57 Silk fabrics other than Handloom silk fabrics
58 58 Skimmed Milk Powder and UHT Milk
59 59 Spices of all varieties and forms including cumin
seed, aniseed, turmeric and dry chillies
1) Mate 0903
2) Pepper of the genus piper, dried or crushed or 0904
ground, fruits of the genus capsicum or of the
genus pimenta
a) Pepper 0904.11
b) Dried chillies 0904.20.10
c) Ch illy powder 0904.20.20
3) Vanila 0905
4) Cinnamon and cinnamon tree flowers 0906.10
5) Cloves (Whole fruit, cloves and stems) 0907
6) Nutmeg, mace and caramoms 0908
a) Nutmeg 0908.10
b) Mace 0908.20.00
c) Cardamoms 0908.30
7) Seeds of arise, badian, fennel, coriander, cumin, 0909
caraway at juniper berries
a) Arise or badian 0909.10
b) Coriander 0909.20
c) Cumin 0909.30
d) Caraway 0909.40
e) Fennel and junipe berries 0909.50
8) Ginger, saffron, turmeric (curcuma), thyme, bay
leaves, curry and other spices
a) Ginger i) Powder 0910.10.40
ii) Other 0910.10.90
b) Saffron 0910.20
c) Turmeric 0910.30
d) Thyme, bay leaves 0910.40
e) Curry 0910.50.00
f) Other spices 0910.99
60 60 Sports goods excluding apparels and footwear
1) Articles of funfare, table or parlour games 9504
including pin tables, billiards, special tables for
casino games and automatic bowling alley
equipment
2) Articles and equipment for general physical 9506
exercise, gymnastics, athelitics, other sports
(including table tennis) or outer games, not
specified or included elsewhere in this chapter;

swimming pools and paddling pools
3) Fishing rods, fish-hooks and other line fishing 9507
tackle; fish landing nets, butterfly nets, and similar
nets; decoy "birds" (other than those of the heading
9208 or 9705) and similar hunting or shooting
requisites
61 61 Starch and Sago
1) Wheat Starch 1108.11
2) Maize (corn) starch 1108.12
3) Potato starch 1108.13
4) Manioc (cassava) starch 1108.14
5) Sago 1108.19.10
6) Flour, meal and powder of dried leguminous 1106.20.10
vegetables of heading 0713, or sago or of roots or
tubers or heading 0714 or of the products of
Chapter VIII - (i) of sago
(ii) of manioc (Cassava) 1106.20.10
62 62 *[x x x], Tamarind seed, dhall, kernel, powder and
husk
* The word “Tamarind” omitted by Act No. 14 of
2007, w.e.f. 1-2-2007.
63 63 Tractors and Threshers, Harvesters, Tractor,
Trailers, Tyres and Tubes of Tractors and
attachments and parts thereof
(Substituted for the words "Tractors and
Threshers, Harvesters and attachments and parts
thereof" by the Act No 23 of 2005 dated 26th Oct
2005 w.e.f 18-8-2005)
1) Tractors (Other than tractors of heading 8709) 8701
2) Parts for tractors 8708.10.10
3) Threshing and harvesting machinery
a) Combine harvester-threshers 8433.51.00
b) Other threshing machinery 8433.52.00
c) Root or tuber harvesting machinery 8433.53.00
d) Other 8433.59.00
e) Parts 8433.90.00
4) Tractor Trailers
5) Tyres and Tubes of Tractors
64 64 Transmission Towers
1) Towers whether or not assessembled for 7308.20.11
transmission line
2) Other 7308.20.19
65 65 Umbrellas 6601
66 66 Vanaspathi, Hydrogenated Vegetable Oil 1516
67 67 Vegetable oils - All kinds of vegetable oils
including solvent oils and Coconut oil
1) Soyabean oil and its fractions, whether or not 1507
refined, but not chemically modified
2) Ground-nut oil and its fractions whether or not 1508
refined, but not chemically modifed
3) Olive oil and its fractions, whether or not 1509
4) Other Oils & their fractions obtained solely 1510

from olives, whether or not refined, but not
chemically modified, including blends of these oils
or fractions with oils or fractions of heading 1509
5) Palm oil and its fractions, whether or not 1511
6) Sunflower seed, safflower or cotton seed oil 1512
and their fractions, thereof, whether or not refined,
but not chemically modified
7) Coconut (copra), palm kernel or babassu oil and 1513
fractions thereof, whether or not refined, but not
chemically modified
8) Rape, colza or mustard oil and its fractions 1514
thereof, whether or not refined, but not chemically
modified
9) Other fixed vegetable fats and oils (including 1515

jojoba oil) and their fractions, whether or not
refined, but not chemically modified.
68 68 Writing instruments, writing ink, Geometry boxes,
colour boxes, pencil sharpners and Erasers
(Substituted for the words" writing instruments" by
the Act No 23 of 2005 dated 26th Oct 2005 w.e.f
18-8-2005)
1) Ball pint pens; felt tipped and other porous- 9608.00

tipped pens and markers; fountain pens; stylograph
pens and other pens; duplicating stylos; propelling
or sliding pencils, pen holders pencil holders and
similar holders; parts (including caps and clips) of
the foregoing articles, other than thaose heading
9609
2) Pencils (other than pencils of heading 9608), 9609 (except
crayons, pencil leads, pastels, drawing charcoals, 9609.90.10)
writing or drawing chalks and tailors'chalks
3) Fountain pen ink 3215.90.20
4) Drawing ink 3215.90.40
5) Erasers 4016.92.00
6) Geometry and colour boxes
69 69 Coal including coke in all its forms but excluding
charcoal
1) Coal; briquettes, ovoids and similar solid fuels 2701

manufactured from coal
2) Coke and semi-coke of coal of lignite or of 2704

peat, whether or not agglomerated; retort carbon
3) Petroleum coke i) Not calcined 2713.11

ii) Calcined 2713.12
70 70 Iron and steel, that is to say
i) Pig Iron, sponge Iron and cast iron including
ingot moulds, and bottom plates
ii) Steel semis, ingots, slabs, blooms and billets of

all qualities, shapes and sizes
iii) Skelp bars, tin bars, sheet bars, hoe-bars and

sleeper bars;
iv) Steel bars, rounds, rods, squares, flats,

octagons and hexagons; plain and ribbed or
twisted, in coil from as well as straight length
v) Steel structurals, angles, joints, channels, tees,

sheet piling sections, Z sections or any other rolled
sections
vi) Sheets, hoops, strips and skelp, both black and

galvanized, hot and cold rolled, plain and
corrugated in all qualities, in straight lengths and in
coil form as rolled and in revitted condition.
vii) Plates, both plain and chequered in all
qualities
viii) Discs, rings, forgoings and steel castings;

ix) Tool, alloy and special steels of any of the
above categories
x) Steel tubes, both welded and seamless, of all

diameters and lengths including tube fittings
xi) Tin-plates, both hot dipped and electrolytic and

tin free plates
xii) Fish plate bars, bearing plate bars, crossing

sleeper bars, fish plates, bearing plates, crossing
sleepers and pressed steel sleepers, rails-heavy and
light crane rails.
xiii) Wheels, tyres axies and wheel sets
xiv) Wire rods and wires rolled, drawn,
galvanised, aluminized, tinned or coated such as by
copper
*(xv) Wire Ropes and Wire Strands
*Added by G.O.Ms.No.574, Rev.CT-II, Dept.
dt.4-4-2008, w.e.f. 1-4-2008.
1) Pig iron, Spiegeleisen in pigs, blocks or other 7201
primary forms
2) Granules and powders of pig iron, spiegeleisen, 7205
iron or steel
3) Iron and non-alloy steel in ingots or other 7206
primary forms (excluding iron of heading 7203)
4) Flat-rolled products of iron or non-alloy steel, 7208

of a width of 600mm or more, hot-rolled, not clad,
plated or coated

of a width of 600mm or more, cold-rolled (cold
reduced), not clad, plated or coated

of a width of 600mm or more, clad plated or coated

of a width of less than 600mm or more, not clad
plated or coated
of a width of less than 600mm or more, clad plated
or coated
9) Bars and rods, hot-rolled, in irregularly wound 7213
coils, of iron or non-aaloy steel
10) Other bars and rods of iron or non-alloy steel, 7214

not further worked than forged, hot-rolled, hot-
drawn or hot-extruded, but encluding those twisted
after rolling
11) Other bars and rods of iron or non-alloy steel 7215
12) Angles, shapes and sections of iron or non- 7216
alloy steel
13) Wire of iron or non-alloy steel 7217

14) Steel piling of iron or steel, whether or not 7301
drilled, punhed or made from assembled elements;
welded angles, shapes and section, of iron or steel
15) Railway or tramway track construction 7302
material of iron or steel, the following: rails,
check-rails and rack rails, switch blades, crossing
frogs, point rods and their crossing pieces, sleepers
(cross - ties) fish-plates, chairs, chair wedges, sole
plates (base plates), rail clips, bed-plates, ties and
other material specialized for jointing or fixing
rails
16) Tubes, pipes and hollow profiles of cast iron 7303
17) Tubes, pipes and hollow profiles, seamless of 7304
iron (other than cast iorn) or steel
18) Other tubes and pipes (for exa mple, welded, 7305
riveted or similar closed) having circular cross-
sections, the external diameter of which exceeds
406.4mm of iron or steel
19) Other tubes and pipes and hollow profiles (for 7306
example, open seam or welded, riveted or similarly
closed), of iron or steel
20) Tubes or pipe fittings (for example, couplings, 7307

elbows, sleeves), or iron or steel
21) Structures (excluding prefabricated buildings 7308
of heading 9406) and parts of structures (for
example, bridges and bridge-sections, lock gates,
towers, lattice masts, roofs, roofing frame-wroks,
doors and windows and their frames and thresholds
for doors shutters, balustrades, pillars and
columns), of iron or steel; plates rods, angles,
shapes, sections tubes and the like prepared for use
in structures, of iron or steel
71 71 Iron and steel, Scrap, that is to say:
i) Iron scrap, cast-iron scrap, runner scrap and iron
skull scrap
ii) Steel melting scrap in all forms including steel
skull, turnings and borings
iii) Defectives, rejects, cuttings or end pieces of
any of the categories of items (i)to(xiv) of entry 70
iv) Ferrous waste and scrap; remelting scrap 7204
ingots of iron and steel
72 72 Oil seeds, that is to say
i) Sesamum or Til (orientale)
ii) Soyabeen (Gylcine seja)
iii) Rape seed and mustard
1) Toria (Brassica compestries vartoria)
2) Rai (Brassica Juncea)
3) Jamba - Taramira (Eruca sativa)
4) Sarcon - yellow and brown (brassica
compestris varsarson)
5) Banarasi Rai or True mustard (Brassica
nigra)
iv) Linseed (linum usita tissimum)
v) Sunflower (Helianthus annus)
vi) Nigar seed (Guizotia abyssinica)
vii) Neem, vepa (Azadi rachta indica)
viii) Mahua, illupai, ippe (Madhuca indica, M.

Latifolia), Bassia, Latifolia and Madhuca
Longifolia Syn. M. Longifolia)
ix) Karanja, Pongam, Honga (Pongamia Pinnata
syn. P. Glabra)
x) Kusum (Schleichera Oleosa, syn. S. Trijuga)
xi) Punna undi (Calophyllum, inophyllum)
xii) Kokum (Carcinia indica)
xiii) Sal (Shorea robusta);
xiv) Tung (Aleurite Jordi and A. Montana)
xv) Red Palm (Elaeis guinenisis)
xvi) Safflower (corthanus tinctorius)
1) Sesamum or Til 1207.40.90
2) Soyabean 1201.00.90
3) Rapeseed 1205
4) Mustard 1207.50.90
5) Linseed 1204.00.90
6) Sunflower 1206.00.90
7) Nigar seed 1207.99.30
8) Kokum 1207.99.40
9) Redpalm 1207.10.90
10) Safflower 1207.60.90
11) Other oil seeds 1207.99.90
73 73 Castor (Ricinus communis) 1207.30.90
74 74 *[xxx]
*Omitted by Act 28 of 2008 w.e.f. 1-8-2008 prior
to its omission it read as “Coconuts other than
tender coconuts cocos nucifera)
75 75 Copra 1203
76 76 Groundnut or peanut (hypogea)
Groundnut not reasted or otherwise cooked,
whether or not shelled or
a) in shell, other 1202.10.19
b) other 1202.10.99
c) Shelled whether or not broken 1202.2
77 77 Cotton seeds 1207.20.90
78 78 Jute that is to say the fibre extracted from plants 5303
belonging to the species corchorus capsularis and
corchorus olitorius *[x x x] and the fibre known as
sunnhemp extracted from plants of the species
Crotalaria Juncea whether baled or otherwise
* The words “and the fibre known as Mesta or Bimli
extracted from plants of the species hibiscus cannabinus
and Hibiuscus sabdariffavar.altissima” omitted by
G.O.Ms.No. 812 Rev. CT-II Dept., dt. 13-6-2007.
79 79 Cotton, that is to say, all kinds of cotton 5201
(indigenous or imported) in all its unmanufactured 5203
State, whether ginned or ungineed, baled, pressed
or otherwise but not including cotton waste.
80 80 Hides and Skins, Tanned or Un-Tanned 4101 to 4106
81 81 Crude oil, that is to say, crude petroleum oils and 2709
crude oils obtained from bituminous minerals
(such as shale, calcareous rock sand), whatever
their composition whether obtained from normal or
condensation oil deposits or by the destructive
distillation of bituminous minerals and whether or
not subjected to all or any of the following
processes
1. Decantation
2 De-salting
3. Dehydration
4. Stabilization in order to normalize the vapour
pressure
5. Elimination of very light fractions with a view
to returning them to the oil-deposits in order to
improve the drainage and maintain the pressure
6. The addition of only those hydrocarbons
previously recovered by physical methods during
the course of the above mentioned process
7. Any other minor process including addition of
pour point depressants or flow improvers which
does not change the essential character of the
substance
82 82 All kinds of Pulses and Dhalls 0713
83 83 Wheat (Triticum vulgare, T. compactum, T. 1001.10.90

Sphaerococum, T. durum, T. Aestivum, L.T. and
dicoccum); 1001.90.20
84 84 Paddy (Oryza sativa L) 1006.10.90
85 85 Rice (Oryza sativa L)
*[86 86 P.V.C. Cloth, Waterproof cloth, Tarpaulin, Rexine

and vehicle covers made from PVC cloth,
waterproof cloth, Tarpaulin and Rexine Products.]
*Subs. for Sl.No.86 by Act 20 of 2009,
w.r.e.f. 23-7-2009
*[87 87 Oil Cakes and Deoiled cakes other than Soya Bean
De-oiled cake]
*Subs. for Sl.No.87 by Act 20 of 2009,
w.r.e.f. 1-3-2009
88 88 “Drugs & Medicines” whether patent or

proprietary, as defined in clauses (i), (ii) and (iii)
of section 3(b) of Drugs and Cosmetics Act, 1940
(Central Act 23 of 1940), including hypodermic
syringes, hypodermic needles, catguts sutures,
surgical cotton, dressings, plasters, catherters,
cannulae, bandages and similar articles but not
including
a) Medicated goods
b) Products capable of being used as cosmetics

and toilet preparations including Toothpaste, Tooth
powders, cosmetics, Toilet articles and soaps.
c) Mosquito Repellants in any form
d) *[x x x]
* Omitted by Act 5 of 2007, w.r.e.f. 1-9-2006.
89 89 Veterinary medicines
* The words “and feed supplements” omitted by
Act 5 of 2007, w.r.e.f. 1-4-2005.
1) Concentrates for compound animal feed 2309.90.20
2) Vaccine for veterinary medicine 3002.30
3) Veterinary medicinal preparation, not for 3004.90.85

human use, not elsewhere specified or included
90 90 All kinds of packing material including Hessian

cloth and jute twine but excluding storage tanks
made of any materials.
1) Self adhesive plates, sheets, film, foil,tape, strip 3919

and other flat shapes, of plastic whether or not in
rolls
2) Other plates, sheets, film, foil and strip of 3920

plastics non-cellular and not reinforced, laminated,
supported or similarly combined with other
materials (including HDPE / PP Woven fabric)
3) Thermocol 3921.90.10
4) Articles for the conveyance or packing of 3923

goods, of plastics; stoppers, lids, caps and other
closures of plastics
5) Packing cases, boxes, crates, drums and similar 4415

packing of wood; cable-drums of wood; pallets,
box pallets and other load boards, of wood; pallet
collars of wood
6) Casks, barrels, vats, tubs and other coopers' 4416

products and parts thereof, of wood, including
staves
7) Cartons (including flattened or folded cartons), 4819

boxes (including flattened or folded boxes), cases,
bags and toher packing continers of paper, paper
board whether in assembled or unassembled
condition.
8) Paper or paperboard labels of all kinds, whether 4821

or not printed.
9) Bobbins, spools, cops and similar supports of 4822

paper pulp, paper or paper board (whether or not
perforated or hardened)
10) Other paper, paperboard, cellulose wadding 4823

and webs of cellulose fibres, cut to size of shape;
other articles of paper plup, paper, paperboard,
cellulose wadding or web of cellulose fibres
11) Sacks and bags, of a kind used for the packing 6305
of goods
12) Carboys, bottles, flasks, jars, pots, phials, 7010

ampoules and other containers, of glass of kind
used for the conveyance or packing of goods;
preserving jars of glass; stoppers, lids and other
closures, of glass.
13) Reservoiers tanks, vats and similar containers 7309

for any material (other than compressed or
liquified gas) of iron or steel, a capacity not
exceedings 300lts. Whether or not lined or heat
insulated, but not fitted with mechanical or thermal
equipment
14) Containers for compressed or liquified gas of 7311

iron or steel
15) Aluminium foil (whether or not printed or 7607

backed with paper, paperboard, plastics or similar
backing materials) of a thickness (excluding any
backing) not exceeding 0.2 mm
16) Aluminium casks, drums, cans, boxes and 7612

other similar containers for any material (othe han
compressed or liquified gas), of a capacity not
exceeding 300lts., whether or not lined or heat
insulated, but not fitted with mechanical or thermal
equipment
17) Aluminium containers for compressed or 7613

liquified gas
18) Stopper, caps and lids (including crown corks, 8309

screw caps and pouring stoppers), capsules for
bottles, threaded bungs, bung covers, seals and
other packing accessories, of base metal
*91 * Sl. No. 91 “Khandasari Sugar” omitted by G.O.Ms.No. 812,
Rev. (CT-II) Dept., dt. 13-6-2007.
92 92 River Sand and grit and stone chips NA

(added by the Act No 23 of 2005dated 26th Oct
2005 w.e.f 18-8-2005)
93 93 Extra Neutral Alcohol (ENA) and rectified spirit NA
2005 w.e.f 18-8-2005)
94 94 Kerosene stove, kerosene lamp, petromax lamp NA
hurrican lamp, glass chimney a nd parts and
accessories thereof
2005 w.e.f 18-8-2005)
95 95 *[Bio-diesel manufactured using non-edible NA
vegetable oils such as Jatropha, Peongamia, Rice
bran, Neem Cotton seed, Rubber seed] **[sale of
used cooking oil to the bio-diesel manufacturers]
* Added by the Act No 23 of 2005 dated 26th Oct
2005 w.e.f 18-8-2005.
** Added by Act No. 34 of 2006, w.r.e.f. 1 -7-2006.
96 96 Artificial and rolled gold jewellery, imitation and NA
costume jewellery
(added by the Act No 23 of 2005 dated 26th Oct
2005 w.e.f 1-9-2005.)
97 97 LPG / CNG conversion kits NA

(added by the Act No 10 of 2006 dated 4th Jan
2006, w.e.f 01.12.2005)
98 98 Pre-stressed Railway Concrete sleepers (added NA
by the Act No 10 of 2006 dated 4th Jan 2006,
w.e.f 01.12.2005)
99 *99 All handicrafts NA
*Added by Act No. 34 of 2006, w.r.e.f. 1 -12-2005.
100 *[100 The following goods when sold as industrial
inputs]
*Subs. for the words “Industrial inputs that is to
say” by Act No. 28 of 2008, w.e.f. 1-7-2008.
1. Animal (including fish) fats and oils refined 1501 to 1505

or purified
2.Other animal fats and oils and their fractions 1506
whether or not refined, but not chemically
modified.
3.Vegetable waxes (other than triglycerides), 1521 & 1522
beeswax, other insect waxes and spermaceti,
whether or not refined or coloured; degras;
residues resulting from the treatment of fatty
substances or animal or vegetable waxes
4.Animal or vegetabl fats boiled, oxidized, 1518
dehydrated, sulphurized, blown, polymerized by
heat in vaccum or in inert gas or otherwise
chemically odified; inedible mixtures or
preparations of fats and oils of this chapter
5.Liquid glucose (non medicinal), Dextrose syrup 1702
6.Denatured ethyl alcohol of any strength 2207.20
7.Sulphur of all kinds other than sublimed sulphur, 2503
precipitated sulphur and colloidal sulphur,
7A..Natural barium sulphate (barites); natural 2511
barium carbonate (witherite), whether or not
calcined, other than barium oxide of heading 2816
8.Manganese ores and concentrates, including 2602
ferruginous manganese ores and concentrates with
a manganese content of 20% or more, calculated
on the dry weight
9.Copper ores and concentrates 2603
10.Nickel ores and concentrates 2604
11.Cobalt ores and concentrates 2605
12.Aluminium ores and concentrates 2606
13.Lead ores and concentrates 2607
14.Zinc ores and concentrates 2608
15.Tin ores and concentrates 2609
16.Chromium ores and concentrates 2610
17.Trungsten ores and concentrates 2611

18.Uranium or Thorium ores and concentrates 2612

19. Molybdenum ores and concentrates 2613
20. Titanium ores and concentrates 2614
21. Niobium, tantalum, vanadium or zirconium 2615
ores and concentrates
22.Precious metals ores and concentrates 2616
23. Other ores and concentrates 2617

24.Granulated slag (slag sand) from the 2618
manufacture of iron and steel
25.Ground granulated blast-furnace slag (GGBS) 2619
26.Tar distilled from coal, from lignite or from 2706
peat and other mineral tars whether or not
dehydrated or partially distilled, including
reconstituted tars
27. Oils and other products of the distillation of 2707
high temperature coal tar constituents exceeds that
of the non –aromatic constituents
[28.Toluole 2707.20.00
29.Xylole 2707.30.00
30.Naphthalene 2707.40.00
31.Phenols 2707.60.00
32.Creosote oils 2707.91.00]
33.Fluorine, chlorine, bromine and iodine 2801

34.Sulphus, sublimed or precipitated; colloidal 2802
sulphur
35.Carbon (carbon blacks and other forms of 2803
carbon not elsewhere specified or included)
36.Hydrogen, rare gases other non metals 2804
excluding medicinal grade oxygen
37.Alkali or alkaline-earth metals, rare-earth 2805
metals, scandium and yttrium, whether or not
intermixed or interalloyed; mercury
38.Hydrogen chloride (hydrochloric acid); 2806
chlorosulphuric acid
39.Sulphuric acid and anhydrides thereof; Oleum 2807
40.Nitric acid; sulphonitric acids 2808
41.Diphosphorus pentaxoxide; phosphoric acid and 2809

polyphosphoric acids
42.Oxides of boron; bor aiccids 2810
43.Halides and halide oxides of non-metals 2812
44.Sulphides of non-metals; commercial 2813

phosphorus trisulphide
45.Ammonia, anhydrous or in aqueous solution 2814
46.Sodium hydroxide (caustic soda); potassium 2815

hydroxide (caustic potash)(; peroxides of sodium
or potassium
47.Hydroxide and peroxide of magnesium; oxides, 2816
hydroxides and peroxides of strontium or barium
48.Zinc oxide, zinc peroxide 2817
49.Aluminium hydroxide 2818.30.00
50.Chromium oxides and hydroxides 2819
51.Manganese oxides 2820
52.Iron oxides and hydroxides 2821.10
53.Cobalt oxides and hydroxides, commercial 2822

cobalt oxides
54.Titanium oxide 2823
55.Hydraxine and hydroxylamine and their 2825

inorganic salts; other inorganic bases; other metal
oxides, hydroxides and peroxides
56.Flurides, fluorosilicates, fluroaluminates and 2826
other complex flurine salts
57.Chlorides, chloride oxides and chloride 2827
hydroxides, bormides and bromide oxides; iodides
and iodide oxides
58.Hypochlorites,commercial calcium 2828
hypochlorites ; chlorites; hypobromites
59.Chlorates and perchlorates; Bromates and 2829
Perbromates; Iodates and periodates
60.Sulphides; Polysulphides 2830

61. Dithionites and sulphoxylates 2831
62. Sulphites; thiosulphates 2832
63.Sulphates, alums, peroxo -sulphates 2833

(persulphates)
[64.Basic chromium sulphate 2833.33.00]

65.Nitrites; nitrates 2834
66.Phosphinates (hypophosphites), phosphonates 2835
(phosphates); phosphates and polyphosphates
67.Carbonates; peroxacarbonates (percarbonates); 2836
commercial ammonium carbonates containing
ammonium carbonate
68.Cyanides, cyanide oxides and complex cyanides 2837
69. Fulminates, cyanates and thiocyanates 2838
70.Borates, peroxoborates (per borates) 2840

71.Sodium dichromate 2841
72.Sodium dichromate 2841.30
73.Potassium dichromate 2841.50
74.Radioactive chemical elements and radioactive 2844
isotopes (including the fissile chemical elements
and isotopes) and their compounds; mixtures and
residues containing these products
75.Isotopes other than those of heading No.28.44; 2845

compounds, inorganic or organic of such isotopes,
whether or not chemically defined
76.Compounds inorganic or organic, of rare earth 2846
metals, of yttrium or of scandium or of mixtures of
these metals
77.Hydrogen peroxide 2847
78.Phosphides, whether or not chemically defined, 2848
excluding Ferro phosphorus
79.Silicon carbide 2849.20
80.Calcium carbides 2849.10.00
81.Hydrides, nitrites, azides, cilidides and borides, 2850

whether or not chemically defined, other than
compounds which are also carbides of heading
No.28.49
82.Cyclic hydrocarbons 2902
83.Halogenated derivatives of Hydrocarbons 2903
84.Sulphonated, nitrated or nitrosated derivatives 2904
of hydrocarbons, whether or not halogenated
85.Acyclic alcohols and their halogenated, 2905
sulphonated, nitrated or nitrosated derivatives
86.Cyclic alcohols and their halogenated, 2906
sulphonated, nitrated or nitrosated derivatives
87.Phenols; Phenol-Alcohols 2907
88.Halogenated, sulphonated, nitrated or nitrosated 2908
derivates of phenols or phenol-alcohols
89.Ethers, ether-alcohols, ether-phenols, ether- 2909
alcoholphenols, alcohol peroxides, ether
perioxides, ketone peroxides (whether or not
chemically defined) and their halogenated,
sulphonated, nitrated or nitrosated derivates
90.Epoxides, epoxyalcohols, epoxyphenols and 2910

epoxyethers, with a three-membered ring and their
halogenated, sulphonated, nitrated or nitrosated
derivates
91.Acetals and hemiacetals, whether or not with 2911

other oxygen function and their halogenated,
92.Aldehydes whether or not with other oxygen 2912
function; cyclic polymers of aldehydes;
paraformaldehyde
93.Halgenated, sulphonated, nitrated or nitrosated 2913
derivates of products of heading No.29.12
94.Acetone 2914.11.00
95.Saturated acyclic monocarboxylic acids and 2915
their anhydrides, halides, peroxides and
peroxyacids; their halogenated, sulphonated,
nitrated or nitrosated derivates
96.Unsaturated acyclic monocarboxylic acids, 2916

cyclic monocarboxylic acids, their anhydrides,
halides, peroxides and peroxyacids; their
derivates
97.Polycarboxylic acids, their anhydrides, halides, 2917
peroxides and peroxyacids; their halogenated
98.Carboxylic acids with additional oxygen 2918
function and their anhydrides, halides, peroxides
and peroxyacids; their halogenated, sulphonated,
nitrated or nitrosated derivates
99.Phosphoric esters and their sales, including 2919

lactophosphates; their salts; their halogenated,
100.Esters of other inorganic acids (excluding 2920
esters of hydrogen halides) and their salts; their
derivatives
101.Amine-function compounds 2921
102.Oxygen-function amino-compounds 2922
103.Quaternary ammonium salts and hydroxides; 2923
lecithins and other phosphoaminolipids
104.Carboxyamide-function compounds; amide- 2924
function compounds of carbonic acid
105.Carboxyamide-function compound (including 2925
saccharin and its salts) and imine-function
compounds
106.Nitrile -function compounds 2926
107.Diazo-, Azo- or azoxy -compounds 2927
108.Oraganic derivates of hydrazine or of 2928
hydroxylamine
109.Organo-sulphur compounds 2930
110.Other organo organic compounds 2931
111.Heterocyclic compounds with oxygen 2932

heteroatom(s) only
112.Heterocyclic compounds with nitrogen 2933
heteroatom(s) only
113.Nucleic acids and their salts; other 2934

heterocyclic compounds
114.Sulphonamides 2935
115.Glycosides, natural or reproduced by synthesis 2938
and their salts, ethers, esters and other derivates
116.Vegetable alkaloids, natural or reproduced by 2939
synthesis, and their salts, ethers, esters and other
derivates
117.Other organic compounds. 2942
118.Tanning extracts of vegetable origin, tannins 3201
and their salts, ethers, esters and other derivates
excluding catechu or Gambier
119. Synthetic organic tanning substances; 3202
inorganic tanning substances; tanning preparations,
whether or not containing natural tanning
substances; enzymatic preparations for pre-tanning
excluding catechu or Gambier
120.Colouring matter of vegetable or animal origin 3203

(including dyeing extracts but excluding animal
black), whether or not chemically defined;
preparations based on colouring matter or
vegetable or animal origin as specified in Note 2 to
this Chapter excluding catechu or Gambier
121.Synthetic organic colouring matter, whether or 3204

not chemically defined; preparations based on
synthetic organic colouring matter as specified in
Note 2 to this Chapter; synthetic organic products
of a kind used as fluorescent brightening agents or
as luminophores, whether or not chemically
defined excluding catechu or Gambier
122.Colour lakes; preparations based on colour 3205

lakes as specified in Note 2 to this chapter
123.Pigments 3206.1
124.Inorganic products of kind used as 3206.50.00
luminophores
125.Master batches 3206.90
126.Prepared pigments 3207.10
127.Glass frit and other glass, in the form of 3207.40.00

powder, granules or flakes
128.Other 3207.10.90
129.Prepared driers 3211
130.Pigments (including metallic powders and 3212
flakes) dispersed in non-aqueous media, in liquid
or paste form of a kind used in the manufacture of
paints (including anamels); stamping foils; dyes
and other colouring matter put up in forms (for
example, bales, tablets and the like) or small
packings (for example, sachets or bottles of liquid)
of a kind used for domestic or laboratory purposes
131.Printing ink whether or not concentrated or 3215.10
solid
132.Casein, caseinates and other casein derivates, 3501
casein glues
133.Enzymes, prepared enzymes not elsewhere 3507
specified or included
134.Chemical preparations for photographic uses 3707
(other than varnishes, glues, adhesives, and similar
preparations)
135.Artificial graphite; colloidal or semi-colloidal 3801
graphite; preparations based on graphite or other
carbon in the form of pastes, blocks, plates or other
semi -manufactures
136.Activated carbon, activated natural mineral 3802

products; animal black, including spent animal
black
137.Residual lyes from the manufacture of wood 3804
pulp, whether or not concentrated,m desugared or
chemically treated, including lignin sulphonates,
but excluding tall oil of heading No.38.03
138.Rosin and resin acids, and derivates thereof: 3806
rosin spirit and rosin oils; run gums
139.Wood tar; wood tar oils; wood, creosote; wood 3807
naphtha; vegetable pitch; brewers pitch and similar
preparations based on rosin, resin acids or on
vegetables pitch
140.Insecticides, fungicides, herbicides, 3808.10
weedicides and pesticides of technical grade.
141.Finishing agents, dye carriers to accelerate the 3809
dyeing or fixing of dye-stuffs and other products

and preparations (for example, dressings and
mordants), of a kind used in the textile, paper,
leather or like industries not elsewhere specified or
included
142.Prepared rubber accelerators, compound 3812
plasticizers for rubber or plastics, not elsewhere
specified or included; anti-oxidizing preparations
and other compound stabilizers for rubber or
plastics
143.Reducers and blanket wash/roller wash used in 3814
the printing industry
144.Reaction initiators, reaction accelerators and 3815
catalytic preparations, not elsewhere specified or
included
145.Mixed alkyl benzenes and mixed 3817
alkylnaphthalenes, other than those of heading
No.27.07 or 29.02
146.Chemical elements doped for use in 3818
electronics, in the form of discs, wafers or similar
forms; chemical compounds doped for use in
electronics
147.Industrial monocarboxylic fatty acids; acid oils 3823
from refining; industrial fatty alcohols
148.Retarders used in printing industry. 3824.90
149.Polymers of ethylene in primary forms 3901
150.Polymers of propylene or of other olefins, in 3902
primary forms
151.Polymers of styrene, in primary forms 3903
152.Polymers of vinyl chloride or of other 3904
halogenated olefins, in primary forms
153.Polymers of vinyl acetate or of other vinyl 3905
esters in primary forms, other vinyl polymers in
primary forms
154.Acrylic polymers in primary forms 3906
155.Polyacetals, other polyethers and epoxide 3907
resins, in primary forms, polycarbonates, alkyd
resins, polyallyl esters and other polyesters, in
primary forms
156.Polyamides in primary forms 3908
157.Amino-resins, polyphenylene oxide, phenolic 3909

resins and polyurethanes in primary forms
158.Silicones in primary forms 3910
159.Petroleum resins, coumarone-indene resins, 3911
polyterpenes, polysulphides, polysulphones and
other products specified in Note 3 to this Chapter,
not elsewhere specified or included in primary
forms
160.Cellulose and its chemical derivates, and 3912
cellulose ethers, not elsewhere specified or
included in primary forms
161.Natural polymers (for example, algenic acid) 3913
and modified natural polymers (for example,
hardened proteins, chemical derivates of natural
rubber), not elsewhere specified or included in
primary forms
162.Ion-exchangers based on polymers of heading 3914
Nos. 39.01 to 39.13 in primary forms
163.Self adhesive plates, sheets, film foil, tape, 3919
strip of plastic whether or not in rolls
164.Other plates, sheets, film, foil and strip of 3920
plastics, non-cellular whether lacquered or
metallised or luminated, supported or similarly
combined with other materials or not
165.Articles for the conveyance or packing of 3923

goods, of plastics, stoppers, lids, caps and other
closures, of plastics but not including -
(a) insulated wares
(b) bags of the type which are used for packing of
goods at the time of sale for the convenience of the
customer including carry bags
166.Natural rubber, balata, gutta percha, Guayule, 4001
chicle and similar natural gums, in primary forms
or in plates, sheets or strips
167.Synthetic rubber and factice derived from oils 4002
in primary forms or in plates, sheets or strip;
mixtures of any product of heading No.4001 with
any product of this heading, in primary forms or in
plates, sheets or strip
168.Reclaimed rubber in primary forms or in 4003
plates, sheets or strip
169.Compounded rubber, unvulcanised in primary 4005

forms or in plates, sheets or strip other than the
forms and articles of unvulcanised rubber
described in heading No.4006
170.Mechanical wood pulp, chemical wood pulp, 4701
semi -chemical wood pulp and pulps of other
fibrous cellulosic materials
171.Cartons (including flattened or folded cartons), 4819
boxes (including flattened or folded boxes) cases,
bags and other packing containers of paper,
paperboard whether in assembled or unassembled
condition
172.Paper printed labels and paper board printed 4821
labels
173.Paper self adhesive tape and printed wrappers 4823
used for packing
174.Sacks and bags of a kind used for packing of 6305.10
goods, of jute or of other textile based fibres of
heading No.5303
175.Carboys, bottles, jars, phials of glass of a kind, 7010
used for the packing goods; stoppers, lids and other
closures of glass
176.Glass fibers (including glass wool and glass 7019
filaments) and articles thereof (for example yarn,
woven fabrics) whether or not impregnated,
coated, covered or laminated with plastics or
varnish
177.Ferro alloys 7202
178.Aseptic packaging aluminum foil of thickness 7607.20
less than 0.2 mm and backed by paper and LDPE
179.Stoppers, caps and lids (including crown 8309
corks, screw caps and pouring stoppers) capsules
for bottles, threaded bungs, bung covers, seals and
other packing accessories of base metal.]
* Entry 100 with subentries upto 179 is added by
Act No. 34 of 2006, w.r.e.f. 1 -5-2006.
Note:- (1) The Headings or sub-headings, as the case may be, listed under
column Nos. (2) & (3) above are the HSN Codes under the Central Excise Tariff
Act, 1985 (5 of 1986).
Note:- (2) The Rules for the interpretation of the provisions of the Central Excise
Tariff Act, 1985 read with the Explanatory Notes as updated from time to time
published by the Customs Co-operation Council, Brussels apply for the

interpretation of this notification.
Note:- (3) Where any commodities are described against any heading or, as the
case may be, sub-heading, and the aforesaid description is different in any
manner from the corresponding description in the Central Excise Tariff Act,
1985, then only those commodities described as aforesaid will be covered by the
scope of this notification and other commodities though covered by the
corresponding description in the Central Excise Tariff will not be covered by the
scope of this notification.
Note:- (4) Subject to Note 2, for the purpose of any entry contained in this
notification, where the description against any heading or, as the case may be,
sub-heading, matches fully with the corresponding description in the Central
Excise Tariff, then all the commodities covered for the purposes of the said tariff
under that heading or sub-heading will be covered by the scope of this
notification.
Note:- (5) Where the description against any heading or sub-heading is shown as
“other”, then the interpretation as provided in Note 2 shall apply.
Note:- (6) The sub-entries 28, 29, 30, 31, 32 and 64 appearing in Col. No. (1) and
the corresponding entries in Col. Nos. (2) and (3) thereof shall be omitted.
*[180. Gum Arabic 1301.20.00
* Entry of 100 subentries 180 to 231 added by Act
No. 34 of 2006, w.r.e.f. 1-6 -2006.
181.Glycerol crude, Glycerol Waters and Glycerol 1520.00.00
lyes
182.Clay including fire clay, fine china clay and 2508
ball clay
183.Natural Graphite 2504
184.Pumice stone; emery; natural corundum, 2513
natural garnet and other natural abrasives, whether
or not heat treated
185.Ash and residues(other than from the 2620
manufacture of iron & steel), containing arsenic,
metals or their compounds
186.Other slag and ash, including seaweed ash 2621
(kelp); ash and residues from the incineration of
municipal waste.
187.Pitch and pitch coke, obtained from coal tar or
from other mineral tars 2708
188.Butylene 2711.14.00
189. Paraffin wax containing by weight less than 2712.2

0.75% of oil; Normal paraffin; not being micro
crystalline petroleum wax
190.Other inorganic acids and other inorganic
oxygen compounds of non metals 2811
191.Silicates, commercial alkali, metal silicates 2839
192.Ethylene 2901.21.00
193.Propylene 2901.22.00
194.Acetylene, in dissolved condition 2901.29.10
195.Heptene 2901.29.20
196.Compounds with other nitrogen functions 2929
197.Essential oils (terpeneless or not), including 3301
concretes and absolutes; resinoids; extracted
oleoresins; concentrates of essential oils, in fats, in
fixed oils, in waxes or the like, obtained by
enfleurage or maceration; terpenic by-products of
the deterpenation of essential oils; aqueous
distillates and aqueous solutions of essential oils
198.When sold in packs of 20ml or, as the case 3302

may be, more or in packs of 20gms or more, the
followingMixtures of odoriferous substances,
mixtures (including alcoholic solutions) with a
basis of one or more of these substances, of a kind
used as raw materials in industry; other
preparations based on odoriferous substances of a
kind used for the manufacture of beverages
199.Artificial waxes and prepared waxes 3404
200.Albumins (including concentrates of two or 3502
more whey proteins, containing by weight more
than 80% whey proteins, calculated on the dry
matter), albuminates and other albumin derivatives
201.Gelatin [including gelatin in rectangular 3503

(including square) sheets, whether or not surface
worked or coloured] and gelatin derivatives
202.Peptones and their derivatives; other protein 3504
substances and their derivatives, not elsewhere
specified or included; hide powder, whether or not
chromed
203.Dextrins and other modified starches (for 3505

example, pregelatinised or esterified starches);
204.Prepared binders for foundry moulds or cores; 3824
Retarders used in the printing industry
205.Waste, parings and scrap of plastics 3915
206.Monofilament of which any cross-sectional 3916
dimension exceeds 1mm, rods, sticks and profile
shapes, whether or not surface worked but not
otherwise worked, of plastics.
207.Plastic fabrics of the type used for making 3926
plastic woven sacks and plastic woven sacks.
208.Waste, parings and scrap of rubber (other than 4004
hard rubber) and powders and granules obtained
there from
209.Plates, sheets and strip of microcellular rubber 4008.11.10
210.Blocks of micro cellular, rubber but not of 4008.19.10
latex foam sponge, used in the manufacture of
soles, heels or soles and heels combined for
footwear
211.Plates, sheets and strip of microcellular rubber 4008.21.10
used in the manufacture of soles, heels or soles and
heels combined for footwear.
212.Blocks of micro cellular, rubber but not of 4008.29.20
latex foam sponge, used in the manufacture of
soles, heels or soles and heels combined for
footwear
213.Corks and stoppers of natural cork 4503
214.Recovered (waste & scrap) paper or paper 4707

board.
215.Sacking fabrics, Hessian fabrics, jute canvas 5310
216.Twine, cordage, ropes and cables, whether or 5607

not plaited or braided and whether or not
impregnated, coated, covered or sheathed with
rubber or plastics.
217.Coir string 5609

218.Natural or artificial abrasive powder or grain 6805

on a base of textile material, of paper of paper
board or of other materials, whether or not cut to
shape or sewn or otherwise made up.
219.Refractory monolithic 6903.90.00
220.Cullet and other waste and scrap of glass in the 7001

mass
221. Laboratory, hygienic or pharmaceutical 7017

glassware, whether or not graduated or calibrated
222. Tin plate containers 7310
223. Castings of all metals,
(i) of non-malleable cast iron 7325.10.00
(ii) of Iron 7325.99.10
(iii) of alloy steel 7325.99.20
(iv) of stainless steel 7325.99.30
(v) grinding balls and similar articles for mills 7325.91.00
(vi) grinding balls and similar articles for mill 7326.11.00
(vii) grinding media balls and cylpebs 7326.90.00
(viii) of copper 7419.91.00
(ix) of other metals
224. Valve Regulated Lead Acid batteries 8507.20.00
225. Electrical insulators of any material 8546
226.Insulating fittings for electrical machines, 8547

appliances or equipment, being fittings wholly of
insulating materia l apart from any minor
components of metal (for example, threaded
sockets) incorporated during moulding solely for
the purpose of assembly, other than insulators of
heading 8546; electrical conduit tubing and joints
therefore, of base metal lined with insulating
material
227.Waste and scrap of primary cells, primary 8548

batteries and electric accumulators, spent primary
cells, spent primary batteries and spent electric
accumulators.
228.Regulator for LPG cylinders and other cylinders 9032
containing compressed gases or compressed liquids
229.Gelatin capsules empty 9602.00.30
230.Buttons of plastics 9606.21.00
231.Slide fasteners and parts thereof.]
* Entry of 100 subentries 180 to 231 added by Act
No. 34 of 2006, w.r.e.f. 1-6-2006. 9607
*232. Yeast of all kinds and forms.
*233. Gel used for preparing bakery products and
bread softner.
* Added by Act 28 of 2008 w.e.f. 1-7-2008.
*234. Winding wire made of copper or Enamelled
Copper wire
*Added by Act 21 of 2011, w.e.f.19-5-2010.
*235. Non-woven fabrics
*Added by Act No. 11 of 2012, w.e.f. 22-11-2011. 5603 1300
101 *101 Liquefied petroleum gas for domestic use
102 *102 Machinery of all kinds that is to say,-
* Sl Nos. 102 to 113 added by Act No. 34 of 2006,
w.r.e.f. 1-7-2006.
1.Nuclear reactors; fuel elements 8401
(cartridges), non- irradiated, for nuclear reactors;
machinery and apparatus for isotopic separation
2.Machinery, plant or laboratory equipment, whether
or not, electrically heated (excluding furnaces, ovens
and other equipment of heading 8514), for the
treatment of materials by a process involving a
change of temperature such as heating, cooking,
roasting, distilling, rectifying, sterilizing, pasteuri-
zing, steaming, drying, evaporating, vaporizing,
condensing or cooling, other than machinery or plant
of a kind used for domestic purposes instantaneous
or storage water heaters non-electric.
(a) instantaneous gas water heaters 8419.11
(b) medical, surgical or laboratory sterilizers 8419.2

(c) dryers for agricultural products 8419.31.00

(d) dryers for wood, paper pulp or paper board 8419.32.00
(e) distilling or rectifying plant 8419.4
(f) heat exchange units 8419.5
(g) machinery for liquefying air or other gas 8419.60.00
(h) machinery for making hot drinks or for 8419.81
cooking orheating food
(I) pasteurizers 8419.89.50
(j) vacuum-vapour plant for deposition of 8419.89.80
metals
(k) parts 8419.9
* (l) Dryers-other 8419.39.00
(m) Pressure Vessels, Reactors, Columns, 8419.8910
Towers or Chemical Storage Tanks.
(n) Glass Lined Equipment 8419.89.20
(o) Autoclaves other than for cooking or 8419.89.30
heating food not elsewhere specified or included
(p) Others 8419.89.90
*Added by Act No. 4 of 2009, w.e.f. 1-7-2006.
3.Calendaring or other rolling machines other than
for metals or glass, and cylinders therefor 8420
4.Centrifuges, including centrifugal dryers
(a) cream separators 8421.11.00
(b) cloth dryers 8421.12.00
(c) parts 8421.99.00
*(d) Bowl Centrifuges 8421.19.10
(e) Basket Centrifuges 8421.19.20
(f) Continuous automatic Centrifuges 8421.19.30
(g) Self cleaning centrifuges 8421.19.40
(h) Decanter Centrifuges Horizontal Bowl 8421.19.50
(i) Screw Conveyor Centrifuges 9421.19.60
(j) Other for Chemical Industries 8421.19.91

(k) Other Filtering/Purifying Machines and 8421.19.99

Apparatus for Liquids.
*Added by Act No. 4 of 2009, w.e.f. 1-7-2006.
5.Machinery for cleaning or drying bottles or 8422.20.00
other containers
6.Machinery for filling, closing, ceiling or 8422.30.00
labelling bottles, canes, boxes, bags or other
containers; machinery for capsuling bottles, jars,
tubes and similar containers; machinery for
aerating machinery
7. Other packing or wrapping machinery 8422.40.00
(including heat-shrink wrapping machinery)
8. Parts of machinery of heading 8422 8422.9
9.Steam or sand blasting machines and similar jet 8424.30.00
projecting machines
10.Parts of machinery of subheading 8424.30.00 8424.90.00
11.Machines for cleaning, sorting or grading seed,
grain or dried leguminous vegetables; machinery
used in the milling industry or for the working of
cereals or dried leguminous vegetables, other than
farm type machinery 8437
12.Sugar manufacturing machinery, 8438.30.10
13.Parts of sugar manufacturing machinery 8438.90.10
14.Tea leaf rolling or cutting machine 8438.80.40
15.Machinery for making pulp of fibrous 8439
cellulosic material or for making or finishing
paper or paper board
16.Other machinery for making up paper pulp, 8441
paper or paper board, including cutting machines
of all kinds
17.Machinery, apparatus and equipment for type 8442
founding or type setting, for preparing or making
printing blocks, plates, cylinders and other
printing components, blocks, plates, cylinders and
lithographic stones, prepared for printing purposes
(planed, grained or polished)
18.Printing machinery used for printing by means 8443

of the printing type, block, plates, cylinders and
other printing components; inkjet printing
machines, machines for uses ancillary to printing
19.Machines for extruding, drawing, texturing or 8444
cutting man-made textile materials
20.Machines for preparing textile fibres; spinning, 8445
doubling or twisting machines and other machinery
for producing textile yarns; textile reeling or
winding (including weft winding) machines and
machines for preparingtextile yarns for use on the
machines of heading 8446 or 8447
21.Weaving machines (looms) 8446

22.Knitting machines, stitch bonding machines and 8447
machines for making gimped yarn, tulle,
lace,embroidery, trimmings, braid or net and
machines for tufting
23.Auxillary machinery for use with machines of 8448

heading 8444, 8445, 8446 or 8447 (for example,
dobbies, jacquards, automatic stop motions, shuttle
changing mechanisms); parts and accessories
suitable for use solely or principally with the
machines of this heading or of heading 8444, 8445,
8446 or 8447 (for example, spindles and spindle
flyers, card clothing, combs, extruding nipples,
shuttles, healds and heald frames, hosiery needles)
24.Machinery for preparing, tanning or working 8453

hides, skins or leather or for making or repairing
footwear or leather, other than sewing machines
25.Converters, ladles, ingot moulds and casting 8454
machines, of a kind used in metallurgy or in metal
foundries
26.Metal rolling mills and rolls therefore 8455
27.Machining centers, unit construction machines 8457

9 single station) and multi-station transfer
machines for working metal
28.Lathes (including turning centers) for removing 8458
metal
29.Machines-tools (including way-type unit head 8459

machines), drilling, boring, milling, treading or
tapping by removing metal other than lathes
30.Machine tools for deburring, sharpening, 8460
grinding, honing, lapping, polishing or otherwise
finishing maetal, or cermets by meands of grinding
stones, abrasives or polishing products, other than
gear cutting, gear grinding or gear finishing
machines of heading 8461
31. Machine tools for planning, shaping, slotting, 8461
broaching, gear cutting, gear grinding or gear
finishing, sawing, cutting off and other machine
tools working by removing metal, or cermets, not
elsewhere specified or included.
32.Machine tools (including presses) for working 8462

metal by forging, hammering or die -stamping
machines tools (including presses) for working
metal by bending, straightening, flattering,
shearing, punching or notching, presses for
working metal or metal carbides, not specified
above
33.Other machine tools for working metal, or 8463
cermets, without removing material
34.Granite cutting machines or equipments 8464.10.10
35.Grinding or polishing machine 8464.20.00
36.Machine tools (including machines for nailing, 8465
stapling, glueing or otherwise assembling) for
working wood, cork, bone, hard rubber, hard
plastics or similar hard materials
37.Parts and accessories suitable for use solely or 8466
principally with the machines of headings 8456 to
8465 including work or tool holders, self-opening
die heads, dividing heads and other special
attachments for machine tools; tool holders for any
type of tool, for working in the hand
38.Machinery and apparatus for soldering, brazing 8468
or welding, whether or not capable of cutting other
than those of heading 8515, gas operated surface
tempering machines and appliances
39.Machinery for sorting, screening, separating, 8474

washing, crushing, grinding, mixing or kneading
earth, stone, ores or other mineral substances, in
solid (including powder or paste) form; machinery
for agglomerating, shaping or moulding solid
mineral fuels, ceramic paste, unhardened cements,
plastering materials or other mineral products in
powder or paste form; machines for forming foundry
moulds of sand
40.Machinery for working rubber or plastics or for 8477
the manufacture of products from these materials not
elsewhere specified
41.Machinery for preparing or making up tobacco, 8478
not specified or included elsewhere in the chapter 84
42.Machines and mechanical appliances having 8479
individual functions, not specified or included
elsewhere
43.Moulding boxes for metal foundry ; mould bases ; 8480
moulding patterns ; moulds for metals (other than
ingot moulds), metal carbides, glass, mineral
materials, rubber or plastics
44.Machinery parts not containing electrical 8485
connectors, insulators, coils, contacts or other
electrical features, not specified or included else
where in chapter 84.
45.Furnaces and boilers of all types including 8514
fluidized bed boilers and ignifluid boilers and boilers
using agricultural waste as fuel but not including
boilers using municipal waste only as fuel
46.Machines and apparatus for electroplating,
electrolysis or electrophoresis 8543.30.00
47.Parts items of heading 8801 or 8802 8803
48.Machines and appliances for testing the hardness, 9024
strength, compressibility, elasticity or other
mechanical properties of materials (for example,
metals, woods, textiles, paper, plastic)
49.Machinery for Photography
*[50. Clean Air Ventilation Systems/Air Handling
systems and the parts thereof, used in
Pharmaceutical Industry].*Added by Act 20 of 2009,
w.r.e.f. 1-5-2009.
*[51. Parts of central heating boilers other than those of 8403 90 00
heading 8402.
52. Parts of auxiliary plant for use with boilers of 8404 90 00

heading 8402 or 8403 (for example, economizers,
super heaters, soot removers, gas recoverers);
condenses for steam or other vapour power units.
53. Parts of producer gas or water gas generators, 8405 90 00
with or without their purifiers; acetylene gas
generators and similar water process gas generators
with or without their purifiers.
54. Parts of steam turbines and other vapour turbines 8406 90 00
55. Parts including regulators of hydraulic turbines, 8410 90 00
water wheels, and regulators therefore
56. Parts of turbo-jets, turbo-propellers and other gas 8411 99 00
turbines
57. Toothed wheels, chain sprockets and other 8483 90 00
transmission elements presented separately;]
*Sl.Nos. 51 to 57, Added by Act 21 of 2011
w.r.e.f. 1-4-2005.
103 103 Tools and Instruments that is to say
1.Hand saws; blades for saws of all kinds (including 8202
slitting, slotting or toothless saw blades)
2.Files, rasps, pliers (including cutting pliers), 8203
pincers, tweezers, metal cutting shears, pipe-cutters,
bolt croppers, perforating purchases and similar hand
tools.
3.Hand operated spanners and wrenches (including 8204
torque meter wrenches but not including tap
wrenches); interchangeable spanner sockets, with or
without handles.
4.Hand tools (including glaziers' diamonds), not 8205
elsewhere specified or included; below lamps; vices;
clamps and the like, other than accessories for and
parts of, machine tools; anvils; portable forges;
hand-or pedal-operated grinding wheels with
frameworks
5.Tools of two or more of the headings 8202 to 8205 8206
put-up in sets for retail sale
6.Interchangeable tools for hand tools, whether or 8207
nor power-operated, or for machine-tools (for
example, for pressing, stamping, punching, tapping,
threading, drilling, boring, broaching, milling,
turning or screw driving), including dies for drawing
or extruding metal, and rock drilling or earth boring
tools
7.Knives and cutting blades, for machines or for 8208

mechanical appliances
8.Plates, sticks, tips and the like for tools, 8209
unmounted of cermets
9.Hand-operated mechanical appliances, weighing 8210
10 kg. Or less, used in the preparation, conditioning
or serving of Food or Drink
10.Scissors, tailors’ shears and similar shears, and 8213
blades therefore
Machine- tools for working any material by removal 8456
of material, by laser or other light or photon beam,
ultra sonic, electro-discharge, electro-chemical,
electron beam, ionic-beam or plasma arc processes
11.Tools for working in the hand, pneumatic, 8467
hydraulic or with self-contained electric or non-
electric motor
12.Direction finding compasses; other navigational 9014
instruments and appliances
13.Surveying (including photogrammetrical 9015
surveying), hydrographic, oceanographic,
hydrological, meteorological or geophysical
instruments and appliances, excluding compasses;
rangefinders
14.Balances of a sensitivity of 5 cg or better, with or 9016
without weights
15.Drawing, marking-out or mathematical 9017
calculating instruments (for example, drafting
machines, pantographs, retractors, drawing sets, slide
rules, disc calculators); instruments for measuring
length for use in the hand (for example, measuring
rods and tapes, micrometers, calipers), not specified
or included elsewhere in this Chapter
16.Mechano-therapy appliances; massage apparatus; 9019
psychological aptitude-testing apparatus, ozone
therapy, oxygen therapy, aerosol therapy, artificial
respiration or other therapeutic respiration apparatus
17.Other breathing appliances and gas masks, 9020
excluding protective masks having neither
mechanical parts nor replaceable filters
18. alpha, beta or gamma radiations, whether or not 9022

for medical, surgical, dental or veterinary uses,
including radiography or radiotherapy apparatus, x-
ray tubes and other e-ray generators, high tension
generators control panels, and desks, screens,
examination or treatment tables or chairs and the like
19.Hydro meters and similar floating instruments, 9025
thermo meters, pyrometers, barometers, hygro
meters and psycho meters, recording or not and any
combination of these instruments
20.Instruments and apparatus measuring or checking 9026
the flow, level, pressure or other variables of liquids
or gases (for example, flow meters, level gages,
manometers, heat meters), excluding instruments and
apparatus of heading 9014, 9015, 9028 or 9032
21 21.Instruments and apparatus for physical or 9027

chemical analysis (for example, polarymeters,
refractometers, spectrometers, gas or smoke analysis
apparatus); instruments and apparatus for measuring
or checking viscosity, porosity, expansion, surface
tension or the like; instruments and apparatus for
measuring or checking quantities of heat, sound, or
like (including exposure meters); micro tomes
22.Revolution counters, production counters, taxi 9029
meters, milometer, pedometers and the like: speed
indicators and tacho meters, other than those of
heading 9014 or 9015; stroboscopes.
23.Oscilloscopes, spectrum analyzers and other 9030
instruments and apparatus for measuring or checking
electrical quantities, excluding meters of heading
9028: of instruments and apparatus for measuring or
detecting alpha, beta, gamma, x-ray, cosmic or other
ionizing radiation
24.Measuring or checking instruments, appliances 9031

and machines, not specified or included elsewhere in
this chapter; profile projectors
25.Automatic regulating or controlling instruments 9032
and apparatus
104 104 Bolts, Nuts threaded or tapped and screws of base
metal or alloys thereof including bolt ends, screws,
studs, screw studding, self tapped screws, screw
hooks and screw rings.
105 105 All hardware of base metal or alloys and other

hardware items like locks, woven wire nettings,
mesh, cloth sieves, and chain link of all metals.
106 106 Biomass briquettes
107 107 * (a) Preserved fruits, vegetables, meat, poultry, sea
foods and fish sold in sealed containers or in a frozen
state.
(b) Fruit jams, jelly, fruits squash, fruit juices and
fruit drinks but excluding aerated fruit drinks.
(c) Cottage cheese (paneer), pickles, sauces,
porridge, marmalade, honey.
*Subs. by Act 28 of 2008 w.e.f. 1-7-2008.
108 108 Katha
109 109 Wet dates
110 110 Cups, plates and glasses made of paper
111 111 Medical equipments / devises and implants
112 112 Papad.
113 113 Optical goods that is to say
Spectacles and goggles 9004.9
Sun glasses 9004.10.00
Spectacle glasses of lenses
(i) of glass 9001.4
(ii) of other material 9001.50.00
Frames and mountings for spectacles, goggles or the
like and parts thereof 9003
Contact lenses 9001.3
Lense cleaning liquid
Intra ocular lens 9002.19.00
*[Explanation I:- The goods mentioned at entry 57 shall be other than those
described in column (3) of first schedule to the Additional Duties of Excise
(Goods of Special Importance), Act 1957.]
114 *114 Tea * Sl. Nos. 114 to 118 added by Act No. 5 of
2007, w.r.e.f. 1-9-2006.
115 115 Cashewnut and kernel
116 116 Sales of goods other than Petrol, all kinds of Diesel
Oils including C9, petroleum gases, lubricants,
other minor petroleum products, Liquor,
Automobiles, tyres and Cement, by a Registered
dealer to,–
(a) The State Government Departments.

(b) Andhra Pradesh Power Generation Corporation
(APGENCO) incorporated as a company under the
provisions of Companies Act.
(c) Transmission Corporation of Andhra Pradesh
(APTRANSCO) incorporated as a company under
the provisions of the Companies Act.
(d) Central Power Distribution Company of Andhra
Pradesh Limited (APCPDCL).
(e) Southern Power Distribution Company of
Andhra Pradesh (APSPDCL).
(f) Eastern Power Distribution Company of Andhra
Pradesh Limited (APEPDCL).
(g) Northern Power Distribution Company of
Andhra Pradesh Limited (APNPDCL).
*(h) The Kuppam Rural Electric Co-operative
Society Limited, Kuppam.
*(i) The Cheepurupalli Rural Electric Co-operative
Society Limited, Cheepurupalli, Vizianagaram
District.
*(j) The Anakapalle Rural Electric Co-operative
Society Limited, Kasimkota.
* Items (h), (i), (j) added by G.O.Ms.No. 759, Rev.
(CT. II) Dept., dt. 4-6-2007.
*(k) Co-operative Electric Supply Society Limited,
Sirsilla.
*Added by Act 15 of 2008, w.r.e.f. 6-12-2007.
*(l) Andhra Pradesh Power Development Company
Limited (APPDCL)
*Added by Act No. 11 of 2012, w.r.e.f. 17-5-2011.
117 117 *Ayurvedic and Homeopathic products manufac-
tured under license issued by the licensing authori-
ties concerned under Drugs and Cosmetics Act,
1940. *Subs. by Act No. 28 of 2008, w.e.f. 1-7-2008.
118 118 Molasses]
*Sl.Nos. 114 to 118 added by Act No. 5 of 2007,
w.r.e.f. 1-9-2006.
*119 119 Goods such as components, accessories and spare
parts of fire arms, weapons, guns, small Arms and
ammunitions sold to the ordinance factories, run by
“Government of India”.
*Added by Act 15 of 2008, w.e.f. 1-1-2008.
*120 120 Tread Rubber and other material used for retreading of
tyres. *Added by Act 15 of 2008, w.e.f. 15-2-2008.
*121 121 Switch made poser supply systems (SMPS) 8504-40-30
Battery Charges
SMPS based Integrated power supply systems (IPS) 8504-40-90
Electrical Transformers (dry type) 8504-31-00
Inverters/Converters 8504-40-10
Lt Panels/AMF Panels/MCC Panels/PCC Panels/ 8537-10-00
Control and Relay Panels
ACDB / DCDB 8537-10-00
Parts of above panels/ACDB/DCDB 8538-10-10
*Added by Act No. 4 of 2009 w.e.f. 1-11-2008
*122 122 Oats *Added by Act No. 4 of 2009, w.e.f. 1-1-2009.
*[123 123 Mosquito nets, insect screens, Perimeter screens,
Meshes for insect protection, Meshes for gardening and
agro meshes, made up of plastic (Polymer) and articles
thereof.] *Added by Act 20 of 2009, w.r.e.f. 1-5-2009.
*124 124 Diesel Power Generators.
*125 125 Lime, Burnt Lime, Lime Stone, Products of Lime,
Dolomite and other white washing materials including
Cem powder other than white cement.
*126 126 Purified Packaged drinking water in bulk containers/
Cans and sachets but excluding aerated, mineral,
distilled, medicinal, ionic, battery and de-mineralized
water. *Added by Act 21 of 2011. w.r.e.f. 2-8-2010.
*127 127 Cotton fabrics, manmade fabrics, woolen fabrics, 212
textile made ups, bedsheets, pillow covers, towels,
blankets, traveling rugs, curtains, embroidery articles
excluding fabrics, made ups and garments made from
handloom/ khadi cloth or produced and sold by the
power loom units in the State to dealers registered
under the Act only at the point of sale in the hands of
powerloom units.] Added by Act No. 11 of 2012,
w.e.f. 11-7-2011.
*128 128 Sugar excluding khandasari sugar
*Added by Act No. 11 of 2012,
w.r.e.f. 11-7-2011.
-------
SCHEDULE V
Goods Taxable at Standard Rate (RNR) of *[14.5%]
All Goods other than those specified in Schedules I, III, IV and VI.
——
*Subs. for “12.5% “ by Act No. 9 of 2010, w.r.e.f. 15-1-2010.

Sch. VI] Goods subjected to tax at special rates 277
SCHEDULE-VI
Goods subjected to tax at special rates
Item Description Point of levy Rate of

No. tax
1
[1 All liquors, bottled and packed as per At the point of first 70%]
the provisions of the A.P. Excise sale in the State
Act,1968 (including imported liquor)
whether bottled and/or packed in
India or outside India, but excluding
Toddy and arrack].
2
2 Petrol At the point of first [31%]
sale in the State
3
3 Aviation motor spirit and any other At the point of first [33%]
motor spirit sale in the State
4
4 Aviation turbine fuel At the point of first [16%]
sale in the State
5 6
5 [All kinds of Diesel Oils including At the point of first [22.25
C9] sale in the State %]
7
[6. Tobacco products including Gutkha, At the point of first 20%.]
khara masala, kimam, dokta, zarda, sale in the State
sukha or surthi and cigarettes except
those specified in Schedule I.
2. Subs. For “33%” by G.O.Ms.No.369 Rev. CT-II, Dept., dt. 7-6-2012.
3. Subs. For “34% by Act No. 34 of 2006, w.e.f. 10-6-2006.
4. Subs. for “4%” by Act 9 of 2010, w.r.e.f. 1-2-2010.
5. The original entry “5. Diesel oil” is substituted by Act No. 34 of 2006, w.r.e.f.
1-5-2006.
6. 21.33% of tax levied upto 19.06.2005, subsequently enhanced to 23% by Act No. 23 of
2005, dt. 26.10.2005, w.e.f. 20.06.2005. Again reduced to 22.25% by Act No. 34 of 2006,
w.r.e.f. 10-6-2006.
-----
278 Commentary on A.P. Value Added Tax [Sch. VI
Explanation I:– For the purpose of item (1) when any distillery or
brewery or any dealer sells liquor to the Andhra Pradesh Beverages Corporation
Limited, or Canteen Stores Department, the sale by the Andhra Pradesh
Beverages Corporation Limited or Canteen Stores Department shall be deemed
to be the first sale.
Explanation II:– For the purpose of item (1) sale of liquor by any
distillery or brewery or any dealer to Andhra Pradesh Beverages Corporation
Limited or Canteen Stores Department shall be exempt from tax under the
Act.
Explanation III:– For the purpose of item (1), a case means 12 numbers
of 1000 ml; 12 numbers of 750 ml; 24 numbers of 375 ml; 48 numbers
of 150 ml; 90 numbers of 100 ml bottles of IML/Wine and 12 numbers
of bottles of Beer.
1
[Explanation III-A:– The amendment issued to item 1 in the notification
issued in G.O.Ms.No 1229, Revenue (CT.II) Department, dated 20-06-2005,
shall be deemed to have come into force w.e.f. 1-4-2005 in so far as it
relates to the stocks of liquor costing more than Rs.700 per case held by
M/s. Andhra Pradesh Beverages Corporation Limited, as on 01-04-2005, and
sold thereafter with old MRP stickers and at the old billing rates as per the
orders issued by the Government in G.O.Rt. No. 399. Revenue (Excise-II)
Department, dt. 31-03-2005.]
Explanation IV:– For the purpose of items 2,3,4 and 5 a sale by
one oil company to another oil company shall not be deemed to be the first
sale in the State. Accordingly any sale by one oil company to any other
person (not being an oil company) shall be deemed to be the first sale in
the State.
Note : The expression ‘oil company’ in this explanation means:
(a) Hindustan Petroleum Corporation Limited
(b) Indian Oil Corporation Limited
(c) Bharat Petroleum Corporation Limited
(d) Indo-Burma Petroleum Company Limited
(e) Chennai Petroleum Corporation Limited
(f) Reliance Industries
(g) Reliance Petro Marketing Private Ltd.
(h) Reliance Petroleum Private Ltd.
(i) Oil and Natural Gas Commission, and
(j) Such other oil company as the Government may, from time to
time, by notification in the Gazette specify in this behalf.
2
[(k) Shell India Marketing Private Limited.]
3
[(l) M/s. Essar Oil Limited]
4
[(m) Numaligarh Refinery Limited]
5
[(n) M/s. Shell MRPL Aviation Fuels and Services Private Limited.]
1. Inserted by Act 23 of 2005, w.e.f. 28-7-2005.
Schedules – Case Law 279
NOTES
The expression “animal feed” does not include “cat feed” and “dog feed”
for purpose of exemption, since, the meaning of words used shall be in relation
to the purpose for which exemption is granted. The only feed intended to
be exempted for granting exemption is the feed given to animals engaged
in agriculture. Therefore, “cat feed” and “dog feed” are liable to be treated
as general goods liable to be taxed at 12½%. Sri Durga Distributors v. State
of Karnataka, (2007) 5 VST 347 (Kar.).
Court is guided by the manner of classification of goods which are
brought to tax and not on the etymological meaning of the product or expert
opinion. Candid Industries v. Commissioner of Commercial Taxes, (2007) 5
VST 381. (Ker.).
H.S.N. means, Harmonises System of Nominclature. Where HSN number
is given that product in question had to be seen in the context of harmonised
system of nominclature and the judgments based thereon. Beckett Benekiser
(I) Ltd. v. Commissioner of Commercial Taxes, (2008) 15 VST 10 (SC).
Where any item is specifically described in the schedule, it can’t be
brought into the general category. For instance, if handkerchiefs are treated
as a different and distinct item it can’t be read into the general items relating
to textiles.
Furnace oil used in the manufacture of Polyster Staple Fibres (PSF)
is to be treated as input and input tax which has been paid on the furnace
oil can be claimed as input tax credit under Sec.2(27) of Orissa VAT Act
against the tax payable or finished product i.e., PSF. Reliance Industries Ltd.
v. Asst. Commissioner of Sales Tax & others, (2008) 15 VST 228. (Orissa).
L.S.H.S. & L.P.G. do not fall under Schedule VI and hence transactions
is HSHS & LPG are entitled for input tax credit. A.G. Glasspak v. Asst.
Commissioner of Commercial Taxes (IV), (2007) 10 VST 9 (AP).
Where a definite article is the Schedule is liable to be taxed at 4% it
is not open to authorities or to the legislature to fix different rates for the
same or at higher rates depending upon the uses to which the purchases
may ultimately utilise it. Mahamaya Agencies v. State of Tripura, (2008) 12
VST 529 (Gauhati).
Entries in Schedule shall be given liberal construction. Resort to residuary
entry can be made only when liberal construction fails. Additional Commissioner
of Sales Tax, Indore v. S. Kumar, (2009) 19 VST 573.
CASE LAW
For reference only:
Schedules:
(1) Coal and coal ash: Coal ash is not the same as coal. The company
which uses coal as a fuel, selling coal ash which was obtained as residue
of the burnt out coal is taxable as such at the hands of the company.
M/s. ITC Bhadrachalam Paper Board Ltd. v. State of A.P. rep. by State
rep. before the Sales Tax Appellate Tribunal, Hyderabad, 1998 (3) An.WR
618 (DB) = 1998 (6) ALD 443.
(2) Trunks are not suitcases: Iron trunk boxes used as containers can’t
be treated as suitcases classified as general goods. State of A.P. rep. by
S.R. before STAT, A.P., Hyd. v. Swapna Mahila Co-operative Super Bazar,
Cuddapah, 1995 (1) An.WR 235 (DB) = (1995) 98 STC 123.
(3) Spectacles, Goggles, Glasses and Frames: Where an entry mentions
spectacles, goggles, glasses, lenses and frames and they were taxed at a single
point, it is not permissible for the State to contend that sale of spectacles
at the point of 2nd sale shall not be subject to tax. State of A.P. rep. by
State representation before STAT, A.P., Hyderabad v. M/s. Deccan Opticals
& Allied Industries (P) Ltd., Hyderabad, 1995 (1) An.WR 65 (DB) = (1995)
98 STC 114.
Cereals: The expression cereals mentioned in the notification granting
exemption means cereals specified in Entry 20 of Schedule III to A.P.G.S.T.
Act and not all the items of cereals specified in Schedule III of APGST
Act or Section 14 of the CST Act. Therefore, the benefit of the exemption
accrues only to the cereals mentioned in Entry 20 of Section 3. Sri
Kanakalinga Paddy & Processing ICS Ltd., Mudinepally rep. by its President
P. Srinivasa Rao v. Commissioner (CT) Govt. of A.P., Hyderabad & others,
1997 (6) ALT 82 (DB).
Livestock and Poultry: Livestock includes poultry; one day old chicks
fall within the purview of livestock for purposes of exemption. State of
A.P. rep. by State rep. before STAT v. M/s. Bhagyalakshmi Hatcheries Pvt.
Ltd., Hyderabad & others, 2000 (6) ALT 679 (DB) = 2000 (6) ALD 463
(DB).
Cock and stocker Coke: The expression coke in all its forms includes
“stocker coke”. State of A.P. v. M/s. Narsing Industries, Hyderabad, 1995
(2) An.WR 598.
(4) Paper pulp trays: Schedule I Entry 19: Paper pulp trays used in
carrying eggs known as egg trays. They can be treated as containers. State
of A.P. rep. by State rep.before STAT, A.P. v. M/s. Pulp ‘N’ Pack Pvt.
Ltd., Tadimalla, W. Godavari District, 1995 (1) An.WR 143 (DB) = (1995)
98 STC 165.
Cast Iron: Entry 102: Cast iron is different from cast iron pipes. They
should be taxed as different goods. M/s. Mahesh Enterprises, Hyderabad
v. State of A.P. rep. by State rep. before STAT, 2000 (4) ALT 159 = 2000
(4) ALD 329 (DB).
(5) Almonds: Schedule I Entry 112: Almonds are dry fruits. The turnover
in almonds accordingly exempt. M/s. TTD Devasthanam Co-operative Society
Ltd., Tirupathi, Chittoor Dist. v. State rep. by State rep. before STAT,
Hyderabad, 1997 (3) An.WR 76 (DB).
(6) Classification should be by use: 1st Schedule Entry 125 & 150:
Goods hire to be classified in accordance with the nature and condition in
which they are sold to the customers but not with reference to different
uses to which they would be put to. Frying pans are used without lids
as frying pans. The mere fact that with the lids they can be used as pressure
pans, they can’t be classified as pressure cookers. State of A.P. rep. by
State rep. before STAT, Hyd. v. M/s. T.T. Ltd., Hyderabad, 1997 (3) An.WR
92 (DB).
(7) Stoneware: Stoneware glazed pipes are pipes which fall item 102
general goods. The contention that since they are used for drainage and
sewage dispossess they should be treated as sanitary ware is negatived. M/
s. Mahesh Enterprises v. State of A.P. rep.by State rep. before STAT,
Hyderabad, 1997 (3) An.WR 144 (DB).
(8) G.I. Pipes Steel tubes: Schedule III Entry 2.1: G.I. pipes are steel
tubes taxable at 4% as declared goods under Entry 2.1 even though they
are used as water supply and sanitary fittings. Mahesh Enterprises Hyd. v.
State of A.P. rep. by State rep. before STAT, Hyd., 2000 (4) ALT 159 =
2000 (4) ALD 329.
(9) Betle nut powder: Entry 158 A: Betel nut manufactured out of arrack
nuts which have not suffered tax under the APGST Act, at one rate and
that manufactured out of arrack nuts suffered tax at a different rate is ultra
vires of Article 301 to 304 and Article 14. M/s. Crane Beetle Nut Powder
Works, Guntur v. State of A.P., 1999 (3) An.WR 160 (DB) = 1999 (6) ALD
30.
(10) Fittings: The word fittings in Entry 102 was included to refer
to articles or things which were fitted or fixed to the floor or walls of a
building and they may in a given case include even articles or materials fitted
or fixed outside provided they could be considered as attached or ancillary
to the building or part of it such as a pipe carrying faucal matter from the
commode to the septic tank but they could not include pipes laid underground
for carrying water supply. Where doubt arises on the actual uses of the
goods, one can’t be said to include other but where both the purposes are
included in one and the same entry, the difficulty in classification may not
arise. State of A.P. rep. by State Rep. before STAT, Hyderabad, A.P. v.
M/s. Pallavi Potteries, Hyderabad, 1995 (2) ALT 208 (DB) = 1995 (1) APLJ
51 (SN).
(11) Goods to be understood in accordance with commercial formulas:
Entry 2(i): Goods which are being brought and sold in the market should
be understood in the commercial formulas. Cast iron including ingots moulds,
bottom plate, iron scrap, cast iron scrap, rubber scrap and iron skull scrap
are mentioned in Section 6 of the Schedule entry. It is too remote to say
that machinery parts made out of cast iron should be treated as cast iron.
They should be taxed as machinery parts only. Andhra Light Castings v.

State of A.P., 1997 (2) An.WR 136 (DB).
(12) Groundnut and Groundnut Kennel: The expression groundnut includes
groundnut kennel. If tax is levied at purchase point on groundnut, it is leviable
on groundnut kennel as well. Devar Oil Industries v. Dy. Commissioner of
Commercial Taxes, 1959 (10) STC 199.
(13) Cotton cloth includes dhothis and sarees: The expression cotton
cloth includes dhothis and sarees. Govt. of A.P. v. P. Venkata Subba Rao
and others, AIR 1960 AP 981 = 1960 (11) STC 561 = 1960 (2) An.WR
426.
(14) Manganese: The word manganese does not include manganese ore
from the scientific point of view, manganese ore contain manganese. Manganese
and manganese ore are two distinct and different commodities. State of A.P.
v. Satyanarayana Khaithan (P) Ltd., 1968 (2) An.WR 451=1968(20) STC
409.
(15) Millets not wheat: The word millets does not include wheat. P.
Subbaiah Chetty v. State of A.P., ILR 1962 AP 114.
(16) Cloth and tape: The word cloth can’t take in nawar tape. Subbaraju
v. State of Andhra, 1956 ALT 574 = 1956 An.WR 709 = AIR 1957 AP
890 = 1956 (7) STC 479.
(17) Jarda: Jarda being a variety of chewing tobacco exempted from
tax. J. Shamdas v. State of A.P., 1967 (19) STC 412.
(18) Insulated copper wire: Insulated copper wire comes under electrical
goods under Entry 38(1) and copper wire without insulation is taxable under
Section 5(1). State of A.P. v. Radiant Engg. Co., 1994 (3) ALT 30 (NRC).
(19) Cotton seed: Cotton seed is not cotton. Cotton seed taxed at sale
point is valid. Reasonableness or justification of the classification of goods
can’t be questioned. Kotak & Co. v. State of A.P., 1962 (13) STC 701.
(20) Parched rice and puffed rice: Parched rice and puffed rice do
not fall under Entry 66 as they are different from rice and taxable under
Section 5(1). M/s. Nooka Anjaiah v. Govt. of A.P., 1976 (2) An.WR 260.
(21) Cycle rickshaw tyres: Cycle rickshaw tyres are different from cycle
tyres. The rate of tax which applied to one will not apply to other. Shankar
Rubber Industries v. State of A.P., 1977 (1) (39) STC 415.
(22) Vim: Vim, a cleaning power is a soap falling under Entry 48 and
is taxable at the point of 1st sale. Hindusthan Agencies v. Commissioner,
1977 (2) (40) STC 348 = 1977 (2) An.WR 144.
(23) Nails: Nails do not fall within the description of wire to wire rods
given in clause 15 of item 2 of III Schedule. Therefore nails are taxable
under Section 5(1). M/s. Sri Venkata Durga Aluminising Works, Nandigama
v. State of A.P., 1986 (1) An.WR 344 = 1986 (63) STC 445.
(24) Bangles: Bangles are not glassware. Where glassware is taxable
differently bangles being not a glassware are assessable as general goods under
Section 5. Shankar Bangles Store v. State, 1976 ALT 156 (NRC).
(25) Dried coconuts: Dried coconuts are included in copra and copra
is an oil seed. M/s. Kuchi Rajeswara Shastry & others v. Asst. Commissioner,
1976 (37) STC 399 = 1976 (1) APLJ 80.
(26) Resin Cotton: Resin cotton comes within the meaning of cotton
fabrics and is exempt from tax under the APGST Act in view of Section
8(2A) of the Central Sales Tax Act. State of A.P. v. Radha Hinyal (P)
Ltd., TRC No. 270/90 dt. 10.09.1990.
(27) Central excise definition not binding: The definition of the word
Tobacco under item 4 of Sch. I to Central Excise and Salt Act, 1944 does
not bring tobacco seed within its purview. Therefore tobacco seed is not
exempted from levy of sales tax under APGST Act. Sikakollu Subba Rao
& Co. v. State of A.P., 1977 (1) An.WR 381.
(28) Crushed stocks of tobacco: The expression tobacco and also its
products includes crushed stalks of tobacco. K.V. Krishnaiah Chetty & Sons
v. Dy. Commercial Tax Officer, ILR 1964 AP 40.
(29) Skimmed Milk powder: Skimmed milk powder is nothing but
dehydrated form of pasteurised milk. 1998 (84) TRC 1966.
(30) Books: The word books does not include literary books. It only
means, all kinds of books such as and including account book. Books
containing reading material will not come under the scope of books.
Govindaswamy Binding Works v. State, 1971 (2) An.WR 444 = 1972 (29)
STC 219.
(31) Green ginger: Green ginger and garlic are not vegetables. G.
Srinivasulu v, State, 1972 (30) STC 120.
(32) Prawns are not fish: Prawns are different from fish. Where the
exemption notification does not cover prawns they can’t be exempted. TBR
Exports, Madras, Kakinada v. State of A.P, 1994 (1) An.WR 306.
(33) Leather cases : Leather cases used as radio covers taxable as radio
accessories and not leather goods. Pioneer Electronics v. State of A.P.,
1983 (54) STC 83.
(34) Accessory - meaning of: To bring an article within the meaning
of “accessory” of some other article, it has to be shown that it is an adjunct
or additional to that other or adds to the beauty, convenience or effectiveness
of that article. M/s. Coromandal Rubber Trades, Vijayawada v. Commissioner
of C.T.O., 1993 (2) An.WR 35.
(35) Distribution boxes: Distribution boxes manufactured and sold by

the assessee to the A.P. Electricity Board are accessories to the electrical
goods. M/s. Srirama Electric Co. v. State, 1976 ALT 87 (NRC).
(36) Robin Blue: Robin Blue does not perform the same function as
a soap. It does not clean the clothes it only adds brightness to the white
clothes. Therefore it is not a soap. Raja Agencies, Rajahmundry v. State
of A.P., 1983 (1) ALT 52 (NRC).
(37) Mineral water: Mineral mixture falls under poultry feed accordingly
exempt from tax. It can’t be taxed as general goods. State of A.P. v. J.K.
& Co., 1993 (1) ALT 12 (NRC).
(38) Readymade clothes are not textiles: All variety of textiles does not
include readymade clothes. M.A. Raheem v. Dy. Commissioner T.O., 1960
(11) STC 355.
(39) Chicks: Chicks are general goods and not livestock. Sri Venkataramana
Hatcheries v. C.T.O., 1987 (2) ALT 297.
(40) Here it may be borne in mind that we are considering the question
of Software in a limited sense in which it is used in the instructions issued
by the Commissioner of Commercial Taxes i.e. when Software is contained
in the Floppies and Disks. In our view, Software is as much good as music
on tapes, video or audio, paintings on paper or any other work of art inscribed
on any material things. When Floppies or Disks of branded software are sold
and purchased or the right to use the same is licensed identifiable commodities/
articles known to the market are dealt with but not the use of skill or labour
of the programmer.
The court further held from the above discussion it follows that Floppies/
Disks containing Software Programme like Oracle, Lotus, Masterkey, N-
Export, Ex-Unigraphic etc. are ‘goods’ are defined under Section 2(h) of the
APGST Act. Tata Consultancy Services v. State of A.P., 1997 (105) STC
421 (AP).
In the matter of applying appropriate rate, the court is guided by
classification made in the statute not on expert opinion or etymonological
meaning. Candid Industries v. Commissioner of Commercial Taxes & Another,
O.T.A. No. 2006, dt. 17-10-2006 (Karn.).
(41) Royalty for use of Trade Mark is taxable. Nutrine Confectionery
Company Pvt. Ltd., v. State of A.P., (2011) 52 APSTJ 37. It is taxable
as consideration received in respect of the transfer of the right to use goods.
——
ANDHRA PRADESH VALUE ADDED
TAX RULES, 2005
1
[G.O.Ms.No. 394, Rev. (CT-II) Dept. dt.31-3-2005]
CHAPTER I
In exercise of the powers conferred by Section 78 of the Andhra

Pradesh Value Added Tax Act, 2005, the Governor of Andhra Pradesh
hereby makes the following rules:–
RULES
1. These rules may be called the Andhra Pradesh Value Added Tax
Rules, 2005.
2. (i) Rules 1, 2(i), 3, 4, 5, 6, 8, 9, 10 and 11 will come in to force
with effect on and from the 31st January, 2005 and;
(ii) The remaining Rules shall come into force with effect from 1st
April, 2005.
3. Definitions:– In these rules, unless the context otherwise requires:
(a) ‘authority prescribed’ means the authority specified in Rule 59;
(b) ‘Assistant Commercial Tax Officer’ means any person appointed
by the Deputy Commissioner by name or by virtue of his office
to exercise the powers of an Assistant Commercial Tax Officer;
(c) ‘capital goods’ for the purpose of cancellation of registration shall
mean, any plant and machinery including computer systems for
the purpose of Rule 14 of these rules;
(d) ‘calendar quarter’ means a period of three months ending on
the 31st March, 30th June, 30th September and the 31st December;
(e) ‘exempted transaction’ shall mean the transfer of goods outside
the State by any VAT dealer otherwise than by way of sale;
2
[(f) ‘Form’ means a form appended to these rules and includes
electronic Form on the Commercial Taxes Department approved
internet or internet website to collect information;]
(g) ‘Government Treasury’ means a treasury or sub-treasury of the
State Government and includes any branch of any bank notified
by the Government from time to time;
1. Pub. in R.S. to Part–I, Ext.No. 29, dt. 20-4-2005.

2. Subs. by G.O.Ms.No. 1725, Revenue (CT-II), dt. 25-11-2006, w.e.f. 29-11-2006.
285
286 Commentary on A.P. Value Added Tax [R. 4
(h) ‘Section’ means a section of the Andhra Pradesh Value Added

Tax Act 2005.
(i) ‘tax fraction’ means the fraction calculated in accordance with
the formula;
r
————
r + 100
where ‘r’ is the rate of tax applicable to the taxable sale.
(j) ‘the Act’ means the Andhra Pradesh Value Added Tax Act 2005.
CHAPTER II
REGISTRATION
4. Procedure for Registration:– (1) Every dealer liable or who opts
to be registered under sub-sections (2) to (6) of Section 17, shall submit
an application for VAT registration in form VAT 100 to the authority
prescribed.
(2) Every dealer not registered or not liable to be registered for VAT
but liable to be registered under sub-section (7) of Section 17, shall submit
an application for TOT registration in form TOT 001 to the authority
prescribed.
(3) Every dealer registered under the Andhra Pradesh General Sales
Tax Act, 1957 whose taxable turnover exceeds rupees five lakhs for the
period from 1st day of January 2004 to 31st day of December 2004, who
is neither required to be registered for VAT nor opted to be registered
for VAT shall be deemed to be registered under sub-section (8) of Section
17.
(4) Every dealer who is allotted a Taxpayer Identification Number
(TIN) under Rule 28 of Andhra Pradesh General Sales Tax Rules 1957
as on the 31st March, 2005 shall be deemed to be registered as VAT
dealer if he is required to register as a VAT dealer under the provisions
of the Act.
(5) Where a dealer has more than one place of business within the
State, he shall make a single application in respect of all such places
specifying therein, one of such places as place of business for the purpose
of registration and submit it to the authority prescribed.
(6) Every dealer required to be registered under clause (c) of sub-
section (5) of section 17 shall authorize in writing on Form VAT 129 a
person residing in the State who shall be responsible for all the legal
obligations of the dealer under the Act.
1
[(7) Every dealer required to be registered under sub-sections (2), (3),
(5), (6)(a), (6)(b) and (7) of Section 17 of the Act shall obtain the Permanent
Account Number from the Income Tax Department and submit the details
thereof along with the application for Registration to the authority prescribed
together with the proof of the same.
1. Added by G.O.Ms.No. 1292, dt. 14-10-2010, w.e.f. 14-10-2010.
R. 5] A.P. Value Added Tax Rules, 2005 287
Provided that every dealer, who is already registered under the above
sub-sections of section 17 of the Act, as on the date of notification of this
Rule, shall, within sixty (60) days from such date, submit to the Commercial
Tax Officer, having jurisdiction over such dealer, the details of his Permanent
Account Number along with proof of the same duly obtaining it from the
Income Tax Department, if not already obtained.
Provided further that nothing in this sub rule shall apply to the dealers
specified in Explanation III under clause (10) of section 2 of the Act].
5. Time to apply for Registration:– (1)(a) Every dealer who is
required to register under sub-section (2) of Section 17, shall apply for
registration not later than fifteen days but not earlier than forty five days
prior to the anticipated date of the first taxable sale.
(b) Every dealer who is required to register under sub-section (3) of
Section 17 shall make an application by the 15th of the month subsequent
to the month in which the liability to register for VAT arose.
(c)(i) Every dealer who is required to register under sub-section (7) of
Section 17 shall make an application for registration fifteen days prior
to commencement of business, where his taxable turnover is estimated
to exceed rupees five lakhs in the next twelve consecutive months.
(ii) In the case of a dealer who is required to register under sub-section
(7) of Section 17 when his taxable turnover for the preceding twelve
months exceeded rupees five lakhs, the dealer shall make an application
by the fifteenth of the month subsequent to the month in which the
taxable turnover exceeded rupees five lakhs.
(2) Every dealer who is required to register under sub-section (5) of
Section 17 shall apply for registration fifteen days prior to the anticipated
date of first taxable sale but not earlier than forty five days prior to the
anticipated date of first taxable sale unless an application is made under
sub-rule (4).
(3) Any dealer effecting sales of goods liable to tax under this Act
may apply to register under clause (a) of sub-section (6) of Section 17
and such registration shall be subject to the conditions prescribed in rule
8.
(4) Any dealer intending to effect sales of goods liable to tax under
the Act may apply to register under clause (b) of sub-section (6) of Section
17 and such registration shall be subject to the conditions prescribed in
Rule 9.
Illustration of time to apply for Registration is given below:
Sl. Section Rule Type of Time to apply Example
No. in the registration
Act
1 17(2) 5(1)(a) New dealer Apply not later than - Expected date of
commencing 15 days but not taxable sale is
business earlier than 45 days 20.7.2005
prior to the Time to apply for
anticipated date of VAT registration is
first taxable sale between 5.6.2005
and 5.7.2005
1 2 3 4 5 6
th
2 17(3) 5(1)(b) Running Apply by the 15 of Liability to register
business (A the month for VAT arose on
TOT dealer subsequent to the 31.8.2005.
or month in which the Time to apply for
unregistered obligation/liability VAT registration is
dealer) to register for VAT on or before
arose. 15.09.2005.
Review the taxable
turnover for the
preceding 3 months
at the end of each
month
3 17(4) 4(4) Dealers No need to apply for Deemed
registered fresh VAT registration for
under registration VAT for those
APGST Act dealers who are
and allotted allotted TINs.
TIN.
4 17(5) 5(2) Dealers Apply for Expected date of
liable for registration not later transaction/first
VAT than 15 days but not taxable sale
registration earlier than 45 days 20.8.2005
irrespective prior to making sales Time to apply is
of taxable or transactions between 5.7.2005
turnover requiring VAT and 5.8.2005.
registration
5 17(6)(a) 5(3) Existing Since it is a ----
business voluntary
effecting registration, dealers
taxable sales can apply when they
& having no require VAT
liability to registration.
register for
VAT but
opting to
register for
VAT.
6 17(6)(b) 5(4) New No time limit. A dealer setting up
business a factory and
intending to anticipating first
effect taxable sale after,
taxable sales say, 20 months can
(start up apply any time.
business)
and
applying for
VAT
registration.
1 2 3 4 5 6
7 17(7) 5(1)(c)(i) New Apply for TOT Expected date of

business registration 15 days commencement of
who has a prior to business:
reason to commencement of 20.8.2005
believe that business.
Time to apply for
his taxable
TOT registration is
turnover in a
on or before
period of
05.08.2005.
next twelve
months will
exceed
Rs.5,00,000
and has no
obligation
for VAT
registration
8 17(7) 5(1)(c)(ii) Existing When taxable Taxable turnover

business turnover for the for preceding 12
which is preceding 12 months months exceeded
neither exceeded Rs.5,00,000 on
registered Rs.5,00,000 apply 31.7.2005
for VAT nor by 15th of the month Time to apply for
for TOT subsequent to the TOT registration
month in which the is 15.8.2005.
taxable turnover
exceeded Rs.5 lakhs Review the taxable
turnover for the
preceding 12
months at the end
of each month.
9 17(8) 4(3) Dealers No need to apply for Deemed

registered fresh TOT registration for
under registration. TOT
APGST Act
1957 and
had taxable
turnover
exceeding
Rs.5,00,000
but below
Rs.40,00,000
for the
period from
1.1.2004 to
31.12.2004
8)6`'
6. Effective date of Registration:– (1) The VAT registration shall

take effect,–
(a) from the first day of the month during which the first taxable
sale is declared to be made in the case of registration under sub-
section (2) of Section 17; or
(b) from the first day of the month subsequent to the month in which
the requirement to apply for registration arose in the case of
registration under sub-section (3) of Section 17; or
(c) from the date of commencement of the Act in the case of dealers
liable for VAT registration under sub-section (4) of Section 17;
(d) from the first day of the month in which the dealer becomes liable
for registration under sub-section (5) of Section 17; or
(e) in the case of a dealer in business opting for registration as a
VAT dealer under clause(a) of sub-section (6) of Section 17,–
(i) where the application is made, on or before the 15th of the month,
the effective date will be the 1st day of the month following the
month in which the application was made;
(ii) where the application is made, after the 15th of the month, from
the 1st day of the month following the month subsequent to the
month in which the application was made;
(f) from the 1st day of the month in which the dealer applied for
registration under clause(b) of sub-section (6) of Section 17;
(2) In the case of registration under sub-section (7) of Section 17,
the general registration for turnover tax shall take effect,–
(a) from the 1st day of the month during which business commenced
in the case of a dealer starting business and who does not register
for VAT, and who has no liability to register for VAT but whose
estimated taxable turnover is more than rupees five lakhs for the
following twelve consecutive months;
(b) from the first day of the month subsequent to the month in which
the obligation to apply for general registration arose in the case
of a dealer, whose taxable turnover exceeded rupees five lakhs
in a period of twelve consecutive months
(3) In the case of deemed registration under sub-section (8) of Section
17, the general registration shall take effect from the date of commencement
of the Act.
Illustrations for Effective Date of Registration (EDR) under this

Rule for Applications Received in time are given below :
Sl. Section in Rule Type of EDR Example

No. the Act registration
1 17(2) 6(1)(a) New dealer From the first day of Declared date of
commencing the month during taxable sale shown
business which the first is 20.7.2005.
taxable sale is
Applied for VAT
declared to be made.
registration on
3.7.2005.
EDR is 1.7.2005.
2 17(3) 6(1)(b) Existing From the first day of Liability for

business. (A the month registration arose
TOT dealer subsequent to the on 31.8.2005.
or month in which the
Applied for VAT
unregistered liability to apply for
registration on
dealer). registration arose.
11.9.2005
EDR is 1.10.2005
3 17(4) 6(1)(c) Dealers From 1.4.2005 Dealers who are

registered allotted Taxpayer
under Identification
APGST Act Numbers as on
and having 31.03.2005 are
liability to deemed to be
register for registered as VAT
VAT. dealers.
EDR is 01.04.2005
4 17(5) 6(1)(d) Dealers From the first day of Expected date of

liable for the month in which transaction/sale
VAT the dealer has under the Act is on
registration applied for VAT 20.08.2005.
irrespective registration.
Applied for VAT
of taxable
registration on
turnover
05.08.2005.
EDR is 01.08.2005
5 17(6)(a) 6(1)(e) Voluntary From the first day of Applied for VAT
registration the month following registration on
of a existing the month in which 10.08.2005
business application for
EDR is 01.09.05
registration is made
on or before the 15th
of the month.
1 2 3 4 5 6
From the first day Applied for

of the month VAT
following the registration on
month subsequent 30.08.2005
to the month in
EDR is
which application
01.10.2005.
for registration is
made after 15th of
month.
6 17(6)(b) 6(1)(f) New business From the first day Dealer setting
intending to effect of the month in up business on
taxable sales (Start which the dealer 20.7.2005.
up business) has applied for
Applied for
registration.
VAT
registration on
03.09.2005
EDR is
01.09.2005.
7 17(7) 6(2)(a) New dealer From the first day Business

commencing of the month commenced on
business and during which 20.08.2005.
estimating his taxable business
EDR is
turnover to exceed commenced.
01.08.2005.
Rs.5,00,000 for the
following 12
consecutive months
and not having a
liability for VAT
registration.
8 17(7) 6(2)(b) Existing business From the first day Taxable

whose taxable of the month turnover of
turnover exceeds subsequent to the Rs.5,00,000
Rs.5,00,000 in a month in which the exceeded on
period of 12 obligation to apply 31.7.2005.
consecutive months. for general
Liability to
registration arose.
apply for TOT
registration i.e.
on or before
15.8.2005
EDR is
01.09.2005.
9 17(8) 6(3) Deemed registration From 1.4.2005 EDR is

for TOT for existing 01.04.2005
registered dealers
under APGST Act
7. Belated application for Registration:– (1) In the case of belated

application for registration submitted after the time limit prescribed in Rule
5, registration shall take effect as below,–
(a) where the application was made in the month it was due or where
it is established by the authority prescribed in the same month
in which it was due, the effective date of registration will be the
first of the next month;
(b) where the application or detection was made in the subsequent
month following the month it was due, the effective date of
registration will be first of the month the application or detection
was made;
(c) where the application or detection was made in the months
subsequent to those defined in (a) and (b) of this sub-rule, the
effective date of registration will be first of the month in which
the application or detection was made.
Illustrations for Effective Date of Registration (EDR) under this
Rule for belated applications are given below :
Sl. Section Rule Type of EDR Example

No. in the registration
Act
1 17(10) 7(1)(a) Belated (i) Application or (i) Date of first

application detection in the taxable sale shown
for month in which the is 20.07.2005
registration application is due.
Applied for VAT/
for new
EDR will be the first TOT registration
dealers
day of the subsequent on 31.07.2005
commencing
month.
business and EDR is 1.08.2005
liable for (ii) Application or
7(1)(b) (ii) date of taxable
VAT or TOT detection in the
sale is 20.7.2005
registration following month
applied for VAT/
and dealers
EDR will be first day TOT registration
liable for
of the month. on 16.08.2005
VAT
7(1)(c) registration (iii)Application or EDR is 1.08.2005
irrespective of detection in the
(iii) date of first
taxable subsequent months.
taxable sale is
turnover. EDR will be first day 20.7.2005
of the month of
Applied for VAT/
application or
TOT registration
detection.
on 15.10.2005
EDR is 1.10.2005
1 2 3 4 5 6
2 17(10) 7(1)(a) Belated (i) Application or (i) Liability for
application detection in the VAT/ TOT on
for month in which the 31.8.2005
registration application was due. Applied for VAT/
for VAT or EDR will be first day TOT registration
TOT by of the subsequent on 25.09.2005
existing month.
dealers EDR is 1.10.2005
exceeding (ii) Application or (ii) Liability for
registration detection in the VAT/TOT on
threshold. following month in 31.8.2005.
which application
was due. Applied for
VAT/TOT
EDR will be first day registration on
of the month in 10.10.2005.
which the application
is received. EDR is 1.10.2005.
(iii) Application or (iii) Liability for
detection in the VAT/TOT on
subsequent months. 31.8.2005.
EDR will be first day Applied for
of the month in VAT/TOT
which application or registration on
detection was made. 19.12.2005
EDR is 1.12.2005.
8. Voluntary Registration:– (1) A VAT dealer registered under

clause (a) of sub-section (6) of Section 17 shall fulfil the following requirements
namely,–
(a) the dealer shall be making taxable sales;
(b) the dealer shall have a prominent place of business owned or
leased in his name;
(c) the dealer shall have a bank account;
(d) the dealer shall not have any tax arrears outstanding under The
Andhra Pradesh General Sales Tax Act, 1957 or The Central Sales
Tax Act, 1956 or under the Act.
(2) A VAT dealer registered under clause (a) of sub-section (6) of
Section 17, shall,–
(a) maintain the full records and accounts required for VAT;
(b) file accurate and timely VAT returns and pay any tax due;
(c) remain registered for 24 months from effective date of registration.
(3) Where VAT dealer registered under clause (a) of sub-section (6)
of Section 17 fails to file timely tax returns and fails to pay any tax due
and his taxable turnover remains under the limits specified in sub-sections
(2) and (3) of Section 17, the authority prescribed shall cancel such
registration after giving the VAT dealer the opportunity of being heard.
9. Start up Business:– (1) A dealer intending to set up a business
in taxable goods who does not anticipate making first taxable sale within
the next three months and applying for VAT registration shall be treated
as a start up business.
(2) The dealer referred to in sub-rule (1) shall make an application
on Form VAT 104 in addition to Form VAT 100 to the authority prescribed.
(3) The dealer applying for registration as a start-up business under
clause (b) of sub-section (6) of Section 17 may apply to be registered only
for a period of twenty four months prior to making taxable sales.
(4) The dealer registered as a start up business under clause (b) of
sub-section (6) of Section 17 may claim a tax credit on each tax return
for a maximum period of twenty four months prior to making taxable sales.
The input tax claimed must be in respect of tax paid on inputs relating
to the prospective taxable business activities. The credit shall be eligible
for refund under the provisions of Section 38. The provisions of sub-section
(1)(b) of Section 38 shall apply only from the tax period in which the first
taxable sale was made.
(5) The dealer registered as a start up business under clause(b) of
sub-section (6) of Section 17 shall abide by all the requirements and
obligations of a VAT dealer including the proper keeping of books of
accounts and regular filing of returns.
(6) A dealer shall cease to be registered under the provisions of clause
(b) of sub-section (6) of Section 17 and shall become registered under the
provisions of sub-section (1) of Section 17, when that dealer makes a taxable
sale in the course of business.
(7) A dealer shall cease to be registered under the provisions clause
(b) of sub-section (6) of Section 17 at the end of a twenty four months
period from the date of registration if no taxable sale has been made. In
such a case, the registration will be cancelled under the provision of Rule
12.
(8) The Deputy Commissioner may at his discretion, where there are
reasonable grounds, vary the conditions under sub-rules (3), (4), (6) and
(7) and may grant a further time upto twelve months for making the first
taxable sale and to continue as start up business.
10. Issue of Certificates:– The authority prescribed shall issue,–

(a) a certificate of VAT registration on Form VAT 105; or
(b) in the case of a Start–up business, a notice on Form VAT 106
in addition to Form VAT 105;
(c) in the case of TOT dealer, a certificate of TOT registration on
Form TOT 003.
11. Suo-moto registration and refusal to register:– (1) The authority
prescribed may register a dealer who, in the opinion of that authority, is
liable to apply for registration as VAT dealer or a TOT dealer as the case
may be, but has failed to do so. The dealer shall be provided with an
opportunity to state his case before registration is effected. A registration
under this subrule shall be issued on Form VAT 111 or on Form TOT
005, as the case may be.
(2) Where the authority prescribed is not satisfied with the information
furnished by the applicant and has reasons to believe that the applicant
does not meet the requirements for registration as VAT dealer or TOT
dealer he shall provide an opportunity specifying the reasons for refusal
before passing any orders for refusal to issue registration. A notification
under this rule shall be issued on Form VAT 103 or on Form TOT 017,
as the case may be.
12. Certificate of Registration:– (1) The certificate of VAT registration
or TOT registration shall be displayed in a conspicuous place at the place
of business mentioned in such certificate and a copy of such certificate
shall be displayed in a conspicuous place at every other place of business
within the State.
(2) No certificate of registration issued shall be transferred.
(3) Where the certificate of registration issued is lost, destroyed,
defaced or mutilated a duplicate of the certificate shall be obtained from
the authority prescribed.
13. Changes in Registration Details:– (1) A dealer registered under
Section 17 shall notify the authority prescribed in writing on Form VAT
112 or on Form TOT 051 as the case may be, within fourteen days,–
(a) of any change in the name, address, of the place of business or
branches or discontinuation of the business;
(b) of a change in circumstances of the dealer which leads to cessation
of business;
(c) of a change in business activities or in the nature of taxable sales

being made or principal commodities traded.;
(d) of any changes in the constitution of the firm;
(e) of a change in bank account details;
(f) when a dealer commences or ceases to execute works contract
for State Government or local authorities.
(2) Where changes in the status of business occur an application shall
be made for fresh registration.
(3)(a) where a dealer intends to change his place of business from
the jurisdiction of one authority to the jurisdiction of another authority in
the State, he shall make an application on Form VAT 112 or on Form
TOT 051 as the case may be, with full particulars relating to the change
of address and the reasons for such change, to the authority prescribed.
(b) the authority prescribed receiving an application on Form VAT
112 or on Form TOT 051 as the case may be for a change of
place of business shall, on approval of the application, remove
such registration from the existing registration records. The
registration file and the application shall be transferred to the
authority prescribed in whose jurisdiction the proposed new place
of business is sought to be established.
(c) The authority prescribed receiving the registration file shall add
the details to the records of that authority, and issue a new
certificate of VAT registration, with the existing TIN and in
respect of a TOT dealer, a new General Registration Number shall
be issued wherever necessary;
(d) the change in a place of business and a change in business
activities shall not in itself, result in cancellation and fresh
registration of a VAT dealer.
14. Procedure for Cancellation of VAT Registration:– (1) Where
a VAT dealer ceases to carry on business, that dealer or his legal representative
shall apply to the authority prescribed for cancellation of registration within
fourteen days of the closure of business.
(2) Subject to sub-rule (3), a VAT dealer may apply in writing on
Form VAT 121 to have his VAT registration cancelled if,–
1
[(a) [xxx]
1. Clause 'a' omitted by G.O.Ms.No.503, Rev. CT-II Dept. dt. 8-5-2009, w.e.f. 1-5-2009,
prior to its omission it read as below:
(a) with respect to the most recent period of three consecutive calendar months, the
taxable turnover did not exceed rupees ten lakhs; and.
(b) the taxable turnover for the previous twelve consecutive calendar
months did not exceed rupees thirty lakhs.
(3) In the case of a VAT dealer making taxable sales, who is registered
under clause(a) of sub-section (6) of Section 17, an application under sub-
rule (2) shall only be made after the expiration of twenty four months from
the date of registration.
(4) Every VAT dealer whose registration is cancelled under this rule
shall pay back input tax credit availed in respect of all taxable goods on
hand on the date of cancellation. In the case of capital goods on hand
on which input tax credit has been received, the input tax to be paid back
shall be based on the book value of such goods on that date:
Provided that in respect of transfer of a business to another VAT
dealer, there shall be no requirement to repay the input tax credit availed
on capital goods and other goods.
(5) The authority prescribed may cancel the registration of a VAT
dealer who has applied for cancellation under sub-rule (1) or sub-rule (2)
if it is satisfied that there are valid reasons for such cancellation of
registration. The cancellation shall be intimated on Form VAT 124.
dealer who has not applied for cancellation of registration if the authority
prescribed is satisfied that the dealer is not entitled for registration under
Section 17 or found to be not complying with the provisions of the Act.
(7) The authority prescribed shall intimate on Form VAT 123 to a
VAT dealer when refusing to cancel the registration of the dealer under
this rule within fourteen days of receipt of Form VAT 121.
(8) The authority prescribed shall issue a notice on Form VAT 125
to a VAT dealer before compulsorily cancelling the registration.
dealer registered under sub-section (6) of Section 17 where the VAT dealer–
(a) has no fixed place of abode or business; or
(b) has not kept proper accounting records relating to any business
activity carried on by him; or
(c) has not submitted correct and complete tax returns;
(10) The cancellation of registration shall take effect from the end
of the tax period in which the registration is cancelled unless the authority
prescribed orders the cancellation to take effect at an earlier date.
(11) The cancellation of a registration of any VAT dealer shall not

affect any liabilities under the Act or any requirement to comply with any
provisions of the Act until the date of cancellation of registration.
(12) Wherever any order of cancellation or refusal to cancel is made,
the VAT dealer shall be given an opportunity of being heard.
15. Procedure for cancellation of TOT registration:– (1) Where
a TOT dealer ceases to carry on business, that TOT dealer or his legal
representative shall apply to the authority prescribed on Form TOT 014
for cancellation of general registration within fourteen days of the closure
of business.
(2) A TOT dealer may apply for cancellation of his general registration
at the end of any period of twelve consecutive months if his taxable turnover
for that period does not exceed rupees three lakhs seventy five thousands
(Rs. 3,75,000/-).
(3) The authority prescribed shall issue an order of cancellation of
registration on Form TOT 015 to the TOT dealer who has applied for
cancellation, if satisfied that there are valid reasons for such cancellation
of registration.
(4) The authority prescribed shall issue an order on Form TOT 016
to a TOT dealer, when refusing to cancel the general registration number.
(5) The authority prescribed shall issue a notice on Form TOT 013
to a TOT dealer before compulsorily cancelling the general registration.
(6) Cancellation of general registration shall take effect from the end
of the month in which the general registration is cancelled, unless the
authority prescribed orders the cancellation to take effect from an earlier
date.
(7) The cancellation of a registration of any TOT dealer shall not
affect any liabilities under the Act or any requirement to comply with any
provisions of the Act until the date of cancellation of registration.
(8) Wherever any order of cancellation or refusal to cancel an
application is made, the TOT dealer shall be given an opportunity of being
heard.
CHAPTER III
DETERMINATION OF TAXABLE TURNOVER AND CALCULATION
OF TAX PAYABLE
16. Determination of Taxable Turnover:– (1) Time of Sale:–

(a) a VAT dealer selling taxable goods shall account for the VAT
at the earliest of the date of delivery of the goods or the issue
of tax invoice;
(b) input tax credit shall only be claimed on receipt of the tax invoice.
(2) The following amounts shall not be included for the purpose of
determining the taxable turnover, namely,–
(a) all amounts allowed as discount provided such discount is allowed
in accordance with the regular practice of the VAT dealer, or
is in accordance with the terms of a contract or agreement entered
into in a particular case and provided also that accounts show
that the purchaser has paid only the sum originally charged less
the discount;
(b) all amounts charged separately as interest or as finance charges
in the case of a hire-purchase transaction or any system of
payment by instalments.
1
[(c) all amounts, forming part of the sale price on account of any
incentives, sanctioned or ordered specifically or in general by either
the Government of Andhra Pradesh or the Government of India
with a view to extend any specific benefit to the agricultural
farmers, subject to the guidelines issued by the Commissioner
thereof.
(d) amount of additional trade margin of 2[12.5%] charged by the
Andhra Pradesh Beverages Corporation Limited to pay as special
privilege fee on the sale of IMFL in the State;
(e) Retailers margin at the retail out lets run by Andhra Pradesh
Beverages Corporation Limited the special margin collected by the
Andhra Pradesh Beverages Corporation Limited and credited to
the Government on account of rounding up of the Maximum Retail
Price to nearest rupee for each bottle.]
(3) An adjustment of sale price and VAT or any other tax can be
made in relation to a taxable sale where,–
(a) the sale is cancelled;
(b) the nature of the sale has been fundamentally varied or altered;
or
(c) the previously agreed consideration for the sale has been altered
by agreement with the recipient, whether due to an offer of a
discount or for any other reason; or
(d) the goods or part thereof have been returned to the seller within
a period of twelve months from the date of sale and the dealer
making the sale has accepted the return of the goods:
1. Subs. for clauses (c), (d) and (e) by G.O.Ms.No.1116, Rev.(CT-II), Dept.
dt. 20-8-2007, w.r.e.f. 1-9-2006.
2. Subs. for "10%" by G.O.Ms.No.1541, Rev.(CT-II), Dept. dt. 18-12-2007.
In the case of the events listed in clauses (a) to (d) where a

tax invoice or an invoice has not yet been issued, the sale price
shall be adjusted in the tax invoice or in the invoice. Where a
tax invoice or invoice has been issued, a credit or debit note shall
be used to adjust the tax invoice or invoice in accordance with
Rule 28.
(e) where any goods sold before 31.03.2005 are returned on or after
01.04.2005 and sales tax relief on closing stocks was already
claimed by the buying VAT dealer, an amount equal to the
purchase value of the goods and the sales tax credit claimed shall
be deducted from the value of the input and the value of input
tax in the tax period in which goods are returned by him provided
credit note issued by the seller is on hand. The selling VAT dealer
in such case may reduce his output value and output tax equal
to the original sale value and the sales tax in the return for the
tax period during which the goods have been returned.
1
[(f) wherever any credit notes are to be issued for discounts or sales
incentives by any VAT dealer to another VAT dealer after issuing
tax invoice, the selling VAT dealer shall pass a credit note without
disturbing the tax component on the price in the original tax invoice,
so as to retain the quantum of input tax credit already claimed
by the buying VAT dealer as well as not to disturb the tax already
paid by the selling VAT dealer.
For example:– If 100 TVs are sold @ Rs. 10,000/- each, amounting
to Rs. 10,00,000/-, the original tax charged @ 2[14.5%] is 3[Rs.1,45,000].
If the discount of 10% is offered subsequently based on fresh purchases,
the selling dealer can pass on the benefit of Rs. 1,00,000/- for the price
without disturbing the tax component of 3[Rs.1,45,000/-]. The buying dealer
will not alter the input tax credit already claimed amounting to 3[Rs.1,45,000].
The selling VAT dealer will not claim reduction in output tax liability
consequent to lowered price offered.]
(4) Where the output tax properly due in respect of the sale exceeds
the output tax actually accounted for by the VAT dealer making the sale,
the amount of the excess shall be regarded as tax charged by the VAT
dealer in relation to a taxable sale made in the tax period in which the
adjustment took place.
(5) Where the output tax actually accounted for exceeds the output
tax properly due in relation to that sale, the VAT dealer making the sale
shall be eligible for an adjustment of excess amount of VAT in the tax
period in which the adjustment took place:
Provided that no such adjustment shall be allowed where the sale has
been made to a person who is not a VAT dealer unless the amount of
1. Added by G.O.Ms.No. 2201, Revenue (CT-II) Dept., dt. 29-12-2005, w.e.f. 1-12-2005.
2. Subs. for "12.5%" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,
w.r.e.f. 15-1-2010.
3. Subs. for "1,25,000/-" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,
w.r.e.f. 15-1-2010.
the excess tax has been repaid by the VAT dealer to the recipient, whether
in cash or as a credit against any amount owing by the recipient.
(6) The provisions of sub-rules (1) to (5) shall mutatis-mutandis apply
to TOT dealer.
(7) In case of a VAT dealer specified in sub-section (9) of Section
4, forty percent (40%) of the total amount of consideration charged by
such dealer shall be allowed as deduction and the balance of sixty percent
(60%) of the total amount of consideration shall be the taxable turnover
for the purpose of levy of tax by way of composition.
17. Treatment of works contracts:– (1) Treatment of VAT dealer
executing works contract–
(a) In the case of contracts not covered by sub-rules (2), (3) and
(4) of this Rule, the VAT dealer shall pay tax on the value of
the goods at the time the goods are incorporated in the work at
the rates applicable to the goods.
(b) In such a case the VAT dealer shall be eligible to claim input
tax credit on ninety percent (90%) of the tax paid on the goods
purchased other than those specified in sub-rule (2) of Rule 20
and shall be eligible to issue a tax invoice.
1
[(c) Where a VAT dealer mentioned in clause (a) awards any part of
the contract to a registered sub-contractor, no tax shall be payable
on the consideration paid for the sub-contract.]
(d) The value of the goods used in execution of work in the contract,
declared by the contractor shall not be less than the purchase
value and shall include seigniorage charges, blasting and breaking
charges, crusher charges, loading, transport and unloading charges,
stacking and distribution charges, expenditure incurred in relation
to hot mix plant and transport of hot mix to the site and distribution
charges.
(e) Subject to clause (d) the following amounts are allowed as deductions
from the total consideration received or receivable for arriving the
value of the goods at the time of incorporation,–
(i) Labour charges for execution of the works;
(ii) Charges for planning, designing and architect’s fees;
(iii) Charges for obtaining on hire or otherwise machinery and tools
used for the execution of the works contract;
(iv) Cost of consumables such as water, electricity, fuel, etc., used
in the execution of the works contract, the property in which is
not transferred in the course of execution of a works contract;
(v) Cost of establishment of the contractor to the extent it is relatable
to supply of labour and services;
1. Subs. by G.O.Ms.No.1116, Rev.(CT-II), Dept. dt. 20-8-2007, w.r.e.f. 1-9-2006.
(vi) Other similar expenses relatable to supply of labour and services;

(vii) Profit earned by the contractor to the extent it is relatable to supply
of labour and services;
1
[(viii) amounts paid to a sub contractor as consideration for the execution
of works contract whether wholly or partly;
Provided that the contractor VAT dealer shall arrive at the value of
goods at the time of incorporation, tax rate wise, from out of the
taxable turnover arrived at as above, on prorata basis taking the ratio
of value of goods liable to tax at different rates against the total value
of purchases relating to such contract.
Provided further that, subject to the filing of returns and payment of
tax as per clause (d), the VAT dealer shall pay the balance amount of
tax arrived at by following this clause at the time of finalization of
accounts relating to the particular work. Such additional taxable
turnover and taxes payable shall be declared in the return for the
month in which accounts are finalized.]
(e) Subject to clause (d) the following amounts are allowed as deductions
from the total consideration received or receivable for arriving the
value of the goods at the time of incorporation,-
2
[(f) Where tax has been deducted at source, the contractor VAT
dealer shall obtain Form 501A with unique form ID from the
Assistant Commissioner /Commercial Tax Officer concerned and
supply the same to the contractee. The contractee shall complete
the Form 501A with required information and supply the same
to the contractor within fifteen days after the end of the month
in which the deduction is made. The contractor VAT dealer shall
submit the Form 501A along with the tax return.]
(g) Where the VAT dealer has not maintained the accounts to
determine the correct value of the goods at the time of incorporation
he shall pay tax at the rate of 3[fourteen and a half percent
(14.5%)] on the total consideration received or receivable subject
to the deductions specified in the table below: In such cases the
contractor VAT dealer shall not be eligible to claim input tax credit
and shall not be eligible to issue tax invoices.
4
(h) Where any tax is deducted under sub-section (3) of section 22
in respect of any dealer executing works contracts and work in
whole or any part of such work is awarded to a registered sub-
contractor by him, the tax proportionate to the amounts paid as
1. Added by G.O.Ms.No.1116, Rev.(CT-II), Dept. dt. 20-8-2007, w.r.e.f. 1-9-2006.

2. Subs. by Ibid.
3. Subs. for "twelve and a half percent (12.5%)" by G.O.Ms.No.1292, Rev. (CT-II)
Dept., dt. 14-10-2010, w.r.e.f. 15-1-2010.
consideration to the sub-contractor out of the tax deducted by the

contractee shall be transferred to the sub-contractor by issuing
Form 501B to the registered sub-contractor. The sub-contractor
shall file Form 501B to the authority prescribed along with the
return in Form VAT 200.]
Standard Deductions for Works Contracts
Sl. No. Type of contract Percentage of the total
value eligible for
deduction
1. (a) Electrical Contracts
(i) H.T. Transmission lines Twenty percent
(ii) Sub-station equipment Fifteen percent
(iii) Power house equipment and extensions Fifteen percent
(iv) 11 and 22 KV and L.T. distribution lines Seventeen percent
12+5
(v) All other electrical contracts Twenty five percent
(b) All structural contracts Thirty five percent
2. Installation of plant and machinery Fifteen percent
3. Fixing of marble slabs, polished granite
stones and tiles (other than mosaic tiles) Twenty five percent
4. Civil works like construction of buildings,
bridges, roads, etc. Thirty percent
1
[4(a) Design, fabrication and installation of
centralized Air-conditioning plant,
Air Handling units, Refrigeration plants
and any other Heating, Ventilating and
Air Conditioning systems. Five percent]
5. Fixing of sanitary fittings for plumbing,
drainage and the like Fifteen percent
6. Painting and polishing Twenty percent
7. Laying of pipes Twenty percent
8. Tyre re-treading Forty percent
9. Dyeing and printing of textiles Forty percent
10. Printing of reading material, cards,
pamphlets, posters and office stationery Forty percent
11. All other contracts Thirty percent
2
[(2) Treatment of works contracts executed for State Government or
Local Authority under composition:
1. Ins. by G.O.Ms.No. 503 Rev. (CT-II), Dept. dt. 8-5-2009, w.e.f. 1-5-2009.
2. Subs. by G.O.Ms.No.1116, Rev.(CT-II), Dept. dt. 20-8-2007, w.r.e.f. 1-9-2006.
(a) Where a dealer executes any works contract exceeding a value

of Rs. 5,00,000 (Rupees five lakhs only) awarded either by a
State Government Department or Local Authority, he must register
himself as a VAT dealer:
(b) The VAT dealer opting to pay tax by way of composition under
clause (b) of sub-section (7) of Section 4 shall apply for composition
in Form VAT 250, before commencement of execution, for each
work or works or category of works he intends to do so and
shall be liable to pay tax at the rate of four percent (4%) on
the total value of the contract. A consolidated Form VAT 250 can
be filed by the contractor for multiple works contracts of similar
nature.
(c) Where tax deduction at source is made, the contractor VAT dealer
shall obtain Form 501 with unique form ID from the Assistant
Commissioner/Commercial Tax Officer concerned and supply the
same to the contractree Government Department or Local Authority.
The contractee Government Department or Local Authority shall
complete Form 501 supplied by the contractor indicating the TIN
of the contractor,; the amount of tax deducted at source and details
of the related contract and supply the same to the contractor within
fifteen days from the end of the month in which the deduction
of tax at source is made.
(d) The contractor VAT dealer shall declare on the VAT Form 200
the amount received or receivable and the tax due on that amount;
(e) The contractor shall submit Form 501 certified by the contractee
together with Form VAT 200 for the month in which payments
was received or receivable whichever is earlier. In case the
contractor fails to submit the Form 501 along with the return, he
shall pay the tax due on the return;
(f) Where the contractee Government Department or local authority
fails to remit such tax deducted at source within fifteen days from
the date of each payment made to the contractor the authority
concerned shall be liable to pay interest for the delayed payment;
(g) In the case of the execution of any works contract for the State
Government or local authority where the dealer has opted to pay
tax by way of composition under clause (b) of sub-section (7)
of Section 4, such VAT dealer shall not be eligible to claim input
tax credit;
(h) Where a VAT dealer mentioned in clause (a) awards any part
of the contract to a registered sub-contractor, no tax shall be
payable on the turnover relating to amounts paid to the sub-
contractor as consideration for the execution of works contract
whether wholly or partly;
(i) Where any tax is deducted under sub-section (3) of section 22
VAT–20

consideration to the registered sub-contractor out of the tax deducted
by the contractee shall be transferred to the registered sub-
contractor by issuing Form 501B to the registered sub-contractor.
The registered sub-contractor shall file Form 501B to the authority
prescribed along with the return in Form VAT 200].
1
[(j) Where tax is collectable at source as per sub-section (3-A) of
Section 22 of the Act, in case of a contractor who have opted
for payment of tax by way of composition, tax @4% on the total
value of the contract shall be collected and remitted by the
contractee within fifteen days from the date of each payment made
to the contractor.]
(3) Treatment of works contracts (other than for State Government
or Local Authority) under composition,–
(a) Any VAT dealer who executes a contract and opts to pay tax
as specified in clause (c) of sub-section (7) of Section 4 must
register himself as a VAT dealer;
2
[(b) The VAT dealer mentioned in clause (a) above shall pay tax at
the rate of four percent (4%) of the total consideration received
or receivable 3[whichever is earlier.]]
(c) In the case where the VAT dealer opts for composition he shall,
before commencing the execution of the work notify the prescribed
authority on Form VAT 250 of the details including the value of
the contract on which the option has been exercised, 4[xxx].
3
[Provided that a consolidated Form VAT 250 can be filed by the
contractor who undertakes multiple works contracts of similar nature.]
(d) On receipt of any payment related to the contract, the contractor
VAT dealer shall calculate the tax due at four percent (4%)
5
[xxx] of the amount received and shall enter such details on
Form VAT 200. The tax due shall be paid with the return
Form VAT 200;
6
[(e) The contractor VAT dealer shall obtain Form 501 A with unique
form ID from the Assistant Commissioner/Commercial Tax Officer
1. Added by G.O.Ms.No. 503, Rev. (CT-II) Dept., dt. 8-5-2009, w.e.f. 1-5-2009.
2. Subs by G.O.Ms.No. 1614 Rev. (CT-II) Dept., dt. 31-8-2005.
4. The words "and when the VAT dealer opts to withdraw from composition, he shall
notify the prescribed authority on Form VAT 250A." Omitted by G.O.Ms.No.503,
Rev. (CT-II), Dept., dt. 8-5-2009, w.e.f. 1-5-2009.
5. The words "of fifty percent (50%)" omitted G.O.Ms.No. 1614 Rev. CT-II Dept.,
dt. 31-8-2005.
6. Subs. by G.O.Ms.No.1116, Rev.(CT-II), Dept. dt. 20-8-2007, w.e.f. 1-9-2006.
concerned and supply the same to the contractee. The contractee

shall complete Form 501 A supplied by the contractor indicating
the TIN of the contractor, the amount of tax deducted at source
and details of the related contract;]
(f) The contractor VAT dealer shall not be eligible for input tax credit
and shall not be eligible to issue tax invoices;
1
[(g) Where a VAT dealer mentioned in clause (a) awards any part
of the contract to a registered sub-contractor, no tax shall be
payable on the turnover relating to amounts paid to the sub-
contractor as consideration;]
(h) 2[xxx]
3
[(i) Where the contractee fails to remit such tax deducted at source
within fifteen days of the date of payment to the contractor the
person authorized to make payment and to deduct tax shall be
liable to pay interest for the delayed payment;
(j) Where any tax is deducted under sub-section (3) of section 22
consideration to the registered sub-contractor out of the tax deducted
by the contractee shall be transferred to the registered sub-
contractor by issuing Form 501B to the registered sub-contractor.
The registered sub-contractor shall file Form 501B to the authority
prescribed along with the return in Form VAT 200.]
(4) Treatment of Apartment Builders and Developers under composition,–
(a) Where a dealer executes a contract for construction and selling
of residential apartments, houses, buildings or commercial complexes
and opts to pay tax by way of composition under clause (d) of
sub-section (7) of Section 4, he must register himself as a VAT
dealer;
(b) The VAT dealer shall notify the prescribed authority on Form VAT
250, of his intention to avail composition for all works specified
in clause (a) above, under taken by him;
(c) 4[xxx]

2. Omitted by G.O.Ms.No. 1116 Rev. (CT-II) Dept., dt. 20-8-2007, Prior to its omission
it read as below :
"In case of a contractor mentioned in clause (a) above, where any tax is deducted under
sub-section (4) of the Section 22, no refund of such tax deducted shall be allowed to
the contractor;"
4. Cl. 'c' omitted by G.O.Ms.No. 503, Rev.(CT-II), Dept. dt. 8-5-2009, w.e.f. 1-5-2009,
prior to its omission it read as below:
"When the VAT dealer opts to withdraw from composition, he shall notify the
prescribed authority on Form VAT 250A."
1
[(d) The VAT dealer shall have to pay tax by way of composition
at the rate of four percent (4%) on twenty five percent (25%)
of the total consideration received or receivable towards cost of
land as well as construction or the market value fixed for the
purposes of stamp duty, whichever is higher and the balance
seventy five percent (75%) of the total consideration received or
receivable shall be allowed as deduction for the purpose of
computation of taxable turnover;]
(e) On receipt of any payment related to the contract, the contractor
VAT dealer shall calculate the tax due at four percent (4%) of
twenty five percent (25%) of the amount received and shall enter
such details on Form VAT 200. The tax due shall be paid with
the return Form VAT 200;
(f) The contractor VAT dealer shall not be eligible for input tax credit
and shall not be eligible to issue tax invoices;
(g) Where the contractor VAT dealer specified in clause (f) above,
awards any portion of his contract to a sub-contractor, such
contractor shall not be eligible for any deduction relating to the
value of the sub-contract.
2
[xxx]
(h) Where any dealer mentioned in clause (a) opted for composition
and paid any tax under the provisions of APGST Act 1957, before
30.04.2005, there shall be no further liability in respect of the built
up area for which tax has already been paid under APGST Act,
provided the sale deed is executed in respect of such built up
area before 30-9-2005.
3
[(i) The VAT dealer mentioned in clause (a) above shall pay an
amount equivalent to one percent (1%) of the total consideration
received or receivable or the market value fixed for the purpose
of stamp duty, whichever is higher. This payment shall be made
by way of a demand draft obtained in favour of the Commercial
Tax Officer or Asst. Commissioner concerned and the instrument
is to be presented at the time of registration of the property to
the Sub-Registrar, who is registering the property, duly furnishing
his TIN (Tax payer Index Number) and the full postal address
of the CTO Asst.Commissioner concerned on the reverse of the
D.D. The Sub-Registrar, shall then send the same to the CTO/
Asst. Commissioner concerned every week.]
(5)(a) Where the contractor is a TOT dealer as specified in
clause(e) of sub-section (7) of Section 4, he shall pay tax at the rate of
one percent (1%) on the value of the goods at the time of their incorporation
in the execution of the contract.
1. Subs. by G.O.Ms.No. 503, Rev.(CT-II), Dept. dt. 8-5-2009, w.e.f. 1-5-2009.
2. Omitted by G.O.Ms.No. 1614 Rev. (CT-II) Dept., dt. 31-8-2005 Prior to its omission
it read as below :
"The sub-contractor if he is a VAT dealer, in such a case may either opt for composition
under clause (d) of sub-section (7) of Section 4, or pay tax under clause (a) of sub-
section (7) of Section 4."
3. Added by G.O.Ms.No. 1614 Rev. (CT-II) Dept., dt. 31-8-2005.
(b) Where the TOT dealer has not maintained the accounts to determine
the correct value of the goods at the time of incorporation he
shall pay tax at the rate of one percent (1%) on the total
consideration received or receivable subject to the following
deductions;
(i) Labour charges for execution of the works;
(ii) Charges for planning, designing and architect’s fees;
(iii) Charges for obtaining on hire or otherwise machinery and tools
(iv) Cost of consumables such as water, electricity, fuel, etc., used
in the execution of the works contract, the property in which is
not transferred in the course of execution of a works contract;
(v) Cost of establishment of the contractor to the extent it is relatable
(vi) Other similar expenses relatable to supply of labour and services;
(vii) Profit earned by the contractor to the extent it is relatable to supply
1
(c) [xxx]
18. 2[(1)] Tax deduction at source.
3
[(a) The tax deduction at source shall be in general at the rate of
either 4% or 2% as prescribed in sub-clause (i) or (ii) respectively
of clause (b) below and it shall be based on adoption of 70%
of the total consideration payable for the execution of works
contract as taxable turnover unless an application has been made
by the dealer to the Assistant Commissioner or Commercial Tax
Officer concerned for specific quantification or provisional
assessment to determine the correct amount of taxable turnover
for a specific contract or agreement.
(b) the rate of tax for the purpose of tax deduction at source shall
be as prescribed below :
(i) All categories of contracts not 4% of 70% of the
falling in sub-clauses (ii) amount payable as
mentioned below. consideration for the
execution of work.
(ii) Contracts for laying or repairing or 2% of 70% of the
roads and contracts for canal amount payable as
digging, lining and repairing. consideration for the
execution of work. ;
1. Omitted by G.O.Ms.No. 1116 Rev. (CT-II) Dept., dt. 20-8-2007, Prior to its omission
it read as below :
"Where any tax is collected or deducted at source under sub-section (3) or (4) of Section
22, such tax collected or deducted shall not be refunded to the contractor TOT dealer;"
2. Renumbered by G.O.Ms.No. 88, Rev. (CT. II) Dept., dt. 27-1-2007, w.r.e.f. 1-9-2006.
3. Subs. for clauses (a) and (b) by Ibid.
(bb) The contractee shall complete Form VAT 501A supplied by the
contractor indicating the TIN, the amount of tax deducted and
details of the related contract. The Contractor, VAT dealer shall
submit the Form VAT 501A to the authority prescribed along with
the return in Form VAT 200;]
(c) Where the VAT dealer has opted to pay tax by way of composition,
he shall declare on the Form VAT 200 the value of the amount
received and the tax due. The amount of tax deducted by the
Contractee should be declared on Form VAT 501A and any
balance of tax payable shall be paid by the contractor. In the
case where the amount of TDS exceeds the liability the prescribed
authority shall issue a notification for a credit to be claimed on
the Form VAT 200.
(d) Where the VAT dealer pays tax on the value of the goods
incorporated in the contract he shall declare on Form VAT 200
the value of the goods and tax due on the goods incorporated
in the contract. The appropriate adjustment for the tax deducted
by the Contractee shall be carried out as in clause (c) ;
1
[(e) Where any tax is deducted under sub-section (3) in respect of
any dealer executing works contracts and work in whole or any
part of such work is awarded to a sub-contractor by him, the
tax proportionate to the amounts paid as consideration to the sub-
contractor out of the tax deducted by the contractee shall be
transferred to the sub-contractor by issuing Form 501B to the sub-
contractor. The sub-contractor shall file Form 501B to the authority
prescribed along with the return in Form VAT 200 ;
(f) The application to be made for quantification or provisional
assessment to determine the taxable turnover shall be in Form
501C and the order to be passed by Assistant Commissioner or
the Commercial Tax Officer concerned shall be in Form 501D.
The order shall be deemed to have been passed by accepting
the claim at the end of sixty days from the date of receipt of
Form 501C.]
2
[(2) Any amount or any sum deducted in accordance with the
provisions of sub-section (3) of Section 22 and paid to the State Government
shall be treated as a payment of tax on behalf of the dealer executing
the works contract and credit shall be given to the said dealer for the
period for which amount was so deducted on production of the certificate
furnished by the contractee under this rule.]
3
[(3)(a) Where tax is collectable at source as per sub-section (3A) of
Section 22 of the Act, tax @4% on the total value of the contract
1. Clauses (e) and (f) added by G.O.Ms.No. 88, Rev. (CT. II) Dept., dt. 27-1-2007, w.r.e.f.
1-9-2006.
2. Added by Ibid.
3. Added by G.O.Ms.No. 503, Rev. (CT-II), Dept., dt. 8-5-2009, w.e.f. 1-5-2009.
shall be collected and remitted by the contractee within fifteen

days from the date of each payment made to the contractor.
(b) Where tax, collected at source as above, is in excess of the liability
of the contractor, who have not opted for payment of tax by way
of composition, such amount of tax, collected in excess of the
liability shall be deemed to have been payable by the contractor
and shall be liable to be forfeited.]
19. Calculation of VAT Payable:– (1) Subject to sub-rule (2), the
tax payable on a taxable sale is calculated by applying the rate of VAT
specified in the Act to the sale price of the transaction;
(2) Where the sale price is to be determined under sub-section (2)
of Section 11, the VAT payable shall be calculated by the formula (T x
R), where T is the consideration received for the taxable sale and R is
the tax fraction. The consideration minus the VAT calculated by the above
formula is the sale price;
(3) The tax payable by a VAT dealer for a tax period shall be
calculated by the formula, X-Y where X is a total of the VAT payable
in respect of all taxable sales made by the VAT dealer during the tax
period, and Y is the total input tax credit the VAT dealer is eligible to
claim in the tax period under the Act.
(4) Where any dealer gets himself registered for VAT under sub-
section (3) of Section 17, within the time prescribed, the liability for VAT
shall be from the effective date of registration,-
(5) 1[x x x]
20. Input Tax Credit:– (1) After the commencement of the Act,
where any dealer gets registered as a VAT dealer or where the authority
prescribed registers any dealer as a VAT dealer under Rule 11 (1), such
dealer shall be eligible for input tax credit as provided under sub-section
(2)(b) of Section 13. The claim shall be made on Form VAT 118 within
10 days from the date of receipt of VAT registration. The goods on which
the input tax credit is claimed or allowed shall be available in stock on
the effective date of VAT registration. The documentary evidence for such
claim shall be on the basis of a tax invoice issued by a VAT dealer for
the purchases made and the input tax credit allowed on Form VAT 119
shall be claimed on the first return to be submitted by such dealers. The
1. Omitted by G.O.Ms.No. 1614 Rev. (CT-II) Dept. dt.31-8-2005 Prior to its omission
it read as below :
"5. (a) Any VAT dealer opting to pay tax by way of composition under sub-section
(9) of Section 4, shall apply for composition on Form VAT 250 to the prescribed
authority.
(b) Such dealer shall be liable to pay tax at the rate of twelve and half percent (12.5%)
on sixty percent (60%) of the total amount of consideration charged, from the first
day of the month in which the application for composition is made. The liability to
tax shall continue till the end of the month in which the application for withdrawal
of composition is received."
prescribed authority shall issue such Form VAT 119 within 10 days of receipt
of Form VAT 118.
(2) The following shall be the items not eligible for input tax credit
as specified in sub-section (4) of Section 13,–
(a) all automobiles including commercial vehicles/two wheelers/three
wheelers required to be registered under the Motor Vehicles Act,
1988 and including tyres and tubes, spare parts and accessories
for the repair and maintenance thereof; unless the dealer is in
the business of dealing in these goods.
(b) fuels used for automobiles or used for captive power generation
or used in power plants;
(c) air conditioning units other than used in plant and laboratory,
restaurants or eating establishments, unless the dealer is in the
business of dealing in these goods.
(d) any goods purchased and used for personal consumption.
(e) any goods purchased and provided free of charge as gifts otherwise
than by way of business practice.
(f) any goods purchased and accounted for in the business but utilized
for the purpose of providing facilities to employees including any
residential accommodation.
(g) crude oil used for conversion or refining into petroleum products;
1
[(h) Natural gas, naptha and coal unless the dealer is in the business
of dealing in these goods.]
(i) any input used in construction or maintenance of any buildings
including factory or office buildings, unless the dealer is in the
business of executing works contracts and has not opted for
composition.
(j) earth moving equipment such as bulldozers, JCB’s, and poclain
etc., and parts and accessories thereof unless the dealer is in the
business of dealing in these goods;
(k) generators and parts and accessories thereof used for captive
generation unless the dealer is in the business of dealing in these
goods.
When any goods mentioned above are subsequently sold without
availing any input tax credit, no tax shall be levied and recovered from
a VAT dealer having been denied the input tax credit at the time of
purchase. Any VAT dealer having purchased items mentioned above shall
maintain a separate account or record without including such purchases
in the purchase of eligible inputs taxable at each rate.
Whenever a VAT dealer makes a claim for input tax credit for any
tax period, the tax paid on the purchases of above goods shall be excluded
1. Subs by G.O.Ms.No.2201 Rev. CT-II Dept. dt.29-12-2005 w.e.f. 1-4-2005. Prior to
its omission it read as "natural gas and coal used for power generation."
for arriving the eligible input tax credit. This principle applies to all the
sub-rules in this rule.
1
[(l) rice purchased by Food Corporation of India from VAT dealers
or farmers or farmer clubs or association of farmers in the State.]
2
[(m) rice purchased by Andhra Pradesh State Civil Supplies Corporation
Ltd., from the Depots of Food Corporation of India, in Andhra
Pradesh or from any other VAT dealer in the State.]
3
[(n) refrigerators, coolers and deep freezers purchased by Soft Drink
4
[and ice cream] Manufacturers not for use in their manufacturing
premises.
(o) any goods purchased and used as inputs in job work.
(p) PDS Kerosene purchased by wholesale dealers for the purpose
of supplying to Fair Price Shops.]
5
[(q) Furnace Oil, LSHS and other similar fuels, used in the furnaces
and boilers of the factories or manufacturing or processing units.]
6
[(r) Cement used in the manufacture of RCC and PCC Pipes, Cement
poles and pre-stressed Railway Concrete Sleepers.]
(3) Where all the sales of a VAT dealer for that tax period are taxable,
the whole of the input tax may be claimed as a credit excluding the tax
paid on the purchase of any goods mentioned in sub-rule (2).
7
[(3A) Where any VAT dealer pays tax at the rate of 8[fourteen
and half percent (14.5%)] on the sale consideration of a used or a second
hand vehicle already registered in the State under the Motor Vehicles Act,
1988, he shall be eligible for notional input tax credit at the rate of 8[fourteen
and half percent (14.5%)] on the purchase price actually paid supported
by documentary evidence. Such notional input tax credit shall not exceed
the output tax payable on the sale of used or second hand vehicle by the
VAT dealer.]
1. Subs by G.O.Ms.No.1675 Rev. CT-II, dt. 23-9-2005. Earlier new clause (l) was added by
G.O.Ms.No.1452, Rev. CT-II, Dept., dt.26-7-2005. Prior to its omission it read as below :
"(l) any goods (except kerosene) purchased or procured for supply through Public
Distribution System (PDS)–As a result of this restriction on input tax credit for the goods
(except kerosene) purchased for the purpose of Public Distribution System (PDS); the
corresponding sales will not be liable to any tax. Accordingly the Food Corporation of
India or A.P. State Civil Supplies Corporation Limited will be liable to pay tax only, if
their sales are first sales. They will not be liable to pay any tax on the sales of goods
(except kerosene) purchased from local VAT Dealers and they will also be not eligible to
claim any input tax credit for such purchases. Fair Price Shops are acting as agents on
behalf of the State Government i.e., a resident principal. As such, fair price shops do not
have any liability to register under A.P. VAT Act, 2005 and to pay any tax. However, if
the fair price shops are dealing in any other goods not supplied through Public Distribution
System, they will be liable to register under A.P.VAT Act, 2005 depending on their
turnover of such goods and will have to pay tax accordingly."
2. Inserted by G.O.Ms. No.1675 Rev. CT-II, dt.23-9-2005 w.e.f. 1-4-2005.
3. New clauses n, o, p added by G.O.Ms.No.2201, Rev. CT-II Dept., dt.29-12-2005. w.e.f.
1-4-2005.
4. Ins. by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010, w.e.f. 14-10-2010.
6. Added by G.O.Ms.No. 1636, Rev. (CT-II), Dept., dt. 18-8-2011.
7. Added by G.O.Ms.No.1614, Rev. CT-II, Dept., dt.31-8-2005.
8. Subs. for "twelve and half percent (12.5%)" by G.O.Ms.No.1292, Rev. (CT-II) Dept.,
dt. 14-10-2010, w.r.e.f. 15-1-2010.
(4)(a) Where any VAT dealer buys and sells the goods in the same
form, the input tax credit can be claimed fully in respect of all the taxable
goods purchased for every tax period excluding the tax paid on the purchase
of any goods mentioned in sub rule (2). Such VAT dealer is required to
make a declaration in the Form VAT 200D for every tax period along with
tax return.
(b) Where any common inputs like packing material are used commonly
for sales of taxable and exempt goods (goods in Schedule I), the VAT
dealer shall repay input tax related to exempt element of common inputs
after making adjustment in the tax return for March by filing Form VAT
200B for the period of twelve months ending March. In Form VAT 200B,
the eligible input tax credit shall be calculated by applying formula.
A x B
C
Where–
A is the total amount of input tax for common inputs for each tax
rate excluding the tax paid on the purchase of any goods mentioned in
sub-rule (2).
B is the sales turnover of taxable goods including zero-rated sales
C is the “total turnover” including sales of exempt goods
(c) This sub rule is not applicable if the VAT dealer is making exempt
transactions.
(5)(a) Where the value of taxable sales is 95% or more of the total
value for that tax period, the VAT dealer may claim credit for the full
amount of input tax paid on purchases.
(b) Where the value of taxable sales is 5% or less of the total value,
the VAT dealer shall not be eligible to claim input tax credit for that tax
period;
(c) Such a VAT dealer covered under clause (a) and (b) above, shall
make an adjustment in the month of March for the 12 month period ending
with March on Form VAT 200B. In the Form VAT 200B, the eligible
input tax credit shall be calculated by applying formula A x B/C. The excess
input credit claimed shall be paid back or the balance input credit eligible
can be claimed in the tax return for March.
(d) This sub rule is not applicable if the VAT dealer is making exempt
transactions.
(6) Where any VAT dealer is able to establish that specific inputs
are meant for specific output, the input tax credit can be claimed separately
for taxable goods. For the common inputs, such VAT dealer can claim
input tax credit by applying the formula
A x B
C
for the common inputs used for taxable goods, exempt goods (goods
in Schedule I) and exempt transactions:
Provided the VAT dealer furnishes an additional return in Form VAT
200A for each tax period for adjustment of input tax credit and also makes
an adjustment for a period of 12 months ending March every year by filing
a return in Form VAT 200B.
(7) Where a VAT dealer is making taxable sales and sales of exempt
goods (goods in Schedule I) for a tax period and inputs are common for
both, the amount which can be claimed as input tax credit for the purchases
of the goods at each tax rate shall be calculated by the formula
A x B
C
(8)(a) Where a VAT dealer is making sales of taxable goods and
also exempt transactions of taxable goods in a tax period, for the purchases
of goods taxed at 1[14.5%,] the input tax to the extent of 2[10.5%] portion
can be fully claimed in the same tax period;
(b) In respect of purchases of goods taxable at 1%, 4% and for the
4% tax portion in respect of goods taxable at 1[14.5%], the VAT dealer
shall apply formula
A x B
C
for each tax period:

w.r.e.f. 15-1-2010.
w.r.e.f. 15-1-2010.
(9)(a) Where a VAT dealer is making sales of taxable goods, exempt

sales (goods in Schedule I) and also exempt transaction of taxable goods
in a tax period, for the purchases of goods taxed at 1[14.5%], the input
tax to the extent of 2[10.5%] portion can be provisionally fully claimed in
the same tax period;
(b) In respect of purchases of goods taxable at 1%, 4% and for the
4% tax portion in respect of goods taxable at 1[14.5%], the VAT dealer
shall apply formula
A x B
C
for each tax period:
an adjustment for a period of 12 months ending Mach every year by filing
(10)(a) In the case of a VAT dealer filing Form VAT 200B, the
excess input credit claimed including 2[10.5%] provisionally claimed for sales
of exempt goods shall be paid back or the balance input credit eligible can
be claimed in the tax return for March;
(b) For the purpose of this rule, the words A,B and C in the formula
A x B
C
shall carry the following meaning subject to clause (c) below:
A is the total amount of input tax for common inputs for each tax
rate for the tax period; excluding the tax paid on the purchases of any
goods mentioned in sub-rule(2);
B is the “taxable turnover” as defined under the Act for the tax period,
which shall include zero rated sales of any goods – inter state sales, exports
and deemed exports.
C is the “total turnover” as defined under the Act.
Both the values of B and C shall not include–
(i) purchase price of goods taxable under Section 4(4) of the Act;
(ii) transactions falling under Section 5 (2), (import) Section 6 (2) of
the CST Act, 1965 ;
(iii) value of transfer of business as a whole;
w.r.e.f. 15-1-2010.
w.r.e.f. 15-1-2010.
(c) Where a VAT dealer makes exempt transactions for the calculation
of input tax credit in excess of input tax of 4% for 1[14.5%] rate goods,
“the value of B” shall include the value of the goods transferred outside
the State otherwise than by way of sale (transaction falling under Section
6(a) of CST Act 1956).
(d) For the purpose of sub-rules from (4) to (9) of this Rule, the
value of A is the amount of input tax relating to common inputs for each
tax rate, B is the taxable turnover and C is the total turnover. For the
purpose of Form VAT 200A, the value of A, B and C would be for that
tax period whereas for the purpose of Form VAT 200B, the values of
A, B and C would be the values for the period of 12 months ending March
including March.
(e) Any VAT dealer opting for any method of input tax credit
calculation specified from sub-rule (5) to sub-rule (9) shall be required to
be under only one method for 12 month period ending March. The method
of adjustment to be made in the return for March shall be on the basis
of latest option exercised by the dealer upto March.
(11) The Deputy Commissioner concerned may impose any conditions
or a particular method for a VAT dealer for the apportionment of input
tax credit where the VAT dealer makes taxable and exempt sales and
or exempt transactions.
(12) Where a VAT dealer opts to pay tax by way of composition
or where a VAT dealer is exempt under Rule 17(2) (j), such dealer shall
furnish Form VAT 200E along with Form VAT 200 for each tax period.
Such VAT dealers shall calculate for each tax period the eligible input tax
credit by excluding the turnover or value relating to composition/exemption
in Form VAT 200E. In addition the VAT dealer shall furnish an adjustment
return in Form VAT 200F for the month of March for a period of 12
months ending March making an adjustment of input tax credit in the Form
VAT 200F.
Illustrations for Rule 20
1. VAT dealers following sub-rule (3) of Rule 20:
(only taxable sales)
TYR, a VAT dealer is dealing in sales of Readymade garments and
Footwear which are taxable at 4% and 1[14.5%] respectively under the
provisions of the Act. TYR is not dealing in sales of any exempt goods.
TYR also purchases packing material and certain other goods required for
business. The procedure for claiming input tax credit for a month is illustrated
below:
w.r.e.f. 15-1-2010.
Purchases (Input) Sales (Output)

Rate of Tax Turnover VAT paid Turnover VAT payable
4% Goods (Ready- 1,00,000 4,000 60,000 2,400
made garments &
Packing material)
1 2
12.5% Goods 2,00,000 [29,000] 2,20,000 [31,900]
(Footwear & other
goods)
3 4
Total Input Tax [33,000] Total [34,300]
Output Tax
VAT payable = Output tax – Input tax
4
= [Rs.34,300] – 3[Rs.33,000]
5
= [Rs.1300]
Note:– No adjustments need to be carried since the dealer is dealing
only in taxable goods.
2. VAT dealers following sub-rule (4) of Rule 20:
(Resellers of taxable goods and exempt goods)
TVK, a super market, registered for VAT is dealing in taxable goods
(Soaps, Cosmetics, Foodgrains etc) and exempt goods (Sugar, milk, vegetables
etc). TVK buys and sells these goods in the same form every month and
also purchases packing material and other goods required for his business.
For a tax period, TVK can claim input tax credit as under:
4% Goods 1,00,000 4,000 1,20,000 4,800
6 7 8
[14.5%] Goods 1,00,000 [14,500] 80,000 [11,600]
Exempt goods 50,000 NIL 40,000 NIL
4% goods like pack-
ing material used as
common inputs for
both taxable &
8
exempt goods [11,600] 400 NIL NIL
1. Subs. for "25,000" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,

w.r.e.f. 15-1-2010.
2. Subs. for "27,500" by Ibid.
5. Subs. for "900" by Ibid.
6. Subs. for "12.5%" by Ibid.
1 2
[14.5%] Goods 20,000 [2,900] NIL NIL
used in business
common for both
taxable and exempt
goods
3
Total Input Tax [21,800] Total
4
Output Tax [16,400]
VAT payable/Credit carried over = Output tax – Input tax
= 4[Rs. 16,400] – 5[Rs. 21,800]
= (+) 6[Rs. 5,400]
Credit carried over to next month.
Since TVK has availed full input tax credit on common inputs in the
monthly returns:
(i) the Vat dealer should make declaration in the Form VAT 200D
for each tax period indicating the details of sales of taxable goods
and exempt goods and also details of common input tax and input
tax paid on taxable goods meant for sale and input tax claimed
in the monthly return. No adjustments need to be made for every
tax period.
(ii) the dealer is required to submit a return in Form 200B for March
to repay input tax related to exempt element of common inputs
after making adjustment of input tax credit for the period of twelve
months ending March for each tax rate.
At the end of March, the turnovers relating to last 12 months
are as under: (Adjustments to be made in Form VAT 200B).
1. Total taxable turnover for 12 months Rs. 50,00,000-B
2. Total sales of exempt goods for 12
months Rs. 10,00,000
3. Total turnover for 12 months
(Sl.No. 1+ Sl.No. 2) Rs. 60,00,000-C
4. Common input tax paid & claimed for
12 months on 4% goods Rs. 4,800-A
for 4%
5. Common input tax paid & claimed for Rs. 30,000-A
12 months on 1[14.5%] goods for 1[14.5%]
w.r.e.f. 15-1-2010.
1
Sl. Description 4% rate of goods [14.5%] rate of
No. goods
1. Apply calculation A x B/C A x B/C
4,800 x 50,00,000 30,000 x 50,00,000
60,00,000 60,00,000
2. Eligible input tax credit 4,000 25,000
3. Input tax credit
claimed in returns 4,800 30,000
4. Balance payable 800 5,000
5. Adjustment Pay this amount by Pay this amount by
including 4% output including 1[14.5%]
box in Form VAT output box in Form
200 for March VAT 200 for March
3. VAT dealer following sub-rule (5) of Rule 20:
(Taxable goods & sales of exempt goods lesser values – Manufacturers
or Resellers)
AMD, a rice miller, registered for VAT is engaged in converting Paddy
into rice and selling the same along with other byeproducts. AMD is not
having any consignment sales or branch transfers. For a tax period, AMD
can claim input tax credit as under:
4% Goods 1,00,000 4,000 1,50,000 6,000
(Paddy from other (Rice,
traders & gunnies) broken rice,
bran)
1
[14.5%] Goods
2
(Machinery items) 10,000 [1,450] NIL NIL
Exempt goods
(Paddy husk) NIL NIL 1,000 NIL
Total
Input Tax Total
3
[5,450] Output Tax 6,000
VAT payable = Output tax – Input tax
= Rs. 6,000 – Rs. 3[5,450]
= Rs. 4[550]
w.r.e.f. 15-1-2010.
Since the value of taxable goods is more than 95% of the total sale
value, AMD can claim full amount of input tax credit. However, if the
value of taxable sales is less than 5% of the total sale value, the VAT
dealer should not claim input tax credit for that tax period.
Further, AMD is required to make an adjustment of input tax credit
for each tax rate in the month of March for the 12 month period ending
March on Form VAT 200B.
At the end of March, the turnovers relating to last 12 months are
illustrated below:
(Adjustments to be made on Form VAT 200B)
1. Total taxable turnover for 12 months Rs. 80,00,000-B
2. Total sales of exempt goods for 12 months Rs. 50,000
3. Total turnover for 12 months
(Sl.No. 1+ Sl.No. 2) Rs. 80,50,000-C
4. Input tax paid & claimed for 12 months on 4% Rs. 48,000-A
rate goods for 4%
5. Input tax paid & claimed for 12 months on Rs. 15,000-A
1
[14.5%] rate goods for 1[14.5%] goods
1
Sl. Description 4% rate of goods [14.5%] rate of
No. goods
1. Apply calculation A x B/C A x B/C
4,800 x 80,00,000 15,000 x 80,00,000
80,50,000 80,50,000
2. Eligible input tax credit 47,700 14,907
3. Input tax credit
claimed in returns 48,000 15,000
4. Balance payable 300 93
5. Adjustment Pay this amount by Pay this amount by
including 4% output including 1[14.5%]
box in Form VAT output box in Form
200 for March VAT 200 for March

(Specific inputs to specific outputs)
USL, a VAT dealer is engaged in manufacturing of various products.
The dealer is manufacturing two separate products (product x and product

w.r.e.f. 15-1-2010.
VAT–21
y) wherein the dealer always makes taxable sales of product x and the
product y is meant for both taxable sales and stock transfers. The dealer
maintains separate records indicating specific inputs required for specific
outputs. For a tax period, the method and procedure for arriving eligible
input tax credit is illustrated below:
4% goods for 2,00,000 8,000 1,50,000 6,000
taxable goods (Product
`x')
4% goods common 4,00,000 16,000 3,00,000
for taxable sales & (Products
exempt transactions `x' and `y') 12,000
1 2
[14.5%] goods 32,000 [4,640] NIL NIL
specific to taxable
sales
1 3
[14.5%] goods 40,000 [5,800] NIL NIL
common for
taxable sales and
exempt transactions
Exempt NIL NIL 1,50,000 NIL
transactions (Product
`y')
4
Total Input Tax [34,440] Total
Output Tax 18,000
USL is using specific inputs for specific taxable sales and certain
common inputs meant for both taxable sales and exempt transactions. Hence,
USL is eligible to claim full input tax credit for VAT paid on specific inputs
for each tax period and for the VAT paid on common inputs, the eligible
input tax credit should be arrived for each tax period by applying calculation
A x B/C where ;
A = Common input tax for the tax period for each tax rate
B = Taxable turnover
C = Total turnover
(Including value of exempt transactions)

w.r.e.f. 15-1-2010.
1
Sl. Description 4% rate of Description [14.5%] rate
No. goods of goods
1. Common 16,000 Common input 5,000
input tax tax paid in the
paid in the tax period
tax period
2. Apply 16,000 x 4,50,000 2[10.5%] portion 3
[3,621]
calculation 6,00,000 (tax x
2
[10.5]/ 1[14.5)]
3 Eligible 12,000 4% portion (tax 1,600
input tax 4.5%/1[14.5%)] 1,600 x 4,50,000
Eligible input tax 6,00,000
in 4% portion out = Rs. 1,200
of 1[14.5%] rate
paid. Eligible 3,400 + 1,200
input tax credit = 4,600
for 1[14.5%] rate
related to
common inputs.
Eligible input tax credit for : Rs. 8,000 (4%) + Rs. 4[4,640] (1[14.5%])
Specific inputs : Rs. 12,000/-
Total eligible input tax credit for : Rs. 12,000 + Rs. 5[16,821]
the tax period : Rs. 28,600
VAT payable/Credit : Output tax – Input tax
carried over : Rs. 18,000 – Rs. 6[28,821]
: (+) 7[10,821] credit carried over to
next period
Note:– (1) USL should submit Form VAT 200 A every month, making
adjustment of input tax credit to arrive and claim eligible input tax credit
for that tax period for each rate.
(2) Further, USL should also carry out adjustment of input tax credit
for each tax rate for a period of 12 months ending March and submit
such details in Form VAT 200B.
(3) Such adjustment shall be made as below:
(a) any excess claimed in the monthly VAT returns shall be paid back
in the return for March by adding it to the appropriate box in
the output column for each tax rate.
w.r.e.f. 15-1-2010.
2. Subs. for "8.5%" by Ibid. 3. Subs. for "3,400" by Ibid.
4. Subs. for "4,000" by Ibid. 5. Subs. for "16,600" by Ibid.
(b) any balance credit eligible in the monthly returns shall be claimed
is the return for March by adding it to the appropriate box in
the input column for each tax rate.
(Manufacturing & selling taxable goods and exempt goods)
KHT, a dairy plant is registered for VAT and engaged in production
and sales of both taxable goods and exempt goods. The procedure for
claiming input tax credit for a month is shown below:
4% rate goods 2,00,000 8,000 1,00,000 4,000
common for
taxable and
exempted goods
1
[14.5%] rate
common for both
taxable and
exempt goods 60,000 2[8,700] NIL NIL
Exempt goods 5,00,000 NIL 7,00,000 NIL
3
Total Input Tax [16,700]
Total
Output Tax 4,000
VAT payable = Output tax – Input tax (eligible)
To arrive eligible input tax credit, the VAT dealer should make
calculation A x B/C in Form VAT 200A for the tax period for each tax
rate.
A = Input tax paid for each tax rate
C = Total turnover (Taxable turnover + turnover of sales
of exempt goods)
1
Sl. Description 4% rate of [14.5%] rate of Total
No. goods goods eligible
2
1. Input tax paid 8,000 [8,700] NIL
in the tax period.
2
2. Apply calculation 8,000 x 1,00,000 [8,700] x1,00,000
8,00,000 8,00,000 NIL
4 5
3. Eligible input tax 1,000 [1,088] [2,088]
w.r.e.f. 15-1-2010.
VAT payable in the tax period : Rs. 4,000 – Rs. 1[2,088]

: Rs. 2[1,112]
Note:– (1) KHT should submit Form VAT 200A every month, making
adjustment of input tax credit to arrive and claim eligible input tax credit
for that tax period.
(2) Further, KHT should also carry out adjustment of input tax credit
for each tax rate for a period of twelve months ending March and submit
such details in Form VAT 200B
6. VAT dealer following sub-rule(8) of Rule 20:
(Taxable goods & exempt transactions of taxable goods)
SKM, a VAT dealer is engaged in manufacture and sale of Cement.
The dealer also despatches the goods on consignment basis to other States.
There are no sales of exempt goods. For a tax period, the purchases and
sales effected by the dealer are illustrated below indicating method and
procedure to claim input tax credit.
4% goods 60,00,000 2,40,000 NIL NIL
3 4
[14.5%] goods 50,00,000 [7,25,000] 5,00,00,000 62,50,000
transactions
5
Total Input Tax [9,65,000] Total 62,50,000
Output Tax
Since the VAT dealer is using the inputs common for both taxable
sales and exempt transactions, SKM should arrive at eligible input tax credit
for each tax rate for the tax period to claim in the monthly return. For
this purpose, SKM should calculate eligible input tax credit in Form VAT
200A for the tax period by applying A x B/C, where ;
1. Subs. for "1,938" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,
w.r.e.f. 15-1-2010.
4. Subs. for "6,25,000" by Ibid.
5. Subs. for "8,65,000" by Ibid.
A = Input tax paid for each tax rate.

C = Total turnover
(Taxable turnover + value of exempt transactions)
Sl. Description 4% rate Description 1[14.5%] rate
No.
1a
1. Input tax 2,40,000 Input tax paid [7,25,000]
paid in the in the tax
tax period period
2. Apply 2,40,000 x 5,00,00,000 2[10.5%] 3
[5,25,000](*)
calculation 5,50,00,000 portion (tax x
2
[10.5]/
1
[14.5)]
3. Eligible 2,18,182 4% portion 2,00,000
input tax (tax 4.5%/ 2,00,000 x 5,00,00,000
1
[14.5%]) 5,50,00,000
Apply calcula- = Rs. 1,81,818
3
tion for 4% [5,25,000] +
portion Eligi- 1,81,818 =
4
ble input tax in [7,06,818]
1
[14.5%] rate
(*) Input tax to the extent of 2[10.5%] portion can be fully claimed in the same tax period.
Total eligible input tax credit

For the tax period : 2,18,182 + 4[7,06,818]
: Rs. 5[9,25,000]
VAT payable for the tax period : Output tax – Input tax (eligible)
: 62,50,000 – 5[9,25,000]
6
: [53,25,000]
Note:– (1) SKM should submit Form VAT 200A every month, making
Adjustment of input tax credit to arrive at and claim eligible Input tax credit
for that tax period.
(2) Further, SKM should also carry out adjustment of input tax credit
w.r.e.f. 15-1-2010.
1a. Subs. for "6,25,000" by Ibid.
3. Subs. for "4,25,000" by Ibid. 4. Subs. for "6,06,818" by Ibid.
(Taxable sales, sales of exempt goods and exempt transactions of
taxable goods)
IAK, a VAT dealer is engaged in manufacture of Cotton yarn and
cloth. The dealer effects stock transfer of cotton yarn to other states besides
making sales of Cotton yarn and exempt goods i.e., Cloth. The method
and procedure to arrive at and claim eligible input tax for a tax period
is illustrated below:
4% goods 1,00,00,000 4,00,000 1,00,00,000 4,00,000
1
12.5% goods 8,00,000 [1,16,000] NIL NIL
Exempt goods NIL NIL 50,00,000 NIL
transactions (Stock
transfers of
cotton yarn)
2
Total Input Tax [5,16,000] Total 4,00,000
Output Tax
IAK is using common inputs for sales of taxable goods, sales of exempt
goods and for the values of exempt transactions. IAK should arrive at eligible
input tax credit for each tax rate for the tax period in Form 200A by applying
A x B/C calculation, where;
A= Input tax paid for each tax rate
C = Total turnover (Taxable turnover + Sales of exempt
Goods + value of exempt transactions)
1. Subs. for "1,00,000" by G.O.Ms.No.1292, Rev. (CT-II), Dept., dt. 14-10-2010,

w.r.e.f. 15-1-2010.
2. Subs. for "5,00,000" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,
w.r.e.f. 15-1-2010.
Sl. Description 4% rate Description 12.5% rate

No.
1
1. Input tax 4,00,000 Input tax paid [1,16,000]
paid in the in the tax
tax period period
2 2a
2. Apply 4,00,000 x 1,00,00,000 [10.5%] [72,414]
calculation 2,00,00,000 portion (tax x
2
[10.5%]/
3
[14.5])
3. Eligible 2,00,000 4% portion 32,000
input tax (tax 4.5%/ 32,000 x 1,00,00,000
2.5%) 2,00,00,000
Eligible input = Rs. 16,000
tax in 4%
4
portion out of [72,414] +
3
[14.5%] rate 16,000 =
5
paid - arrive [88,414]
by applying
calculation
Eligible input
tax in
3
[14.5%] rate
goods
Total eligible input tax credit
for the tax period : 2,00,000 + 5[88,414]
: Rs. 6[2,88,414]
VAT payable for the tax period : Output tax – Input tax (eligible)
: 4,00,000 – 6[2,88,414]
: Rs. 7[1,11,586]
Note:– (1) IAK should submit Form VAT 200A every month, making
adjustment of input tax credit to arrive at and claim eligible input tax credit
for that tax period for each rate.
(2) Further, IAK should also carry out adjustment of input tax credit
1. Subs. for "1,00,000" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,
w.r.e.f. 15-1-2010.
2a. Subs. for "68,000" by Ibid. 3. Subs. for "12.5%" by Ibid.
21. Calculation of Turnover Tax payable (TOT)
(a) The TOT payable by a TOT dealer shall be calculated by applying
the rate of TOT to the taxable turnover.
(b) In cases where the taxable turnover of a dealer exceeds five lakh
rupees in the preceding twelve months and he registers for TOT
within the prescribed time, the liability for TOT shall be from the
effective date of registration.
22. Calculation of VAT Payable on sales of goods predominantly
to non-VAT dealers and consumers
(1) A VAT dealer selling goods liable to VAT shall maintain the
records and calculate VAT payable in the following manner namely:–
(a) a separate record of all goods received, which are exempt or liable
to VAT at any rate other than the standard rate;
(b) in the case of sales predominantly to non-VAT dealers and
consumers, a daily record of the gross receipts of goods taxable
at each tax rate and the value of exempt goods sold.
(c) the VAT due for payment shall be calculated by applying the tax
fraction to the aggregate of daily gross receipts for the month
at each tax rate. The total value of taxable sales for each tax
rate shall be calculated by deducting the tax from the aggregate
of daily gross receipts for each month.
(d) copies of any tax invoices issued to VAT dealers.
CHAPTER IV
RETURNS, PAYMENTS & ASSESSMENTS
23. Tax Returns:– (1) A return to be filed by a VAT dealer under

Section 20 shall be on Form VAT 200 and it shall be filed within 20 days
after the end of the tax period. The return shall be completed in duplicate
and one copy with the proof of receipt shall be retained by VAT dealer;
1
[x x x]
1. Omitted by G.O.Ms.No. 395, Rev. (CT-II) Dept., dt. 30-3-2007, w.r.e.f. 14-3-2006.
Prior to its omission it read as below :
"Provided that the return for the month of March shall be filed on or before 7th April."
(2) A return to be filed by a TOT dealer under Section 20 shall be

on Form TOT 007 and it shall be filed within 30 days after the end of
the calendar quarter;
(3) In the case of a VAT dealer having more than one place of
business all returns prescribed by these rules shall be submitted by the head
office of the business in the State and shall include the total value of all
sales of all the branches in the State of such VAT dealer;
(4) Where the registration of a VAT dealer or TOT dealer is cancelled,
a final return on Form VAT 200C or TOT 007 as the case may be shall
be filed within fifteen days of the effective date of cancellation of registration;
(5) If there is a change in the rate of tax during a tax period, a
separate return in respect of each portion of the tax period showing the
application of different rates of tax shall be furnished;
(6)(a) If any VAT dealer having furnished a return on Form VAT
200 finds any omission or incorrect information therein, other than as a
result of an inspection or receipt of any other information or evidence by
the authority prescribed, he shall submit an application on Form VAT 213
within a period of six months from the end of the relevant tax period.
(b) On receipt of Form VAT 213 in the case of an under-declaration,
a Form VAT 307 shall be issued for the under-declared tax and the interest
due on the late payment. In the case of an over-declaration Form VAT
308 shall be issued
(7)(a) In the case of casual trader a declaration on Form CAT001
shall be filed within twenty four hours of his arrival in any place in the
State before the authority prescribed indicating the nature of goods and
their value in which he intends to deal and the period for which he intends
to conduct his business.
(b) The casual trader shall file a final declaration in Form CAT 002
before the authority prescribed on the last day on which he intends to leave
the place along with payment of the tax due on the taxable turnover.
(8) Every VAT dealer who claims input tax credit in respect of certain
goods or any specific category of VAT dealers, as notified by the Commissioner
or any other VAT dealer as required by the Deputy Commissioner concerned
shall submit a return in Form VAT 225 in addition to the return on Form
VAT 200, containing the details of purchases made from other VAT dealers
in the State for each tax period or for any other period as may be notified
by the Commissioner or as required by the Deputy Commissioner concerned.
1
[xxx]
2
[xxx]
3
[(12) All the returns prescribed under sub-rules (1) to (8) 4[xxx] of
this Rule may also be filed electronically through electronic filing system
to be created for the purpose.
5
[Provided that such class of dealers as may be notified by the
Commissioner of Commercial Taxes from time to time shall file all the returns,
prescribed under sub-rules (1) to (8) of this Rule electronically through electronic
filing system created for the purpose.]
(13) Every Department of the State and Central Government shall
submit a return in Form VAT 230 with all the information, required therein,
for each month. The return for each month shall reach the assessing
authority of the area, in which the principal place of business is located,
on or before 20th day of the succeeding month. The return shall be submitted
by the officer of the Department, duly authorized in this behalf by the Head
of the Department, concerned. Along with the return, he shall also pay
the tax due, if any, as per the return, through cheque, demand draft, pay
order or Government treasury challan.]
6
[(14) Every VAT dealer or TOT dealer, other than casual traders,
may also file the returns, prescribed under sub-rules (1) to (6) of this Rule
in e-Seva Centres by paying user charges, as prescribed by the Commissioner
of Commercial Taxes from time to time. Such returns shall be filed in
duplicate and the e-Seva centre shall return one of those returns with the
proof of receipt of the same.]
24. Tax Payment:– 7[(1) In case of a VAT dealer, the tax declared
to be due in Form VAT 200 shall be paid not later than twenty (20) days
after the end of the tax period by way of remittance into the Treasury or by
1. Omitted by G.O.Ms.No. 503, Rev. (CT-II), dt. 8-5-2009, w.e.f. 1-5-2009, Prior to
its omission it read as below:
"(9) All the returns, prescribed under sub-rules (1) to (8) of this rule, may also be
filed electronically through electronic filing system to be created for the purpose."
2. Clause 10, 11 added by G.O.Ms.No. 517, Revenue (CT. II), dt. 23-4-2007,
w.r.e.f. 1-4-2007, rescinded by G.O.Ms.No.1181, Rev. (CT-II), Dept. dt. 13-10-2008,
w.e.f. 1-10-2008.
Earlier it read as below:
"(10) Every VAT dealer or a TOT dealer shall file an additional quarterly return for
the quarters ending March, June, September and December containing the details of
sales & purchases of taxable goods made within the state in Forms TOT 060A, TOT
060B, VAT 226A, VAT 226B, VAT 227A, VAT 227B and VAT 228A, as applicable
to them within 30 days from the end of the quarter.
(11) The Commissioner may by notification exclude any dealer or any category of dealers
from submitting the returns as prescribed in sub-rule (10) above. The Commissioner
may also notify the method of filing the quarterly returns prescribed."
4. The words "and (10)" omitted by G.O.Ms.No.1292, Rev. (CT-II) Dept.,
dt. 14-10-2010, w.e.f. 14-10-2010.
5. Added by Ibid.
6. Added by Ibid.
7. Subs. for sub-rules (1), (2) and (3) by G.O.Ms.No.1292, Rev. (CT-II) Dept.,
dt. 14-10-2010, w.r.e.f. 1-10-2010.
way of online payment through Internet website of the Commercial Tax

Department or any other Internet website, authorized by the Commissioner
of Commercial Taxes. However online payment shall also be governed by
the Terms and Conditions stipulated therefor.
(2) In case of a TOT dealer, the tax, declared to be due in Form TOT
007, shall be paid not later than thirty (30) days after the end of the calendar
quarter by way of remittance into the treasury or by way of online payment
through Internet website of the Commercial Tax Department or any other
Internet website authorized by the Commissioner of Commercial Taxes.
However online payment shall also be governed by the Terms and Conditions
stipulated therefor.
(3) The return in Form VAT 200 or Form TOT 007 shall be accompanied
by proof of payment of tax declared to be due in such return.]
(4) Where any VAT dealer or TOT dealer submits a Form VAT 200
or 1[Form TOT 007] 2[without the proof of payment of] the full amount
of tax payable, the authority prescribed shall send a notice on Form VAT
202 or TOT 012 to the VAT dealer or to the TOT dealer for the tax
under paid. Such notice shall be deemed to be an assessment cum demand
notice and the VAT dealer or TOT dealer shall pay the sum specified
in the notice within the time specified therein.
(5) Where any dealer has been permitted to pay tax or any other amount
by way of instalments, the following conditions shall apply:
(a) The dealer shall not default payment of any other taxes or any other
amount due under the Act subsequent to the granting of instalments.
(b) In the event of any default, the order granting instalments shall become
infructuous unless on application it is specifically restored by the
Deputy Commissioner.
(c) Any other conditions as may be specified in the order.
(6) Where any VAT dealer has paid any Entry Tax and intends to
adjust such amount against VAT payable by him as specified in sub-section
(5) of Section 22, he shall make a declaration on Form 503 and file alongwith
Form VAT 200 for the Tax period.
3
[(7) The dealers who opt to pay tax by way of composition under sub-
section (8A) of Section 4 of the Act, shall pay tax as follows:
4
Sl.No. Slab in terms of Prints, ordered and [Tax payable
received from the film processing labs. per print]
(1) (2) (3)
(1) 151 prints and above Rs.40,000/-
(2) 101 to 150 prints Rs.30,000/-
(3) 36 to 100 prints Rs.20,000/-
(4) Below 36 prints Rs.10,000/-]
1. Subs. for "Form 007" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,
w.r.e.f. 1-10-2010.
2. Subs. for "without a receipt from Government treasury or demand draft or a cheque
for" by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010, w.r.e.f. 1-10-2010.
3. Added by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010, w.r.e.f. dt. 3-3-2009.
4. Subs. for "Tax payable" by G.O.Ms.No. 54 Rev. (CT-II) Dept., dt. 19-1-2011,
w.r.e.f. 3-3-2009.
25. Assessments:– (1) Where a VAT dealer fails to file a VAT

return as prescribed under Section 20, the authority prescribed shall assess
unilaterally the tax payable. The authority prescribed shall serve upon the
VAT dealer a notice of the tax assessed and the penalty due on Form
VAT 204. The VAT dealer shall pay the sum within the time and the
manner specified on the form or shall file the return outstanding. If the
return is filed the unilateral assessment shall be withdrawn, without prejudice
to the penalty under sub-section (3) of Section 50 and interest due for
late payment.
(2)(a) A VAT unilateral assessment shall be made by totalling the
tax declared on the tax returns or paid by way of assessment during the
previous twelve months and by dividing the amount by twelve to arrive
at an average monthly liability for the previous twelve months. The average
shall be compared with the tax due declared on the last return filed. The
higher figure of the two shall be used for arriving the tax for the purpose
of assessment. A penalty of fifty percent (50%) of that sum shall be levied.
(b) In the case of a VAT dealer who has not been registered for
a period of twelve months, the amount declared in box 16(b) of
Form VAT 100 shall be divided by twelve to provide the basis
for the calculation of the average taxable turnover.
The standard rate of tax shall be applied to this amount to calculate
the tax liability. A penalty of fifty percent (50%) of that sum shall
be levied. In the case of a deemed registration under sub-rule
(4) of Rule 4, the total turnover declared on Form VAT 100 shall
be divided by twelve to provide the basis for the calculation of
the taxable turnover.
(c) Where a credit return is filed in the previous twelve months with
the claim of credit carried forward in any tax period, the credit
carried forward shall be ignored for the calculation. Where a return
is filed in the previous twelve months with the claim of refund
in any tax period, the refund amount shall be deducted from the
total tax declared on the returns for calculation of the taxable
turnover under clause (a) or (b).
(d) Where in the previous twelve months, credit or refund is claimed
in all the returns or a credit balance is arrived at, no unilateral
assessment shall be made.
(3) Where a TOT dealer fails to file a return as prescribed under
Section 20, the authority prescribed shall assess the tax payable unilaterally.
The authority shall serve upon the TOT dealer a notice of the tax assessed
and a notice of the penalty due on Form TOT 010. The TOT dealer shall
pay the sum within the time and manner specified on the form or file the
return outstanding. If the return is filed the unilateral assessment shall be
withdrawn without prejudice to the penalty under sub-section (3) of Section
50 and interest due for late payment.
(4)(a) A TOT unilateral assessment shall be calculated by totalling
the tax declared on TOT returns or demanded and or paid by way of
assessment for the previous twelve months. This sum shall be divided by
four to provide an average quarterly TOT liability. A penalty of fifty percent
(50%) of that sum shall be levied;
(b) In the case of a TOT dealer who has not been registered for
a period of twelve months the amount declared in box fourteen
of Form TOT 001 shall be divided by four to arrive at the average
taxable turnover. The turnover tax rate shall be applied to this
amount to calculate the TOT liability. A penalty of fifty percent
(50%) of that sum shall be levied;
(c) In the case of a TOT dealer registered under the provisions of
sub-section (8) of Section 17, the gross turnover declared for the
year ending 31 of March 2005 under the Andhra Pradesh General
Sales Tax, 1957 shall be divided by four to arrive at the average
taxable turnover for the purposes of this rule.
(5) Where any VAT return filed by the VAT dealer appears to the
authority prescribed to be incorrect or incomplete that authority prescribed
shall assess the tax payable to the best of his judgment on Form VAT
305 after affording a reasonable opportunity to the dealer in Form VAT
305 A. He shall serve upon the VAT dealer an order of the tax assessed,
the penalty and interest due on Form VAT 305. The VAT dealer shall
pay the sum within the time and manner specified on the notice.
(6) Where any TOT return filed by the TOT dealer appears to the
authority prescribed to be incorrect or incomplete that authority shall assess
the tax payable to the best of his judgment on Form TOT 025 after affording
a reasonable opportunity to the dealer on Form TOT 025A. He shall serve
upon the TOT dealer an order of the tax assessed, the penalty levied and
interest due on Form TOT 025. The TOT dealer shall pay the sum within
the time and manner specified on the notice.
(7) Where a dealer receives any amount due to price variations, which
have not been included in the return filed for that tax period, he shall include
the additional amount received and tax calculated at the rate applicable
in the return to be filed in the period in which the additional amounts are
received.
(8)(a) For the purpose of Section 53, the tax underdeclared in respect
of input tax means the excess of input tax claimed over and above the
input tax actually entitled to be claimed in the return for a particular tax
period.
(b) The tax underdeclared in respect of output tax means the difference
between output tax actually chargeable and the output tax declared
in the return for a particular tax period.
(c) In respect of a TOT dealer the tax underdeclared means the
difference between the tax declared on Form TOT 007 and the
tax actually due by the dealer for the period.
(9) Where any sales tax credit claimed under Rule 37 is found to
be in excess of the amount actually entitled, such amount shall be recovered
along with interest by assessing the VAT dealer.
1
[(10) Every VAT dealer shall furnish, for every financial year, to
the prescribed authority, the statements of Manufacturing/Trading Account,
Profit and Loss Account, Balance Sheet and Annual Report, duly certified
by a Chartered Accountant within the meaning of the Chartered Accountants
Act, 1949 (Central Act, 38 of 1949), on or before the 31st day of December
subsequent to the financial year to which the statements are related.]
1. Added by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010, w.r.e.f. 1-10-2010.
Illustrations:
(a) VKM, a VAT dealer filed a return for tax period declaring input tax
as Rs. 10000/- and output tax as Rs. 5000/- and the net excess tax
of Rs. 5000/- was carried over to the next tax period. On verification
by the authority prescribed after 6 months, the eligible input tax credit
is found to be Rs. 8000/-. There was no variation in output tax. The
tax under declared in respect of input tax is Rs. 2000/- (Rs. 10000
– Rs. 8000)/-. The percentage of under declaration of tax is twenty
five percent (25%) (2000X100/8000). Accordingly under declared tax
of Rs. 2000/- along with penalty of Rs. 500/- i.e. twenty five percent
(25%) and interest at the rate of 1% for the period i.e. six months
of delay is payable.
(b) NKC, a VAT dealer filing a return declared input tax as Rs. 23000
and output tax as Rs. 77000/- and net tax of Rs. 54000/- was paid
along with return. On verification by the authority prescribed after four
months it was found that there is no variation in the eligible input tax
declared in the return. However, the output tax chargeable for that
tax period was found to be Rs. 80,000/- as against the declared out
put tax of Rs. 77,000/-.
The tax under declared in respect of out put tax is Rs. 3000/- (i.e.
Rs. 80000-Rs. 77000). The percentage of under declaration is 3.8% (3000X100/
80000). Now the dealer is liable to pay the under declared tax of Rs. 3000/
- along with penalty of Rs. 300/- i.e. 10% and interest at the rate of 1%
for the delayed period of 4 months.
CHAPTER V
TAX INVOICES, CREDIT AND DEBIT NOTES
26. Invoices:– (1) The invoices, bills or cash memoranda issued by
any dealer 1[xxx] shall be serially numbered for each year and in the case
of a dealer other than a retail dealer, each of such invoice, bill or cash
memorandum issued shall contain the following particulars:
(a) The full name, style and address of the business of the dealer
making the sale;
(b) The Taxpayer Identification Number (TIN) or the General
Registration Number (GRN) of the dealer making the sale;
(c) The full name, style and address of the business of the buying
dealer and General Registration Number (GRN), if registered as
a TOT dealer. Provided that where the purchaser is a consumer,
the invoice, bill or cash memoranda need not contain the full name
and address of such purchaser.
(d) The date on which the invoice is issued;
(e) The description of the goods supplied;
1. The words "other than a retail dealer" omitted by G.O.Ms.No.1335, Rev. (CT-
II) Dept., dt. 8-11-2010, w.e.f. 10-11-2010.
(f) The quantity or volume of the goods sold;

1
[(g) The basic price of goods sold, rate of tax, amount of tax and
the total sale price which is the sum of basic price and tax amount.]
Explanation:– For the purpose of this sub rule, a retail dealer is a
dealer whether registered as a VAT dealer or as a TOT dealer making
sales predominantly to consumers i.e. more than ninety percent (90%) of
the total sales.
(2) Notwithstanding anything contained in sub-rule (1) the gate pass
cum invoice which a dealer registered under the Central Excise Act 1944,
(Central Act 1 of 1944) or under the rules made thereunder is obliged
to issue shall be deemed to have been issued under this Act provided such
gate pass cum invoice contains all the particulars mentioned in clauses (a)
to (g) of sub-rule (1).
Explanation: For the purpose of this sub-rule, any gate pass cum
invoice issued for the removal of goods other than by way of sale shall
not be deemed to be an invoice for the purpose of sub-rule (1).
27. Tax Invoices:– (1) A tax invoice specified in Section 14 shall
contain the following particulars namely,–
(a) The words “Tax Invoice” written in a prominent place.
(b) Commercial name, address, place of business and TIN of the VAT
dealer making a sale.
(c) Commercial name, address, place of business and TIN of the VAT
dealer making the purchase.
(d) The serial number of the invoice (printed or computer generated)
and date on which invoice is issued.
(e) The date of delivery of the goods.
(f) The description of the goods supplied.
(g) The quantity or volume of the goods sold.
(h) The rate of tax for each category of goods.
2
[(i) The basic price of goods sold, rate of tax, amount of tax and the
total sale price which is the sum of basic price and tax amount.]
(2) An invoice issued under sub-rule (2) of Rule 26 shall be deemed
to be a tax invoice provided such invoice contains all the particulars specified
in sub-rule (1).
(3) A VAT dealer who has not received a tax invoice may require
the VAT dealer, who has supplied the goods, to provide a tax invoice in
respect of the sale.
(4) Input tax credit shall be claimed only against an original tax invoice.
1. Subs. by G.O.Ms.No.1335, Rev. (CT-II) Dept., dt. 8-11-2010, w.e.f. 10-11-2010.

2. Subs. by Ibid.
(5) The VAT dealer making a taxable sale shall retain one copy of
the tax invoice.
(6) Where a purchasing VAT dealer loses the original tax invoice,
the seller shall provide a copy clearly marked “ copy in lieu of lost tax
invoice” containing the following certificate.
“I hereby declare that this is the duplicate of the tax invoice bearing
No. .................., dated .................. Issued to .................. bearing TIN
...................”
Date: Signature:
(7) A request for a tax invoice under sub-rule (6) of this Rule shall
be made within thirty days after the date of the sale.
(8) A VAT dealer who receives a request under sub-rule (6) of this
Rule shall comply with the request within fourteen days after receiving
that request.
28. Credit Notes and Debit Notes:– (1) Where a tax invoice has
been issued and the amount shown as tax charged in that tax invoice exceeds
the tax liable in respect of the sale, the VAT dealer making the sale shall
issue to the buyer a credit note and containing the particulars prescribed
specified in sub-rule (4) of this rule.
(2) Where a tax invoice has been issued and the tax liable in respect
of the sale is more than the amount shown as tax charged in that invoice
the VAT dealer making the sale shall issue to the buyer a debit note and
containing the particulars specified in sub-rule (5).
(3)(a) Credit notes and debit notes in respect of goods returned after
sales or purchases shall be issued only when the goods have been returned
within a period of twelve months from the date of sale.
(b) Credit notes and debit notes in respect of any annual discounts
and any price adjustments shall be issued as and when the accounts
are settled between the seller and the buyer provided the settlement
is made within the twelve months from the end of the year and
the discounts or price adjustments are supported by proper
documentary evidence.
(4) Credit Notes shall contain the following particulars namely:–
(a) the words “credit note” in a prominent place.
(b) the commercial name, address, place of business and the Taxpayer
identification number of the VAT dealer making the sale.
8)6`
(c) the commercial name, address, place of business and the Tax payer
identification number of the buying VAT dealer.
(d) the date on which the credit note was issued;
(e) the rate of tax;
(f) the sale price shown on the tax invoice, the revised amount of
the sale price, the difference between the two amounts and the
tax charged that relates to that difference;
(g) a brief explanation of the circumstances giving rise to the issuing
of the credit note; and
(h) information sufficient to identify the taxable sale to which the
credit note relates.
(i) proof of transport of the goods in respect of sales returns like
LR. or RR.
(5) Debit Notes: The debit note shall contain the following particulars
namely;–
(a) the words ‘debit note’ in a prominent place
(b) the commercial name, address, place of business and the tax
identification number of the VAT dealer making the sale;
(c) the commercial name, address, place of business and the taxpayer
identification number of the buying VAT dealer.
(d) the date on which the debit note was issued;
(e) the rate of tax;
(f) the sale price shown on the tax invoice, the revised amount of
the sale price, the difference between the two amounts and the
tax charged that relates to that difference;
(g) a brief explanation of the circumstances giving rise to the issuing
of the debit note;
(h) information sufficient to identify the taxable sale to which the
debit note relates; and
(i) proof of transport of the goods in respect of sales returns like
LR or RR.
CHAPTER VI
%
29. Records to be maintained by VAT dealer:– (1) Every VAT

dealer shall keep and maintain a true and correct account of his business
transactions in any of the languages specified in the Eighth Schedule to

the Constitution or in the English language.
(2) The VAT dealer shall maintain wherever applicable, the following
records, namely;–
(a) a VAT monthly account specifying total output tax, total input tax
and net tax payable or the tax credit due for refund or carry
forward.
(b) purchase records, showing details of all purchases on which tax
has been charged and eligible for input tax credit, purchases with
VAT charged but not eligible for input tax credit under sub-rule
(2) of Rule 20 and all purchases made without charge of tax.
Original tax invoices for purchases on which tax has been charged,
and invoices for purchases made without charge of VAT shall
all be retained in date order.
(c) sales records showing separately all sales made liable to different
tax rates, Zero-rated sales and exempt sales. Copies of tax invoices
related to taxable sales and invoices related to exempt sales shall
all be retained in date and numerical order.
(d) credit notes and debit notes issued and received shall all be retained
in date and numerical order.
(e) record of all zero-rated export of goods together with copies of
customs clearance certificates, invoices issued to the foreign
purchasers, transport documentation in the case of export of goods,
certificates in Form H prescribed under the Central Sales Tax
Act, 1956 orders or contracts for or with the foreign purchaser,
and evidence of payment by bank transfer through a bank or by
a letter of credit payable by a bank.
(f) record of inter-State sales and inter-State transfer supported by
C forms, F forms prescribed under the Central Sales Tax Act,
1956, Waybills and stock transfer vouchers.
(g) cash records maintained by retailers namely cash books, petty cash
vouchers, and other account records including copy receipts or
cash register machine rolls detailing the daily takings.
(h) records of entry tax payment:
(i) records of tax collection at source and tax deduction at source.
(j) records of details of availment of tax holiday/deferment.
(k) records of adjustment of VAT credit against liabilities under the

(l) records of calculation of purchase point tax liability under sub-
section (4) of Section 4.
(m) computer records, where available.
(n) details of input tax calculations where the VAT dealer is making
both taxable and exempt sales.
(o) Documents, records, and claim forms for all transitional relief
claims of tax credit for sales tax and claims for VAT credit on
first registration for VAT.
(p) stock records and any manufacturing records.
(q) Order records, delivery notes and way bills
(r) appointment and job books.
(s) annual accounts including trading, profit and loss accounts, the
balance sheet.
(t) Bank records, including statements, cheque book counter foils and
pay-in-slips.
(u) copy of customs clearance certificates.
(3) All records specified in sub-rule (2) of this Rule shall be retained
for a period of six years and made available for inspection by the authority
prescribed.
(4) Every VAT dealer who keeps and maintains the accounts in a
language other than English shall adopt international numerals in the
maintenance of such accounts.
(5) A VAT dealer making sales predominantly to non-VAT dealers
and consumers and who does not separately record every sale, shall maintain
a daily record of gross receipts for sales taxable at each tax rate and
exempt sales.
30. Records to be maintained by TOT dealer:– (1) Every dealer
registered under sub-sections (7) or (8) of Section 17 shall keep and maintain
a true and correct account in any of the languages specified in the Eighth
Schedule to the Constitution or in the English language.
(2) TOT dealer shall maintain in particular, the following records,
namely;–
(a) the value of the goods produced, manufactured, bought and sold
by him;
(b) the names and addresses of the dealers from whom goods were
purchased, supported by bill or delivery note issued by the seller
and duly signed and dated;
(c) the daybook, ledgers and cash-book, bill books and account books
which shall be serially numbered for each year and
(d) the sale bills, invoices, delivery notes, credit notes or debit notes
and way bills which shall bear a printed serial number and be
written in duplicate, triplicate or quadruplicate, as the case may
be of which the dealer shall retain one copy thereof.
(3) Any dealer who keeps and maintains his accounts under sub-rules
(1) and (2), in any language other than English, shall adopt international
numerals in the maintenance of such accounts.
31. Records to be maintained by a dealer executing works
contracts:– (1) Every dealer executing works contract shall keep separate
accounts for each contract specifying the particulars of the names and
addresses of the persons for whom he has executed works contracts
(2) Every dealer executing works contract and opting to pay tax by
way of composition shall maintain records of–
(a) payments received from the contractee.
(b) records of entry on Form VAT 200
(c) records of tax collection at source or tax deduction at source made
from the payments received on the works contracts.
(3) Every dealer executing works contract and not opting to pay tax
by way of composition shall keep the following records; namely;–
(a) the particulars of goods procured by way of purchase or otherwise
for the execution of works contract;
(b) the particulars of goods to be used or used in the execution of
each works contract;
(c) the details of payment received in respect of each works contract
(d) the details of:
(i) labour charges for works executed;
(ii) amount paid to sub-contractor for labour and services ;
(iii) charges for planning, designing and architect’s fees;

(iv) charges for obtaining on hire or otherwise machinery and tools
(v) cost of consumables such as water, electricity, fuel etc., used in
the execution of the works contract the property in which is not
transferred in the course of execution of a works contract;
(vi) cost of establishment of the contractor to the extent it is relatable
(vii) other similar expenses relatable to supply of labour and services;
(viii) profit earned by the contractor to the extent it is relatable to supply
(ix) all amounts for which goods exempted under Schedule I are
transferred in execution of works contract;
(x) turnover of goods involved in the execution of works contract
which are transferred in the course of inter-State trade or commerce
under Section 3 of the Central Sales Tax Act, 1956 or transferred
outside the State under Section 4 or transferred in the course of
import or export under Section 5 of the said Act.
32. Records to be maintained by cold storage plants:– (1) Every
owner or other person in charge of a cold storage 1[or ware house or godown
or any other such place, by whatever name called, where goods are generally
stored] in the State shall keep and maintain a true and correct account in
the register in Form 520 showing the stocks of goods entrusted for storage.
Explanation:– ‘Cold Storage’ means an air-conditioned building in
which low temperature is maintained to preserve the quality of the goods
stored.
(2) Every such person shall file a detailed statement in Form 515
relating to the goods stored by persons other than Registered dealers and
farmers before the Commercial Tax Officer, having jurisdiction over the
cold storage 1[or ware house or godown or any other such place] on or
before the fifteenth of every month showing the name and quantity of goods
received for storage during the previous month.
(3) Every such person shall also obtain and keep on record a certificate
issued by the Village Secretary to the effect that the farmer who has stored
1. Inserted by G.O.Ms.No. 1624, Revenue (CT. II), dt. 6-11-2006.

his produce in the cold storage 1[or ware house or godown or any other
such place] is a genuine farmer and that the produce is from his own land
or in the land taken by him on lease. On each of such certificates, every
such persons shall note the serial number of the relevant entry in the register
in Form 520 immediately after making entries in the said register.
(4) The Commercial Tax Officer having jurisdiction over the cold
storage 1[or ware house or godown or any other such place] or any other
officer authorized by the concerned Deputy Commissioner shall have powers
of inspection of Cold Storages.
33. Records to be maintained by clearing/forwarding agents:– (1)
When the goods are transported after clearance from a seaport, on behalf
of a dealer not registered under the Act, the clearing or forwarding agent,
as the case may be, notwithstanding that such agent is not a dealer registered
under the Act or any other person in charge of the goods vehicle or vessel,
who, on behalf of such agent or importer transports the goods from the
seaport shall carry with him the following documents in respect of the goods
carried in the goods vehicle or vessel, namely:–
(a) a trip sheet, or log book, as the case may be;
(b) a Delivery Note in Form 602
(c) copy of the foreign seller’s invoice with the copy of bill of entry;
and;
(d) letter from the importer or clearing or forwarding agent to the
consignee, specifically mentioning the description, quantity and
value of the goods imported:
Provided that, in case, goods are imported by a dealer, registered
under the Act it is sufficient, if the goods are accompanied by
a way bill in Form X or Form 600 instead of Delivery Note in
Form 602.
(2) A clearing or forwarding agent/importer from outside the State
of Andhra Pradesh shall obtain the required number of Delivery Notes in
Form 602 from the Commercial Tax Officer, having jurisdiction over the
seaport, by producing evidence of import of goods, including nature of
goods, quantity and value of goods.
(3) A clearing or forwarding agent at a sea port shall furnish information
relating to consignments cleared by him during the previous month to the

Commercial Tax Officer, having jurisdiction over the seaport, so as to reach

him on or before the tenth day of the succeeding month.
34. Records to be maintained by agents acting on behalf of
principals:– (1) Any person acting as a selling agent on behalf of agriculturist
principal or any other dealer not registered as a VAT dealer or as a TOT
dealer shall be required to maintain records on Form 521 containing the
full particulars of names and addresses of agriculturist principals, names
and addresses of buying dealers with TIN / GRN, name and quantity of
the commodity sold, the date of sale, value of sale etc. 1[He shall also
submit every month a copy of Form 521 along with proof of payment of
tax to the Commercial Tax Officer having jurisdiction where such agent
is located.]
(2)(a) Any person acting as a buying agent or as a selling agent on
behalf of resident principals other than agriculturist’s principals shall maintain
records on Form 522 containing the details of name and address of resident
principal, TIN / GRN, name and quantity of commodity purchased or sold,
date of purchase or sale, value of the goods, tax invoice or invoice number
issued or received on behalf of principal etc.
2
[Provided that the selling agent on behalf of a resident principal shall
furnish a declaration to the principal in Form 522B prescribed, when the
goods received from such principal are transferred outside the State otherwise
than by way of sale under Section 6A of Central Sales Tax Act, 1956,
containing the details of goods received from the principal and the details
of goods transferred outside the State along with the copies of statutory
forms received.]
(b) Every resident principal registered under the Act who is carrying
on the business of selling or buying any of the goods taxable under
the Act, through his agent, shall issue a declaration to such agent
in Form 522A.
3
[(c) Every dealer, being the principal and claiming exemption on his
turnover under clause (b) of sub-section (10) of section 4 shall
be in possession, for every tax period, a declaration in Form 522C
obtained from the registered dealer who, on his behalf as an Agent,
sold the taxable goods relating to such turnover and such selling
agent shall issue the declaration to his principal within ten days
from the end of the month in which such goods were sold.
(d) Every dealer, being the principal and claiming deduction of input
tax on goods, purchased by any other registered dealer on his
behalf as a buying Agent, shall be in possession, for every tax
period, a declaration in Form 522D, duly obtained from such buying
agent, together with the tax invoices in original, relating to such
purchases, and such buying agent shall issue the declaration and
1. Added by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010, w.r.e.f. 24-9-2008.
2. Added by G.O.Ms.No. 597, Rev. (CT. II) Dept., dt. 2-5-2007, w.r.e.f. 1-4-2005.
3. Subs. for Clauses (c) and (d) by G.O.Ms.No. 503, Rev. (CT-II), Dept., dt. 8-5-2009,
w.e.f. 1-5-2009.
furnish the tax invoices to his principal with ten days from the
end of the month in which such goods were purchased.]
(3) Every person acting as an agent on behalf of non-resident principal
shall issue tax invoices or invoices on behalf of the principal and shall
maintain the records on Form 523 containing the details like name and
address of the non-resident principal, registration number of non-resident
principal in the State, name and quantity of the commodity purchased or
sold, value of the goods sold or purchased, date of sale or purchase,
particulars of transportation to his principal tax, invoice number issued or
received etc.
(4) Every cotton ginning mill shall maintain in the prescribed form the
following records, namely;–
(a) Register of kapas ginned and lint dispatched on Form 524.
(b) Register of stocks on Form 525.
CHAPTER VII
REFUNDS
35. Procedure for Refunds:– (1) The claim for refund shall be made
by a VAT dealer on Form VAT 200 by a TOT dealer on Form TOT
030.
(2) Any VAT dealer who claims any refund of VAT or a TOT dealer
who claims refund of excess TOT shall not be eligible for any refund unless
all the returns due have been filed and the taxes due have been paid.
(3) The authority prescribed shall have the powers to adjust any amount
to be refunded against any taxes, penalty and interest outstanding under
the Act against such VAT dealer or such TOT dealer.
(4) The authority prescribed shall not refund any VAT where tax,
penalty, interest or any other amount is outstanding against such VAT dealer
under the Andhra Pradesh General Sales Tax Act, 1957 and or under the
(5) Subject to the conditions specified in sub-section (1) of Section
38, a VAT dealer shall be eligible to claim a refund for the tax period
in which sales falling within the scope of 1[clause (b) of Section 8] have
been made in excess of Rupees ten lakhs in such tax period and in other
cases at the end of second year after commencement of the Act and
thereafter in the return to be filed for month of March or in the event
of cancellation of registration.
(6)(a) In the case of sales falling within the scope of sub-section (1)
of Section 5 of Central Sales Tax Act, 1956, the VAT dealer shall be
in possession of the following documents:
(i) Copy of contract or order from a foreign buyer
1. Subs. for "clauses (b) and (c) of S.8" by G.O.Ms.No. 503, Rev. (CT-II), Dept.,
dt. 8-5-2009, w.e.f. 1-5-2009.
(ii) 1[x x x]
(iii) Copy of the invoice issued to the foreign purchaser
(iv) Transport documentation i.e. Bill of Lading, Airway Bill, or a like
document.
(v) Evidence of payment or evidence of letter of credit from the
foreign purchaser.
2
[(vi) Copy of the document in proof of export duly certified by Customs
Department.]
(b) In the case of sales falling within the scope of sub-section (3)
of Section 5 of Central Sales Tax Act, 1956, the VAT dealer
shall be in possession of the following documents:
(i) Declaration in Form ‘H’
(ii) Purchase order from exporter
(iii) Evidence of export in the form of transport documentation i.e.
bill of lading, air way bill or a like document.
3
[(c) in the case of sales falling within the scope of sub-section (6)
of Section 8 of Central Sales Tax Act, 1956, the Value Added
Tax dealer shall be in possession of the following documents :
(i) Declaration in Form 1 ;
(ii) Authorisation Certificate from Development Commissioner ;]
(7) A VAT dealer making sale of goods in the course of inter-state
trade or commerce falling under Section 3 of the Central Sales Tax Act,
1956 may adjust any excess credit available under the Act against any
tax payable under the Central Sales Tax Act, 1956 for the same tax period.
(8)(a) Where the VAT dealer makes a claim under Section 38, such
refund shall be made within a period of ninety days of the date the return
was due or the date the return is filed whichever is later.
(b) Where the VAT dealer fails to produce accounts or records
required by the authority prescribed within seven days of date
of issue of the notice, the time limit specified in clause (a) shall
not apply.
(c) Where the VAT dealer has produced accounts or records within
the prescribed time limit, interest shall be payable at the rate of
one percent (1%) per month from the date after the expiry of
the ninety days till the date of actual refund.
1. Sub-clause (ii) "copy of the customs clearance certificate" omitted by G.O.Ms.No. 816,
Revenue (CT. II) Dept., dt. 15-6-2007, w.r.e.f. 1-4-2005.
2. Added by G.O.Ms.No. 816, Revenue (CT. II) Dept., dt. 15-6-2007, w.r.e.f. 1-4-2005.
3. Added by G.O.Ms.No. 1624, Revenue (CT. II), dt. 6-11-2006.
The interest in respect of part of month shall be computed

proportionately and for this purpose, month shall mean a period of thirty
days.
(9)(a) Where any refund is due to VAT dealer under Section 39, a
notice in Form VAT 351 shall be issued by the authority prescribed
proposing either adjustment of such refund against any tax, interest, penalty
and any amount due under the Act outstanding against such dealer or
notifying the refund within fifteen days of date of receipt of the order
specified in Section 39 of the Act.
(b) The VAT dealer, on receipt of such Form, shall confirm the claim
of refund within fifteen days of receipt by returning Form VAT
352.
(c) On After receipt of confirmation from the VAT dealer, the authority
prescribed shall either adjust or refund the amount as the case
may be.
(d) The stipulated time of ninety days under Section 39 shall include
the period of process specified under clauses (a), (b) and (c).
(e) Where the refund is not made within ninety days, the interest shall
be payable at the rate of one percent (1%) per month from the
date after the expiry of the said ninety days till the date of actual
refund.
The interest in respect of part of month shall be computed
proportionately and for this purpose, month shall mean a period
of thirty days.
(10)(a) Where any turnover tax has been levied and collected under
the Act in respect of sale inside the State of any declared goods specified
in Section 14 of the Central Sales Tax Act, 1956 and such goods are
subsequently sold by a VAT dealer in the course of inter-State trade or
commerce, the turnover tax so levied and collected shall be refunded to
such VAT dealer in manner and subject to the conditions specified in
clauses (b) to (e) of this sub-rule.
Provided that the refund shall not be made unless the tax payable
under the Central Sales Tax Act, 1956 is paid.
(b) The refund of tax referred to in clause (a) shall be made to the
VAT dealer who effected the first sale in the course of the inter-
State trade or commerce.
(c) Every application for such refund under this rule shall be filed by
the VAT dealer claiming refund in Form VAT 360 before the authority
prescribed having jurisdiction over the place of business of the VAT
dealer within a period of ninety days from the date of payment of
the tax due under the Central Sales Tax Act, 1956 in respect of
declared goods specified under clause (a) above
(Provided that the authority prescribed may condone for reasons to
be recorded in writing, any delay in filing of such application)
(d) The burden of proving that a VAT dealer is entitled to such refund
shall be on the VAT dealer claiming such refund.
(e) The authority prescribed shall, after making such enquiry as he
considers necessary, refund without interest the turnover tax levied
and collected within ninety days from the date of receipt of application
on Form VAT 360.
Provided that the authority prescribed shall first adjust the amount
of such refund towards tax, penalty, interest or any amount due from
the VAT dealer for any tax period and then refund the balance if
any.
(11) The claim for refund under sub-section (3) of Section 15 of the
Act shall be made on Form 510 along with the invoices in original. The
refund in such cases shall be made within a period of 45 days from the
date of submission of Form 510.
(12) The claim for refund under sub-section (5) of Section 38 of the
Act shall be made on Form 510A, along with the copies of invoices, within
45 days from the end of the month during which the goods are purchased,
to the Commissioner or to any other officer in Commissioner. The refund
in such cases shall be made within a period of 45 days from the date
of the claim.
1
[(13) The Claim for refund under sub-section (9) of Section 38 of
the Act shall be made in Form 510B, along with the proof of payment
of tax in original, within 45 days from the end of the month during which
the tax was paid, to the Commissioner or to any other officer, authorized
by the Commissioner. The refund in such cases shall be made within a
period of 90 days from the date of claim.]
CASELAW
Excess tax collected by the assessee shall not be refunded unless the assessee
proves that he has refunded it to the customers. The Associated Cement Company
Ltd., Hyderabad v. The CTO, Secunderabad and another, (2012) 54 APSTJ 61.
CHAPTER VIII
TRANSFER OF A BUSINESS
36. Conditions for Transfer of a Business:– The transfer of a
business from one VAT dealer to another VAT dealer is exempt from
VAT subject to the following conditions, namely;–
(a) the business must be transferred as an ongoing concern and
continue trading under the new ownership;
(b) the VAT dealer transferring the business shall notify the authority
prescribed of the transfer of the business within ten days of the
date of the transfer;
(c) the VAT dealer transferring the business shall apply for cancellation
of his registration, if warranted and shall comply with the provisions
of Rule 14.
(d) The VAT dealer acquiring the business shall account for tax on
the stock and assets acquired, at the time of their sale.
(e) The VAT dealer acquiring the business shall retain all the tax
records related to that business for a period of not less than six
years as specified in sub-section (4) of Section 42 after the end
of the year in which the business was acquired.
CHAPTER IX
CREDIT FOR TAX PAID ON STOCK ON HAND AT
THE COMMENCEMENT OF THE ACT
37. Conditions for the Relief of Sales Tax at the Commencement

of the Act:– (1) On the first day of the commencement of the Act, if
a VAT dealer has in stock any goods on which sales tax has been paid
under the Andhra Pradesh General Sales Tax Act, 1957, that VAT dealer
shall be entitled to claim a credit of sales tax excluding turnover tax paid
under the said Act for such goods which were purchased from 1st day
of April 2004 to 31st day of March 2005.
(2) The conditions for claiming sales tax credit shall be,–
(a) the dealer claiming credit must be registered for VAT on the date
of commencement of the Act;
(b) the claim for credit shall be on Form VAT 115;
(c) where the goods in stock are listed in Schedule I or Schedule
VI to the Act, no sales tax credit shall be allowed;
(d) the sales tax credit allowed shall be subject to the conditions in
Rule 20;
(e) a VAT dealer claiming sales tax credit shall make an inventory
of all goods on hand on the date of commencement of the Act
on which a sales tax credit is claimed within a period of seven
days of the commencement of the Act ;
(f)(i) where documentary evidence of sales tax charged is available,
the sales tax charged shall be used as the basis for claiming the
credit. In case of goods specified in the Sixth Schedule of the
Andhra Pradesh General Sales Tax Act, 1957, the tax paid on
the value of the goods shall be arrived by applying the tax fraction,
even though tax was not shown separately;
(ii) where the documentary evidence specified in clause(i) is not

available, the amount that can be claimed as credit shall be based
on ninety percent (90%) of purchase value. The tax component
which can be claimed as a credit shall be calculated by the use
of the tax fraction to this value;
(iii) where any tax was paid on any goods at the point of purchase
by the dealer himself, such tax actually paid shall be eligible for
sales tax credit;
(g) where the goods in stock are listed in sub-rule (2) of Rule 20,
no sales tax credit shall be allowed except as provided for under
the provisions of that rule;
(h) a claim for sales tax credit shall be submitted to the authority
prescribed within ten days from the date of commencement of
the Act. The Deputy Commissioner may, having regard to the
circumstances permit the VAT dealer to make the claim after
the said ten days but not later than thirty days from the date
of commencement of the Act. The approval of the claim for sales
tax credit shall be issued on Form VAT 116 not later than ninety
days from the date of commencement of the Act ;
(i) the VAT dealer shall keep all documents relating to the claim
for credit for a period of four years from the date of commencement
of the Act and shall provide such documents to the authority
prescribed for audit if required;
1
[Whenever a VAT dealer is liable to restrict his sales tax credit
as per the conditions in Rule 20, he shall submit Form VAT 200-
G along with the return. Wherever annual adjustment of sales tax
credit is to be made, such VAT dealer shall submit Form VAT
200-H along with the return for March, 2006.]
(3) When a claim under this Rule is approved on Form VAT 116
by the authority prescribed the amount certified as eligible for credit shall
be claimed as a credit in six equal instalments. 2[These instalments shall
be claimed in the returns for the period from August, 2005 to March, 2006.]
(4) Where any claim for sales tax credit is found to be false either
fully or partly, the authority prescribed shall reject the claim to the extent
1. Ins by G.O.Ms.No. 2201 Rev. CT-II, Dept., dt 29-12-2005. w.e.f. 1-12-2005.

2. Subs by ibid for "These shall be claimed monthly commencing on the return for August,
2005 and ending on the return for January, 2006"
it is false and the excess claimed or approved shall be recovered by

assessing the dealer under the provisions of the sub-rule (9) of Rule 25;
(5) Where any VAT dealer executing any works contract claimed sales
tax relief on closing stock as on 31.03.2005, and such goods are used in
the works contracts for which composition is opted after 01.04.2005, such
VAT dealer shall declare the value of the closing stocks as output value
and the sales tax claimed as output tax in the tax period in which composition
is opted for such specific contract.
(6) Where any VAT dealer opting to pay tax under sub-section (9)
of Section 4 claimed sales tax relief on closing stock as on 31.03.2005,
and such goods are used in the business for which composition is opted
after 01.04.2005, such VAT dealer shall declare the value of the closing
stocks as output value and the sales tax claimed as output tax in the tax
period in which composition is opted for such specific business.
CHAPTER X

38. Procedure for Appeals:– (1) Subject to the provisions of Section

31, any person aggrieved by an order passed or proceeding recorded under
the provisions of the Act, other than an order passed under sub-rule (1)
and (3) of Rule 25 by any officer not above the rank of an Assistant
Commissioner, may appeal to the Appellate Deputy Commissioner of the
area concerned:
Provided that Commissioner may either suo-motu or on application,
for reasons to be recorded in writing transfer an appeal pending before
an Appellate Deputy Commissioner to another Appellate Deputy
Commissioner and shall communicate the order of transfer to the appellant
or applicant to every person affected by the order, the authority against
whose orders the appeal or application was preferred, and to the Appellate
Deputy Commissioner.
(2)(a) Every such appeal shall be in Form APP 400 verified in the
manner specified in the rules;
(b) It shall be in duplicate;
(c) It shall be accompanied by a treasury receipt in support of having
paid;
(i) in case where the levy of tax, or penalty or interest is disputed,
a fee calculated at the rate of two percent of the disputed tax
or penalty or interest subject to a minimum of fifty rupees and
a maximum of One thousand rupees and;
(ii) in all other cases a fee of Fifty rupees;

(d) It shall be accompanied by a declaration on Form APP 400A
stating that the amount specified in the second proviso to sub-
section (1) of Section 31 has been paid, and proof of such
payments.
(3) The appeal may be sent to the Appellate Deputy Commissioner
by registered post or be presented to him or to such officer as he may
appoint in this behalf by the appellant in person or by his authorized
representative or a legal practitioner.
(4) The Appellate Deputy Commissioner shall, after giving the appellant
a reasonable opportunity of being heard, pass orders as specified in sub-
39. Application for Stay of collection of tax disputed:– (1) Every
application under clauses (a) or (b) of sub-section (3) of Section 31 or
under sub-section (6) of Section 33 shall be on Form APP 406 and shall
be verified in the manner specified therein.
(2) It shall be in duplicate and one of the copies shall be affixed
with court-fee stamp of the value of three rupees and shall also be
accompanied by a certified copy of the order of assessment or order of
penalty.
(3) Any order staying collection shall be limited to the amount actually
disputed in appeal.
40. Application for Stay when appeal is filed before the Appellate
Tribunal:– (1) In a case where stay of collection of the tax or penalty
under dispute is granted by the Appellate Deputy Commissioner under
clause (a) of sub-section (3) of Section 31 and on disposal of the appeal
by such Appellate Deputy Commissioner under sub-section (4) of Section
31, the appellant files an appeal to the Appellate Tribunal, he may apply
to the Additional Commissioner (Commercial Taxes)(Legal) or Joint
Commissioner (Commercial Taxes) (Legal) for the continuance of the stay
granted under clause (a) of sub-section (3) of Section 31 by the Appellate
Deputy Commissioner until the appeal filed before the Appellate Tribunal
is disposed of.
(2) The application shall be on Form APP 404 in duplicate and one
of the copies shall be affixed with court-fee stamp of the value of three
rupees. A copy of the appeal petition filed before the Tribunal shall be
enclosed to the application.
(3) Any order staying collection shall be limited to the amount actually
disputed in appeal before the Appellate Tribunal.
1
[(4) The application in Form APP404 shall be accompanied by the
proof of payment of tax as specified in sub section (2) of Section 33.]
41. Communication of Appellate or Revisional Orders:– Every
order of an appellate authority under Section 31 or revising authority under
Section 32, as the case may be, shall be communicated to the appellant
or the party affected by the order, to the authority against whose order
the appeal was filed and to any other authority concerned.
42. Appellate or Revisional authority may enhance tax payable
by a dealer:– Where the tax as determined by the authority prescribed
appears to the appellate authority under Section 31 or to the revising authority
under Section 32 to be less than the correct amount of tax payable by
the dealer, the appellate or revising authority shall, before passing orders,
determine the correct amount of tax payable by the dealer after issuing
a notice to the dealer and after making such enquiry as such appellate
or revising authority considers necessary.
43. Orders of Appellate or Revising Authority shall be given
effect to:– The order passed on appeal or on revision shall be given effect
to by the assessing authority who shall refund any excess tax or fee found
to have been collected and shall have power to collect any tax or fee
which is found to be due, in the manner as if it were a tax assessed by
himself.
44. Appeal to the Sales Tax Appellate Tribunal – Procedure:–
(1)(a) Every appeal under Section 33 to the Appellate Tribunal shall be
in Form APP 401 and shall be verified in the manner specified therein.
(b) Every such appeal shall clearly set forth the grounds of appeal
and the relief claimed and shall be accompanied by,
(i) four spare copies thereof;
(ii) four copies of the order appealed against one of which
shall be the original or the authenticated copy and ;
(iii) four copies of the order of the assessing authority.
(c) It shall also be accompanied by a treasury receipt in support of
having paid;
(i) in cases where the levy of tax or penalty is disputed, a fee
calculated at the rate of two percent of the disputed tax and or
penalty subject to a minimum of Rs. 100/- and a maximum of
Rs. 2,000/- and ;
(ii) in all other cases a fee of One hundred rupees ; and
VAT–23
1
[(d) It shall be accompanied by satisfactory proof of payment of the
amounts, as specified in the first, second and third provisos, as
the case may be, under Section 33 of the Act.]
(2) If the Appellate Tribunal allows an appeal preferred by a dealer
under Section 33 it may, in its discretion, by order, refund either wholly
or partly the fee paid by the dealer under sub-section (3) of Section 33.
(3) Every order passed by the Appellate Tribunal under Section 33
shall be communicated to the Deputy Commissioner concerned and to the
State Representative, in addition to those specified in sub-section (8) of
Section 33.
45. Time limit to file revision petition to the High Court:– Within
ninety days from the date on which the order of the Sales Tax Appellate
Tribunal, under Section 33 was communicated to him, the dealer or the
State Representative may prefer a petition to the High Court, under Section
34 against the order on the ground that the Appellate Tribunal has decided
erroneously or has failed to decide, any question of law.
46. Revision to the High Court – Procedure:– Every petition under
sub-section (1) of Section 34 to the High Court shall be on Form APP
402 it shall be verified in the manner specified therein.
It shall be accompanied by a certified copy of the order of the
Appellate Tribunal and where it is preferred by the dealer be accompanied
by a fee of five hundred rupees.
47. Appeal to the High Court – Procedure:– Every appeal under
Section 35 to the High Court shall be on Form APP 403 and shall be
verified in the manner specified therein. It shall be preferred within sixty
days from the date on which the order was communicated and shall be
accompanied by a certified copy of the order of the Commissioner of
Commercial Taxes appealed against and a fee calculated at the rate of
two percent of the disputed tax or penalty or any other amount subject
to a minimum of five hundred rupees and maximum of two thousand rupees.
48. Review by High Court – Procedure:– Every application for
review under sub-section (7) of Section 34 or sub-section (4) of Section
35 to the High Court shall be on Form APP 404 or Form APP 405
respectively and shall be verified in the manner specified therein.
It shall be preferred within one year from the date of communication
to the petitioner of the order sought to be reviewed, and where it is preferred
by the dealer be accompanied by a fee of hundred rupees.
1. Subs. for "It shall be accompanied by satisfactory proof of payment of the amounts
as specified in first and second provisos as the case may be, of sub-section (2) of
Section 33." by G.O.Ms.No. 503, Rev. (CT-II), Dept., dt. 8-5-2009, w.e.f. 1-5-2009.
49. Orders of the Appellate Tribunal or High Court shall be given

effect to:– Every order passed by the Appellate Tribunal or the High Court
shall, on authorization by the Appellate Tribunal or the High Court, as
the case may be, be given effect to by the authority prescribed, who shall
refund without interest, within ninety days from the date of communication
of the authorization, any excess tax found to have been collected and shall
also collect any additional tax which is found to be due in the same manner
as a tax and assessed by himself.
50. Powers of Revision under Section 32 may be exercised by
higher authorities:– (1) The powers of the nature referred to in sub-section
(1) of Section 32 may be exercised by the Commissioner, Additional
Commissioner, Joint Commissioner, Deputy Commissioner and Commercial
Tax Officer in the case of orders passed or proceedings recorded by
authorities, officers or persons subordinate to them within a period of four
years from the date on which the order or proceeding was served on the
dealer.
(2) No order shall be passed under sub-rule (1) enhancing any assessment
unless an opportunity has been given to the assessee to show cause against
the proposed enhancement.
Explanation:– The aforesaid periods shall be computed subject to the
deduction of the periods indicated in sub-sections (5) and (6) of Section
32.
51. Authorities who may exercise powers of revision under Section
32:– For the purpose of the exercise of the powers of the nature referred
to in sub-section (1) of Section 32 the authorities specified in column (1)
of the Table below shall be deemed to be sub-ordinate to the authority
specified in the corresponding entry in column (2) thereof.
1. Additional Commissioners, Joint Commissioner of

Commissioners, Deputy Commissioners, Commercial Taxes.
Appellate Dy. Commissioners, Assistant
Commissioners, Commercial Tax Officers,
Deputy Commercial Tax Officers and
Assistant Commercial Tax Officers.
2. Deputy Commissioners including Appellate Additional
Deputy Commissioners, Assistant Commissioner of
Commissioners, Commercial Tax Officers, Commercial Taxes
Deputy Commercial Tax Officers and (legal), or Joint
Assistant Commercial Tax Officers. Commissioner of
Commercial Taxes
(Legal)
3. Assistant Commissioners, Commercial Tax Deputy Commissioner

Officers, and Deputy Commercial Tax (Commercial Taxes), of
Officers and Assistant Commercial Tax the division concerned.
Officers.
4. Commercial Tax Officers, Deputy Assistant
Commercial Tax Officers and Assistant Commissioner
Commercial Tax Officers. (Commercial Taxes), of
the division concerned.
CHAPTER XI
&# '#
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52. Search as per the procedure prescribed in Cr.P.C. 1973:– (1)

Where any officer duly authorized under Section 43, conducts a search
of any office, shop, shop-cum-residence (residential accommodation) godown,
vessel, vehicle, or any other place of business or any premises or place
where he has reason to believe that the dealer keeps or is for the time
being keeping any goods, accounts, registers or other documents of his
business, he shall as far as possible follow the procedure prescribed in the
Code of Criminal Procedure, 1973 (Central Act 2 of 1974).
(2) If on search, such officer finds any accounts, registers or other
documents which he has reason to believe to relate to any evasion of tax
or other fee due from the dealer under the Act, he may, for reasons to
be recorded in writing, seize such accounts, registers, or other documents
and shall give the dealer a receipt for the same. The accounts and registers
so seized shall not be retained by such officer for more than thirty days
at a time without the permission of the next higher authority.
53. Seizure and confiscation of goods:– (1) If any officer authorized
under Section 43, finds any goods in any office, shop, godown, vehicle
vessel or any other place of business or any other building or place of
a dealer which have not been accounted for in the accounts, registers, or
other documents maintained in the course of his business, the officer may,
for reasons to be recorded in writing, seize such goods. The order of seizure
on Form 603 shall specify the description, the quantity and the value of
the goods seized. A copy of it shall be served on the dealer or the person
in charge of the goods.
(2) Any officer may, if security in cash is furnished to his satisfaction,
order release of goods seized to the owner, and if he is not present, to
the person in charge of the goods pending further enquiry if necessary.
The order of release on Form 604 shall be subject to the condition that
if the goods in question are finally confiscated under sub-rule (4), they shall
be produced within such time as may be required, failing which, the cash
security furnished shall stand forfeited to the State Government without
further notice.
(3) In cases not falling under sub-rule(2), if the whole or any of the
goods, seized under sub-rule (1) are of a perishable nature, the officer may
sell them or get them sold, in public auction as laid down in sub-rules (8)
to (17).
Provided that the notice of fifteen days laid down in sub-rule (9) below
shall not apply to the public auction of goods of perishable nature and in
lieu of the same, the officer shall cause adequate publicity through displaying
a notice on the notice board of his office.
(4) Any such officer, after making such enquiry as he deems fit and
after giving the owner of the goods, if he is ascertained, an opportunity
of being heard, may confiscate the whole or any part of the goods seized,
if he is satisfied that there is evasion or an attempt to evade tax thereon
in any manner whatsoever. If the owner is not ascertained even after the
enquiry, the officer shall order confiscation of the goods. A copy of the
order of confiscation on Form 605 shall be served on the owner of the
goods if he is ascertainable.
(5) The goods confiscated under sub-rule (4) shall be sold in public
auction as laid down in sub-rules (8) to (17).
(6) If, on enquiry, under sub-rule (4), it is considered by the officer
who seized the goods that confiscation is not warranted in regard to any
of the goods seized, or if any order of confiscation is set aside or modified
in regard to any goods, on appeal or revision, such goods shall be returned
to the owner or any other person authorized by him if they had not be
sold in public auction under sub-rule (3) or (5). If they had already been
sold in public auction, the proceeds of the sale less the expenses incurred
in the sale, if any by the State Government, shall be refunded to the owner
of the goods or any other person authorized by him.
(7) In case wherein a confiscation order has been passed in respect
of any goods, the owner of which was not ascertainable before the order
is passed, such owner of the goods or any other person on his behalf may
appear before the officer who ordered the confiscation and satisfy him with
relevant records regarding the bonafides of the goods in question and
regarding the reasons for his non-appearance earlier. If the officer is
satisfied that there has been no evasion or attempt at evasion of tax he
may order, for reasons to be recorded in writing, the release of the goods
confiscated or if such goods had already been sold and delivered, the refund
of the sale proceeds of the goods, less the expenses incurred for safe
custody of the goods and other incidental charges. If the officer is not
so satisfied, he may after recording reasons therefore, order that the sale
under sub-rule (5) shall be proceeded with or that the proceeds of the
sale already conducted shall not be refunded, as the case may be.
(8) The officer who detained the goods shall cause to be published
in the notice board of his office a list of the goods detained and intended
for sale with a notice on Form 606 under his signature, specifying the place
where and the date on, and the hour at which the detained goods will
be sold in open auction and shall also display copy of such list and notice
in the office of the Commercial Tax Officer having jurisdiction over the
place where the goods were detained.
(9) A notice of fifteen days shall be given before the auction is
conducted.
(10) Intending bidders shall deposit as earnest money a sum equal
to five percent (5%) of the estimated value of the goods.
(11) At the appointed time, the goods shall be put up in one or more
lots, as the officer conducting the auction sale may consider necessary and
shall be knocked down in favour of highest bidder, subject to confirmation
of the sale by the Commercial Tax Officer having jurisdiction over the
place where the goods were detained where the value of the goods auctioned
does not exceed one thousand rupees and by any officer not lower in rank
than the Deputy Commissioner in other cases.
(12) The earnest money deposited by the unsuccessful bidders shall
be refunded to them within three days from the date of auction.
(13) (a) The auction purchasers shall pay to the officer conducting
the auction the sale value of the goods in cash immediately after the sale
and shall not be permitted to carry away any part of the goods until he
has paid in full and until the sale is confirmed by the authority specified
in sub-rule (11).
(b) The officer receiving the value of the goods in cash shall issue
a receipt on Form 607 to the person making such payment.
(14) Where the purchaser fails to pay the purchase money the earnest
money deposited by the defaulting bidder shall be forfeited to the Government
and the goods shall be resold in the auction. The procedure prescribed for
the first auction shall be followed for conducting the subsequent auction.
(15) If any order directing detention is set aside on appeal or revision,

the goods so detained, if they have not been sold in auction, shall be released
and if they have been sold, the proceeds thereof shall be paid to the owner
of the goods, deducting the expenses incurred from the time a detention
of the goods to the time they were sold in auction.
(16) Any person from whom tax is due shall on application to the
officer on Form 608 who conducted the sale, and upon sufficient proof,
be paid the sale proceeds specified under sub-rule (13), after deducting
the expenses of sale and other incidental charges and the amount of tax
due.
(17) The procedure specified in this rule shall apply to give effect
to the orders directing refund on appeal of revision.
54. Acquisition of goods:– (1) The powers specified under Section
44 shall be exercised with prior approval of next higher authority, by any
officer not below the rank of the Commercial Tax Officer having jurisdiction
over the area where the goods are available at the time of initiating
proceedings for acquisition of goods.
(2) The goods acquired under Section 44 shall be sold in public auction
following the procedure laid down in sub-rules (8) to (17) of Rule 53.
(3) Every officer who has acquired the goods under Section 44 shall
pass orders within fifteen days from the date of such acquisition, sanctioning
payment of compensation to the owner of the goods as specified in sub-
CHAPTER XII
MOVEMENT OF GOODS/GOODS VEHICLES
AND CHECK-POSTS
55. Movement of Goods in Goods Vehicles:– (1) Subject to sub-

rules (2) and (4) every dealer who consigns goods by a goods vehicle shall
make out a waybill in Form X or Form 600 in triplicate and issue the original
and duplicate thereof duly signed by him or his manager or agent to the
owner or the other person in charge of the goods vehicle.
For the purpose of this clause, only waybills printed under the authority
of the State Government or the Commissioner shall be used. When such
waybills are not readily available for use for any reason, the waybills
containing the signature and official seal of the Commercial Tax Officer
or the Asst. Commissioner having jurisdiction over the consignor shall be
used in lieu of such printed waybills.
Provided that the issue of a way bill shall not be necessary where
a person who is not a dealer transports his household or other articles for
his own use from one place to another and also in respect of transport
of the goods specified in Schedule I to the Act.
(2) In the case of goods imported into the State from the places outside
the State, the waybill of the State from which the goods commence their
journey shall be accepted if accompanied by a tax invoice or a sale invoice
or a delivery note or a document in such form, as has been approved by
the Commissioner:
Provided that any consignee dealer who desires to import goods notified
by the Commissioner of Commercial Taxes to be sensitive, from other States
or Union Territories shall send in advance a way bill in duplicate to the
consignor. Such way bill in duplicate filled in by the consignor shall
accompany the goods and shall be tendered by the person-in-charge of
the goods vehicle to the officer-in-charge of the check post through which
the goods vehicle first enters into the State.
(3) The owner or the other person in charge of the goods vehicle
shall carry the original and duplicate of the waybill and shall tender the
original waybill to the officer in charge of the Check Post through which
the goods vehicle first passes on its way.
(4) In the case of a manufacturer registered as a VAT dealer the
copy of the gate pass-cum-invoice raised by such manufacturer shall be
accepted in lieu of the waybill in Form 600 provided the Taxpayer Identification
Number is superscribed on the gate pass-cum-invoice. Provided that where
any category of manufacturers are notified by Commissioner as ineligible
to use the gate pass cum invoice as waybill, they shall make out waybills
on Form 600.
(5) Every person obtaining the Way Bills under sub-rule (i) shall keep
and maintain a register in Form 601 showing a true and correct account
of the way bills obtained, used and held in stock by him.
(6) Where a way bill either blank or duly filled in is lost, the person
who obtained the way bill forms printed under the authority of the Government
or containing the signature and official seal of the assessing or registering
authority as the case may be shall forthwith notify the loss in writing to
the issuing authority and shall also by way of an indemnity bond furnish
such reasonable security as may be demanded by such authority for each
way bill lost. Any dealer giving an incorrect and untrue declaration shall
be deemed to have committed an offence under the Act.
1
[(7)The transporter or owner or other person incharge of goods vehicle
or a vessel as the case may be shall maintain a register of record in Form
520-A containing full details of the consignor or consignee with full address,
TIN Registration Number, CST Registration Number, Invoice Number/
Delivery Challan Number/quantity and value of the goods and other details
of goods transported in the goods vehicle or a vessel. The transporter or
owner or other person in charge of the goods vehicle or a vessel as the
case may be shall submit an extract of the entries made in such register
of records, extract of entries entered in the log book or goods vehicle records
or trip sheet as the case may be for each month to reach the Commercial
Tax Officer having jurisdiction over the area in which the goods are delivered
before the 10th day of the succeeding month. The register of record
maintained shall be made available to any Officer of the Commercial Taxes
Department not below the rank of Deputy Commercial Tax Officer in case
of any enquiry, whenever called for. The word 'transporter' shall include
any agency transporting goods by Road, Rail, Air, Water or combination
thereof.]
2
[(8)The owner or other person incharge of goods vehicle or a vessel
or a bus carrying passengers and goods, as the case may be and where
such goods are transported for more than one consignee in the State or
other States and where such transport of goods are not covered by sub-
rule (1) to sub-rule (6) of this rule, shall submit details of the goods being
carried in Form-650 at the first entry into the State at the Check post.
Such Form shall be submitted in duplicate to the Officer incharge of the
Check post and after getting it verified and attested by the Officer incharge
of the Check post the original should be retained at the Check post and
the duplicate shall be issued to the person submitting such Form-650 and
he shall carry duplicate form along with goods vehicle.
(9) The owner or other person incharge of goods vehicle or a vessel
or a bus carrying passengers and goods, as the case may be and where
such goods are transported for more than one consignee in other States
and where such transport of goods are not covered by sub-rule (1) to sub-
rule (6) of this rule, shall submit details of the goods being carried in Form
651 at the Exit Check post in the State. Such Form shall be submitted
1. Subs for "The owner or other person incharge of goods vehicle or a vessel, as the
case may be, shall submit an extract of the entries recorded in the log book or goods
vehicle record or trip sheet, as the case may be, for each month to reach the Commercial
Tax Officer having jurisdiction over the area in which the goods are delivered before
the tenth day of the succeeding month" by G.O.Ms.No. 2201, Rev. CT-II, Dept., dt.29-
12-2005. w.e.f. 1-12-2005.
2. Sub-rules (8), (9) and (10) added by Ibid, w.e.f. 1-12-2005.
in duplicate to the Officer incharge of the Check post and after getting
it verified and attested by the Officer incharge of the Check post, the original
should be retained at the Check post and the duplicate shall be issued to
the person submitting such Form-651 and he shall carry duplicate Form
along with goods vehicle.
(10) The owner or other person incharge of goods vehicle or a vessel
or a bus, as the case may be had transported goods covered by rule 55(8)
and rule 55(9), in a month, in addition to complying with the provisions
of sub-rule (7) of this rule, shall submit the duplicate copies of Forms-
650 and 651 for each month by 10th of the following month to the Deputy
Commissioner having jurisdiction over the area where the registered office
of such vehicles, buses and vessels carrying goods are located. The copies
of duplicate Forms 650 and 651 should also be submitted by their branches
and parcel offices if such branches are independently operating and such
copies of Forms should be submitted to the Deputy Commissioner in whose
jurisdiction such branch offices are located or where goods are delivered
by such transport vehicles or buses or vessels.]
56. Procedures and powers of officers at Check-posts:– (1)(a)
Subject to sub-rule (2) the officer in charge of the Check post or any
other officer authorized shall have the power to stop and inspect any goods
vehicle, and all the records. If on such inspection, it is found that there
is any discrepancy in the goods or any defect in the records or if any
other omission or irregularity is detected; the officer shall issue notice on
Form 610 specifying the description, the quantity and the value of the goods
proposed to be detained under sub-section (6) of Section 45. A copy of
the notice shall be served on the owner of the goods and if he is not
present on the spot on the driver or any other person in charge of goods
vehicle;
(b) The security specified in Section 45 shall be an amount equal to
two times of the tax payable;
(c) the security shall be in the form of cash or in the form of bank
guarantee, by a bank incorporated under the Banking Regulations
(Companies) Act, 1949 (Central Act 10 of 1949);
(d) the officer receiving the security and the tax shall issue a receipt
in the name of dealer liable to pay tax and also intimate the details
of such collection to the officer concerned having jurisdiction over
the place of business of the owner of the goods;
(e) the tax collected on detention of the goods or goods vehicle shall
be credited to the account of the owner of the goods if he is
registered and if he is not registered, the officer specified in clause
(d) shall pass proceedings as deemed fit and take appropriate

action under the provisions of the Act and these Rules;
(f) where the tax and the security directed to be paid or furnished
is not paid or not furnished, the officer concerned who detained
the goods, shall pass an order specifying the description, quantity
and value of the goods detained and the reasons for such detention.
A copy of the order shall be served on the owner of the goods
or on the driver or any other dealer in charge of the goods vehicle;
(g) no such detention by any officer concerned shall be for more than
three days except with the permission of the next higher authority.
(h) the next higher authority shall be the Commercial Tax Officer
of the area having jurisdiction over the Check Post or the area
in which such detention was made and where the detention is made
by the Commercial Tax Officer, the next higher authority shall
be the Deputy Commissioner of the area concerned;
(i) where no claim is made for the goods detained within the time
prescribed in the detention order or where the goods detained are
subject to speedy and natural decay, the Commercial Tax Officer
having jurisdiction over the Check post or the area where the
detention was made, shall cause sale of such goods in open auction
and remit the sale proceeds thereof in a Government treasury
provided that, a notice of fifteen days is given before the auction
is conducted in respect of goods which are not subject to speedy
and natural decay;
(j) the auction shall be conducted by an officer not below the rank
of Deputy Commercial Tax Officer and in case the goods were
detained by an officer below the rank of Deputy Commercial Tax
Officer the goods shall be transferred to the Deputy Commercial
Tax Officer having jurisdiction over the Check Post or the area
within which such detention is made;
(k) the Deputy Commercial Tax Officer conducting the auction shall
cause to be published in the notice board of his office a list of
the goods detained and intended for sale with a notice under his
signature, specifying the place where, and the date on, and the
hour at which the detained goods will be sold in open auction
and shall also display copies of such list and notice at the check
post or the barrier where the goods were detained, and in the office
of the Commercial Tax Officer having jurisdiction over the check
post or barrier where the goods were detained;
(l) a notice of fifteen days shall be given before the auction is

conducted;
(m) Intending bidders shall deposit as earnest money a sum equal to
five percent (5%) of the estimated value of the goods;
(n) at the appointed time, the goods shall be put up in one or more
lots, as the officer conducting the auction sale may consider
necessary, and shall be knocked down in favour of the highest
bidder, subject to the confirmation of sale by the next higher
authority;
(o) the earnest money deposited by the unsuccessful bidders shall be
refunded to them;
(p) the successful bidder shall be permitted to carry the goods only
after he has paid the full amount to the officer conducting the
auction, failing which the earnest money deposited by him shall
be forfeited to the Government and the goods may be resold in
the auction. The procedure prescribed for the first auction shall
be followed for conducting the subsequent auction;
(q) the officer receiving the payment for value of goods shall issue
a receipt for such payment;
(r) where an order directing detention is set-aside on appeal, the goods
so detained shall be released and where they have been sold, the
proceeds thereof, shall be paid to the owner of the goods, deducting
the expenses incurred from the time of detention of the goods
to the time they were sold in auction;
(s) any person from whom tax is due shall, on application to the officer,
who conducted the sale, and upon sufficient proof be paid the
sale proceeds after deducting the expenses of sale and other
incidental charges and the amount of tax due;
(t) the procedure specified in this shall apply to give effect to the
orders directing refund on appeal or revision.
(2)(a) when the goods are being transported to any destination within
the State by a transport operator notified by the Commissioner, the Officer-
incharge of the check post or any other officer authorized detecting any
discrepancy in the goods or any defect in the records or any other omission
or irregularity shall, instead of detaining the goods at the check post serve
a notice of offence on the approved transport operator and permit such
operator to carry the goods to the destination within the State, provided
the approved transport operator undertakes to part with the goods only after
the receipt of the release order from the authority prescribed having
jurisdiction over the destination. The officer in-charge of the check post
or officers authorized shall within forty eight hours transmit the notice of
offence and other documents if any, to the authority prescribed, having
jurisdiction over the destination.
The authority prescribed having jurisdiction over the destination, to
whom the notice of offence has been referred shall proceed to take action
deemed fit and the procedure prescribed in sub-rule (1) shall mutatis-
mutandis apply.
(b) For the purpose of clause (a) the Commissioner of Commercial Taxes
shall have the power to approve the transport operator by a notification;
Any transport operator desirous of availing such facility shall apply
to the Commissioner along with an indemnity bond to indemnify any
loss that may be occasioned to the Government of Andhra Pradesh
on account of breach of faith;
The Commissioner of Commercial Taxes shall, after enquiry, may
either notify or refuse to notify within fifteen days from the date
of the application.
1
[(3) Where the owner or other person incharge of goods vehicle or
a vessel or a transport bus carrying passengers and goods has not complied
with the provisions made in Rule 55(8), 55(9) and 55(10) or carrying goods
other than those mentioned in such Forms, on verification of such vehicle
or bus or vessel, the Officer incharge of the Check post shall detain the
vehicle along with the goods for further verification. The procedures and
powers laid down in sub-rule (1) and sub-rule (2) of this rule shall be
followed by the Officer in charge of the Check posts to dispose of such
detained goods and vehicles.]
CASELAW
While tax and penalty are paid at the check-post on admission, the question
of refund of tax and penalty does not arise. Sri Venkateswara Animal and Health
Products v. Deputy Commercial Tax Officer-I, Madanapally, (2012) 54 APSTJ 75.
57. Procedures and powers of officers at other places:– (1) At
any place other than a check post or a barrier, the driver or any other
person in-charge of a goods vehicle or boat or a vessel as the case may
be, on demand, by an officer authorized, shall stop the vehicle or boat, as
the case may be, and keep it stationary as long as may reasonably be
necessary, and allow the officer to examine the contents in the vehicle or boat
1. Added by G.O.Ms.No. 2201, Rev. CT-II, Dept., dt. 29-12-2005. w.e.f. 1-12-2005.
or vessel and inspect all records relating to the goods carried, which are in
the possession of such driver or other person in charge, who shall, if so
required, give his name and address and the name and address of the owner
of the goods vehicle or vessel.
(2) If on such inspection by such officer it is found that any dealer
is transporting goods in a goods vehicle or vessel not covered by a waybill
in Form 600 or such other document prescribed in Rule 58 issued by the
person who consigned the goods, such officer may take action as provided
for in Rule 56.
1
[(3) Further on such inspection by such Officer it is found that any
goods vehicle or a vessel or a bus carrying passengers and goods is not
accompanying with the copies of Form-650 or Form-651 as the case may
be or such vehicles are carrying the goods other than those mentioned in
those forms, such Officer may take action as provided for in Rule 56.]
58. Transit Movement:– 2[(1) In order to obtain a transit pass under
Section 47, the driver or the person in charge of the goods vehicle shall
submit such documents and furnish such information which may be relevant
or necessary along with payment of a fee of Rs. 50/- in cash or by way
of Demand Draft or treasury challan to the officer in charge of the check
post or barrier after his entry into the State. The amount of Rs. 50/- so
collected shall be remitted to the head of account of user charges.
(2) The officer in charge of the first check post shall after examining
the documents and after making such enquiries as he deems necessary,
shall make out a Transit Pass in Form 616 in triplicate and issue the original
and duplicate thereof duly signed by him to the driver or person-in-charge
of the vehicle after obtaining his signature at the end of the declaration
provided in the said form.]
(3) The driver or the person-in-charge of the goods vehicle shall carry
the original and duplicate copies of the transit pass and shall tender the
original copy to the officer-in-charge of the last check post or barrier before
1. Added by G.O.Ms.No. 2201, Rev. CT-II, Dept., dt. 29-12-2005. w.e.f. 1-12-2005.
2. Subs. for sub-rules (1) and (2) by G.O.Ms.No. 29, Rev. (CT. II) Dept., dt. 10-1-2007,
prior to its substitution it read as under :
(1) In order to obtain a transit pass under Section 47, the driver or the person-in-
charge of a goods vehicle shall submit a declaration on Form ‘615 to the officer-in-
charge of the first check post or barrier, after his entry into the State and shall also
furnish if so required, any other information that may be relevant and necessary.
(2) The officer-in-charge of the first check post shall, after examining the documents
and after making such enquiries as he deems necessary, shall make out a transit pass
on Form 616 in triplicate and issue the original and duplicate thereof duly signed by
him to the driver or the person-in-charge of the goods vehicle.
his exit from the State.

1
[Provided that where the goods carried by such vehicle are, after
their entry into the State, transported outside the state by any other vehicle,
the number of that vehicle shall be recorded in the original and duplicate
copies of the transit pass and certified by the officer prescribed ;]
(4) The driver or the person-in-charge of the goods vehicle shall stop
the vehicle and allow the officer-in-charge of the last check post or barrier
to inspect the documents, transit pass and the goods in order to ensure
that the goods being taken out of the State are the same goods for which
transit pass had been obtained.
(5) If on such inspection, the officer-in-charge of the last check post

or barrier is satisfied that the goods being transported are the same goods
both in quantity and description noted in the transit pass, he shall affix the
seal of the check post on the duplicate copy of the transit pass under his
signature and allow the vehicle to pass into the other State.
(6) If on such inspection, it appears that the quantity of goods under

transport is less than the quantity noted in the transit pass or the description
of the goods is different from the description noted in the transit pass, the
officer-in-charge of the last check post or barrier shall presume that the
goods to that extent have been sold within the State by the owner or other
person-in-charge of the goods vehicle and shall accordingly assess the owner
or other person incharge of the goods vehicle as specified in Section 21.
The said officer shall have the power to detain the vehicle so long as he
may reasonably be deem it necessary.
(7) Powers of the nature referred to in sub-rule (6) may also be

exercised by an officer not below the rank of an Assistant Commercial
Tax Officer. He shall, however, inform the officer-in-charge of the first
check post within seven days of such inspection, in case, he proposes to
make an assessment.
(8) The original copy of the transit pass, so received by the officer-
in-charge of last check post or barrier shall be sent by him by Registered
Post, to the officer-in-charge of the first check post or barrier within ten
days from the date of receipt from the driver or the other person-in-charge
of the goods vehicle. Action taken under sub-rule (6) shall also be informed
1. Added by G.O.Ms.No. 29, Rev. (CT. II) Dept., dt. 10-1-2007.

within the said time.

1
[(9) In case the original copy of the transit pass is not received back
within thirty days of its issue, the officer-in-charge of the first check post
shall send a report to the Commercial Tax Officer prescribed who shall
assess the owner of the goods vehicle as specified in Section 47 of the
Act.]
CHAPTER XIII
MISCELLANEOUS
59. Authority prescribed:– (1) For the purpose of exercising powers
specified in column (1) of the table below, the authorities specified in column
(2) therein, shall be the authorities prescribed.
Sl. Authority
Columnprescribed
(1) underColumn (2) and the Rules
the Act Column (3)
No. Powers Authority Section/Rules
2
1. VAT [Any other officer not Section 17(10),
registration/Amend- below the rank of Assistant 17(11), 18(1)(a),
ment/Cancellation Commercial Tax Officer, 19(2), Rules 4 to
duly authorized by the 14.
Commissioner of
Commercial Taxes.]
2. TOT Assistant Commercial Tax Section 17(10),
registration/Amend- Officer of the circle 17(11), 18(1)(b),
ment/Cancellation authorized by the 19(2) Rules 4 to
Commercial Tax Officer 7, 10 to 12 and
of the Circle 3[or any other 15
officer, not below the rank
of Assistant Commercial
Tax Officer duly authorized
by the Commissioner.]
3. Receipt of VAT Assistant Commissioner Section 20(1)
return (Large Taxpayer Unit) or Rule 23
Commercial Tax Officer or
officer authorized by him.
1. Subs. by G.O.Ms.No. 29, Rev. (CT. II) Dept., dt. 10-1-2007, prior to its substitution
it read as under :
"(9) The officer-in-charge of the first check post or barrier, if he is not in receipt of
the original copy of the transit pass within thirty days of issue by him, shall send
a report to the Commercial Tax Officer, having jurisdiction over the first check post
or barrier, who shall assess the owner of the goods vehicle as specified in Section 21
read with Section 47."
2. Subs. for "Commercial Tax Officer of the Circle concerned (or any other officer
not below the rank of Commercial Tax Officer, duly authorized by the
Commissioner" by G.O.Ms.No. 1308, Rev. (CT-II) Dept., dt. 22-10-2010,
w.e.f. 22-10-2010.
Sl. Column (1) Column (2) Column (3)

Receipt of TOT return Deputy Commercial Tax
Officer authorized for the
purpose.
4. Assessments
VAT-
(i) Unilateral (i) Assistant Section 21(1)
assessment under Commissioner of the Rule 25(1)
Rule 25(1) division concerned in case
of Large Taxpayer Unit
and Commercial Tax
Officer in the case of
circle.
(ii) Assessment under (ii)(a) Assistant Section 20(3)(a)
Rule 25(5) Commissioner in case of & (b), Section
Large Taxpayer Unit 21(3), 21(4),
dealer. 21(5), 24(2),
(b) Commercial Tax Rule 25(5)
Officer or Deputy
Commercial Tax Officer
in case of dealers in the
territorial jurisdiction of
the circle as authorized by
Deputy Commissioner
concerned.
(c) 1[Any officer not
below the rank of Deputy
as authorized by the Joint
Commissioner or
Additional Commissioner
empowered for this
purpose by the
Commissioner.]
(d) Any officer not below
the rank of Deputy
of the division as
authorized by the Deputy
Commissioner of the
division.
1. Subs. by G.O.Ms.No. 1164, Rev. (CT. II) Dept., dt. 14-8-2006, w.r.e.f. 1.4.2005.
8)6` "

(iii) Reassessment The authority who detects Section 21(6)
(a) in case of under the under assessment.
assessment
(b) in case of errors The authority who made Rule 60
apparent on record. the assessment.
(iv) TOT-Unilateral (iv) Deputy Commercial Sec. 20(3)(a) &
assessment/Best Tax Officer of the circle (b), 21(1), 21(3),
Judgement concerned as authorized (4) & (5) and
assessment. by the Commercial Tax Rule 25(1) &
Officer of the circle 25(5).
concerned.
(v) TOT reassessment Deputy Commercial Tax Sec. 21(6)
Officer of the circle
concerned as authorized
by the Commercial Tax
Officer of the circle
concerned.
1 2
[(vi) Assessment in [Commercial Tax Section 47
case of failure to Officer, having the Rule 58(4)]
tender the transit pass jurisdiction over the
at the exit check post. Check Post at which the
Transit Pass is issued (or)
any other officer
authorized by the Deputy
Commissioner (CT)
having jurisdiction over
the check post at which
the transit pass is issued.]
3
[(vii) Proceedings to Assistant Commissioner, Section 37 and
be issued in conse- Commercial Tax Officer Rules 43 and
quence to the orders, or the Deputy Commercial 49.]
passed by different Tax Officer, as the case
Appellate and may be, having territorial
Revision Authorities jurisdiction over the
under Sections dealer, irrespective of the
31,32,33,34 and 35 of fact whether the original
the APVAT Act. order under appeal or
revision has been passed
by him or not.
1. Added by G.O.Ms.No. 29, Rev. (CT. II) Dept., dt. 10-1-2007.

2. Subs. by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010, w.e.f. 14-10-2010.
3. Inserted by G.O.Ms.No. 503, Rev. (CT-II), Dept., dt. 8-5-2009, w.e.f. 1-5-2009.

5. Recovery of An officer not below the rank of Sec. 27(2), 29
taxes Deputy Commercial Tax Officer as
(Provisional authorized by the Deputy
attachment Commissioner of the division
and third concerned.
party
recovery)
6 Refunds In cases where the amount does not Sec. 38(1),
(i) VAT exceed Rs. 50,000/- the Commercial (2), (3), (6),
Tax Officer of the circle concerned. 40(2) and
In the case of Large Taxpayer Unit Rule 35
dealers, the Assistant Commissioner
of the division upto a sum of Rs. 2
lakhs.
In the cases where the sum does not
exceed Rs. 10 lakhs the Deputy
Commissioner of the division
concerned.
In the cases where the sum exceeds
Rs. 10 lakhs the Joint Commissioner
or Additional Commissioner in the
office of the Commissioner of
Commercial Taxes.
(ii) TOT Deputy Commercial Tax Officer of Sec. 38(7)
the circle as authorized by the Rule 35
Commercial Tax Officer of the circle.
7. Entry, (a) Assistant Commissioner or Sec. 43(1), (2)
Inspection, Commercial Tax Officer of the Large Rules 52 & 53
search, Taxpayer Unit concerned in respect
seizure, of cases on the register of the Large
confiscation : Taxpayer Unit.
(b) Commercial Tax Officer of the
circle concerned.
(c) Any officer not below the rank of
Deputy Commercial Tax Officer of
the division with prior permission or
approval of the Deputy
Commissioner concerned.
1
[(d) Deputy Commercial Tax Officer
working in the G.A. (V&E)
Department.
1. Subs. by G.O.Ms.No. 1164, Rev. (CT. II) Dept., dt. 14-8-2006, w.r.e.f. 1-4-2005.

(e) Any officer not below the rank
of Deputy Commercial Tax
Officer as authorized by the Joint
Commissioner or Additional
Commissioner empowered for
this purpose by the
Commissioner.]
1 2
8. [Residential [Any officer not below the rank Sec. 43(2),
accommodation of Deputy Commercial Tax Rules 52 & 53
not being a Officer authorized by the Deputy
business-cum- Commissioner concerned and
residence] officers not below the rank of
Deputy Commercial Tax Officer
working in General
Administration (Vig. & Enf.)
Department authorized by the
Deputy Commissioner working in
Vigilance & Enforcement
Department.]
2
9. Power to [Any officer not below the rank Sec. 45, Rules
inspect records/ of Assistant Commercial Tax 56 & 57
goods of a Officer of the Circle/Division
vehicle concerned as authorized by the
Commercial Tax Officer/Deputy
Commissioner concerned and any
officer not below the rank of
Deputy Commercial Tax Officer
working in the General
Administration (Vig. & Enf.)
Department.
3
[9A. Certifying the The CTO having jurisdiction over Proviso to
transshipment the place, where transshipment sub-rule (3) of
details in the takes place. Rule 58]
transit pass.
10. Levy of Sections 49 to
specific 57
penalties under
the Act
1. Subs. by G.O.Ms.No. 1779, Rev. (CT. II) Dept., dt. 13-10-2005, w.e.f. 17-10-2009.
2. Subs. by Ibid.
3. Inserted by G.O.Ms.No. 29, Rev. (CT. II) Dept., dt. 10-1-2007.
Sl. Column (1) Column (2) Colm

No Powers Authority Sec.
− Any penalty Assessing authority or
relatable to VAT Registering or inspecting
dealer on the rolls of authority as the case may be
Large Tax Payer
Unit.
− Any penalty Assessing authority or
relatable to VAT Registering or inspecting
dealer other than authority as the case may be.
Large Tax Payer
Unit.
− Any penalty By the registering authority,
relatable to TOT assessing authority authorized
dealer. officer who detects such offence.
− Any penalty or By the authorized officer who
penalties detects such offence.
11. Forfeiture Assessing or inspecting authority Sec. 5
as the case may be. (5), (6
12. Prosecution/Composit Assessing or inspecting authority Sec. 5
ion of offences as the case may be. 61
13. Authority to prescribe Assessing authority concerned. Sec. 4
records
14. Casual trader-receipt Deputy Commercial Tax Officer Rule
of return and of the circle as authorized by the
assessment Commercial Tax Officer of the
circle concerned.
15. Authority before Appellate Deputy Commissioner Sec. 3
whom appeal is to be concerned.
filed.
16. Remittance of TDS Commercial Tax Officer of the Sec. 2
(2) The Commissioner shall be the authority empowered as specified

in Section 3-A, to assign any functions of the authorities prescribed to any
officers subordinate to him whenever he may deem it necessary.
60. Correction of Errors:– Any authority prescribed, appellate or
revising authority may at any time within four years from the date of any
order passed by him rectify any clerical or arithmetical mistake apparent
from the record. No such rectification which has the effect of enhancing
the tax liability or penalty shall be made unless a notice is given to the
person concerned to provide him with a reasonable opportunity of being
heard.
CASELAW
Where correction under Section 60 does not involve enhancement of
taxing liability or penalty, there is no need to issue any notice or give any
opportunity of hearing. Lease Plan India Ltd., v. CTO, Ranigunj, 2010 (6)
ALD 497 (DB) = (2010) 51 APSTJ 73.
61. Power to Require Production of Documents and Obtain
Information:– (1) The Commissioner or any officer authorized in writing
by the Commissioner 1[or any officer working in Vigilance & Enforcement
Department not below the rank of Deputy Commissioner or any officer
not below the rank of Deputy Commercial Tax Officer working in Vigilance
& Enforcement Department authorized in writing by the Deputy Commissioner
working in Vigilance & Enforcement Department] may, by notice on Form
555, require any person, whether or not liable for tax under the Act,–
(a) to furnish any information that may be required by the notice;
or
(b) to attend at the time and place designated in the notice for the
purpose of being examined on oath by the Commissioner or by
such officer relating to any proceedings under the Act. The
Commissioner or such officer may require the person examined
to produce any book, record, or computer-stored information in
the control of the person.
(2) The Commissioner or any Officer specified in sub-rule (1) or any
officer prescribed under the Act, or these of shall have all the powers
conferred on a civil court under the provisions of the Civil Procedure Code,
1908 (Central Act 5 of 1908) to summon and enforce the attendance of
any person or to examine any person on oath or affixation or to compel
production of documents.
(3) Where the notice requires the production of a book or record,
it is sufficient if that book or record is described in the notice with reasonable
certainty.
62. Information to be treated as confidential:– (1) All particulars
contained in any statement made, return furnished or accounts or documents
produced under the provisions of the Act or of the rules made thereunder,
1. Inserted by G.O.Ms.No. 1779, Rev. (CT-II) Dept., dt. 13-10-2005, w.e.f. 17-10-2005.
or in any evidence given or in any record of any proceeding relating to

the recovery of a demand prepared for the purpose of the Act or the
rules made thereunder, shall be treated as confidential and shall not be
disclosed.
(2) Nothing contained in sub-rule (1) shall apply to the disclosure of
any such particulars,–
(i) for the purpose of any investigation or prosecution under the Indian
Penal Code, 1860 or under any other enactment for the time being
in force in respect of any such statement, return, accounts,
documents, evidence, affidavit or deposition or for the purpose of
a prosecution under the Act or the rules made thereunder; or
(ii) to any person acting in the execution of the Act or the rules made
thereunder where it is necessary to disclose the same to him for
the purpose of the Act or the Rules made thereunder; or
(iii) occasioned by the lawful employment under the Act or the rules
made thereunder of any process for recovery of any demand;
or
(iv) to a Civil Court in any suit to which the Government are a party,
which relates to any matter arising out of any proceeding under
the Act or the rules made thereunder; or
(v) occasioned by the lawful exercise by a public servant of his powers
under the Indian Stamp Act, 1899 to impound an insufficiently
stamped document; or
(vi) to an officer of,–
(a) the Government of India; or
(b) the Government of any State in India with which an agreement
for disclosure on a reciprocal basis has been entered into by the
Government of this State; or
(c) any State which has acceded to the Republic of India and with
which an agreement for disclosure on a reciprocal basis has been
entered into by the Government of this State; or
(vii) to an officer of any department, other than the Commercial Taxes
Department of the Government, after obtaining,–
(a) the permission of the Commercial Tax Officer of the area concerned,
where such particulars are to be furnished by a Deputy Commercial
Tax Officer or Assistant Commercial Tax Officer; and
(b) the permission of the Commissioner where such particulars are
to be furnished by a Commercial Tax Officer or an Assistant
Commissioner or a Deputy Commissioner:
Provided that such particulars shall be furnished under clause (vii)

only in exceptional cases and that any officer obtaining such
particulars shall keep them as confidential and use them only in
the lawful exercise of the powers conferred by or under any
enactment.
63. Nomination of Responsible person:– (1) Every VAT dealer or
every TOT dealer registered under the Act, shall nominate a person on
Form 560 authorizing him or her to sign any returns or any documents
or any statements, and to receive any notices or orders on his behalf. Any
returns filed, any statements made and notices or orders received by such
nominated person shall be binding on the dealer.
(2) Every VAT dealer being a partnership, trust, company, non-resident
individual, or resident individual who resides outside the State for more
than one tax period shall nominate a person who is a resident in the State
for purposes specified in sub-rule (1).
(3) The name of the person nominated shall be notified on Form
560 to the Commissioner or Officer authorized by him within the time
specified as follows, namely,–
(a) in the case of a partnership, trust, company or non-resident
individual, in the first tax period in which the partnership, trust,
company or individual becomes a VAT dealer; or
(b) in the case of a resident individual who resides outside the State,
in the first tax period in which the individual resides outside the
State.
(4) Where a person fails to comply with clause (a) of sub-Rule (3),
the Commissioner or Officer authorized shall nominate a person for the
purposes specified in sub-rule (1).
(5) A person may, by notice in writing to the Commissioner or Officer
authorized change the nominated person.
(6) The person nominated shall be responsible for any obligation
imposed on the partnership, trust, company or individual under the Act.
64. Mode of Service of orders and notices:– (1) Unless otherwise
provided in the Act, or these Rules, a notice or other document required
or authorized under the Act or these Rules to be served shall be considered
as sufficiently served,–
(a) on a person being an individual other than in a representative
capacity if,–
(i) it is personally served on that person ; or
(ii) it is left at the person’s usual or last known place of residence

or office or business in the State; or
(iii) it is sent by registered post to such place of residence, office
or business, or to the person’s usual or last known address in
the State; or
(b) on any other person if,–
(i) it is personally served on the nominated person ; or
(ii) it is left at the registered office of the person or the person’s
address for service of notices under the Act; or
(iii) it is left at or sent by registered post to any office or place of
business of that person in the State;
(iv) where it is returned unserved, if it is put on board in the office
of local chamber of commerce or traders association.
(2) The certificate of service signed by the person serving the notice
shall be evidence of the facts stated therein.
65. Conditions regarding enrolment, suspension and cancellation
of enrolment of Sales Tax Practitioners:– (1) A sales tax practitioner
representing any person before any authority other than the High Court
under clause (e) of Section 66 shall be,–
(a) a person who possesses a degree in Commerce or Economics
or Law of a recognized University or;
(b) a person, who has retired from the Andhra Pradesh Commercial
Taxes Department:
Provided that in either case he is enrolled as a sales tax practitioner
by the Commissioner and whose enrolment has not been cancelled;
or
(c) any person who has been enrolled as sales tax practitioner under
Andhra Pradesh General Sales Tax Act 1957.
(2) Any person possessing the qualifications specified in clause (a)
or (b) of sub-rule (1) may apply to the Commissioner for enrolment as
a sales tax practitioner. The application for enrolment shall be accompanied
by a treasury receipt in support of having credited a sum of 1[Five thousand
rupees] to the following Head of Account:
(040 Sales Tax-Receipts under the State Sales Tax Act)
If the Commissioner of Commercial Taxes is satisfied that the applicant
has the required qualifications and has not been found guilty of misconduct
in connection with any sales tax proceeding, he shall enroll such person
as a sales tax practitioner.
1. Subs. for "One thousand rupees" by G.O.Ms.No.1292, Rev. (CT-II) Dept.,
dt. 14-10-2010, w.e.f. 14-10-2010.
(3)(a) Notwithstanding anything contained in sub-rules (1) and (2), no

person who had held office in the Commercial Taxes Department not below
the rank of Assistant Commercial Tax Officer and has retired or resigned
from such post, shall be eligible for a period of two years from the date
of his retirement or date of acceptance of the resignation, to act as a Sales
Tax Practitioner or to accept any engagements, to appear on behalf of
any dealer in any sales tax proceedings, except before the Sales Tax
Appellate Tribunal and the Commissioner of Commercial Taxes.
1
[xxx]
(4) The Commissioner of Commercial Taxes may, by order, cancel
or suspend the enrolment of a person who is enrolled as a Sales Tax
Practitioner–
(a) if he is found guilty of misconduct in connection with any sales
tax proceedings; or
(b) if his enrolment has been found wrongly ordered.
(5) No order shall be passed by the Commissioner of Commercial
Taxes rejecting an application for enrolment or cancelling or suspending
an enrolment unless the applicant or the sales tax practitioner, as the case
may be, has been given a reasonable opportunity of making his representation.
(6) Any applicant in respect of whom an order has been passed by
the Commissioner of Commercial Taxes rejecting his application for enrolment,
and any sales tax practitioner in respect of whom an order has been passed
by the Commissioner of Commercial Taxes cancelling or suspending the
enrolment may within one month from the date of receipt of such order,
appeal to the Government to have such order cancelled; and no such order
shall have effect till the expiry of one month from the date of its receipt
by such person or practitioner or where an appeal is preferred until the
disposal of the said appeal.
(7) Any person, who is entitled to appear before any authority on
behalf of a dealer under Section 66, shall file an authorization from the
dealer on Form 565.
1. Clause (b) omitted by G.O.Ms.No.1292, Rev. (CT-II) Dept., dt. 14-10-2010,

w.e.f. 14-10-2010.
Prior to its omission it read as under:--
"(b) Every person enrolled as a Sales Tax Practitioner shall renew his enrolment
every year by paying an amount of one hundred rupees and by furnishing latest
particulars about himself before 30th day of April every year:
Provided that any Sales Tax Practitioner enrolled under the provisions of
the Andhra Pradesh General Sales Tax Act, 1957, shall be deemed as enrolled
on the date of the commencement of the Act and the renewal of enrolment shall
commence from 1st day of April, 2006."
1
[(8) The Commissioner of Commercial Taxes may authorize any
officer not below the rank of Joint Commissioner to exercise the powers
conferred in this rule.]
66. Procedure for filing, disposal etc., authority for clarifications
and advance ruling:– (1) An applicant may withdraw an application filed
under Section 67 within thirty days from the date of application.
(2)(i) An application under Section 67 shall be in Form 570 and shall
be verified in the manner indicated therein and every such application shall
be accompanied by a fee of one thousand rupees.
(ii) The fees specified in the sub-rule (1) shall be paid by way of
crossed demand draft in favour of the Commissioner of Commercial
Taxes, A.P., Hyd.
(3) On receipt of any such application, the Authority shall cause a
copy thereof to be forwarded to the assessing or registering authority
concerned and call for any information or records.
(4) The authority may, after examining such application and any records
called for, by order, either admit or reject the application within thirty days
of the receipt of the application.
(5) A copy of every order made under sub-rule (4) shall be sent to
the applicant and the authority specified in sub-rule (3).
(6) The authority shall hold its sittings at its headquarters at Hyderabad
as and when required and the date and place of hearing shall be notified
in such manner as the Chairman may by general or special order direct.
(7) Where an application is admitted under sub-rule (4), the authority
shall after examining such further material as may be placed before it by
the applicant or obtained by the authority, pass such order as deemed fit
on the questions specified in the application, after giving an opportunity to
the applicant of being heard, if he so desires. The authority shall pass an
order within four weeks of the date of the order admitting the application
and a copy of such order shall be sent to the applicant and to the authority
specified in sub-rule (3).
(8)(i) The authority may at its discretion permit or require the applicant
to submit such additional facts as may be necessary to enable it to pronounce
its clarification or advance ruling.
(ii) Where in the course of the proceedings before the authority, a
fact is alleged which cannot be borne out by or is contrary to
the record, it shall be stated clearly and concisely and supported
by a duly sworn affidavit.
(9) Where on the date fixed for hearing or any other day to which
the hearing may be adjourned, the applicant or the officer concerned does
not appear in person or through an authorized representative when called
on for hearing, the authority may dispose of the application ex parte on
merits:
Provided, that where an application has been so disposed of and the
applicant or the authority specified in sub-rule (3), applies within fifteen
1. Sub-rule (8) added by G.O.Ms. No. 2201, dt. 29-12-2005, w.e.f 1-12-2005.
days of receipt of the order and satisfies the authority that there was
sufficient cause for his non-appearance when the application was called
upon for hearing, the authority may, after allowing the opposite party a
reasonable opportunity of being, make an order setting aside the ex parte
order and restore the application for fresh hearing.
(10) Where the authority on a representation made to it by any officer
or otherwise finds that an order passed by it was obtained by the applicant
by fraud or mis-representation of facts, it may be, by order, declare such
order to be void ab initio and thereupon all the provisions of the Act and
the rules thereunder shall apply to the applicant as if such order had never
been made.
(11) A copy of the order made under sub-rule (6) shall be sent to
the applicant and the Commissioner or the officer concerned.
(12) Where the applicant dies or is wound up or dissolved or disrupted
or amalgamated or succeeded to by any other person or otherwise comes
to end, the application shall not abate and may be permitted by the authority,
where it considers that the circumstances justify it, to be continued by the
executor, administrator or other legal representative of the applicant or by
the liquidator, receiver or assignee, as the case may be, on an application
made in this behalf.
(13) Where the authority finds on its own motion or on a representation
made to it by the applicant or the authority specified in sub-rule (3), but
before the clarification or ruling pronounced by the authority has been given
effect to by the officer concerned, that there is a change in law or facts
on the basis of which the clarification or ruling was pronounced, it may
by order modify such ruling in such respects as it considers appropriate,
after allowing the applicant and the officer a reasonable opportunity of being
heard.
(14)(i) The authority may, with a view to rectify any mistake apparent
from the record, amend any order passed by it before the clarification or
ruling order pronounced by the authority has been given effect to by the
officer concerned.
(ii) Such amendment may be made on its own motion or when the
mistake is brought to its notice by the applicant or the officer concerned,
but only after allowing the applicant and the officer reasonable opportunity
of being heard.
67. Treatment of tax incentive cases:– (1) Where any unit is
availing a tax holiday on the date of commencement of the Act, it shall
be treated as converted as the unit availing tax deferment. The balance
period available as on 31st day of March 2005 to such units shall be doubled.
The eligibility amount shall be the balance available to such unit as on that
date. Balance period means the difference of period between date of
completion of eligibility shown in the certificate of eligibility and 1st day
of April 2005.
(2) The units already availing tax deferment prior to commencement
of the Act, shall continue to be eligible to avail the balance amount available
as on 31st day of March 2005 and for the period as mentioned in the
eligibility certificate.
(3) The tax payable and the tax to be claimed as deferment for each
period shall be the net tax (i.e. output tax less input tax) which shall be
debited to the eligibility amount. 1[xxx]
2
[Illustration
CDL Industries was granted tax holiday for a period of 7 Years from
10-10-1999 for an amount of Rs.65,22,000. As on 31-03-2005, the dealer
has availed an amount of Rs.45,10,000.
The period originally availed is 5 (five) years, 5(five) months and 21 days.
The period of availment prior to 01-04-2005, when worked out on doubling
the same, is 10 (ten) years (11) months and 12 days. Deduct this period
from total period of 14 (fourteen) years, as availed to the Units under
Deferment Scheme originally. The balance period to be availed after 1.4.2005
is 36 months and 18 days. As per the above sub-rule (1) of this Rule, the
dealer now is eligible to avail Tax Deferment for the balance amount of
Rs.20,12,000/- for a period of 36 months and 18 days i.e. 01.04.2005 to
18-04-2008.
The amount of deferment, availed for each year, shall be paid after the
end of the period of availment to the dealer after the conversion from Tax
Holiday Scheme to Deferment Scheme.
The Calculation is as follows:
1. Actual period of availment under
Tax Holiday Scheme : 10-10-1999 to 9-10-2006
2. Period left as on 01-04-2005 : 01-04-2005 to 9-10-2006
3. Period left : 1 Year 6 months 9 days
4. Period doubled as per rule : 3 Years and 18 days
5. Period up to which the unit is Eligible
for incentive : 18-4-2008
6. The Month & year in which the Tax
Availed in the year 2005-2006 is payable : May 2008
7. The month & Year in which the Tax
Deferment availed in subsequent Year
is payable : May 2009 and so on.]
(4) Where any VAT dealer is availing deferment, a declaration in Form
502 shall be filed for every tax period in addition to the return in Form VAT
200.
3
[(5) The amount availed in the first year, in which the unit is converted
from Tax Holiday Scheme to Deferment Scheme, shall be paid in the month
succeeding the month in which the period for which the Unit is eligible for
availment of the incentives is completed and the amount availed in the second
year, shall be paid in the year, subsequent to the year in which the amount,
availed in the first year is paid or payable and so on.]
CASELAW
It is only the legislature which can withdraw any concession retrospectively.
Such withdrawal cannot be effected by any delegated authority through rule.
Suguna Poultry Farm Ltd., Palamaner v. State of A.P., (2010) 51 APSTJ 91.
1. Omitted by G.O.Ms.No. 2201, dt. 29-12-2005, w.r.e.f 1-4-2005. Prior to its omission it
read as below :
“Wherever the input tax exceeds output tax for a tax period and the deferment unit made
any export sales or sales in the course of exports in the same tax period, the unit shall
carry forward such excess input tax upto the month of March every year and shall be
eligible to claim refund in the tax return for the month of March every year”.
2. Subs. by G.O.Ms.No. 503, Rev. (CT-II), Dept., dt. 8-5-2009, w.e.f. 1-5-2009.
3. Added by G.O.Ms.No. 503, Rev. (CT-II), Dept., dt. 8-5-2009. w.e.f. 1-5-2009.
HSN CODES
How to read HSN Code for the purposes of VAT?
HSN Code gives numbers for all the different classes and types of goods
involved in foreign trade, both import and export. According to the name of
the article with reference to the Code Number, the Customs Officer determines
the duty payable thereon.
Under the VAT Act, the description of the articles is given in the schedules
appended to the Act that itself should have achieved the purpose. The description
is being wide and it is also the purpose of the VAT Act that all those articles
which satisfy the description shall be liable to be taxed at the rates prescribed;
the addition of several items with a foreword, "that is to say" raises several
complications. If the article under consideration satisfies the description, but
is not found in the HSN Code, the question immediately arises whether it is
covered by description and if not whether it could be taxed at that rate. To
exclude such article from the purview of description would naturally be unjust.
Similarly, if the article specified in the HSN Code does not satisfy the description
to levy tax at that rate is not the objective of the Act.
It is therefore suggested that the Act may clarify that when the article satisfies
the description, whether it is included in the HSN Code or not it shall be taxed
at the rate prescribed for the article coming under the description; and only
such of those the HSN Code when satisfies the description also may be liable
to be taxed at the rate indicated for the article described.
There is yet one more difficulty. Many of the HSN Codes end with the
expression, "others". The Act stipulates that the dealers shall acquaint themselves
with HSN Codes and also with the several interpretation given to the names
of the articles mentioned given by the concerned authorities thereon and by
the courts. In this context, it would have been better if the description of the
articles given in schedules if so required should have been made still wider
to comprehend fully the scope of the article mentioned instead of requiring the
assessee to refer to some other enactment for determining rate of the tax under
VAT Act.
Scope of applicability of certain items included under Schedule

I and Schedule IV of the Act.
[G.O.Ms.No. 1615, Rev. (CT. II) Dept., dt. 31-8-2005]
In exercise of the powers conferred under sub-section (2) of Section
76 of the A.P. Value Added Tax Act, 2005, the Governor of Andhra Pradesh
in supersession of G.O.Ms.No. 398, Revenue (CT. II) Dept., dt. 31-3-2005
and G.O.Ms.No. 490, Revenue (CT. II) Dept., dt. 15-4-2005, hereby order
that the HSN Codes in respect of thirteen (13) items in Sch. I and seventy
(70) items in Schedule IV shall be as specified in Annx. I and Annx. II
respectively appended to this notification.
This notification shall come into force on and from 1-9-2005.
507
508 H.S.N. Codes
ANNEXURE-I
SCHEDULE - I
Entry
Sl.
No. in Description of Goods HSN Code
No.
Sch.
1 1 Agricultural implements manually
operated or animal driven
2 2 Aids and implements used by handicapped
persons
1) Orthopaedic or fracture appliances 9021.10
2) Artificial joints 9021.31
3) Hearing aids, excluding parts and 9021.40
accessories
4) Other (parts and accessories) 9021.90
5) Braille typewriters (electric) 8469.20.10
6) Braille typewriters (non-electric) 8469.30.10
7) Wheel chairs for invalid (not 8713.10.10
mechanically propelled)
8) Wheel chairs for invalid 8713.90.10
3 4 Betel leaves 1404.90.40
4 5 Books and periodicals & journals
including maps,charts and globes.
1) Printed books, Brochures, leaflets and 4901.10.20
similar printed whether or not in single
sheet
2) Journals and periodicals (atleast 4 times 4902.10.20
a week)
3) Journals and periodicals (other) 4902.90.20
4) Children's picture, drawing or colouring 4903
books
H.S.N. Codes 509
5) Maps and hydrographic or similar 4905

charts of all kinds, including atlases,wall
maps,topographical plans and
globes,printed
6) Globes,round and inflatable
5 7 Charcoal 4402
6 9 Condoms and contraceptives
1) Sheath contraceptives 4014.10
2) Chemical contraceptive preparations 3006.60
based on hormones, or other products of
heading 2937 or on spermicides
7 13 Electrical energy 2716.00.00
8 15 Fishnet and Fishnet fabrics 5608.11.10
9 19 Garlic and Ginger
(1) Garlic
(a) fresh 0703.20.00
(b) Dried 0712.90.40
(2) Ginger (a) fresh 0910.10.10
(b) dried unbleached 0910.10.20.
(c ) dried bleached 0910.10.30
10 28 Raw wool 5101
11 29 Semen including frozen semen
(1) Bovine semen 0511.10.00
(2) Frozen semen , other than bovine 0511.99.91
12 30 Silk worm laying, cocoon and raw silk 5001 & 5002
13 41 Husk of pulses, paddy, groundnut and 2302 (except
wheat bran 2302.10 &
2302.20)
510 H.S.N. Codes
Explanation (1) The Rules for the interpretation of the provisions of the
Central Excise Tariff Act, 1985 read with the Explanatory Notes as updated
from time to time published by the Customs Co-operation Council, Brussels
apply for the interpretation of this notification.
Explanation (2) Where any commodities are described against any heading
or, as the case may be, sub-heading, and the aforesaid description is
different in any manner from the corresponding description in the Central
Excise Tariff Act, 1985, then only those commodities described as aforesaid
will be covered by the scope of this notification and other commodities
though covered by the corresponding description in the Central Excise
Tariff will not be covered by the scope of this notification.
Explanation (3) Subject to Explanation 2, for the purpose of any entry

contained in this notification, where the description against any heading or,
as the case may be, sub-heading, matches fully with the corresponding
description in the Central Excise Tariff, then all the commodities covered
for the purposes of the said tariff under that heading or sub-heading will be
covered by the scope of this notification.
Explanation (4) Where the description against any heading or sub-heading

is shown as "other", then the interpretation as provided in Note (2) shall
apply.
H.S.N. Codes 511
ANNEXURE-II
SCHEDULE - IV
Entry
Sl.
No. in Description of Goods HSN CODE
No.
Sch.
Agricultural implements not operated

1 1
manually or not driven by animal
1) Agricultural, horticultural or forestry 8432
machinery for soil preparation or
cultivation; lawn or sports-gound roller
2) Harvesting or threshing machinery, 8433 (except
including straw or fodder balers; grass or 8433.51 &
hay mowers; machines for cleaning, 8433.52)
sorting or grading eggs, fruit or other
agricultural produce, other than
machinery of heading 8437
3) Other agricultural, horticultural, 8436
forestry, poultry-keeping or bee-keeping
machinery, including germination plant
fitted with mechanical or thermal
equipment; poultry incubators and
brooders
4) Root or tuber harvesting machinery 8433.53
All kinds of bricks including fly ash
2 3
bricks, refractory bricks
1) Bricks (of siliceous fossil meals) 6901.00.10
2) Blocks (of siliceous fossil meals) 6901.00.20
3) Magnesia carbon bricks, shapes and 6903.10.10
graphetised alumina
4) Building Bricks (Ceramic) 6904.10.00
5) Cement building blocks and bricks 6810.11.00
512 H.S.N. Codes
6) Refractory bricks, blocks, tiles and 6902.00

similar refractory ceramic constructional
goods, other than those of siliceous fossil
meals or similar siliceous earths
7) Bricks and tiles of fly ash 6815.99.10
3 4 Asphaltic roofing sheets 6807
4 5 Earthen tiles other than ceramic and 6905.10.00

glazed tiles
5 6 All types of yarn and sewing thread other 1[x x x]
than cotton yarn in hank and silk yarn in
hank
(1) Yarn of carded wool 5106
(2) Yarn of combed wool 5107
(3) Yarn of fine animal hair (carded or 5108
combed)
(4) Yarn of wool or fine animal hair, 5109
containing 85% or more by weight wool
or of fine animal hair
(5) Yarn of coarse animal hair or horse 5110
hair ( including gimped horse hair yarn)
(6) Flax yarn 5306
(7) Yarn of jute or of other textile bast 5307
fibres of heading No. 5303
(8) Yarn of other vegetable textile fibres; 5308
paper yarn
(9) Yarn (other than sewing thread) of 5509
synthetic staple fibres
(10) Yarn ( other than sewing thread) of 5510
artificial staple fibres
(11) Yarn ( other than sewing thread) of 5511
man made staple fibres
1. Code No. 5106 deleted vide Errata in G.O.Ms.No. 1932, Rev. (CT-II)
Dept., dt. 18-11-2005.
H.S.N. Codes 513
(12) Synthetic filament yarn other than 5402

sewing thread
(13) Man made filament yarn (other than 5406
sewing thread)
(14) Artificial filament yarn other than 5403
sewing thread
(15)Textile yarn 5604
(16) Metalised yarn whether or not 5605
gimped
(17) Gimped yarn and strip 5606
6 8 Arecanut, betel nut and betel nut powder
1) Whole 0802.90.11
2) Split 0802.90.12
3) Ground 0802.90.13
7 10 Bearings of all kinds 8482
8 11 Beedi leaves 1404.90.10

9 12 Transmission rubber belts
1) PVC belt conveyor 3926.90.10
2) Conveyor or transmission belts or 4010
belting of vulcanised rubber
3) Leather belting for machinery 4204.00.40
4) Transmission or conveyor belts or 5910
belting, of textile material, whether or
not impregnated, coated, covered or
laminated with plastics, or reinforced
with metal or other material
10 13 Bicycles, tricycles, cycle rickshaws &
parts and accessories thereof
514 H.S.N. Codes
1) Bicycles and other cycles (including 8712

delivery tricycles), not motorised
2) Frames and forks, and parts thereof 8714.91
3) Wheel rims and spokes 8714.92
4) Hubs, other than coaster braking hubs 8714.93
and hub brakes, and free wheels sprocket
wheels
5) Brakes including coaster braking hubs 8714.94
and hub braking and parts thereof
6) Saddles 8714.95
7) Pedals and crank - gear, and parts 8714.96
thereof
8) Other 8714.99
9) New pneumatic tyres of rubber, of a 4011.50
kind used on bicycles
10) Inner tubes of rubber of a kind used 4013.20
on bicycles
11) Inner tubes of rubber of a kind used 4013.90.50
in tyres of cycle rickshaws and 3-
wheeled powered cycle rickshaws.
11 14 Bitumen
1) Asphalt, natural 2714.90.10

2) Bitumen, natural 2714.90.20
3) Petroleum bitumen 2713.20.00
4) Cut backs, bituminous or asphalt 2715.00.10
12 16 Bulk Drugs
1) ketones and quinones, whether or not 2914
with other oxygen function and their
halogenated, sulphonated, nitrated or
nitrosated derivatives
H.S.N. Codes 515

3) Organic derivatives of hydrazine or of 2928
hydro xylamine
5) Hetero cyclic compounds with oxygen 2932
heteroatom(s) only
6) Hetero cyclic compounds with 2933
nitrogen heteroatom(s) only
7) Nucleic acids and their salts, whether 2934
or not chemically defined; other hetero
cyclic compounds
13 19 Chemical fertilizers, Bio-fertilizers and
Bone Meal including mixtures or Nurient
elements such as Iron, Zinc, Copper and
biological derivatives such as Enzymes,
Co-enzymes and Aucines
1) Mineral or chemical fertilisers, 3102
nitrogenous
phosphatic
potassic
4) Mineral or chemical fertilisers 3105
containing two or three of the fertilising
elements lnitrogen, phosphorus and
postassium, other fertilisers; goods of
this chapter in tablets or similar forms or
in packages of a gross weight not
exceeding 10 Kgs.
5)Gibberellic acid 3808.30.30
6) Plant growth regulators 3808.30.40
516 H.S.N. Codes
7) Enzymes 3507
(Except
3507.90.10)
8) Bio-fertilizers 3101
14 20 Pesticides, Insecticides, fungicides,
herbicides, weedicides and other plant
protection equipment and accessories
thereof but including drip and sprinkles
irrigation systemexcluding mosquito
repellants in any form
(1)Insecticides,fungicides etc 3808(except
3808.10.91,
3808.30.30
&
3808.30.40)
(2) Other appliances - Agricultural or 8424.81.00
horticultural (including drip/ sprinkler
irrigation system)
15 21 Coir and Coir products excluding coir
mattresses
1) Coconut Coir 5305.11
2) Products of coir 5609.00.10
16 22 Cotton waste and Cotton yarn waste 5202
17 24 Electrodes including welding electrodes 8311
and welding rods
18 25 Exercise Note books including Graph 4820
books and laboratory note books, Office
stationery including computer stationery,
writing pads and Account Ledgers
1) Flax, raw or processed but not spun; 5301
flax tow and waste (including yarn waste
and garmetted stock)
H.S.N. Codes 517
2) True hemp (cannabis sativa L), raw or 5302

processed but not suun; tow and waste of
true hemp (including yarn waste and
garnetted stock)
3) Sisal and other textile fibres of the 5304
genus agave, raw or processed but not
spun; tow and waste of these fibres
(including yarn waste and garnetted
stock)
4) Coconut, abaca (Manila hemp or 5305
Musa textilis Nee), ramie and other
vegetable textile fibres, not elsewhee
specified or included, raw or processed
but not spun; tow, noils and waste of
these fibres (including yarn waste anmd
garnettled stock)
5) Flex yarn 5306
6) Synthetic staple fibres, not carded, 5503
combed or otherwise processed for
spinning
7) Artificial staple fibnres, not carded, 5504
spinning
8) Waste (including noils, yarn waste 5505
and garnetted stocks) of man-made fibres
9) Synthetic staple fibres, carded combed 5506
or otherwise processed for spinning
10) Artificial staple fibres, carded, 5507
spinning
11) Glass wool or glass fibre 7019.90.10
12) Optical fibres, optical fibres bundles 9001.10
and cables
518 H.S.N. Codes
20 27 Ferrous and non-ferrous metals and

alloys and extrusions thereof
1) Ferro-alloys 7202
2) Ferrous optained by direct redictopm 7203
pr orpm ore and other spongy ferrous
products, in lumps, pellets or similar
forms; iron having minimum purity by
weight of 99.94%, in lumps, pellets or
similar forms
3) Semi-finished products of iron or non- 7207
alloy steel
4) Stainless steel in ingots or other 7218
primary forms; semi-finished products of
stainless steel
5) Flat-rolled products of stainless steel, 7219
of a width of 600 mm or more
6) Flat-rolled products of stainless steel, 7220
of a width of less than 600 mm
7) Bars and rods, hot-rolled, in 7221
irregularly wounded coils, of stainless
steel
8) Other bars and rods of stainless steel; 7222
angles, shapes and sections of stainless
steel
9) Wire of stainless steel 7223
10) Other alloy steel in ingots or other 7224
primary forms; semi-finished products of
other alloy steel
11) Flat-rolled products of other alloy 7225
steel, of a width of 600 mm or more
12) Flat-rolled products of other alloy 7226
steel, of a width of less than 600 mm
H.S.N. Codes 519
13) Bars and rods, hot-rolled, in 7227

irregularly wound coils, of other alloy
steel
14) Other bars and rods of other alloy 7228
steel; angles, shapes and sections, of
other alloy steel; hollow drill bars and
rods, of alloy or non-alloy steel
15) Wire of otherr alloy steel 7229
16) Copper matters; cement copper 7401
(precipitateed copper)
17) Unrefined copper; copper anods for 7402
electrolytic refining
18) Refined copper and copper alloys, 7403
unwrought
19) Copper waste and scrap 7404
20) Master alloys of copper 7405
21) Copper powders and flakes 7406
22) Copper bars, rods and pfofiles 7407
23) Copper wire 7408
24) Copper plates, sheets and strip, of a 7409
thickness exceeding 0.15 mm
25) Copper foil(whether or not printed or 7410
backed with paper, paperboard, plastics
or similar backing materials) of a
thickness (excluding any backing) not
exceeding 0.15 mm
27) Copper tube or pipe fittings (for 7412
28) Standard wire, cables, plated bands 7413
and the like, of copper, not electrically
insulated
520 H.S.N. Codes
29) Nickel mattes, nickel oxide sinters 7501

and other intermediate products of nickel
metallurgy
30) Unwrought nickel 7502
31) Nickel waste and scrap 7503
32) Nickel powders and flakes 7504
33) Nickel plates, sheets, strip and foil 7506
34) Nickel tubes, pipes and tube or pipes 7507
fittings (for example, couplings, elbows,
sleeves)
35) Unwrought aluminium 7601
36) Aluminium waste and scrap 7602
37) Aluminium powders and flakes 7603
38) Aluminium bars, rods and profiles 7604
39) Aluminium wire 7605
40) Aluminium plates, sheets and strip, 7606
of a thickness exceeding 0.2 mm
41) Unwrought lead 7801
42) Lead waste and scrap 7802
43) Lead bars, rods, profiles and wire 7803
44) Lead plates, sheets, strip and foil; 7804
lead powders and flakes
45) Unwrought zinc 7901
46) Zinc waste and scrap 7902
47) Zinc dust, powders and flakes 7903
48) Zinc bars,rods, profiles and wire 7904
49) Zinc plates, sheets, strip and foil 7905
50) Unwrought tin 8001
H.S.N. Codes 521
51) Tin waste and scrap 8002

52) Tinbars, rods, profiles and wire 8003
53) Tin plates, sheets and strip, of a 8004
thickness exceeding 0.2 mm
54) Tin foil (whether or not printed or 8005
backed with paper, paperboard, plastics
or similar backing materials), of a
exceeding 0.2 mm; tine powders and
flakes
55) Tungsten (wolfram) and articles 8101
thereof, including waste and scrap
56) Molybdenum and articles thereof, 8102
57) Tantalum and articles thereof, 8103
58) Magnesium and articles thereof, 8104
59) Cobalt mattes and other intermediate 8105
products of cobalt metallurgy; cobalt and
articles thereof, including waste and
scrap
60) Bismuth and articles thereof, 8106
61) Cadmium and articles thereof, 8107
62) Titanium and articles thereof, 8108
63) Zirconium andarticles thereof, 8109
64) Antimony and articles thereof, 8110
522 H.S.N. Codes
65) Manganese and articles thereof, 8111

66) Beryllium, chromium, germanium, 8112
vanadium, gallium, harnium, indium,
niobium (columbium), rhenium and
thallium, and articles of these metals,
21 28 Flour, Atta, Maida, Suji,
Besan,Rawa,Vermicelli and semiya
1) Wheat or meslin flour 1101
2) Ceral flours other than that of wheat 1102
or meslin
3) Flour, meal and powder of the dried 1106
leguminous vegetables of heading 0713,
of sago or of roots or tubers of heading
0714 of of the products of Chapter 8
4) Cereal groats, meal and pellets; and
cereal grains otherwise worked
(i) Groats of wheat 1103.11.10
(ii) Meal of Wheat 1103.11.20
(iii) Groats and meal of Maize (corn) 1103.13.00
(iv) Groats and meal of other cereals 1103.19.00
(v) Pellets 1103.20.00
(vi) Rolled or flaked grains of Oats 1104.12.00
(vii) Rolled or flaked grains of other 1104.19.00
cereals
(viii) Other worked grains ( for example;
hulled, pearled , sliced or kibbled )
(a) of Oats 1104.22.00
(b) of Maize (corn) 1104.23.00
H.S.N. Codes 523
(c ) of other cereals 1104.29.00

(ix) Germ of cereals, whole, rolled , 1104.30.00
flaked or ground
5) Vermicelli and semiya
22 31 Hand Pumps, parts and fittings thereof
1) Pumps for dispensing fuel or 8413.11
lubricants, of the type used in flling
stations or in garages
2) Hand pumps (other) 8413.19.10
3) Hand pumps, othr than those of sub- 8413.20
heading 8413 or 8413.19
4) Hand or foot-operated air pumps 8414.20
5) Parts of hand pump for handling 8413.91.40
water
23 32 Herb,bark, dry plant, dry root, 1211
commodity knowns as jari booti and dry
flower
24 33 Hose pipes and fittings thereof
1) Tubes,pipes and hoses, of vulcanised 4009
rubber other than hard rubber, with or
without their fittings (for example, joints,
elbows, flanges)
25 35 Rice Bran including de-oiled rice bran
1) De-oiled Rice bran 2302.20.10
2) Rice bran, raw 2302.20.20
26 36 Ice 2201.90.10
27 37 Incense Sticks commonly known as, 3307.41
Agarbathi, dhupkathi or dhupati
28 39 IT Products, that is to say
524 H.S.N. Codes
(1) Word processing machines and

Electronic typewriters
(a)Word processing machines 8469.11.00
(b)Electronic typewriters 8469.12.00
(2) (i)Electronic calculators 8470.10.00
(ii)Other electronic calculating machines
(a) incorporating a printing device 8470.21.00
(b) other 8470.29.00
(c) other calculating machines 8470.30.00
(3) Computer systems and peripherals,
Electronic diaries
(a)computer systems, peripherals 8471
and parts
(b)Electronic diaries
(4) Parts and Accessories of HSN 84.69,
84.70 & 84.71 for items listed above
(5) DC Micromotors,Stepper motors of
an output not exceeding 37.5 watts.
(a) D C Micromotors of an output 8501.10.11
not exceeding 37.5 W
(b) Stepper motors of an output not 8501.10.12
exceeding 37.5 W
(6) Parts of HSN 85.01 for items listed
above
(7) Uninterrupted power supply(UPS)
and their parts
(8) Permanent magnets and articles 8505
intended to become permanent
magnets(Ferrites)
H.S.N. Codes 525
(9) Electrical apparatus for line 8517

telephony or line telegraphy, including
line telephone sets with cordless
handsets & telecommunication apparatus
for carries-current line systems or for
digital line systems;videophones
(10) Microphones, mutimedia speakers,
headphones ,Earphones & combined
microphone speaker sets & their parts
(a) Microphones 8518.10.00
(b) Multimedia speakers 8518.22.00
(c) Headphones etc. 8518.30.00
(d) Parts 8518.90.00
(11) Telephone answering machines 8520.20.00
(12) Parts of Telephone answering
machines
(13) Prepared unrecorded media for
sound recording or similar recording of
other phenomena,Video and Audio CD's,
Cassettes, and DVD's(recorded and
unrecorded)
(i)Prepared unrecorded media for 8523
sound recording or similar recording of
other phenomena
(ii) Records, tapes and other 8524.32
recorded media (a) for reproducing
sound only
(b) Other 8524.39
(c) Other magnetic tapes of a 8524.51
width not exceeding 4mm
(d) Other magnetic tapes of a 8524.52
width exceeding 4mm but not exceeding
6.5mm
526 H.S.N. Codes
(e)Other magnetic tapes of a 8524.53

width exceeding 6.5mm
(14) IT software of any media.
(a) Disc for laser reading systems 8524.31.11

for reproducing phenomena other than
sound or image
(b) Magnetic tapes for reproducing 8524.40.11
phenomena other than sound or image
(c) other software
(i) on floppy disc or catridge 8524.91.11

tape
(ii) on disc or on CD ROM 8524.91.12
(iii) on other media 8524.91.13
(15) Transmission apparatus other than
apparatus for radio or T.V.
broadcasting,transmission apparatus
incorporating reception apparatus,digital
still video cameras
(a) Transmission apparatus 8525.2
incorporating reception apparatus
(b) Communication jamming 8525.10.40
equipment
(c) Wireless Microphone 8525.10.50
(d) Still image video cameras & 8525.40.00
other video camera recorders; digital
cameras
(16) Radio communication receivers,
Radio Pagers
(a) Radio pagers 8527.90.11
(b) Demodulators 8527.90.12
H.S.N. Codes 527
(c) Other 8527.90.19

(i) Aerials, antennas and parts 8529.10
(ii) Parts of HSN 8525 & 8527 listed
above
(17) LCD Panels, LED panels and parts
thereof
(a) LCD Panels / LED Panels 8531.20.00
(b) Parts 8531.90.00
(18) Electrical capacitors, fixed, variable
or adjustable(pre-set) and parts thereof
(a)Electrical capacitors, fixed, 8532
variable
(b) Parts 8532.90.00
(19) Electrical resistors(including 8533
rheostats & potentiometers),other than
heating resistors
(20) Printed Circuits 8534.00.00
(21) Switches,Connectors&Relays for up
to 5 amps at voltage not exceeding 250
Volts,Electronic fuses
(22) DATA/Graphic Display tubes, other
than TV Picture tubes and parts thereof
(a)Colour 8540.40.00
(b)Black & White or other 8540.50.00
monochrome
(23) Diodes, transistors & similar semi- 8541
conductor devices;Photosensitinve semi-
conductor devices,including photovoltaic
cells whether or not assembled in
modules or made up into panels;Light
emitting diodes;Mounted piezo-electric
crystals
528 H.S.N. Codes
(24) Electronic Integrated Circuits and 8542

Micro-assemblies
(25) Signal Generators and parts thereof
(a)Signal Generators 8543.20
(b) Parts 8543.90.00
(26) Optical fibre cables 8544.70
(27) Optical fibre and optical fibre 9001.10.00
bundles, cables
(28) Liquid Crystal devices, flat panel
display devices and parts thereof
(a) Liquid Crystal devices, flat 9013.80.10
panel display devices
(b) Parts 9013.90.10
(29) Cathode ray oscilloscopes, spectrum
analysers, cross talk meters,Gain
measuring instruments,Distortion factor
meters,Psophometers,Network & Logic
analyzer & Signal Analyzer
(a)Cathode ray oscilloscopes 9030.20.00
(b) Spectrum analysers 9030.39.20
(c)Other instruments & 9030.40.00
apparatus,specially designed for
telecommunications(for example,cross-
talk meters,gain measuring
equipments,distortion factor
meters,psophometers)
29 41 Nawar 5806.31.20
30 42 Napa slabs 6801
31 44 Paper all kinds 4707, 4801
to 4817
H.S.N. Codes 529
1) Toilet paper 4818.10

2) Hand kerchiefs, cleaning or facial 4818.20
tissues, towels
3) Table cloths and serviettes 4818.3
32 45 Pipes of all varieties including G.I., C.I.,
PVC, Ductile , RCC & PCC Pipes, their
fittings thereof and Cement poles
1) Tubes, pipes and hoses, and fittings 3917
therefor (for example, joints, elbows,
flanges), of plastics
2) Asbestos cement pipes 6811.30.10
3) Other (50% graphite or other carbon) 6903.10.90
4) Other ( 50% of alumina or alumina 6903.20.90
and silica )
5) Other Pipes 6903.90.90
6) Ceramic pipes, conduits, guttering and 6906
pipe fittings
7) Tubes, Pipes and hollow profiles of 7303
cast iron
8) Tubes, pipes and hollow profiles, 7304
seamless, of iron ( other than
cast iron) or steel
9) Other tubes and pipes (for example, 7305
welded, riveted or similarly closed)
having circular cross sections, the
external diameter of which exceeds
406.4 mm, of iron or steel
10) Other tubes, pipes and hollow 7306
profiles (for example, open seam or
welded, riveted or similarly closed) of
iron or steel
11) Tube or pipe fittings ( for example, 7307
couplings, elbows, sleeves) of iron or
530 H.S.N. Codes
steel

13) Copper tube or pipe fittings ( for 7412
14) Nickel tubes, pipes and tube or pipe 7507
fittings ( for example, couplings, elbows,
sleeves)
15) Aluminium tube or pipe fittings (for 7609
16) Aluminium tubes and pipes 7608
17) Lead tubes, pipes and tube or pipe 7805
sleeves)
18) Zinc tubes, pipes and tube or pipe 7906
sleeves)
19) Tin tubes, pipes and tube or pipe 8006
sleeves)
20) Cement Pipes (RCC & PCC),
Cement Poles
33 46 Plastic footwear and Hawai chappals.
(1) Water proof footwear with outer
soles and uppers of plastics, the uppers
of which are neither fixed to the sole not
assembled by stitching , riveting, nailing,
screwing, plugging or similar processes
a) Footwear incorporating a protective 6401.10.10
metal toe-cap of rubber
b) Footwear incorporating a protective 6401.10.90
metal toe-cap - Other
H.S.N. Codes 531
c) Foot wear covering the knee-Other 6401.91.90
d ) Footwear covering the ankle but not 6401.92.90

covering the knee
e) Other 6401.99.90
(2) Other footwear with outer soles and

uppers of plastics
(a) sports footwear 6402.12.90
(b) other than sports footwear 6402.19.90
(3) Footwear with upper straps or thongs 6402.20

assembled to the sole by means of plugs
(Hawai chappal)
34 *47 Printed material like Diary, Calendar,
etc.
1) Music, printed or in manuscript, 4904

whether or not bound or illustrated
2) Plans and drawings for architectural, 4906

engineering, industrial, commercial,
topographical or similar purposes, being
originals drawn by hand; hand-written
texts; photographic reproductions on
sensitized paper and carbon copies of the
foregoing
3) Printed or illustrated postcards; 4909

printed cards bering personal greetings,
messages or announcements, whether or
not illustrated, with or without envelopes
or trimmings
4) Calendar of any kind, printed, 4910

including calendar blocks
* Vide Errata in G.O.Ms.No. 1932, Rev. (CT-II) Dept., dt. 18-11-2005.
532 H.S.N. Codes
5) Other printed matter, including 4911

printed pictures and photographs
35 48 Printing ink excluding toner and 3215
cartridges
36 50 Pulp of bamboo, wood, waste paper and
bagasse
1) Mechanical wood pulp 4701
2) Chemical wood pulp, dissolving 4702
grades
3) Chemical wood pulp,soda or sulphate, 4703
other than dissolving grades
4) Chemical wood pulp, sulphite, other 4704
than dissolving grades
5) Wood pulp obtained by a combination 4705
of mechanical and chemical pulping
processes
6) Pulps of fibres derived from recovered 4706
(waste and scrap)paper or paperboard or
of other fibrous cellulosic material
7) Beet pulp, bagasse and other waste 2302.20.00
37 51 Rail coaches, engines and wagons
1) Rail locomotives powered from an 8601
external source of electricity or by elctric
accumulators
2) Other rail locomotives; locomotive 8602
tenders
3) Self-propelled railway or tramway 8603
coaches, vans and trucks, other than
those of heading 8604
4) Railway or tramway maintenance or 8604
service vehicles; whether or not self-
propelled (for example,
kh b ll k
H.S.N. Codes 533
workshops,cranes, ballast tampers, track-

liners, testing coaches and track
inspection vehicles)
5) Railway or tramway passenger 8605

coaches, not self-propelled; luggage
vans, post office coaches and other
special purpose railway or tramway
coaches, not self propelled (excluding
those of heading 8604)
6) Railway or tramway goods vans and 8606
wagons, not self propelled.
38 53 Renewable energy devices and spare
parts
1) Flat Plate solar Collectors.
2) Concentrating and pipe type solar
collectors.
3) Solar Cookers of Various sizes.
4) Solar Water heaters and systems.
5) Air/Gas/Fluid heating system.
6) Solar Stills and desalination system.
7) Solar pumps based on solar thermal

and solar photovoltaic conversion.
8) Solar power generating systems. 7615.19.30
9)Solar crop driers and systems
10) Solar ponds and systems
11)Solar Photovoltaic modules and 9405.50.40
panels for water pumping, lighting and
other applications.
12)Solar Refrigeration Cold Storages
and Air Conditioning Systems.
534 H.S.N. Codes
13) Biogas,Plants,Stoves,appliances and

Engines.
14) Wind Mills and any specially 8412.80.30
designed equipments which run on wind
mills/wind powers
15) Any special devices including 8502.31.00
electric generators and pumps running on
win energy.
16) Agricultural and Municipal Waste
conversion devicing producing energy.
17) Equipment for utilising ocean waves
and thermal energy.
18) Biomass devices
19) Improved wood burning
stoves(Chulhas).
20) Briquetted and other types of fuel
manufactured from agricultural Waste.
21) (a) Turbines, (b) Generators and (c) 8406
Control panel used in Mini/Micro Hydel
systems to generate electricity
22) Gasifiers-Mechanical and Electrical.
23) Sterling engines operated with
agricultural residue/waste.
24) Blak continuously plated solar
elective coating sheets, fins and tubes.
25) Electrically operated vehicles
including battery powered vehicles or
fuel cell powered vehicles.
26) Biolers fired with bagasse,
agricultural waste or multifue for use in
cogeneration plants.
H.S.N. Codes 535
27) Turbo altemators,back pressure or

condensing extraction type, for use in
cogeneration plants.
28) Solar Photovoltaic cells modules and 8541.40.11
systems/devices
39 54 Safety matches 3605.00.10
40 55 Sewing Machine and parts and 8452
accessories thereof
41 56 Ship and other water vessels
(1) Cruise ships, excursion boats, ferry 8901
boats, cargo ships, barges and similar
vessels for the transport of persons or
goods
(2) Fishing vessels , factory ships and 8902
other vessels for processing or
preserving fishery products
(3) Yachts and other vessels for pleasure 8903
or sports; row boats and canoes
(4) Tugs and pusher craft 8904
(5) Light vessels, fire floats, dredgers, 8905
floating cranes and other vessels the
navigability of which is subsidiary to
their main function; floating docks;
floating or submersible drilling or
production platforms
(6) Other vessels, including war ships 8906
and life boats other than rowing boats
(7) Other floating structures ( for eg; 8907
rafts, tanks, coffer-dams , landing stages,
bouys and beacons)
(8) Vessels and other floating structures 8908
for breaking up
536 H.S.N. Codes
42 59 Spices of all varieties and forms

including cumin seed, aniseed, turmeric
and dry chillies
(1) Mate 0903
(2) Pepper of the genus piper, dried or 0904
crushed or ground, fruits of the genus
capsicum or of the genus pimenta
(a) Pepper 0904.11
(b) Dried chillies 0904.20.10
(c) Chilly powder 0904.20.20
(3 ) Vanila 0905
(4) Cinnamon and cinnamon tree flowers 0906.10
(5) Cloves (whole fruit , cloves and 0907
stems)
(6) Nutmeg , mace and cardamoms 0908
(a) Nutmeg 0908.10
(b) Mace 0908.20.00
(c) Cardamoms 0908.30
(7) Seeds of anise, badian, fennel , 0909
coriander , cumin, caraway at juniper
berries
(a) Anise or badian 0909.10
(b) Coriander 0909.20
(c) Cumin 0909.30
(d) Caraway 0909.40
(e) Fennel and juniper berries 0909.50
(8) Ginger , saffron, turmeric (curcuma),
thyme, bay leaves, curry and other spices
H.S.N. Codes 537
(a) Ginger (i )Powder 0910.10.40

(ii) Other 0910.10.90
(b) Saffron 0910.20
(c) Turmeric 0910.30
(d) Thyme, bay leaves 0910.40
(e) Curry 0910.50.00
(f) Other spices 0910.99
43 60 Sports goods excluding apparels and
footwear
(1) Articles of funfare , table or parlour 9504
games including pin tables, billiards,
special tables for casino games and
automatic bowling alley equipment.
(2) Articles and equipment for general 9506
physical exercise , gymnastics, athletics,
other sports ( including table tennis) or
outer games, not specified or included
elsewhere in this chapter; swimming
pools and paddling pools
(3) Fishing rods, fish- hooks and other 9507
line fishing tackle; fish landing nets,
butterfly nets, and similar nets; decoy
"birds" (other than those of the heading
9208 or 9705) and similar hunting or
shooting requisites
44 61 Starch and Sago
1) Wheat Starch 1108.11
2) Maize (Corn) starch 1108.12
3) Potato starch 1108.13
4) Manioc (cassava) starch 1108.14
5) Sago 1108.19.10
538 H.S.N. Codes
6)Flour, meal and powder of dried 1106.20.10

leguminous vegetables of heading 0713,
or sago or of roots or tubers or heading
0714 or of the products of Chapter VIII -
(i) Of sago
(ii) Of manioc (Cassava) 1106.20.10
45 63 Tractors and Threshers, Harvesters,
Tractor Trailers, Tyres and Tubes of
Tractors and attachments and parts
thereof
(1) Tractors (other than tractors of 8701
heading 8709)
(2 ) Parts for tractors 8708.10.10
(3) Threshing and harvesting machinery
(a) combine harvester-threshers 8433.51.00
(b) other threshing machinery 8433.52.00
(c ) root or tuber harvesting 8433.53.00
machinery
(d) other 8433.59.00
(e) Parts 8433.90.00
(4) Tractor Trailers
(5) Tyres and Tubes of Tractors
46 64 Transmission Towers
1)Towers whether or not assessembled 7308.20.11
for transmission line
2) Other 7308.20.19
47 65 Umbrellas 6601
48 66 Vanaspathi, Hydrogenated Vegetable Oil 1516
49 67 Vegetable oils - All kinds of vegetable
Oils including solvent oils and Coconut
H.S.N. Codes 539
Oil
(1) Soyabean oil and its fractions, 1507

whether or not refined, but not
chemically modified
(2) Ground-nut oil and its fractions, 1508
chemically modified
(3) Olive oil and its fractions, whether or 1509
not refined, but not chemically modified
4) Other Oils & their fractions obtained 1510
solely from olives, whether or not
refined, but not chemically modified,
including blends of these oils or fractions
with oils or fractions of heading 1509
(5) Palm oil and its fractions, whether or 1511
not refined, but not chemically modified
(6) Sunflower seed, safflower or cotton 1512
seed oil and their fractions, thereof,
chemically modified
(7) Coconut (copra), palm kernel or 1513
babassu oil and fractions thereof,
chemically modified
(8) Rape, colza or mustard oil and its 1514
fractions thereof, whether or not refined,
but not chemically modified
(9) Other fixed vegetable fats and oils 1515
(including jojoba oil) and their fractions,
chemically modified.
50 68 Writing instruments, writing ink.
Goemetry boxes, Colour boxes, Pencil
540 H.S.N. Codes
Sharpners and Erasers
(1) Ball point pens; felt tipped and other 9608.00

porous-tipped pens and markers;
fountain pens; stylograph pens and other
pens; duplicating stylos; propelling or
sliding pencils, pen holders pencil
holders and similar holders; parts
(including caps and clips) of the
foregoing articles, other than those
heading 9609
(2) Pencils (other than pencils of heading 9609 (except
9608), crayons, pencil leads, pastels, 9609.90.10)
drawing charcoals, writing or drawing
chalks and tailors'chalks
(3)Fountain pen ink 3215.90.20
(4) Drawing ink 3215.90.40
(5) Erasers 4016.92.00
(6) Geometry and colour boxes
51 69 Coal Including Coke in all its forms but
excluding char coal
1) Coal; briquettes, ovoids and similar 2701
solid fuels manufactured from coal
2) Coke and semi-coke of coal, of lignite 2704
or of peat, whether or not agglomerated;
retort carbon
3) Petroleum Coke (i) Not calcined 2713.11
(ii) Calcined 2713.12
52 70 Iron and steel, that is to say:
(i) Pig Iron, Sponge Iron, and cast
iron including ingot moulds, and bottom
plates.
H.S.N. Codes 541
(ii) Steel semis, ingots, slabs, blooms

and billets of all qualities, shapes and
sizes.
(iii) Skelp bars, tin bars, sheet bars,
hoe-bars and sleeper bars;
(iv) Steel bars, rounds, rods, squares,
flats, octagons and hexagons; plain and
ribbed or twisted, in coil from as well as
straight length
(v) Steel structurals, angles, joints,
channels, tees, sheet piling sections, Z
sections or any other rolled sections
(vi) Sheets, hoops, strips and
skelp, both black and galvanized,
hot and cold rolled, plain and
corrugated in all qualities, in
straight lengths and in coil form
as rolled and in revitted
condition.
(vii) Plates, both plain and
chequered in all qualities
(viii) Discs, rings, forgings
and steel castings;
(ix) Tool, alloy and special
steels of any of the above
categories
(x) Steel tubes, both welded
and seamless, of all diameters
and lengths including tube
fittings
(xi) Tin-plates, both hot
dipped and electrolytic and tin
free plates
542 H.S.N. Codes
(xii) Fish plate bars, bearing

plate bars, crossing sleeper bars,
fish plates, bearing plates,
crossing sleepers and pressed
steel sleepers, rails – heavy and
light crane rails;
(xiii) Wheels, tyres, axies
and wheel sets
(xiv) Wire rods and wires
rolled, drawn, galvanized,
aluminized, tinned or coated
such as by copper
(1) Pig Iron, Spiegeleisen in pigs, blocks 7201
or other primary forms
(2) Granules and powders, of pig iron, 7205
spiegeleisen, iton or steel
(3) Iron and non-ally steel in ingots or 7206
other primary forms (excluding iron of
heading 7203)
(4) Flat-rolled products of iron or non- 7208
ally steel, of a width of 600 mm or more,
hot-rolled, not clad, plated or coated.
alloy stee, of a width of 600 mm or
more, cold-rolled (cold-reduced), not
clad, plated or coated
alloy steel, of a width of 600 mm or
more, clad plated or coated
alloy steel, of a width of less than 600
mm, not clad, plated or coated
alloy steel, of a width of less than 600
H.S.N. Codes 543
mm, clad, plated or coated
(9) Bars and rods, hot-rolled, in 7213

irregularly wound coils, of iron or non-
ally steel
(10) Other bars and rods of iron or non- 7214
ally steel, not further worked than
forged, hot-rolled, hot-drawn or hot-
extruded, but including those twisted
after rolling
(11) Other bars and rods of iron or non- 7215
alloy steel
(12) Angles, shapes and sections of iron 7216
or non-alloy steel
(13) Wire of iron or non-alloy steel 7217
(14) Steel piling of iron or steel, whether 7301
or not drilled, punched or made from
assembled elements; welded angles,
shapes and section, of iron or steel
(15) Railway or tramway track 7302
construction material of iron or steel, the
following: rails, check-rails and rack
rails, switch blades, crossing frogs, point
rods and their crossing pieces, sleepers
(cross-ties) fish-plates, chairs, chair
wedges, sole plates (base plates), rail
clips, bed-plates, ties and other material
specialized for jointing or fixing rails
(16) Tubes, pipes and hollow profiles, of 7303
cast iron
(17) Tubes, pipes and hollow profiles, 7304
seamless, of iron (other than cast iron) or
steel
544 H.S.N. Codes
(18) Other tubes and pipes (for example, 7305

welded, riveted or similar closed) having
circular cross-sections, the external
diameter of which exceeds 406.4 m.m. of
iron or steel.
(19) Other tubes, pipes and hollow 7306
profiles (for example, open seam or
welded, riveted or similarly closed), of
iron or steel
(20) Tubes or pipe fittings (for example, 7307
couplings, elbows, sleeves), or iron or
steel
(21) Structures (excluding prefabricated 7308
buildings of heading 9406) and parts of
structures (for example, bridges and
bridge-sections, lock-gates, towers,
lattice masts, roofs, roofing frame-works,
doors and windows and their frames and
thresholds for doors shutters,
balustrades, pillars and columns), of iron
or steel; plates rods, angles, shapes,
sections tubes and the like, prepared for
use in structures, of iron or steel
53 71 Iron and Steel Scrap, that is to say:
(i) Iron scrap, cast-iron scrap, runner
scrap and iron skull scrap
(ii) Steel melting scrap in all forms
including steel skull, turnings and
borings
(iii) Defectives, rejects, cuttings or end
pieces of any of the categories of item (i)
to (xiv) of entry 70
(iv) Ferrous waste and scrap; remelting 7204
scrap ingots of iron and steel.
54 72 Oil Seeds, that is to say
H.S.N. Codes 545
(i) Sesamum or Til (orientale)

(ii) Soyabeen (Glycine seja)
(iii) Rape seed and mustard
1. Toria (Brassica
campestris vartoria)
2. Rai (Brassica Juncea)
3. Jamba – Taramira
(Eruca satiya)
4. Sarcon – yellow and
brown (brassica compestris
varsarson)
5. Banarasi Rai or True
mustard (Brassica nigra)
(iv) Linseed (linum usitatissimum)
(v) Sunflower (Helianthus annus)
(vi) Nigar seed (Guizotia abyssinica)
(vii) Neem, vepa (Azadi rachta indica)
(viii) Mahua, illupai, ippe (Madhuca
indica, M. Latifolia), Bassia, Latifolia
and Madhuca Longifolia Syn. M.
Longifolia)
(ix) Karanja, Pongam, Honga (Pongamia
pinnata syn. P Glabra)
(x) Kusum (Schleichera Oleosa, syn. S.
Trijuga)
(xi) Punna undi(Calophyllum,
inophyllum)
(xii) Kokum (Carcinia indica)
(xiii) Sal (Shorea robusta);
546 H.S.N. Codes
(xiv) Tung (Aleurite Jordi and

A.Montana)
(xv) Red Palm (elaeis guinenisis)
(xvi) Safflower (corthanus tinctorius)
(1) Sesamum or Til 1207.40.90
(2) Soyabean 1201.00.90
(3) Rapeseed 1205
(4) Mustard 1207.50.90
(5) Linseed 1204.00.90
(6) Sunflower 1206.00.90
(7) Nigar seed 1207.99.30
(8) Kokum 1207.99.40
(9) Redpalm 1207.10.90
(10) Safflower 1207.60.90
(11) Other Oil seeds 1207.99.90
55 73 Castor (Ricinus communis) 1207.30.90
56 75 Copra 1203
57 76 Groundnut or peanut (hypogea)
Groundnut not roasted or otherwise
cooked, whether or not shelled or broken
a) in shell, other 1202.10.19
b) other 1202.10.99
c) Shelled whether or not broken 1202.20
58 77 Cotton seeds 1207.20.90
H.S.N. Codes 547
59 78 Jute, that is to say the fibre extracted from 1[5303]

plants belonging to the species corchorus
capsularis and corchorus olitorius and the
fibre known as Mesta or Bimli extracted
from plants of the species hibiscus
cannabinus and Hibiuscus sabdariffavar
altissima and the fibre known as sunnhemp
extracted from plants of the species
Crotalaria Juncea whether baled or otherwise
60 79 Cotton, that is to say, all kinds of cotton 5201
(indigenous or imported) in all its 5203
unmanufactured State, whether ginned or
unginned, baled, pressed or otherwise but
not including cotton waste.
61 80 Hides and Skins, Tanned or Un-Tanned 4101 to 4106
62 81 Crude oil, that is to say, crude petroleum oils 2709

and crude oils obtained from bituminous
minerals (such as shale, calcareous rock
sand), whatever their composition whether
obtained from normal or condensation oil
deposits or by the destructive distillation of
bituminous minerals and whether or not
subjected to all or any of the following
processes
1. decantation
2. de-salting
3. dehydration
4. stabilization in order to normalize the
vapour pressure
5. elimination of very light fractions with a
view to returning them to the oil-
deposits in order to improve the drainage
and maintain the pressure.
1. Subs. For HSN Code “5305” vide Errata in G.O.Ms.No. 1932, Rev.
(CT-II) Dept., dt. 18-11-2005.
548 H.S.N. Codes
6. the addition of only those

hydrocarbons previously recovered by
physical methods during the course of the
above mentioned process
7. any other minor process including
addition of pour point depressants or flow
improvers which does not change the
essential character of the substance
63 82 All kinds of Pulses and Dhalls 0713
64 83 Wheat (Triticum vulgare, T. compactum, 1001.10.90
T.sphaerococum, T.durum, T.aestivum, and
L.T.dicoccum); 1001.90.20
65 84 Paddy (Oryza sativa L) 1006.10.90
66 86 P.V.C. Cloth, Waterproof cloth, Tarpaulin
and Rexine
1) Textile fabrics impregnated with 5903.10
(i) Polyvinyl cloride
(ii) polyurethane 5903.20
2) Tarpaulins, Awnings (i) of Cotton 6306.11
(ii) of Synthetic fibre 6306.12
3) Jute Tarpaulins (including DW 6306.19.10
Tarpaulin)
4) Tents (i) of cotton 6306.21
(ii) of synthetic fibres 6306.22
(iii) of other textile materials 6306.29
67 87 Oil cakes and Deoiled cakes
1) Oil Cake and other solid residues 2304
whether or not ground or in the form of
pellets, resulting from the extraction of
soyabean oil
H.S.N. Codes 549
2) Oil Cake and other solid residues 2305

ground-nut oil
3) Oil Cake and other solid residues, 2306
vegetable fats or oils, other than those of
heading 2304 or 2305
68 88 Drugs & Medicines whether patent or
proprietary, as defined in clauses (i), (ii)
and (iii) of Section 3(b) of Drugs and
Cosmetics Act,1940 (Central Act 23 of
1940), including hypodermic syringes,
hypodermic
needles,catguts,sutures,surgical cotton,
dressings, plasters, catherters, cannulae,
bandages and similar articles but not
including
(a) Medicated goods
(b) Products capable of being used as
cosmetics and toilet preparations
including Toothpastes, Tooth
powders,cosmetics, Toilet articles and
soaps.
(c) Mosquito Repellants in any form
(d) Surgical equipment, medical devices
and implants
1) Drugs & Medicines 3001 to 3004
(Except
3002.90.10)
2) Pro-Vitamins and Vitamins, natural or 2936
re-produced by synthesis, derivatives
thereof used primarily as Vitamins, and
inter mixtures of the foregoing, whether
550 H.S.N. Codes
or not in any solvent

3) Hormones, prostaglandins, 2937
thromboxanes and leukotrienes, natural or
reproduced by synthesis; derivatives and
structural analogues thereof, including
chain modified polypeptides used
primarily as hormones
4) Anti-biotics 2941
5) Other organic compounds 2942
6) Diagnostic or laboratory reagents on a 3822
backing, prepared diagnostic or
laboratory reagents whether or not on a
backing, other than those of heading 3002
or 3006; certified reference materials.
7)Wadding, gauze, bandages and similar 3005
articles(for example, dressings, adhesive
plasters, poultices), impregnated or
coated with pharmaceutical substances or
put up in forms or packings for retail sale
for medical, surgical, dental or veterinary
purposes
8) Sterile surgical catgut, similar sterile 3006.10
suture materials and sterile tissue
adhesives for surgical wound closure;
sterile laminaria and sterile laminaria
stents: sterile absorbable surgical or
dental haemostatics
9) Blood grouping reagents 3006.20.00
10) Opacifying preparations for X-ray 3006.30.00
examination; diagnostic reagents
designed to be administered to the patient
11) Dental cements and other dental 3006.40.00
fillings; bone reconstruction cements
H.S.N. Codes 551
12) First-aid boxes and kits 3006.50.00

13) Gel preparations designed to be used 3006.70.00
in human 0r veterinary medicine as a
lubricant for parts of the body for surgical
operations or physical examinations or as
a coupling agent between the body and
medical instruments
14) Oxygen, medicinal grade 2804.40.10
15) Syringes, with or without needles 9018.31.00
16) Tubular metal needles and needles for 9018.32
sutures
17) Other 9018.39
69 89 Veterinary medicines and Feed
supplements
1) Concentrates for compound animal 2309.90.20
feed
3) Vaccine for veterinary medicine 3002.30
4) Veterinary medicinal preparation, not 3004.90.85
for human use, not elsewhere specified or
included
70 90 All kinds of packing material including
Hessian cloth and jute twine but
excluding storage tanks made of any
materials.
1) Self adhesive plates, sheets, film, foil, 3919
tape, strip and other flat shapes, of
plastics, whether or not in rolls
2) Other plates, sheets, film, foil and strip 3920
of plastics non-cellular and not
reinforced, laminated, supported or
similarly combined with other materials
(including HDPE / PP Woven fabric)
3) Thermocol 3921.90.10
552 H.S.N. Codes
4) Articles for the conveyance or packing 3923

of goods, of plastics; stoppers, lids, caps
and other closures of plastics
5) Packing cases, boxes, crates, drums 4415
and similar packing of wood; cable-drums
of wood; pallets, box pallets and other
load boards, of wood; pallet collars of
wood
6) Casks, barrels, vats, tubs and other 4416
coopers' products and parts thereof, of
wood, including staves
7) Cartons (including flattened or folded 4819
cartons), boxes (including flattened or
folded boxes), cases, bags and other
packing containers of paper, paper board
whether in assembled or unassembled
condition
8) Paper or paperboard labels of all kinds, 4821
whether or not printed.
9) Bobbins, spools, cops and similar 4822
supports of paper pulp, paper or paper
board (whether or not perforated or
hardened)
10) Other paper, paperboard, cellulose 4823
wadding and webs of cellulose fibres, cut
to size or shape; other articles of paper
plup, paper, paperboard, cellulose
wadding or web of cellulose fibres
11) Sacks and bags, of a kind used for the 6305
packing of goods
12) Carboys, bottles, flasks, jars, pots, 7010
phials, ampoules and other containers, of
glass, of a kind useds for the conveyancve
or packing of goods; preserving jars of
glass; stoppers, lids and other closures, of
glass
H.S.N. Codes 553
13) Reservoiers tanks, vats and similar 7309

containers for any material (other than
compressed or liquified gas) of iron or
steel, a capacity not exceeding 300
lts.whether or not lined or heat insulated,
but not fitted with mechanical or thermal
equipment
14) Containers for compressed or 7311
liquified gas of iron or steel
15) Aluminimum foil (whether or not 7607
printed or backed with paper, paperboard,
plastics or similar bcking materials) of a
exceeding 0.2 mm
16) Aluminium casks, drums, cans, boxes 7612
and other similar containers for any
material (other than compressed or
liquified gas), of a capacity not exceeding
300 lts., whether or not lined or heat
insulated, but not fitted with mechanical
or thermal equipment
17) Aluminium containers for 7613
compressed or liquified gas
18) Stoppers, caps and lids (including 8309
crown corks, screw caps and pouring
stoppers), capsules for bottles, threaded
bungs, bung covers, seals and other
packing accessories, of base metal
Explanation (1) The Rules for the interpretation of the provisions of the
Central Excise Tariff Act, 1985 read with the Explanatory Notes as updated
from time to time published by the Customs Co-operation Council, Brussels
apply for the interpretation of this notification.
Explanation (2) Where any commodities are described against any heading
or, as the case may be, sub-heading, and the aforesaid description is
different in any manner from the corresponding description in the Central
554 H.S.N. Codes
Excise Tariff Act, 1985, then only those commodities described as aforesaid
will be covered by the scope of this notification and other commodities
though covered by the corresponding description in the Central Excise
Tariff will not be covered by the scope of this notification.
Explanation (3) Subject to Explanation 2, for the purpose of any entry

contained in this notification where the description against any heading or,
as the case may be, sub-heading, fully with the corresponding description in
the Central Excise Tariff, then all the matches commodities covered for the
purposes of the said tariff under that heading or sub-heading will be covered
by the scope of this notification.
Explanation (4) Where the description against any heading or sub-heading

is shown as "other", hen the interpretation as provided in Note (2) shall
apply.
------
THE ANDHRA PRADESH VALUE ADDED TAX APPELLATE
TRIBUNAL REGULATIONS, 20051
Rc. No. STAT — A2/381/06:— In exercise of the powers conferred
by sub-section (5) of Section 3 of the Andhra Pradesh Value Added Tax
Act, 2005 (A.P. Act No. 5 of 2005) the Appellate Tribunal, Andhra Pradesh,
with the previous sanction of the State Govt. hereby makes the following
Regulations, for regulating its procedure and disposal of its business.
Regulations
Chapter I
General
1. Short title:— These regulations may be called the Andhra Pradesh
Value Added Tax Appellate Tribunal Regulations, 2005.
2. Definitions:— In these regulations, unless there is anything repugnant
in the subject or context,—
(i) "Act" means the Andhra Pradesh Value Added Tax Act, 2005.
(ii) 'Appeal' means a memorandum of appeal to the Appellate Tribunal
filed under Section 33 of the Act;
(iii) 'Chairman' means the Chairman of the Tribunal;
(iv) 'Form' means a form annexed to these regulations;
(v) 'Gazette' means the Andhra Pradesh Gazette;
(vi) 'Legal Representative' means a person who in law represents
the estate of a deceased person, and includes a universal donee or legatee
or a part of an estate and any person decided by the Tribunal to represent
the deceased person in the proceedings pending before it unless and until
a competent court has decided otherwise;
(vii) 'Party' means the appellant or applicant and includes his pleader
or authorized agent;
(viii) 'Pleader' means a pleader as defined in sub-section (15) of
Section 2 of the Code of Civil Procedure, 1908;
(ix) 'Rules' means the Andhra Pradesh Value Added Tax Rules, 2005;
(x) 'Secretary' means the person who is for the time being discharging
the functions of the Secretary to the Tribunal;
(xi) 'Section' means a section of the Act;
(xii) 'State Representative' means an officer appointed by the State
Government to receive on their behalf notices issued by the Tribunal and
generally to appear, act and plead on their behalf in all proceedings before
the Tribunal and includes an officer appointed to act on his behalf in his
absence;
(xiii) 'Tribunal' means the Appellate Tribunal;
(xiv) words and expressions used but not defined in these regulations
shall have the meaning assigned to them in the Act and the Rules.
1. Pub. in A.P. Gaz. R.S. to Pt-II, No.7, dt. 27-4-2006.
555
556 A.P. VAT Appellate Tribunal Regulations, 2005
Chapter II
Headquarters, Sittings and Office Hours
3. Headquarters:— (1) The Tribunal shall sit at Hyderabad &
Visakhapatnam.
(2) Place of hearing:— All appeals shall ordinarily be heard at
Hyderabad & Visakhapatnam :
Provided that the Chairman may decide that any appeal may be heard
at any other place in the respective jurisdictions.
4. Office hours:— The Appellate Tribunal shall hold its sittings during
the same hours as the other offices of the State Government.
5. Language:— The language of the Tribunal shall be English.
Chapter III
Appeals
6. Presentation of appeals:— (1) An appeal shall be presented to
the Secretary concerned either by the party in person or by sending it through
registered post.
(2) When an appeal is presented by a pleader or an authorized agent,
it shall be accompanied by a letter of authority appointing him as such.
(3) Every such appeal shall be made in accordance with the provisions
of the Act, the rules and those regulations and shall be accompanied by
a Government Treasury Challan in support of the payment of the fee
prescribed by sub-rule (1)(c) of Rule 44.
(4) An appeal preferred by any dealer shall specify the State of Andhra
Pradesh as the respondent; it shall also furnish the name and the address
of the party to whom notice may be sent.
7. Registration of appeals:— (1) On receipt of an appeal, the
Secretary concerned shall endorse on it the date of its receipt. The Secretary
concerned shall thereafter, as soon as possible, examine,—
(i) Whether the person presenting it has the authority to do so; and
(ii) Whether it confirms to the provisions of the Act, the rules and these
regulations.
If the Secretary concerned is satisfied on these points he shall cause
it to be registered in a register to be kept for the purpose.
(2) If the Secretary concerned finds that the appeal does not confirm
to the requirements of the Act, the rules and these regulations, he shall
call upon the party by a notice in Form 'A' to remedy the defect or defects
within a reasonable period to be specified by him. The Secretary may, for
sufficient cause, extend the said period. If the defect or defects are remedied
within the period allowed, the Secretary shall cause the appeal to be
registered.
A.P. VAT Appellate Tribunal Regulations, 2005 557
(3) If the defects are not remedied within the period allowed, the
Secretary shall make a report to that effect to the Chairman of that
jurisdiction who may reject the appeal or fix a date for hearing the matter
and give due notice of such hearing to the party and State Representative
of Form 'B'.
(4) On the date so fixed, the Tribunal shall, after hearing the party
and the State Representative, pass orders directing either the registration
of the appeal or its rejection. Where the appeal is rejected the Tribunal
shall record its reasons for doing so.
(5) When an appeal is presented after the period prescribed under
the Act, it shall be accompanied by a petition supported by an affidavit
setting forth the facts on which the applicant relies to satisfy the Tribunal
that he had sufficient cause for not preferring the appeal within such period.
Such appeal shall not be admitted unless notice has been given to the
respondent and his objections have been heard and the Tribunal is satisfied
that the appellant had sufficient cause for not preferring the appeal in time.
The notice under sub-regulation (5) shall invariably mention, among
others, the date on which the appeal was presented to the Secretary under
Regulation 6 and also the challan number and date on which the appeal
fee was paid according to Rule 44 of the A.P. VAT Rules, 2005.
8. Procedure after registration of appeal:— (1) As soon as may
be after the registration of the appeal, the Secretary shall fix a date for
hearing in Form 'C'. A copy of the memorandum of appeal and of the
order appealed from shall also be furnished to him. It shall be the duty
of the State Representative to obtain the records of the case from the
Commercial Tax Officer or the Deputy Commissioner, as the case may
be, and transmit them to the Secretary concerned.
9. Notice of appeal:— (1) After the appeal has been registered,
notice of the day fixed for hearing under Regulation 8 in Form 'C' shall
be delivered or issued by registered post to the party. The notice shall
state that if he does not appear on the day so fixed or on any other day
to which the hearing may be adjourned, the appeal will be dismissed for
default or disposed of on merits, ex parte.
(2) Where an appeal, application or petition has been dismissed for
default or disposed of ex parte, the appeal, applicant or petitioner may
apply to the Tribunal for re-admission of the appeal, application or petition;
and where it is shown to the satisfaction of the Tribunal that he was
prevented by sufficient cause from appearing when the appeal, application,
or petition was called on for hearing, the Tribunal may re-admit the appeal,
application or petition on such terms as it thinks fit.
(3) An application for re-admission of an appeal, application or petition
dismissed for default or disposed of ex parte, shall be made within thirty
days from the date of communication of the order of dismissal.
Chapter IV
Hearing, Adjournment and Judgment
10. Procedure of the hearing:— On the date fixed for hearing or
on any other date to which the hearing may be adjourned, the party shall
ordinarily be heard first in support of his appeal. The respondent or his
pleader or his authorized agent, shall, if necessary, be heard next, and in
such case, the party shall be entitled to reply.
11. Fresh evidence and witnesses:— (1) The party or the respondent
shall not be entitled to produce additional evidence whether oral or
documentary, before the Tribunal, but,—
(a)if the authority from whose order the appeal is preferred has refused
to admit evidence which ought to have been admitted, or
(b) if the party or the respondent seeking to adduce additional
evidence satisfies the Appellate Tribunal that such evidence, notwithstanding
the exercise of due diligence, was not within his knowledge or could not
be produced by him at or before the time when the order under appeal
was passed, or
(c) if the Tribunal requires any documents to be produced or any
witnesses to be examined to enable it to pass orders, or
(d) for any other sufficient reason the Tribunal may allow such
evidence or documents to be produced or witnesses examined :
Provided that the other party shall, in such cases, be entitled to produce
rebutting evidence, if any.
(2) If the Tribunal is of opinion that any witness should be examined
in connection with any case before it, it may, instead of examining him
before itself, issue a notice to any Commercial Tax Officer or Deputy
Commissioner of Commercial Taxes or an Advocate or such other suitable
person as it may deem fit, in the circumstances of the case.
12. Adjournment:— The Appellate Tribunal may, on such terms as
it thinks fit, and at any stage, adjourn the hearing of any appeal.
An application for adjournment shall ordinarily be presented in person
by the party before the Tribunal. In case such an application is sent by
post or otherwise, the party shall make his own arrangements for obtaining
intimation of the date of adjournment at his own cost by enclosing postage
stamp or reply-paid telegram voucher. Notice of adjournment shall also be
put up on the notice board of the Tribunal.
13. Procedure in case of death of appellant:— If the appellant
dies while the appeal is pending and it cannot be proceeded with, unless
his legal representative is brought on record, the Tribunal shall adjourn further
proceedings to enable his legal representative to appeal and apply for being
made a party. If the legal representative fails to do so within ninety days
from the date of death of the appellant, the appeal shall abate as regards
such deceased appellant.
14. No abatement by reason of death after hearing:—
Notwithstanding anything contained in Regulation 13, there shall be no
abatement by reason of the death of any party between the conclusion
of the hearing and the passing of the order but the order may, in such
case, be passed notwithstanding the death and shall have the same force
and effect as if it has been passed before the death took place.
15. Determination of legal representative:— If a question arises
in any appeal whether a person is the legal representative of a deceased
appellant, such question may be determined by the Tribunal in a summary
way, if necessary, after taking evidence.
16. Procedure in case of assignment:— If during the tendency
of an appeal before the Tribunal, the business of any dealer who is a party
thereto is assigned to or devolves upon some other person either wholly
or in part, the Tribunal may after considering the applications of any person
claiming to be so entitled, add such person as party to the appeal as it
may consider to be so entitled in law.
17. Procedure in case of insolvency:— If a dealer, who is a party
to an appeal becomes insolvent and his estate becomes vested in the Official
Assignee or Official Receiver, the latter may by leave of the Tribunal, be
made a party to the appeal.
18. Setting aside of abatement or dismissal:— (a) Whenever an
order of abatement or dismissal has been passed, in a case where the
appellant has died, his legal representative, in a case whether the representative
has died, the appellant and, in a case where the appellant and, in a case
where the appellant has become insolvent and his estate vested in the
Official Assignee or Official Receiver such Assignee or Receiver, may,
within sixty days from the date of such order, apply to the Tribunal for
setting aside the abatement or dismissal and the Tribunal shall, on sufficient
cause being shown to its satisfaction, set aside such abatement or dismissal
and proceed with the appeal.
(b) Where an application under clause (a) has been filed after more
than 60 days from the date of the order, the Tribunal may condone the
delay on a separate application when the delay is properly explained.
19. Order:— Every order of the Tribunal shall be in writing.
20. Unanimous or majority order:— Where the order is unanimous,
it shall be signed and dated by all the members of the Tribunal. Where
it is an order of the majority it shall be similarly signed and dated by the
members forming the majority. The dissenting member, shall also write his
order and record his opinion on the point or points on which he dissents.
21. Communication of the order:— The Tribunal shall communicate
the order to the party, the State Representative, the authority against whose
order the appeal was preferred, the concerned Deputy Commissioner and
the Commissioner of Commercial Taxes.
22. Return of exhibits:— (a) The parties or respondents, other than
the State Representative, shall apply for the return of the documents filed
by them within three months from the date of communication of the

Tribunal's orders, failing which the Tribunal shall not be responsible for any
loss or damage to the documents. The application shall contain an undertaking
to the effect that such documents shall be produced before the Tribunal
whenever required by it.
(b) The records of the case and such other documents as may be
produced by the State Representative shall, after the disposal of the case,
be returned to him along with the order on the case and acknowledgement
obtained.
(c) Unfilled documents:— Other documents which have been produced
by parties (as additional evidence before the Tribunal under Regulation 11)
but have either not been tendered in evidence or having been tendered
in evidence have been rejected shall be taken back immediately after the
disposal of the case, by the party producing them after signing thereof,
if they are not so taken, the Tribunal shall not be responsible for any loss
of or damage to the said documents.
23. Appointment of temporary copyists:—It shall be competent
to the Chairman to appoint without the previous sanction of the Government,
one or more temporary copyists according to necessity for preparing the
copies to be granted under Regulation 24. Such temporary copyists shall
be paid out of the contingent provision, a remuneration at one rupee for
every 175 words or a fraction of 175 words copied by him or at such
other rate as may be fixed by the Chairman.
Chapter V
Miscellaneous
24. Copies of documents on payment of fees:— (1) Any party
or respondent in an appeal before the Tribunal may apply to the Secretary
for the inspection of any documents or for a certified copy of any document
including the order in the appeal.
(2) Application for copies shall be in Form 'E' and shall set out the
name and address of the applicant in full, the date and description of the
document of which a copy is required and the purpose for which it is
required. Any application which is not in the proper form shall be returned
for amendment.
Note:— "A Court Fee label of the value of Rupees two shall be
affixed to every such application".
(3) Application for copies shall be accompanied by copy stamp papers
to cover the cost of preparing copies according to the following scale,
namely:—
(a) For the first 200 words or less — Two Rupees
(b) For every additional 100 words or fraction thereof — One Rupee.
(4) If the Secretary feels any doubt about the property of granting
a copy of any such document, he shall place the application before the
Chairman, and act in accordance with his orders.
Search
25. Application for search:— Every person requiring a search to
be made among the records of the Tribunal for the purpose either of
inspecting a document or of obtaining copy thereof shall apply to the
Secretary in Form F.
Note:— "A Court Fee label of the value of Rupees two shall be
affixed to the application" and "A single application shall be sufficient for
inspection any number of documents in a single appeal record".
26. Scale of search fees:— When the document applied for belong
to a year, previous to the current calendar year, a search fee in court-
fee stamps, shall be affixed to the application, according to the following
scale:—
(a) Fee payable for the first document or entry applied for or, if
only one document or entry is applied form, for that document or entry
— Five Rupees.
(b) Fee payable for every document or entry other than the first
included in the same application and connected with the same subject —
Two Rupees.
27. Notice:— Forms 'A' to 'D' with suitable modifications wherever
necessary, shall be used for the purpose of the notice to be issued by
the Tribunal.
28. Service of notice on Government:— (1) The notices required
to be issued under the Act or the Rules or these Regulations, shall be
served in the manner prescribed in Rule 64 of the Andhra Pradesh Value
Added Tax Rules, 2005, an acknowledgement containing the signature of
the addressee undelivered or any member of his family or his pleader or
his authorized agent or an endorsement by the Postal Authorities to the
effect that the notice was refused by the addressee shall unless the contrary
is proved, be deemed to be sufficient to hold that the notice was duly served.
(2) Where the Tribunal is satisfied that the addressee is evading service
or that it is not possible to serve the notice in the ordinary way, it may
direct that a copy of the notice shall be affixed on its notice board and
another copy on the outer door or some other conspicuous part addressee's
office or place of business or last known place of his residence.
29. Delegation of powers by Chairman:— The Chairman may in
writing, delegate his powers under these regulations to one of the other
members during his absence on leave or otherwise.
Form - A
[See Regulation 7(2)]
Before the Value Added Tax Appellate Tribunal, Andhra
Pradesh, Hyderabad
Appeal No. ...................... of ......................
........Appellant
vs.
.......Respondent
To
The above named appellant.
You have filed an appeal against the Order of the Commercial Tax
Officer/Deputy Commissioner in his Appeal No. ..................... dated.............
it does not comply with provisions of the Andhra Pradesh Value Added
Tax Act, 2005 and the rules and regulations made thereunder in the following
aspects.
2. You are hereby required to remedy the defects within................
of the receipt of this notice by you.
Given under my hand and the seal of the Appellate Tribunal.
(By order)
Date:
Seal: Secretary
Form - B
Before the Value Added Tax Appellate Tribunal, Andhra
Pradesh, Hyderabad
Appeal No. ....................... of.................
.......Appellant
vs.
.......Respondent
To
Please take notice that the appeal filed by you against the order of
the Commercial Tax Officer/Deputy Commissioner............................. in his
Appeal No. .................. dated..................... has been placed before the
Appellate Tribunal for orders regarding its admission as it is defective as
already intimated to you by notice, dated.........
The Appellate Tribunal will hear the matter on ....................... If you
want to be heard, you should be present at the time of the hearing in
person or through your pleader or authorized agent. If you fail to do so,
the Appellate Tribunal will pass orders in your absence.
(By order)
Date:
Seal: Secretary
Copy to the State Representative.
Form - C
[See Regulations 8 & 9(1)]
Appeal No. ................... of ....................
......Appellant
vs.
.....Respondent
To
Your appeal before the Appellate Tribunal against the orders of the
........................ in his Appeal No. ....................... dated.................... stands
posted for hearing on........................... at 10.30 a.m. at the Office of the
Tribunal at Hyderabad.
Please take notice that if you do not appear on the above date or
any other day to which the hearing may be adjourned either in person or
by pleader or by authorized agent in support of your appeal, it will be
dismissed for default or disposed of on merits, ex parte.
(By order)
Date:
Seal: Secretary
Copy to the State Representative with copies of Appeal Memorandum
and the order appealed from.
Note:— 1. All accounts (Day book, ledger, railway receipts, Bill of
lading, invoices, vouchers, connected correspondence, if any, statements,
returns, agreements, contracts etc. maintained for the assessment year(s)
to which the appeal relates should be produced at the time of hearing.
2. If any person other than the appellant appears before the Appellate
Tribunal, he should produce a letter of authority (duly stamped Vakalat or
Power of Attorney, as the case may be).
Form - D
[See Regulation 27]
Appeal No. ................... of ..................
......Appellant
vs.
......Respondent
To
The...............
Please take notice that ......................
(By order)
Date:
Seal: Secretary
Form - E
Form of Application for copy of Public Records
To
The Secretary,
Value Added Tax Appellate Tribunal,
Andhra Pradesh,
Hyderabad.
(Rupees two Court-fee Stamp)
1. Name and address of the Applicant in full:
2. Description of records required (as far as possible)
3. Purpose for which copy is required.
Date: Signature of Applicant

Form - F
[See Regulation 25]
Form of Application for Search of Public Records
To
The Secretary,
Value Added Tax Appellate Tribunal,
Andhra Pradesh,
Hyderabad.
(Rupees two Court-fee Stamp)
1. Name and address of the Applicant in full:
2. Description of records required (as far as possible)
3. Purpose for which inspection or copy is required.
Date: Signature of Applicant

Sl. Date Particulars Purchase Input tax Sale Output tax VAT
No. (Rs.) (Rs.) (Rs.) (Rs.) payable Rs.
Calculation of net VAT payable by a VAT dealer in respect of some 88 types of

transactions he may deal with in the course of his business
1. 1-4-2005 To cash purchase of goods subject to 10,00,000

4% of tax under VAT Invoice, dt.
1.4.2005 marked as XX1.
1-4-2005 To cash input tax account as per VAT 40,000
Invoice marked XX1
2. 1-4-2005 By cash by sale of goods (purchased 20,00,000
under VAT invoice, dt. 1-4-2005
marked XX1) through self VAT
invoice dated 1-4-2005 marked SS1.
1-4-2005 By VAT account 80,000 40,000
Note:- The entire input tax can be deducted from the output tax. So deducted the net VAT payable is its balance.
12.5% tax under VAT Invoice, dt.
2.4.2005 marked XX2.
2-4-2005 To cash input tax account as per VAT 1,25,000
Invoice marked XX2.
565

invoice, dt. 2-4-2005 marked as SS2.
2-4-2005 By VAT account 2,50,000 1,25,000
Note:- The entire input tax can be deducted from the output tax. So deducted the net VAT payable is its balance.
5. 3-4-2005 To cash purchase of liquor subject to 10,00,000
70% tax under VAT invoice dt.
3.4.2005 marked XX3 issued by the
A.P. Beverages Corporation.
3-4-2005 To cash input tax account as per VAT 7,00,000
invoice, dt. 3.4.2005 marked as XX3.
6. 3-4-2005 By cash by sale of liquor (purchased 20,00,000
under VAT invoice, dt. 3.4.2005
marked as XX3) through self VAT
invoice, dt. 3.4.2005 marked as SS3.
3-4-2005 By VAT account -- --
Note: The turnover of goods subject to 70% of tax is an exempt turnover to all dealers other than the A.P. Beverages
corporation and Canteen Stores Department. Hence, no output tax is payable.
566

1% tax under VAT invoice, dt.
4.4.2005 marked XX4.
4-4-2005 To cash input tax as per VAT invoice 10,000
marked as XX4.
4-4-2005 By VAT account @ 1% 20,000 10,000
Note: The entire input tax can be deducted from the output tax. So deducted the net VAT payable is its balance.
9. 5-4-2005 To cash purchase of goods intended 10,00,000
for trade in the course of inter-state
sale subject to 4% tax under VAT
invoice, dt. 5-4-2005 marked as XX5.
marked as XX5) in the course of
567
inter-state trade through self VAT

invoice, dt. 5.4.2005 marked as SS5.
5-4-2005 By VAT account (zero tax) -- --
Note:- After Central Sales Tax is paid, input tax can be claimed as a refund. Subject to the conditions prescribed.
for trade in the course of export trade
subject to tax at 4% under VAT
invoice, dt. 6.4.2005 marked XX6.
invoice, dt. 6.4.2005 marked XX6.
12. 6-4-2005 By cash by sale of goods in the 20,00,000
course of export trade (purchased
under invoice, dt. 6.4.2005 marked as
XX6) through self VAT invoice, dt.
6.4.2005 marked SS6.
6-4-2005 By VAT account (zero tax) -- --
Note:- After the tax is paid in accordance with the provisions of the Central Sales Tax Act, the refund of input tax can be claimed
following the procedure prescribed therefore.
13. 7-4-2005 To cash for purchase of goods taxable 10,00,000
at 4% to be used in the manufacture
of goods when sold will be taxable at
568
12½% under VAT invoice, dt.

marked as XX7 at 4% tax)
manufactured and sold subject to
12½% tax through self VAT invoice,
dt. 7.4.2005 marked as SS7 subject to
12½% tax.
7-4-2005 By VAT account 2,50,000 2,10,000
Note:- Here input tax paid is at a lower rate. The manufactured goods being taxable at higher rate the deduction towards input tax is
permissible only to the extent it was paid to the seller. The net tax payable would be (2,50,000-40,000) = Rs. 2,10,000/-.
at 4% to be used in the manufacture
of goods when sold will be exempt
from tax under VAT invoice, dt.
8-4-2005 To cash input tax as per VAT 40,000
569

under VAT invoice, dated 8.4.2005
marked XX8 at 4% tax)
manufactured which when sold are
exempt from tax through self VAT
Note:- When the goods manufactured are out of goods suffered input tax are exempt from tax there is no input tax credit.
17. 9-4-2005 To cash for purchase of exemption 10,00,000
goods to be used in the manufacture
of goods when sold will also be
exempt from tax under VAT invoice,
dt. 9.4.2005 marked as XX9.
9-4-2005 To cash input tax account as per VAT --
marked XX9) exempted from tax
through self VAT invoice, dt.
9.4.2005 marked as SS9.
570

Note:- Here there is no input tax nor is there any output tax payable. Hence, the question of adjusting any tax arises.
at 4% to be used for purposes
otherwise than sales say office use or
for free distribution under VAT
invoice, dt. 10-4-2005 marked as
XX10.
XX10.
20. 10-4-2005 By transfer of goods otherwise than -- -- --
by sale (purchased under VAT
invoice, dt. 10-4-2005 marked XX10
subject to 4% tax) through self
SS10.
Note:- Since the goods purchased are used for purpose of office or for free distribution, no tax is payable on such transfer. Hence
there is no input tax Credit.
571
21. 11-4-2005 To cash for purchase of goods outside 10,00,000

the state and sold directly in another
outside state.
11-4-2005 To cash input tax account as per VAT
invoice, dt. 11-4-2005 issued by the
outside VAT dealer marked XX11.
marked XX11) outside the State
through self invoice, dt. 11.4.2005
marked as SS11.
11-4-2005 By VAT account
Note:- In cases where goods were purchased outside the State and the same are sold away outside the state, there does not arise any
question of input tax or output tax or any input tax credit.
23. 12-4-2005 To cash for purchase of goods subject 10,00,000
to tax at 70% from a VAT dealer who
is not the first seller and who is not
liable to pay any tax under VAT
invoice, dt. 12.4.2005 marked as
XX12.
12-4-2005 To cash input account as per VAT
XX12.
572

from the 2nd seller of goods subject to
70%) under VAT invoice, dt.
12.4.2005 marked XX12) through
self VAT invoice, dt. 12.4.2005
marked as SS12.
Note:- Here a dealer who is dealing in liquor subject to 70% tax sells goods to another dealers, he is not entitled to collect any tax
from the purchasing dealers. Accordingly such dealers are not liable to pay any tax nor can they claim any benefit of input
tax.
to tax at 70% from a dealer who is
not a VAT dealer under his bill, dt.
from the not a dealer subject to tax at
70% under his bill dt. 13.4.2005
marked as XX13) through self VAT
SS13.
13-4-2005 By VAT account. -- --
573
Note:- Where a VAT dealer purchases goods from a non-VAT dealer there is no question of input tax credit. Such dealer need not
pay any output tax at all.
to tax at 12 ½% from a dealer who is
not a VAT dealer for lumpsum price
including turnover tax.
from a dealer subject to 12 ½% who
is not a VAT dealer for lumpsum
price including turnover tax bill dt.
14.4.2005 marked as XX14) through
self VAT invoice dated 14.4.2005
marked as SS14.
14-4-2005 By VAT account 2,50,000 2,50,000
Note:- Where the transaction is in between a non-VAT dealer and a VAT dealer the selling VAT dealer is not entitled to any input tax
credit.
to 4% from a dealer who is not a
VAT dealer under his bill dt.
15.4.2005 marked XX15 including
TOT tax and intended for local sale.
574
15-4-2005 To cash for the turnover tax billed by 15,000

the TOT dealer.
from a dealer subject to 4% who is
not a VAT dealer under his bill dt.
15.4.2005 marked as XX15 including
TOT tax) through self VAT invoice
dt. 15.4.2005 marked as SS15.
15-4-2005 By VAT account 80,000 80,000
Note:- Since the VAT dealer purchased goods from a TOT dealer who is not entitled to issue VAT invoice, the VAT dealer here is not
entitled to input tax credit.
to tax at 1% from a dealer who is not
a VAT dealer under his bill dated
16.4.2005 marked XX16 (intended
for local resale)
16-4-2005 To cash towards the turnover tax 25,000
billed by the TOT dealer, in excess of
authorized tax.
from a dealer subject to 1% tax who
is not a VAT dealer under his bill dt.
575
16-4-2005 marked XX16 through self

VAT invoice dt. 16.4.2005 marked as
SS16.
16-4-2005 By VAT account 20,000 20,000
Note:- Since the VAT dealer here purchased goods from a TOT dealer who is not entitled to issue VAT invoice, no input tax credit is
permissible. It may be noted here that the TOT tax charged by the seller is higher than the VAT payable by the VAT dealer,
even then the VAT dealer is neither entitled to any tax credit or any refund. He is not entitled to recovers excess tax charged
by the TOT dealer.
33. 17-4-2005 To cash towards the turnover tax at 10,00,000
1% billed separately as goods liable
to VAT rate of 4% in the bill dt.
17.4.2005 marked XX17.
17-4-2005 To cash towards the turnover tax 15,000
billed by the TOT dealer.
from a dealer subject to turnover tax
at 1% billed separately by TOT
dealer in his bill dt. 17.4.2005 marked
XX17 for goods liable to VAT rate of
4% and valued Rs. 10 lakhs
purchased and sold at Rs. 20,00,000
17-4-2005 By VAT account 80,000 80,000
576
Note:- Here TOT dealer has issued a bill for his turnover tax to the VAT dealer showing the amount of tax he collected from the VAT
dealer. Since the bill is not a VAT invoice, the VAT dealer cannot claim any adjustment of the input tax in the output tax.
Therefore, the total amount of output tax is the net VAT payable by him.
to 4% tax for sale in the course of
inter-state sale, from a dealer who is
not a VAT dealer under the bill dt.
18.4.2005 marked XX18.
18-4-2005 To cash towards turnover tax at 1% 40,000
billed separately in bill dt. 18.4.2005
marked as XX18.
36. 18-4-2005 By cash by sale of goods subject to 20,00,000
4% tax for sale in the course of inter-
state sale (purchased from a dealer
who is not a VAT dealer under his
bill dt. 18.4.2005 marked as xx18)
through self VAT invoice dt.
Note:- Since the seller of goods is not a VAT dealer and the sale effected is in the course of inter-state trade at zero rate, there is no
output tax payable.
577

to 12½% tax from a dealer who is not
a VAT dealer for use in the
manufacture of goods taxable at
12½%.
19-4-2005 To cash towards turnover tax at 1% 15,000
billed separately under the bill dt.
19.4.2005 marked XX19.
38. 19-4-2005 By cash by sale of goods subject to 20,00,000
12½% tax (purchased from a dealer
who is not a VAT dealer under his
bill dated 19.4.2005 marked XX19)
for use in the manufacture of goods
taxable at 12½% and sold locally
under the bill dt. 19.4.2005 marked as
SS19.
19-4-2005 By VAT account 2,50,000 2,50,000
Note:- The selling dealer being a TOT dealer is not entitled to issue VAT invoice. The purchasing dealer is not entitled to any input
tax credit. The goods manufactured and sold are liable to be taxed at the rate of 12½% without any adjustment of any tax
paid by the VAT dealer at the time of purchase.
at VAT rates 4%, from a dealer who
578
is exempt from the Act under his bill

dated 20.4.2005 marked XX20.
40. 20-4-2005 By cash by sale of goods taxable at 4,00,000
VAT rate of 4% (purchased from a
dealer who is exempted from tax
under his bill dated 20.4.2005 marked
XX20) through self VAT invoice
dated 30.4.2005 marked as SS20.
20-4-2005 By VAT account 16,000 16,000
Note:-- Where the goods are purchased by a VAT dealer from a dealer who is an exempted dealer under the Act, the VAT dealer is
not entitled to adjustment of any tax he might have paid to the exempted dealer. Hence, the VAT dealer here is liable to pay
full VAT amount.
41. 21-4-2005 To cash for purchase of goods subject 10,000
to 4% of tax under VAT invoice
21-4-2005 To cash input tax account as per VAT 400
invoice marked as XX21.
42. 21-4-2005 By cash by consignment sale of 20,000
goods outside state (purchased under
VAT invoice dt. 21.4.2005 marked
XX21) through self VAT invoice dt.
579
21-4-2005 By VAT account 800 400

Note:- Consignment sales or sales whether they are sent to dealers within the State or outside the State. Hence, the input tax here
shall be deducted from the output tax. So deducted the net VAT payable is the balance.
to 4% of tax under VAT invoice
invoice marked XX22.
44. 22-4-2005 By transfer of goods to branches 20,00,000
within the State (purchased under
VAT invoice dated 22.4.2005 marked
XX22) through self transfer invoice
dt. 22.4.2005 marked transfer invoice
1.
Note:- Where goods are transferred to branches with in the State it is not a sale. The question of payment of the tax payable will
arise only after the goods are sold by the branches and when their turnover is added to the turnovers at the principal office.
4% of tax under VAT invoice dt.
23.4.2005 marked XX23.
580

under VAT invoice dated 23.4.2005
invoice dt. 23.4.2005 marked as
SS23.
23-4-2005 By VAT account 80,000 40,000
46A. 23-4-2005 To cash goods sold above are -80,000 -40,000
returned.
Note:- When the goods are returned the entries made above should be reversed. Accordingly, no output tax need to be paid. But, the
fact of return and the fact of repayment should be proved by necessary documents.
24.4.2005 marked XX24.
48. 24-4-2005 By transfer towards works contract 20,00,000
the goods (purchased under VAT
invoice dt. 24.4.2005 marked XX24)
through self transfer invoice dt.
24.4.2005 marked T.R. invoice No. 2
appropriated to the works contract.
581
24-4-2005 By VAT account 80,000 40,000

Note:- The use of the goods used in the works contract by the works contractor are deemed to be a sale of goods made in the favour
of principal. The value of the goods so utilised in the works contract are liable to be taxed and accordingly the entire input
tax paid by the contractor can be deduced from the output tax. So deducted the net VAT payable is its balance. In case, the
principal has made any deduction towards advance tax deduction at source such amount may also be deducted from the net
VAT payable.
4% of tax under VAT invoice dated
25.4.2005 marked XX25 for
transferor to the hirer.
50. 25-4-2005 By adjustment of the total amount 20,00,000
fixed as hire purchase to the hirer of
goods (purchased under VAT invoice
dt. 25.4.2005) through self transfer
invoice, dt. 25.4.2005 marked
transfer invoice No. 3 made in favour
of the hirer.
25-4-2005 By VAT account 80,000 40,000
582
Note:- Where goods are transfered by the owner to the hire purchaser they are deemed to have been sold for the total amount of the
instalments. Therefore, VAT is payable on the transfer of goods effected in favour of the hirer. It is permissible to deduct the
input tax from the output tax. So deducted the net VAT payable is the balance.
4% of tax under VAT invoice dated
26.4.2005 marked XX26 for transfer
to licencee.
52. 26-4-2005 By adjustment of the total amount of 20,00,000
the licence fees fixed for the licencee
for use of the goods during the period
licenced (purchased under VAT
26.4.2005 marked transfer invoice
No. SS4.
26-4-2005 By VAT account 80,000 40,000
Note:- Where the VAT dealer leases the goods on payment of licence fees the goods are deemed to have been sold for the total
amount of licence fees for the period for which the goods are leased. Therefore, the amount of VAT payable is on the total
amount of the licence fees fixed. The input tax is deductible from the output tax. So deducted the net VAT payable is its
balance.
583

27.4.2005 marked XX27 for purposes
of disposal under lucky draw scheme.
54. 27-4-2005 By adjustment of the total value of 20,00,000
goods given under the lucky draw
scheme (purchased under VAT
27.4.2005 marked transfer invoice
No. SS5.
27-4-2005 By VAT account 80,000 40,000
Note:- Where the dealer gives goods ostencibly as gift means only a sale consideration of which is received through instalments by
each subscriber till the end of the period. Therefore, from the sale value so cumulatively arrived at is taxable and the input
tax can be deducted from the output tax. The balance only is the net VAT payable by the dealer. Such entry is made every
time the lucky draw gift is given to the subscribers during the period of the scheme. The same is the case with the promotion
sales and gifts made to celebrities.
55. 28-4-2005 To cash purchase to goods subject to 10,00,000
4% of tax under VAT invoice
584
dt. 28.4.2005 marked XX28 in

respect of goods sold as under
clearance sale.
under VAT invoice dt. 28.4.2005)
through clearance sale under cash bill
dt. 28.4.2005 marked as CB1.
28-4-2005 By VAT account 32,000 8,000
Input tax
credit
Note:- Where the goods are sold as clearance sale/open auction, the sale value of the goods shall be the actual amount realised. The
output tax in such circumstances, when the sale value is lower than the price at which they were originally purchased, the
output tax which being less than the input tax the VAT dealer will be entitled to the excess input tax and accordingly such
excess can be carried over as credit to the next month. If for any reason, the assessing authority finds the value at which the
goods are sold are low, the assessing authority may in such circumstances, arrive at the output tax on the basis of fair market
price instead of at the amount for which the goods are sold either as clearance sales or by auction.
57. 29-4-2005 To cash purchase of goods say paper 4,00,000

subject to 4% of tax from an
585
exempted dealer under his

miscellaneous Bill No. 1, dt.
29-4-2005 To cash input tax account under the NIL
above Bill.
58. 29-4-2005 By cash by sale of goods viz. books 8,00,000
manufactured out of paper purchased
as above.
29-4-2005 By VAT Account NIL 16,000
Note:- Here, the Vendor being an exempt dealer there is no input tax ; the books being exempted goods there is no output tax.
However, the dealer has to pay purchase tax at 4% on the paper used by him for manufacturing books which happened to be
exempt goods. Hence, the VAT payable is Rs. 16,000/-.
4% of tax (an isolated transaction in
goods not an item mentioned in the
Certificate of Registration) under
VAT Invoice, dated 30-4-2005
marked as XX30.
30-4-2005 To cash input tax under the above 8,000
bill.
586
60. 30-4-2005 By cash by sale of goods as an 4,00,000

isolated transaction
30-4-2005 By VAT A/c. 16,000 8,000
Notes:- If the dealer claims that his isolated transaction being less than Rs. 5 lakhs he need not pay any tax would be untenable.
Where a VAT dealer who is registered for goods taxable at 4% indulges in an isolated transaction beyond his normal
business, he does not cease to be a registered VAT dealer in respect of those goods as well. He cannot claim to be a casual
trader or an exempted dealer in respect of this item. He shall pay tax as VAT dealer.
Works Contractor – VAT dealer

Sl. Particulars Total value of the Rate of tax VAT Payable (Rs.)
No. contract (Rs.)
61. Where the VAT dealer has not maintained 80,00,000 12 ½ % on total value 10,00,000
accounts.
Notes:- If the VAT dealer fails to maintain correct account of the materials used and has also not opted for composition, he shall pay
tax at 12½ % on the total value of the contract. No question of input tax rebate will arise.
62. Where the VAT dealer having works contract with 80,00,000 4% on the total value – 3,20,000
State Government or local authority opts to the or the amount received
scheme of composition.
Notes:- In case, the VAT dealer enters into composition with the State Government or local authority he shall pay tax at the
concessional rate of 4% on the total value of the contract. Here also, no question of input tax rebate arises.
587
63. Where the VAT dealer having works contract with 80,00,000 4% on the 50% of the 1,60,000
any other authority or Government including total value – or the
Central Government enters into a composition. amount received
Notes:– In case of VAT dealer enters into composition in respect of the works contract he shall pay tax at a concessional rate of 4%
on the 50% of the total value of the contract. Here also, no question of input tax rebate arises.
64. Where the VAT dealer is a builder selling 40,00,000 4% on the 25% of the 40,000
residential apartments opts to a scheme of total value of the
composition. apartment
Notes:– In case the VAT dealer is a building contractor, he shall pay tax on ¼th of the registered value of the apartment sold by him.
Here, no question of materials incorporated in the contract arises ; no question of any input tax rebate arises.
Works Contractor – TOT dealer

Sl. Particulars Total value of the Rate of tax VAT Payable (Rs.)
No. contract (Rs.)
65. Where the contractor is a TOT dealer. 30,00,000 1% on the value of the 20,000
Value of the goods goods incorporated.
incorporated
20,00,000
588
Notes:– In case the contractor is a TOT dealer, and if he maintains the account of the materials incorporated in the execution of the
contract, he is liable to pay tax at 1% on the value of the materials used. Here also, no question of input tax rebate arises.
66. Where the contractor is a TOT dealer and who did Total value of the 1% on the total value 30,000
not maintain the accounts. contract 30,00,000 of the contract
Notes:– In case the contractor is a TOT dealer, and accounts are not maintained properly, of the materials incorporated in the
execution of the contract he should pay 1% of the tax on the total value of the contract. Here also no question of input tax
rebate arises.
Transitional Relief – Input Tax Credit on Stocks held on 31-3-2005 – If full credit is
given where Bills show the tax
67. 30-5-2005 To Input tax transitional – as per 4,20,000
Commissioner of Commercial Taxes
Communication CCC No. 2005, dt.
30.5.2005 on the stocks held on
31.3.2005 valued as Rs. 40,00,000/-
of which Rs. 10,00,000/- taxable at
4% amounting to Rs. 40,000/- Rs.
20,00,000/- taxable at 18%
amounting to Rs. 3,60,000 and Rs.
10,00,000/- taxable at 2% amounting
to Rs. 20,000/- aggregating to
589
Rs. 4,20,000/- which is adjustable in

six equal instalments from 1-8-2005.
68. 30-5-2005 By Input tax – transitional on the 70,000
stocks held on 31-3-2005 adjustment
of 1/6th in output tax for August,
2005.
If input tax credit is given where bills include APGST Tax Element
69. 30-5-2005 To input tax-transitional as per 3,26,838
Communication No. CCC 2005, dt.
30-5-05 on stocks held on 31-3-2005
valued Rs. 40 lakhs of which Rs. 10
lakhs are taxable at 4% under APGST
rates, Rs. 20 lakhs at 18% APGST
rate and Rs. 10 lakhs at 2% APGST
rate under consolidated bills without
showing the tax element therein.
Input tax calculated on 90% of the
value of the goods billed applying the
tax fraction
Tax x 100
100 + Rate of tax
590
which comes to Rs. 3,26,838/- as

follows :
(i) Rs. 9,00,000 x 4/100 x100/104=
Rs. 34,615
(ii) Rs. 18,00,000 x 18/100 x
100/118 = Rs. 2,74,576
(iii) Rs. 9,00,000x2/100 x 100/102 =
Rs. 17,647
Rs. 3,26,838
70. 30-5-2005 By input tax transitional on the stocks 54,373

held on 31-3-2005 adjustment of 1/6th
of output tax from August, 2005
Where purchase tax is paid under APGST
71. 30-05-2005 To input tax-transitional as per 1,60,000
Communication CCC No. 2005, dt.
30-5-2005 on stocks held on
31.3.2005 valued Rs. 40 lakhs taxable
at 4% on purchase point to be
adjusted in six equal instalments from
1-8-2005.
591
72. 30-05-2005 By Input tax transitional on the stocks 26,666

held on 31-3-2005 adjustment of 1/6th
in output tax for August, 2005.
Notes:- The above calculations are made in accordance with the latest rule whereby Input Tax Credit is permissible whether the
goods taxable under the APGST Act are higher or lower than the rates under the VAT Ordinance. In case, this rule is by any
reason found by Courts as invalid and the input tax permissible is held to be that much only which could be calculated at the
scheduled rates of the VAT Ordinance or the amount paid by the dealers at a rate prescribed under the APGST Act happens
to be less than the VAT rate, that amount only should be given as input tax credit on the stocks held on 31-3-2005 the
calculations would then be as follows.
Transitional relief input tax credit on stocks held on 31-3-2005 at VAT Rate
73. 30-5-2005 To input tax transitional on stocks 1,40,000
held on 31-3-2005 valued Rs. 40
lakhs of which Rs. 10 lakhs are
taxable at 4% under APGST (same as
the rate under VAT), amounting to
Rs. 40,000/- ; Rs. 20 lakhs taxable at
18% under APGST (amounting to Rs.
3,60,000/- (VAT rate 4%) and Rs. 10
lakhs taxable at 2% under APGST
amounting to Rs. 20,000/- (VAT rate
4%), aggregating to Rs. 4,60,000/-.
The claim is restricted under
592
communication No. CCC 2005, dt.

30.5.2005 to lower or equal rates
under VAT or the actual amount paid
where the rate under APGST is
lower than VAT rate. The
calculations then would be as
follows :
(i) Rs. 10 lakhs at 4% Rs. 40,000
(ii) Rs. 20 lakhs at 4%, the rate being
the VAT rate is Rs. 80,000
(iii) Rs. 10 lakhs at 2%, APGST rate
being less than VAT rate Rs. 20,000
Rs. 1,40,000
Which is adjustable in 6 equal
instalments from August, 2005.
74. 30-05-2005 By input tax transitional on the stocks 23,333
held on dt. 31.3.2005 adjustment of
1/6th amount in the output tax for
August, 2005.
75. 30-05-2005 To input tax-transitional on stocks 1,23,493
held on 31-3-2005 valued at Rs. 40
lakhs of which Rs. 10 lakhs taxable at
4% under APGST amounting to Rs.
593
40,000/- ; Rs. 20 lakhs taxable at 18%

under APGST amounting to Rs.
3,60,000/- and Rs. 10 lakhs taxable at
2% under APGST amounting to Rs.
20,000/- for which bills do not
disclose the tax amount separately.
The claim accordingly restricted to
under the Communication No. CCC
2005, dt. 30-5-2005, input tax is
calculated at 90% of the value of the
goods billed applying the tax fraction:
Tax x 100
--------------------
100 + rate of tax
(i) Rs. 9,00,000 x 4/100 x 100/104 =
Rs. 36,615.
(ii) Rs. 18,00,000x4/100 x 100/104 =
Rs. 69,231
(iii) Rs. 9,00,000x2/100 x100/102 =
Rs. 17,647
-----------------
Rs. 1,23,493
-----------------
594
76. 30-05-2005 By input tax-transitional on stocks 20,582

held on 30-05-2005 adjustment of
1/6th amount in the output tax for
August, 2005.
Schedule VI – Liquor by Canteen Stores
70% tax under VAT Invoice, dt.
3.4.2005 marked XX3A issued by
Canteen Stores Department,
Hyderabad.
78. 3-4-2005 To cash Input Tax account as per 7,00,000
VAT Invoice, dt. 3-4-2005 marked
XX3A.
79. 3-4-2005 By cash by sale of goods purchased 20,00,000
under VAT Invoice, dt. 3-4-2005
marked XX3A through self VAT
invoice, dt. 3-4-2005 marked SS3A.
80. 3-4-2005 By VAT Account. -- --
Note:- The turnover of goods subject to 70% of tax is exempt turnover to all dealers other than the A.P. Beverages Corporation Ltd.,
and Canteen Stores Department. Hence, no output tax is payable.
595
81. 3-4-2005 To cash purchase of petrol subject to 10,00,000

70% tax under VAT Invoice, dt.
3.4.2005 marked XX3B issued by Oil
Corporation.
82. 3-4-2005 To cash input tax account as per VAT 7,00,000
invoice No. XX3B, dt. 3-4-2005
83. 3-4-2005 By cash by sale of petrol purchased 20,00,000
marked as XX3B through self VAT
invoice, dated 3-4-2005 marked as
SS3B.
84. 3-4-2005 By VAT Account.
Note:- The turnover of petrol subject to 70% of tax is an exempt turnover to all dealers other than oil companies. Hence, no output
tax is payable.
for sale to a unit in Special Economic
Zone (SEZ) subject to 4% tax under
VAT invoice, dt. 5-4-2005 marked
XX5A.
86. 5-4-2005 To cash input tax account as per VAT 40,000
Invoice No. XX5A, dt. 5-4-2005.
596
87. 5-4-2005 By cash by sale of goods purchased 20,00,000

vide VAT Invoice No. XX5A dt.
5.4.2005 is sold to a unit in Special
Economic Zone (SEZ) through self
VAT Invoice No. SS5A, dt. 5.4.2005.
88. 5-4-2005 By VAT Account (Zero rate tax) -- --
Note:- After Sales Tax is paid by the Special Economic Zone (SEZ) Unit, input tax can be claimed as a refund subject to the
conditions prescribed.
597
Where the discount allowed on the sales affected by VAT dealer
to his customer who is also a VAT dealer.
Rs. Rs.
1. The account to be maintained by the
seller will be as under :
Value of the goods sold 10,00,000
Output Tax on the above sale 40,000
Less : Discount allowed at 10% 1,00,000
------------
Net Sales 9,00,000
------------
Less : Tax on the discount allowed 4,000
-----------
Net VAT payable at 4% on Rs. 9,00,000 36,000
-----------
2. The account to be maintained by the
purchasing VAt dealer will be as under :
Value of the goods purchased 10,00,000
Input tax on the above purchase 40,000
Less : Discount allowed at 10% 1,00,000
-------------
Net Purchases 9,00,000
-------------
Less : Tax on the discount allowed 4,000
-----------
Net Input Tax at 4% on Rs. 9,00,000 36,000
-----------
——
598
CENTRAL SALES TAX ACT, 1956
[Act No. 74 of 1956]
An Act to formulate principles for determining when a sale or
purchase of goods takes place in the course of inter-State trade or
commerce or outside a State or in the course of import into or export
from India, to provide for the levy, collection and distribution of taxes
on sales of goods in the course of inter-State trade or commerce and
to declare certain goods to be of special importance of inter-State trade
or commerce and specify the restrictions and conditions to which State
laws imposing taxes on the sale or purchase of such goods of special
importance shall be subject.
Statement of Objects and Reasons:
In the interest of the national economy of India certain amendments
were undertaken in the Constitution by the Constitution (Sixth
Amendment) Act, 1956, whereby—
(a) taxes on sales or purchases of goods in the course of inter-
State trade or commerce were brought expressly within the purview of
the legislative jurisdiction of Parliament;
(b) restrictions could be imposed on the powers of State legislatures
with respect to the levy of taxes on the sale or purchase of goods within
the State where the goods are of special importance in inter-State trade
or commerce.
The amendments at the same time authorised Parliament to formulate
principles for determining when a sale or purchase takes place in the
course of inter-State trade or commerce or in the course of export or
import or outside a State in order that the legislative spheres of Parliament
and the State legislatures become clearly demarcated. In the case of
goods of special importance in inter-State trade or commerce, a law
of Parliament is to lay down the restrictions and conditions subject to
which any State law may regulate the tax on sales or purchases of such
goods in the State.
2. This Bill seeks to provide for the legislation authorised by the
Constitution as amended above with a view to enabling the State
Governments to raise additional revenues by levying tax on inter-State
transactions which are at present immune from tax under their respective
599
sales tax laws. After taking into account the recommendations of the
Taxation Enquiry Commission and in consultation with the States the
Government of India were of thee view that the following principles
should govern the scheme of the detailed legislation on the three inter-
related subjects:
(i) The Central Government should authorise the State Governments
to impose on behalf of the Central Government tax on the sale or
purchase of goods in the course of inter-State trade or commerce. The
Central legislation should also delegate to the States the Central
Government’s power to levy and collect the tax and for this purpose
prescribe the same system of registration, assessment, etc., as prevails
in the States concerned under their own sales tax system.
(ii) An important aspect of the Central Legislation will be concerned
with the definition of the locale of sales for the purpose of defining
in detail the relative jurisdiction, firstly of the Union and the States,
and secondly, of the States inter se. It is therefore, necessary that the
law should define clearly, with specific reference to sales tax the
circumstances in which a sale or purchase becomes taxable by a particular
State and no other. It should also define for the purpose of the
Constitutional restrictions on the State’s power to impose a tax under
Item 54 of the State list, when a sale or purchase of goods may be
said to take place:
(a) in the course of export out of India,
(b) in the course of import into India, and
(c) in the course of inter-State trade or commerce.
(iii) The Central legislation should provide for the declaration of
certain commodities which are in the nature of raw materials and of
special importance in inter-State trade or commerce and lay down the
restrictions and conditions as to the rate, system of levy and other
incidents of tax subject to which the States may impose tax on the sale
or purchase thereof.
3. Necessary provisions have, therefore, been made in the different
Chapters of this Bill incorporating the principles stated above.
Be it enacted by Parliament in the Seventh Year of the Republic
of India as follows:–
Sec. 2] Central Sales Tax Act, 1956 601
CHAPTER I

called the Central Sales Tax Act, 1956.
(2) it extends to the whole of India.
(3) It shall come into force on such date as the Central Government
may, by notification in the Official Gazette, appoint, and different dates
may be appointed for different provisions of this Act.
2. Definitions:– In this Act, unless the context otherwise requires,–
(a) “appropriate State” means–
(i) in relation to a dealer who has one or more places of business
situate in the same State, that State;
(ii) in relation to a dealer who has places of business situate in
different States, every such State with respect to the place or
places of business situate within its territory;
1
[(aa) “business” includes–
(i) any trade, commerce or manufacture, or any adventure or
concern in the nature of trade, commerce or manufacture,
whether or not such trade, commerce, manufacture, adventure
or concern is carried on with a motive to make gain or profit
and whether or not any gain or profit accrues from such trade,
commerce, manufacture, adventure or concern; and
(ii) any transaction in connection with, or incidental or ancillary
to, such trade, commerce, manufacture, adventure or concern;
(ab) “crossing the customs frontiers of India” means crossing the
limits of the area of a customs station in which imported goods or export
goods are ordinarily kept before clearance by customs authorities.
Explanation:– For the purposes of this clause, “customs station”
and “customs authorities”, shall have the same meanings as in the
Customs Act, 1962 (52 of 1962)];
2
[(b) “dealer” means any person who carries on (whether regularly
or otherwise) the business of buying, selling, supplying or distributing
1. Inserted by the Central Sales Tax (Amendment) Act, 1976.
2. Subs. by the Central Sales Tax (Amendment) Act, 1976.
goods, directly or indirectly, for cash or for deferred payment, or for

commission, remuneration or other valuable consideration, and includes–
(i) a local authority, a body corporate, a company, any co-operative
society or other society, club, firm, Hindu undivided family or
other association of persons which carries on such business;
(ii) a factor, broker, commission agent, del credere agent, or any
other mercantile agent, by whatever name called, and whether
of the same description as hereinbefore mentioned or not, who
goods belonging to any principal whether disclosed or not; and
(iii) an auctioneer who carries on the business of selling or auctioning
goods belonging to any principal, whether disclosed or not and
whether the offer of the intending purchaser is accepted by him
or by the principal or a nominee of the principal.
Explanation 1:– Every person who acts as an agent, in any State,
of a dealer residing outside that State and buys, sells, supplies, or
distributes, goods in the State or acts on behalf of such dealer as–
(i) a mercantile agent as defined in the Sale of Goods Act, 1930
(3 of 1930), or
(ii) an agent for handling of goods or documents of title relating
to goods, or
(iii) an agent for the collection or the payment of the sale price
of goods or as a guarantor for such collection or payment,
and every local branch or office in a State of a firm registered outside
that State or a company or other body corporate, the principal office
or headquarters whereof is outside that State, shall be deemed to be
a dealer for the purposes of this Act.
Explanation 2:– A Government which, whether or not in the course
of business, buys, sells, supplies or distributes, goods, directly or otherwise,
for cash or for deferred payment or for commission, remuneration or
other valuable consideration, shall, except in relation to any sale, supply
or distribution of surplus, unserviceable or old stores or materials or
waste products or obsolete or discarded machinery or parts or accessories
thereof, be deemed to be a dealer for the purposes of this Act;]
(c) “declared goods” means goods declared under Section 14 to
be of special importance in inter-State trade or commerce;
(d) “goods” includes all materials, articles, commodities and all

other kinds of movable property, but does not include newspapers,
actionable claims, stocks, shares and securities;
(dd) “place of business” includes–
(i) in any case where a dealer carries on business through an agent
by (whatever name called), the place of business of such agent;
(ii) a warehouse, godown or other place where a dealer stores his
goods; and
(iii) a place where a dealer keeps his books of account;
(e) “prescribed” means prescribed by rules made under this Act;
(f) “registered dealer” means a dealer who is registered under
Section 7;
1
[(g) “sale”, with its grammatical variations and cognate expressions,
means any transfer of property in goods by one person to another for
cash or deferred payment or for any other valuable consideration, and
includes,–
(i) a transfer, otherwise than in pursuance of a contract, of property
in any goods for cash, deferred payment or other valuable
consideration;
(ii) a transfer of property in goods (whether as goods or in some
other form) involved in the execution of a works contract;
(iii) a delivery of goods on hire-purchase or any system of payment
by instalments;
(iv) a 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;
(v) a supply of goods by any unincorporated association or body
of persons to a member thereof for cash, deferred payment or
other valuable consideration;
1. Subs. by the Finance Act, 2002, w.e.f. 11-5-2002. Prior to substitution it read as :
"Sale", with its grammatical variations and cognate expressions, means any transfer
of property in goods by one person to another for cash or for deferred payment or
for any other valuable consideration, and includes a transfer of goods on the hire-
purchase or other system of payment by instalments, but does not include a mortgage
or hypothecation of or a charge or pledge on goods ;"
(vi) a supply, by way of or as part of any service or in any other

manner whatsoever, of goods, being food or any other article
for human consumption or any drink (whether or not
intoxicating), where such supply or service, is for cash, deferred
payment or other valuable consideration,
but does not include a mortgage or hypothecation of or a charge
or pledge on goods;]
(h) “sale price” means the amount payable to a dealer as
consideration for the sale of any goods, less any sum allowed as cash
discount according to the practice normally prevailing in the trade, but
inclusive of any sum charged for anything done by the dealer in respect
of the goods at the time of or before the delivery thereof other than
the cost of freight or delivery or the cost of installation in cases where
such cost is separately charged;
1
[Provided that in the case of a transfer of property in goods
(whether as goods or in some other form) involved in the execution
of a works contract, the sale price of such goods shall be determined
in the prescribed manner by making such deduction from the total
consideration for the works contract as may be prescribed and such price
shall be deemed to be the sale price for the purposes of this clause.]
2
[(i) “sales tax law” means any law for the time being in force
in any State or part thereof which provides for the levy of taxes on
the sale or purchase of goods generally or on any specified goods
expressly mentioned in that behalf and includes value added tax law,
and "general sales tax law" means any law for the time being in force
in any State or part thereof which provides for the levy of tax on the
sale or purchase of goods generally and includes value added tax law'.]
(j) “turnover” used in relation to any dealer liable to tax under
this Act means the aggregate of the sale prices received and receivable
by him in respect of sales of any goods in the course of inter-State
trade or commerce made during any prescribed period and determined
1. Ins. by Finance Act, 2005, w.e.f. 13-5-2005.

2. Subs. by Finance Act, 2005, w.e.f. 13-5-2005. Prior to its substitution, it read as under:
"(i) "sales tax law" means any law for the time being in force in any State or part
thereof which provides for the levy of taxes on the sale or purchase of goods generally
or on any specified goods expressly mentioned in that behalf, and "general sales tax
law" means the law for the time being in force in any State or part thereof which
provides for the levy of tax on the sale or purchase of goods generally ;"
in accordance with the provisions of this Act and the rules made
thereunder;
1
[(ja) "works contract" means a contract for carrying out any work
which includes assembling, construction, building, altering, manufacturing,
processing, fabricating, erection, installation, fitting out, improvement,
repair or commissioning of any movable or immovable property;]
(k) “year”, in relation to a dealer, means the year applicable in
relation to him under the general sales tax law of the appropriate State,
and where there is no such year applicable, the financial year.
CHAPTER II
Formulation of principles for determining when a sale or

purchase of goods takes place in the course of inter-state trade or
commerce or outside a State or in the course of import or export
3. When is a sale or purchase of goods said to take place in
the course of inter-State trade or commerce:– A sale or purchase
of goods shall be deemed to take place in the course of inter-State trade
or commerce if the sale or purchase–
(a) occasions the movement of goods from one State to another;
or
(b) is effected by a transfer of documents of title to the goods
during their movement from one State to another.
Explanation 1:– Where goods are delivered to a carrier or other
bailee for transmission, the movement of the goods shall, for the
purposes of clause (b), be deemed to commence at the time of such
delivery and terminate at the time when delivery is taken from such
carrier or bailee.
Explanation 2:– Where the movement of goods commences and
terminates in the same State it shall not be deemed to be a movement
of goods from one State to another by reason merely of the fact that
in the course of such movement the goods pass through the territory
of any other State.
4. When is a sale or purchase of goods said to take place outside
a State:– (1) Subject to the provisions contained in Section 3, when
a sale or purchase of goods is determined in accordance with sub-section

(2) to take place inside a State, such sale or purchase shall be deemed
to have taken place outside all other States.
(2) A sale or purchase of goods shall be deemed to take place
inside a State, if the goods are within the State–
(a) in the case of specific or ascertained goods, at the time of the
contract of sale is made; and
(b) in the case of unascertained or future goods, at the time of
their appropriation to the contract of sale by the seller or by
the buyer, whether assent of the other party is prior or subsequent
to such appropriation.
Explanation:– Where there is a single contract of sale or purchase
of goods situated at more places than one, the provisions of this sub-
section shall apply as if there were separate contracts in respect of the
goods at each of such places.
5. When is a sale or purchase of goods said to take place in
the course of import or export:– (1) A sale or purchase of goods
shall be deemed to take place in the course of the export of the goods
out of the territory of India only if the sale or purchase either occasions
such export or is effected by a transfer of documents of title to the
goods after the goods have cross the customs frontiers of India.
(2) A sale or purchase of goods shall be deemed to take place
in the course of the import of the goods into the territory of India only
if the sale or purchase either occasions such import or is effected by
a transfer of documents of title to the goods before the goods have
crossed the customs frontiers of India.
1
[(3) Notwithstanding anything contained in sub-section (1), the last
sale or purchase of any goods preceding the sale or purchase occasioning
the export of those goods out of the territory of India shall also be
deemed to be in the course of such export, if such last sale or purchase
took place after, and was for the purpose of complying with, the
agreement or order for or in relation to such export.]
2
[(4) The provisions of sub-section (3) shall not apply to any sale
or purchase of goods unless the dealer selling the goods furnishes to
1. Inserted by the Central Sales Tax (Amendment) Act, 1976, w.e.f. 1-4-1976.
2. Inserted by Finance Act, 2005, w.e.f. 13-5-2005.
the prescribed authority in the prescribed manner a declaration duly filled

and signed by the exporter to whom the goods are sold in a prescribed
form obtained from the prescribed authority.
(5) Notwithstanding anything contained in sub-section (1), if any
designated Indian carrier purchases Aviation Turbine Fuel for the purposes
of its international flight, such purchase shall be deemed to take place
in the course of the export of goods out of the territory of India.
Explanation:– For the purposes of this sub-section, "designated
Indian carrier" means any carrier which the Central Government may,
by notification in the Official Gazette, specify in this behalf.]
CHAPTER III
Inter-State Sales Tax
6. Liability to tax on inter-State sales:– (1) Subject to the other

provisions contained in this Act, every dealer shall, with effect from
such date as the Central Government may, by notification in the Official
Gazette, appoint, not being earlier than thirty days from the date of
such notification, be liable to pay tax under this Act on all sales of
goods other than electrical energy effected by him in the course of inter-
State trade or commerce during any year on and from the date so
notified:
1
[Provided that a dealer shall not be liable to pay tax under this
Act on any sale of goods which, in accordance with the provisions of
sub-section (3) of Section 5, is a sale in the course of export of those
goods out of the territory of India.]
(1A) A dealer shall be liable to pay tax under this Act on a sale
of any goods effected by him in the course of inter-State trade or
commerce notwithstanding that no tax would have been leviable (whether
on the seller or the purchaser) under the sales tax law of the appropriate
State if that sale had taken place inside that State.
2
[(2) Notwithstanding anything contained in sub-section (1) or sub-
section (1A), where a sale of any goods in the course of inter-State
trade or commerce has either occasioned the movement of such goods

from one State to another or has been effected by a transfer of documents
of title to such goods during their movement from one State to another,
any subsequent sale during such movement effected by a transfer of
documents of title to such goods to a registered dealer, if the goods
are of the description referred to in sub-section (3) of section 8, shall
be exempt from tax under this Act:
Provided that no such subsequent sale shall be exempt from tax

under this sub-section unless the dealer effecting the sale furnishes to
the prescribed authority in the prescribed manner and within the prescribed
time or within such further time as that authority may, for sufficient
cause, permit,–
(a) a certificate duly filled and signed by the registered dealer from
whom the goods were purchased containing the prescribed particulars
in a prescribed form obtained from the prescribed authority; and
(b) if the subsequent sale is made to a registered dealer, a declaration

referred to in sub-section (4) of section 8:
Provided further that it shall not be necessary to furnish the

declaration referred to in clause (b) of the preceding proviso in respect
of a subsequent sale of goods if,–
(a) the sale or purchase of such goods is, under the sales tax law
of the appropriate State exempt from tax generally or is subject to tax
generally at a rate which is lower than three per cent. or such reduced
rate as may be notified by the Central Government, by notification in
the Official Gazette, under sub-section (1) of section 8 (whether called
a tax or fee or by any other name); and
(b) the dealer effecting such subsequent sale proves to the satisfaction
of the authority referred to in the preceding proviso that such sale is
of the nature referred to in this sub-section.]
1
[(3) Notwithstanding anything contained in this Act, no tax under
this Act shall be payable by any dealer in respect of sale of any goods
1. Subs. by Finance Act, 2005, w.e.f. 13-5-2005.

Sec. 6A] Central Sales Tax Act, 1956 609
made by such dealer, in the course of inter-State trade or commerce, to

any official, personnel, consular or diplomatic agent of–
(i) any foreign diplomatic mission or consulate in India; or
(ii) the United Nations or any other similar international body,
entitled to privileges under any convention or agreement to which India
is a party or under any law for the time being in force, if such official,
personnel, consular or diplomatic agent, as the case may be, has purchased
such goods for himself or for the purposes of such mission, consulate, United
Nations or other body.
(4) The provisions of sub-section (3) shall not apply to the sale of
goods made in the course of inter-State trade or commerce unless the dealer
selling such goods furnishes to the prescribed authority a certificate in the
prescribed manner on the prescribed form duly filled and signed by the
official, personnel, consular or diplomatic agent, as the case may be.]
6A. Burden of proof, etc., in case of transfer of goods claimed
otherwise than by way of sale:– (1) Where any dealer claims that he
is not liable to pay tax under this Act, in respect of any goods, on the
ground that the movement of such goods from one State to another was
occasioned by reason of transfer of such goods by him to any other place
of his business or to his agent or principal, as the case may be, and not
by reason of sale, the burden of proving that the movement of those goods
was so occasioned shall be on that dealer and for this purpose he may
furnish to the assessing authority, within the prescribed time or within such
further time as that authority may, for sufficient cause, permit, a declaration,
duly filled and signed by the principal officer of the other place of business,
or his agent or principal, as the case may be, containing the prescribed
particulars in the prescribed form obtained from the prescribed authority,
along with the evidence of despatch of such goods 1[and if the dealer fails
to furnish such declaration, then, the movement of such goods shall be
deemed for all purposes of this Act to have been occasioned as a result
of sale.]
(2) If the assessing authority is satisfied after making such inquiry
as he may deem necessary that the particulars contained in the declaration
furnished by a dealer under sub-section (1) 2[are true and that no inter-
State sale has been effected, he may, at the time of, or at any time before,
the assessment of the tax payable by the dealer under this Act, make an
order to that effect and thereupon the movement of goods to which the
1. Inserted by the Finance Act, 2002, w.e.f. 11-5-2002.

VAT–39
declaration relates shall, subject to the provisions of sub-section (3)] be

deemed for the purpose of this Act to have been occasioned otherwise
than as a result of sale.
1
[(3) Nothing contained in sub-section (2) shall preclude reassessment
by the assessing authority on the ground of discovery of new facts or revision
by a higher authority on the ground that the findings of the assessing authority
are contrary to law, and such reassessment or revision may be done in
accordance with the provisions of General Sales Tax Law of the State.]
Explanation:– In this section, “assessing authority”, in relation to a
dealer, means the authority for the time being competent to assess the tax
payable by the dealer under this Act.
7. Registration of dealers:– (1) Every dealer liable to pay tax under
this Act shall, within such time as may be prescribed for the purpose, make
an application for registration under this Act to such authority in the
appropriate State as the Central Government may, by general or special
order, specify, and every such application shall contain such particulars as
may be prescribed.
(2) Any dealer liable to pay tax under the sales tax law of the
appropriate State, or where there is no such law in force in the appropriate
State or any part thereof, any dealer having a place of business in that
State or part, as the case may be, may, notwithstanding that he is not
liable to pay tax under this Act, apply for registration under this Act to
the authority referred to in sub-section (1), and every such application shall
contain such particulars as may be prescribed.
Explanation: For the purposes of this sub-section, a dealer shall be
deemed to be liable to pay tax under the sales tax law of the appropriate
State notwithstanding that under such law a sale or purchase made by him
is exempt from tax or refund or rebate of tax is admissible in respect thereof.
(2A) Where it appears necessary to the authority to whom an application
is made under sub-section (1) or sub-section (2) so to do for the proper
realisation of the tax payable under this Act or for the proper custody and
use of the forms referred to in clause (a) of the first proviso to sub-section
(2) of Section 6 or sub-section (1) of Section 6A or 2[sub-section (4) of
Section 8], he may, by an order in writing and for reasons to be recorded
therein, impose as a condition for the issue of a certificate of registration
a requirement that the dealer shall furnish in the prescribed manner and
within such time as may be specified in the order such security as may
be so specified, for all or any of the aforesaid purposes.
1. Ins. by Finance Act, 2010.
2. Subs. for "clause (a) of sub-section (4) of Section 8" by Act No. 16 of 2007, w.e.f.
1-4-2007.
(3) If the authority to whom an application under sub-section (1) or

sub-section (2) is made is satisfied that the application is in conformity with
the provisions of this Act and the rules made thereunder and the condition,
if any, imposed under sub-section (2A), has been complied with, he shall
register the applicant and grant to him a certificate of registration in the
prescribed form which shall specify the class or classes of goods for the
purposes of sub-section (1) of Section 8.
(3A) Where it appears necessary to the authority granting a certificate
of registration under this section so to do for the proper realisation of tax
payable under this Act or for the proper custody and use of the forms
referred to in sub-section (2A), he may, at any time while such certificate
is in force, by an order in writing and for reasons to be recorded therein,
require the dealer, to whom the certificate has been granted, to furnish
within such time as may be specified in the order and in the prescribed
manner such security, or, if the dealer has already furnished any security
in pursuance of an order under this sub-section or sub-section (2A), such
additional security, as may be specified in the order, for all or any of the
aforesaid purposes.
1
[(3B) No dealer shall be required to furnish any security under sub-
section (2A) or any security or additional security under sub-section (3A)
unless he has been given an opportunity of being heard.
(3BB) The amount of security which a dealer may be required to
furnish under sub-section (2A) or sub-section (3A) or the aggregate of the
amount of such security and the amount of additional security which he
may be required to furnish under sub-section (3A), by the authority referred
to therein, shall not exceed–
(a) in the case of a dealer other than a dealer who has made an
application, or who has been registered in pursuance of an application, under
sub-section (2), a sum equal to the tax payable under this Act, in accordance
with the estimate of such authority, on the turnover of such dealer for
the year in which such security or, as the case may be, additional security
is required to be furnished; and
(b) in the case of a dealer who has made an application, or who
has been registered in pursuance of an application, under sub-section (2),
a sum equal to the tax leviable under this Act, in accordance with the
estimate of such authority on the sales to such dealer in the course of
inter-State trade or commerce in the year in which such security or, as
the case may be, additional security is required to be furnished, had such
dealer been not registered under this Act.]
(3C) Where the security furnished by a dealer under sub-section (2A)
or sub-section (3A) is in the form of a surety bond and the surety becomes
1. Subs. for existing sub-section (3B) by the Central Sales Tax (Amendment) Act, 1976.
(3C) Where the security furnished by a dealer under sub-section

(2A) or sub-section (3A) is in the form of a surety bond and the surety
becomes insolvent or dies, the dealer shall, within thirty days of the
occurrence of any of the aforesaid events, inform the authority granting
the certificate of registration and shall within ninety days of such
occurrence furnish a fresh surety bond or furnish in the prescribed
manner other security for the amount of the bond.
(3D) The authority granting the certificate of registration may by
order and for good and sufficient cause forfeit the whole or any part
of the security furnished by a dealer,–
(a) for realising any amount of tax or penalty payable by the dealer;
(b) if the dealer is found to have misused any of the forms referred
to in sub-section (2A) or to have failed to keep them in proper
custody :
Provided that no order shall be passed under this sub-section
without giving the dealer an opportunity of being heard.
(3E) Where by reason of an order under sub-section (3D), the
security furnished by any dealer is rendered insufficient, he shall make
up the deficiency in such manner and within such time as may be
prescribed.
(3F) The authority issuing the forms referred to in sub-section (2A)
may refuse to issue such forms to a dealer who has failed to comply
with an order under that sub-section or sub-section (3A), or with the
provisions of sub-section (3C) or sub-section (3E), until the dealer has
complied with such order or such provisions, as the case may be.
(3G) The authority granting a certificate of registration may, on
application by the dealer to whom it has been granted, order the refund
of any amount or part thereof deposited by the dealer by way of security
under this section, if it is not required for the purposes of this Act.
(3H) Any person aggrieved by an order passed under sub-section
(2A), sub-section (3A), sub-section (3D) or sub-section (3G) may, within
thirty days of the service of the order on him, but after furnishing the
security, prefer, in such form and manner as may be prescribed, an appeal
against such order to such authority (hereafter in this section referred
to as the “appellate authority”) as may be prescribed :
Provided that the appellate authority may, for sufficient cause,

permit such person to present the appeal–
(a) after the expiry of the said period of thirty days ; or
(b) without furnishing the whole or any part of such security.
(3-I) The procedure to be followed in hearing any appeal under
sub-section (3H), and the fees payable in respect of such appeals shall
be such as may be prescribed.
(3J) The order passed by the appellate authority in any appeal under
sub-section (3H) shall be final.
(4) A certificate of registration granted under this section may–
(a) either on the application of the dealer to whom it has been
granted, or where no such application has been made, after due notice
to the dealer, be amended by the authority granting it if he is satisfied
that by reason of the registered dealer having changed the name, place
or nature of his business or the class or classes of goods in which he
carries on business or for any other person the certificate of registration
granted to him requires to be amended ; or
(b) be cancelled by the authority granting it where he is satisfied,
after due notice to the dealer to whom it has been granted, that he
has ceased to carry on business or has ceased to exist or has failed
without sufficient cause, to comply with an order under sub-section (3A)
or with the provisions of sub-section (3C) or sub-section (3E) or has
failed to pay any tax or penalty payable under this Act, or in the case
of a dealer registered under sub-section (2) has ceased to be liable to
pay tax under the sales tax law of the appropriate State or for any other
sufficient reason.
(5) A registered dealer may apply in the prescribed manner not
later than six months before the end of a year to the authority which
granted his certificate of registration for the cancellation of such
registration, and the authority shall, unless the dealer is liable to pay
tax under this Act, cancel the registration accordingly, and where he
does so, the cancellation shall take effect from the end of the year.
8. Rates of tax on sales in the course of inter-State trade or
commerce:– 1[(1) Every dealer, who in the course of inter-State trade
1. Sub-sections (1) and (2) subs. by Act No. 16 of 2007, w.e.f. 1-4-2007. Prior to its
omission it read as :
or commerce, sells to a registered dealer goods of the description referred

to in sub-section (3), shall be liable to pay tax under this Act, which
shall be three per cent. of his turnover or at the rate applicable to the
sale or purchase of such goods inside the appropriate State under the
sales tax law of that State, whichever is lower:
Provided that the Central Government may, by notification in the
Official Gazette, reduce the rate of tax under this sub-section.
(2) The tax payable by any dealer on his turnover in so far as
the turnover or any part thereof relates to the sale of goods in the course
"(1) Every dealer, who in the course of inter-State trade or commerce–

(a) sells to the Government any goods ; or
(b) sells to a registered dealer other than the Government goods of the description
referred to in sub-section (3) ;
shall be liable to pay tax under this Act, with effect from such date as may be notified
by the Central Government in the Official Gazette for this purpose, which shall be
two per cent of his turnover or at the rate applicable to the sale or purchase of such
goods inside the appropriate State under the sales tax law of that State, or, as the
case may be, under any enactment of that State imposing value added tax, whichever
is lower :
Provided that the rate of tax payable under this sub-section by a dealer shall continue
to be four per cent of his turnover, until the rate of two per cent takes effect under
this sub-section.
(2) The tax payable by any dealer on his turnover insofar as the turnover or any
part thereof relates to the sale of goods in the course of inter-State trade or commerce
not falling within sub-section (1)–
(a) in the case of declared goods, shall be calculated at twice the rate applicable to
the sale or purchase of such goods inside the appropriate State;
(b) in the case of goods other than declared goods, shall be calculated at the rate
of ten per cent or at the rate applicable to the sale or purchase of such goods inside
the appropriate State, whichever is higher ; and
(c) in the case of goods, the sale or, as the case may be, the purchase of which is,
under the sales tax law of the appropriate State, exempt from tax generally shall be
nil,
and for the purpose of making any such calculation under clause (a) or clause (b),
any such dealer shall be deemed to be a dealer liable to pay tax under the sales tax
law of the appropriate State, notwithstanding that he, in fact, may not be so liable
under that law.
Explanation:– For the purposes of this sub-section, a sale or purchase of any goods
shall not be deemed to be exempt from tax generally under the sales tax law of the
appropriate State if under that law the sale or purchase of such goods is exempt only
in specified circumstances or under specified conditions or the tax is levied on the
sale or purchase of such goods at specified stages or otherwise than with reference
to the turnover of the goods."
of inter-State trade or commerce not falling within sub-section (1), shall

be at the rate applicable to the sale or purchase of such goods inside
the appropriate State under the sales tax law of that State.
Explanation:– For the purposes of this sub-section, a dealer shall
be deemed to be a dealer liable to pay tax under the sales tax law
of the appropriate State, notwithstanding that he, in fact, may not be
so liable under that law.]
1
(2A) [x x x]
2
[(3) The goods referred to in sub-section (1)]–
(a) ** ** **
(b) are goods of the class or classes specified in the certificate
of registration of the registered dealer purchasing the goods as being
intended for re-sale by him or subject to any rules made by the Central
Government in this behalf, for use by him in the manufacture or
processing of goods for sale or 3[in the telecommunications network
or] in mining or in the generation or distribution of electricity or any
other form of power ;
(c) are containers or other materials specified in the certificate of
registration of the registered dealer purchasing the goods, being containers
or materials intended for being used for the packing of goods for sale;
(d) are containers or other materials used for the packing of any
goods or classes of goods specified in the certificate of registration
referred to in clause (b) or for the packing of any containers or other
materials specified in the certificate of registration referred to in clause (c).
4
[(4) The provisions of sub-section (1) shall not apply to any sale
in the course of inter-State trade or commerce unless the dealer selling
the goods furnishes to the prescribed authority in the prescribed manner
a declaration duly filled and signed by the registered dealer to whom
the goods are sold containing the prescribed particulars in a prescribed
form obtained from the prescribed authority :
1. Omitted by the Finance Act, 2002, w.e.f. 11-5-2002.

2. Subs. for "The goods referred to in clause (b) of sub-section (1)" by Act 16 of 2007,
w.e.f. 1-4-2007.
4. Subs. by Act 16 of 2007, w.e.f. 1-4-2007.
Provided that the declaration is furnished within the prescribed time

or within such further time as that authority may, for sufficient cause,
permit.]
(5) Notwithstanding anything contained in this section, the State
Government may, 1[on the fulfilment of the requirements laid down in sub-
section (4) by the dealer,] if it is satisfied that it is necessary so to do
in the public interest, by notification in the Official Gazette and subject to
such conditions as may be specified therein, direct,–
(a) that no tax under this Act shall be payable by any dealer having
his place of business in the State in respect of the sales by him, in the
course of inter-State trade or commerce, 1[to a registered dealer
2
[xxx]] from any such place of business of any such goods or classes of
goods as may be specified in the notification, or that the tax on such sales
shall be calculated at such lower rates than those specified in sub-section
(1) 3[xxx] as may be mentioned in the notification ;
(b) that in respect of all sales of goods or sales of such classes of
goods as may be specified in the notification, which are made, in the course
of inter-State trade or commerce, 1[to a registered dealer 2[xxx]] by any
dealer having his place of business in the State or by any class of such
dealers as may be specified in the notification to any person or to such
class of persons as may be specified in the notification, no tax under this
Act shall be payable or the tax on such sales shall be calculated at such
lower rates than those specified in sub-section (1) 3[xxx] as may be
mentioned in the notification.
4
[(6) Notwithstanding anything contained in this section, no tax under
this Act shall be payable by any dealer in respect of sale of any
goods made by such dealer, in the course of inter-State trade or commerce
to a registered dealer for the purpose of setting up, operation, maintenance,
reconditioning, re-engineering, packaging or for use as packing material or
packing accessories in an unit located in any special economic zone or
for development, operation and maintenance of special economic zone by
2. The words "or the Government" omitted by Act 16 of 2007, w.e.f. 1-4-2007.
3. The words "or sub-section (2)" omitted by Act 16 of 2007, w.e.f. 1-4-2007.
4. Subs. by Finance (No. 2) Act, 2004, w.e.f. 10-9-2004. Prior to its substitution, it read
as under :
"(6) Notwithstanding anything contained in this section, no tax under this Act shall
be payable by any dealer in respect of sale of any goods made by such dealer, in
the course of inter-State trade or commerce to a registered dealer for the purpose
of manufacture, production, processing, assembling, repairing, reconditioning, re-
engineering, packaging or for use as trading or packing material or packing accessories
in an unit located in any special economic zone, if such registered dealer has been
authorised to establish such unit by the authority specified by the Central Government
in this behalf."
goods made by such dealer, in the course of inter-State trade or commerce

to a registered dealer for the purpose of setting up, operation, maintenance,
reconditioning, re-engineering, packaging or for use as packing material
or packing accessories in an unit located in any special economic zone
or for development, operation and maintenance of special economic zone
by the developer of the special economic zone, if such registered dealer
has been authorised to establish such unit or to develop, operate and
maintain such special economic zone by the authority specified by the
Central Government in this behalf.]
(7) The goods referred to in sub-section (6) shall be the goods
of such class or classes of goods as specified in the certificate of
registration of the registered dealer referred to in that sub-section.
(8) The provisions of sub-sections (6) and (7) shall not apply to
any sale of goods made in the course of inter-State trade or commerce
unless the dealer selling such goods furnishes to the 1[prescribed authority
referred to in sub-section (4) a declaration in the prescribed manner
on the prescribed form obtained from the authority specified by the
Central Government under sub-section (6)], duly filled in and signed
by the registered dealer to whom such goods are sold.
Explanation:– For the purposes of sub-section (6), the expression
“special economic zone” has the meaning assigned to it in clause (iii)
to Explanation 2 to the proviso to Section 3 of the Central Excise Act,
1944 (1 of 1944).]
8A. Determination of turnover:– (1) In determining the turnover
of a dealer for the purpose of this Act, the following deductions shall
be made from the aggregate of the sale prices, namely :
(a) the amount arrived at by applying the following formula–
rate of tax × aggregate of sale prices
—————————————————
100 plus rate of tax
Provided that no deduction on the basis of the above formula shall
be made if the amount by way of tax collected by a registered dealer,
1. Subs. for "authority referred to in sub-section (6) a declaration in the prescribed manner
on the prescribed form obtained from the authority referred to in sub-section (5)" by
the Finance (No. 2) Act, 2004, w.e.f. 10-9-2004.
in accordance with the provisions of this Act, has been otherwise

deducted from the aggregate of sale prices.
Explanation:– Where the turnover of a dealer is taxable at different
rates, the aforesaid formula shall be applied separately in respect of
each part of the turnover liable to a different rate of tax ;
(b) the sale price of all goods returned to the dealer by the
purchasers of such goods–
(i) within a period of three months from the date of delivery of
the goods, in the case of goods returned before the 14th day
of May, 1966 ;
(ii) within a period of six months from the date of delivery of the
goods, in the case of goods returned on or after the 14th day
of May, 1966 :
Provided that satisfactory evidence of such return of goods and
of refund or adjustment in accounts of the sale price thereof
is produced before the authority competent to assess or, as the
case may be, reassess the tax payable by the dealer under this
Act ; and
(c) such other deductions as the Central Government may, having
regard to the prevalent market conditions, facility of trade and interests
of consumers, prescribe.
(2) Save as otherwise provided in sub-section (1), in determining
the turnover of a dealer for the purposes of this Act, no deduction shall
be made from the aggregate of the sale prices.
9. Levy and collection of tax and penalties:— (1) The tax
payable by any dealer under this Act on sales of goods effected by him
in the course of inter-State trade or commerce, whether such sales fall
within clause (a) or clause (b) of Section 3, shall be levied by the
Government of India and the tax so levied shall be collected by that
Government in accordance with the provisions of sub-section (2), in
the State from which the movement of the goods commenced :
1
[Provided that, in the case of a sale of goods during their movement
from one State to another, being a sale subsequent to the first sale in
respect of the same goods and being also a sale which does not fall
within sub-section (2) of Section 6, the tax shall be levied and collected–
1. Subs. by the Central Sales Tax (Amendment) Act, 1976.
(a) where such subsequent sale has been effected by a registered

dealer, in the State from which the registered dealer obtained or, as
the case may be, could have obtained, the form prescribed for the
purposes of *[sub-section (4) of Section 8] in connection with the
purchase of such goods, and
(b) where such subsequent sale has been effected by an unregistered
dealer in the State from which such subsequent sale has been effected.]
(2) Subject to the other provisions of this Act and the rules made
thereunder, the authorities for the time being empowered to assess, re-
assess, collect and enforce payment of any tax under the general sales
tax law of the appropriate State shall, on behalf of the Government
of India, assess, re-assess, collect and enforce payment of tax, including
any 1[interest or] penalty, payable by a dealer under this Act as if the
tax or 1[interest or] penalty payable by such a dealer under this Act
is a tax or 1[interest or] penalty payable under the general sales tax
law of the State ; and for this purpose they may exercise all or any
of the powers they have under the general sales tax law of the State;
and the provisions of such law, including provisions relating to returns,
provisional assessment, advance payment of tax, registration of the
transferee of any business, imposition of the tax liability of a person
carrying on business on the transferee of, or successor to, such business,
transfer of liability of any firm or Hindu undivided family to pay tax
in the event of the dissolution of such firm or partition of such family,
recovery of tax from third parties, appeals, reviews, revisions, references,
refunds, rebates, penalties, 2[charging or payment of interest,] compounding
of offences and treatment of documents furnished by a dealer as
confidential, shall apply accordingly :
Provided that if in any State or part thereof there is no general
sales tax law in force, the Central Government may, by rules made in
this behalf make necessary provision for all or any of the matters
specified in this sub-section.
3
[(2A) All the provisions relating to offences, 4[interest] and penalties
(including provisions relating to penalties in lieu of prosecution for an
offence or in addition to the penalties or punishment for an offence
* Subs. for "clause (a) of sub-section (4) of Section 8" by Act No. 16 of 2007, w.e.f.
1-4-2007.
3. Subs. by the Finance Act, 2000, w.e.f. 12-5-2000.
620 Commentary on A.P. Value Added Tax [Sec. 9B
but excluding the provisions relating to matters provided for in Sections

10 and 10A) of the general sales tax law of each State shall, with
necessary modifications, apply in relation to the assessment, re-assessment,
collection and the enforcement of payment of any tax required to be
collected under this Act in such State or in relation to any process
connected with such assessment, re-assessment, collection or enforcement
of payment as if the tax under this Act were a tax under such sales
tax law.]
1
[(2B) If the tax payable by any dealer under this Act is not paid
in time, the dealer shall be liable to pay interest for delayed payment
of such tax and all the provisions for delayed payment of such tax and
all the provisions relating to due date for payment of tax, rate of interest
for delayed payment of tax and assessment and collection of interest
for delayed payment of tax, of the general sales tax law of each State,
shall apply in relation to due date for payment of tax, rate of interest
for delayed payment of tax, and assessment and collection of interest
for delayed payment of tax under this Act in such States as if the tax
and the interest payable under this Act were a tax and an interest under
such sales tax law.]
(3) The proceeds in any financial year of any tax, including any
1
[interest or] penalty, levied and collected under this Act in any State
(other than a Union Territory) on behalf of the Government of India
shall be assigned to that State and shall be retained by it ; and the
proceeds attributable to Union Territories shall form part of the
Consolidated Fund of India.
9A. Collection of tax to be only by registered dealers:– No
person who is not a registered dealer shall collect in respect of any
sale by him of goods in the course of inter-State trade or commerce
any amount by way of tax under this Act, and no registered dealer shall
make any such collection except in accordance with this Act and the
rules made thereunder.
9B. Rounding off of tax, etc.:– The amount of tax, interest,
penalty, fine or any other sum payable, and the amount of refund 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 :
Provided that nothing in this section shall apply for the purpose of
collection by a dealer of any amount by way of tax under this Act in
respect of any sale by him of goods in the course of inter-State trade
or commerce.
10. Penalties:– If any person–
(a) furnishes a 1[x x x] declaration under sub-section (2) of Section
6 or sub-section (1) of Section 6A or sub-section (4) 2[or sub-section (8)]
of Section 8, which he knows, or has reason to believe, to be false; or
(aa) fails to get himself registered as required by Section 7, or fails
to comply with an order under sub-section (3A) or with the requirements
of sub-section (3C) or sub-sec. (3E), of that section; or
(b) being a registered dealer, falsely represents when purchasing any
class of goods that goods of such class are covered by his certificate of
registration ; or
(c) not being a registered dealer, falsely represents when purchasing
goods in the course of inter-State trade or commerce that he is a registered
dealer ; or
(d) after purchasing any goods for any of the purposes specified in
clause (b) or clause (c) or clause (d) of sub-section (3) 1[or sub-section
(6)] of Section 8 fails, without reasonable excuse, to make use of the goods
for any such purpose ; or
(e) has in his possession any form prescribed for the purpose of sub-
section (4) 1[or sub-section (8)] of Section 8 which has not been obtained
by him or by his principal or by his agent in accordance with the provisions
of this Act or any rules made thereunder ; or
(f) collects any amount by way of tax in contravention of the provisions
contained in Section 9A,
he shall be punishable with simple imprisonment which may extend to six
months, or with fine or with both ; and when the offence is a continuing
offence, with a daily fine which may extend to fifty rupees for every day
during which the offence continues.
1. The word "certificate or" omitted by Act No. 16 of 2007, w.e.f. 1-4-2007.
10A. Imposition of penalty in lieu of prosecution:– (1) If any

person purchasing goods is guilty of an offence under clause (b) or clause
(c) or clause (d) of Section 10, the authority who granted to him or,
as the case may be, is competent to grant to him a certificate of
registration under this Act may, after giving him a reasonable opportunity
of being heard, by order in writing, impose upon him by way of penalty
a sum not exceeding one and a half times the tax which would have
been levied under sub-section (2) of Section 8 in respect of the sale
to him of the goods, if the sale had been a sale falling within that sub-
section :
Provided that no prosecution for an offence under Section 10 shall
be instituted in respect of the same facts on which a penalty has been
imposed under this section.
(2) The penalty imposed upon any dealer under sub-section (1)
shall be collected by the Government of India in the manner provided
in sub-section (2) of Section 9–
(a) in the case of an offence falling under clause (b) or clause
(d) of Section 10, in the State in which the person purchasing the goods
obtained the form prescribed for the purposes of 1[sub-section (4) of
Section 8] in connection with the purchase of such goods ;
(b) in the case of an offence falling under clause (c) of Section
10, in the State in which the person purchasing the goods should have
registered himself if the offence had not been committed.
11. Cognizance of offences:– (1) No Court shall take cognizance
of any offence punishable under this Act or the rules made thereunder
except with the previous sanction of the Government within the local
limits of whose jurisdiction the offence has been committed or of such
officer of that Government as it may, by general or special order, specify
in this behalf ; and no Court inferior to that of a Presidency Magistrate
or a Magistrate of the first class shall try any such offence.
(2) All offences punishable under this Act shall be cognizable and
bailable.
12. Indemnity:– No suit, prosecution or other legal proceeding
shall lie against any officer of Government for anything which is in
good faith done or intended to be done under this Act or the rules made
thereunder.
1. Subs. for "clause (a) of sub-section (4) of Section 8" by Act No. 16 of 2007, w.e.f.
1-4-2007.
13. Power to make rules:– (1) The Central Government may, by

notification in the Official Gazette, make rules providing for–
(a) the manner in which applications for registration may be made
under this Act, the particulars to be contained therein, the procedure
for the grant of such registration, the circumstances in which registration
may be refused and the form in which the certificate of registration
may be given ;
1
[(aa) the manner of determination of the sale price and the
deductions from the total consideration for a works contract under the
proviso to clause (h) of Section 2;]
2 3
[ [(ab)] the form and the manner for furnishing declaration under
sub-section (8) of Section 8;]
(b) the period of turnover, the manner in which the turnover in
relation to the sale of any goods under this Act shall be
determined, and the deductions which may be made under
clause (c) of sub-section (1) of Section 8A in the process of
such determination ;
(c) the cases and circumstances in which, and the conditions
subject to which, any registration granted under this Act may
be cancelled ;
(d) the form in which and the particulars to be contained in any
declaration or certificate to be given under this Act the State
of origin of such form or certificate and the time within which
any such certificate or declaration shall be produced or furnished;
(e) the enumeration of goods or class of goods used in the
manufacture or processing of goods for sale or in mining or
in the generation or distribution of electricity or any other form
of power ;
(f) the matters in respect of which provision may be made under
the proviso to sub-section (2) of Section 9 ;
(g) the fees payable in respect of applications under this Act;
1. Inserted by Finance Act, 2005, w.e.f. 13-5-2005.

3. Clause (aa) re-lettered as clause (ab) by Finance Act, 2005, w.e.f. 13-5-2005.
1
[(h) the proper functioning of the Authority constituted under
Section 19;
(i) the salaries and allowances payable to, and the terms and
conditions of service of, the Chairman and Members under sub-
section (3) of Section 19;
(j) any other matter as may be prescribed.]
(2) Every rule made by the Central Government under sub-section
(1) shall be laid, as soon as may be after it is made, before each House
of Parliament 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, both Houses agree in
making any modification in the rule or both Houses agree that the rule
should not be made, the rule 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.
(3) The State Government may make rules, not inconsistent with
the provisions of this Act and the rules made under sub-section (1),
to carry out the purposes of this Act.
(4) In particular and without prejudice to the powers conferred by
sub-section (3), the State Government may make rules for all or any
of the following purposes, namely:–
(a) the publication of lists of registered dealers, of the amendments
made in such lists from time to time, and the particulars to be contained
in such lists ;
(aa) the manner in which security may be furnished under sub-
section (2A) or sub-section (3A) or sub-section (3C) of Section 7 and
the manner in which and the time within which any deficiency may
be made up under sub-section (3E) of that section ;
(b) the form and manner in which accounts relating to sales in
the course of inter-State trade or commerce shall be kept by registered
dealers ;
1. Clauses (h), (i) and (j) inserted by the Central Sales Tax (Amendment) Act, 2001,
w.e.f. 12-9-2001.
(c) the furnishing of any information relating to the stocks of goods

of, purchases, sales and deliveries of books by, any dealer or any other
information relating to his business as may be necessary for the purposes
of this Act ;
(d) the inspection of any books, accounts or documents required
to be kept under this Act, the entry into any premises at all reasonable
times for the purposes of searching for any such books, accounts or
documents kept or suspected to be kept in such premises and the seizure
of such books, accounts or documents ;
(e) the authority from whom, the conditions subject to which and
the fees subject to payment of which any form of certificate prescribed
under clause (a) of the first proviso to sub-section (2) of Section 6 or
of declaration prescribed under sub-section (1) of Section 6A or sub-
section (4) of Section 8 may be obtained, the manner in which such
forms shall be kept in custody and records relating thereto maintained
and the manner in which any such form may be used and any such
certificate or declaration may be furnished ;
(ee) the form and manner in which, and the authority to whom,
an appeal may be preferred under sub-section (3H) of Section 7, the
procedure to be followed in hearing such appeals and the fees payable
in respect of such appeals ;
(f) in the case of an undivided Hindu family, association, club,
society, firm or company or in the case of a person who carried on
business as a guardian or trustee or otherwise on behalf of another
person, the furnishing of a declaration stating the name of the person
who shall be deemed to be the manager in relation to the business of
the dealer in the State and the form in which such declaration may
be given ; and
(g) the time within which, the manner in which and the authorities
to whom any change in the ownership of any business or in the name,
place or nature of any business carried on by any dealer shall be
furnished.
(5) In making any rule under this section the Central Government
or, as the case may be, the State Government may direct that a breach
thereof shall be punishable with fine which may extend to five hundred
rupees and when the offence is a continuing offence, with a daily fine
which may extend to fifty rupees for every day during which the offence
continues.
8)6`"
CHAPTER IV
Goods of Special Importance in Inter-State
Trade or Commerce
14. Certain goods to be of special importance in inter-State

trade or commerce:– It is hereby declared that the following goods
are of special importance in inter-State trade or commerce:–
1
[(i) Cereals, that is to say,–
(i) paddy (Oryza sativa L.);
(ii) rice (Oryza sativa L.);
(iii) wheat (Triticum vulgar, T. compactum, T. sphaerococcum, T.
edurum, T. aestivum L.T. dicoccum);
(iv) jowar or milo (Sorghum vulgare Pers);
(v) bajra (Pennisetum typhoideum L.);
(vi) maize (Zea mays L.)
(vii) ragi (eleusine coracana Gaertn.);
(viii) kodon (paspalum scrobiculatum L.);
(ix) 2[x x x]
(x) barley (Hordeum vulgare L.);]
3
[(ia)] coal, including coke in all its forms, but excluding charcoal:
Provided that during the period commencing on the 23rd day of
February, 1967 and ending with the date of commencement of Section
11 of the Central Sales Tax (Amendment) Act, 1972 (61 of 1972), this
clause shall have effect subject to the modification that the words “but
excluding charcoal” shall be omitted;
(ii) cotton, that is to say, all kinds of cotton (indigenous or
imported) in its unmanufactured state, whether ginned or unginned,
baled, pressed or otherwise, but not including cotton waste;

2. Clause (ix) "kutki (Panicum miliare L.)" omitted by Act No. 16 of 2007,
w.e.f. 1-4-2007.
3. Clause (i) renumbered as (ia) by the Central Sales Tax (Amendment) Act, 1976.
1
[(iia) cotton fabrics covered under heading Nos. 52.05, 52.06,
52.07, 52.08, 52.09, 52.10, 52.11, 52.12, 58.01, 58.02, 58.03, 58.04,
58.05, 2[58.06,] 59.01, 59.03, 59.05, 59.06 and 60.01 of the Schedule
to the Central Excise Tariff Act, 1985 (5 of 1986);]
(iib) cotton yarn, but not including cotton yarn waste;
3
[(iic) crude oil, that is to say, crude petroleum oils and crude oils
obtained from bituminous minerals (such as shale, calcareous rock,
sand), whatever their composition, whether obtained from normal or
condensation oil-deposits or by the destructive distillation of bituminous
minerals and whether or not subjected to all or any of the following
processes:–
(1) decantation;
(2) de-salting;
(3) dehydration;
(4) stabilisation in order to normalise the vapour pressure;
(5) elimination of very light fractions with a view to returning them
to the oil-deposits in order to improve the drainage and maintain
the pressure;
(6) the addition of only those hydrocarbons previously recovered
by physical methods during the course of the above mentioned
processes;
(7) any other minor process (including addition of pour point
depressants or flow improvers) which does not change the
essential character of the substance;]
4
[(iid) Aviation Turbine Fuel sold to an aircraft with a maximum
take-off mass of less than forty thousand kilograms operated by scheduled
airlines.
Explanation:– For the purposes of this clause, “scheduled airlines”
means the airlines which have been permitted by the Central Government
to operate any Scheduled air transport service;]
(iii) hides and skins, whether in a raw or dressed state;
(iv) iron and steel, that is to say,–

4. Subs. by Finance Act, 2007.
(i) pig iron, 1[sponge iron and] cast iron including 2[ingot moulds,
bottom plates], iron scrap, cast iron scrap, runner scrap and
iron skull scrap;
(ii) steel semis (ingots, slabs, blooms and billets of all qualities,
shapes and sizes);
(iii) skelp bars, tin bars, sheet bars, hoe-bars and sleeper bars;
(iv) steel bars (rounds, rods, squares, flats, octagons and hexagons,
plain and ribbed or twisted, in coil form as well as straight
lengths);
(v) steel structurals (angles, joists, channels, tees, sheet piling
sections, Z sections or any other rolled sections);
(vi) sheets, hoops, strips and skelp, both black and galvanised, hot
and cold rolled, plain and corrugated, in all qualities, in straight
lengths and in coil form, as rolled and in riveted condition;
(vii) plates both plain and chequered in all qualities;
(viii) discs, rings, forgings and steel castings;
(ix) tool, alloy and special steels of any of the above categories;
(x) steel melting scrap in all forms including steel skull, turnings
and borings;
(xi) steel tubes, both welded and seamless, of all diameters and
lengths, including tube fittings;
(xii) tin-plates, both hot dipped and electrolytic and tinfree plates;
(xiii) fish plate bars, bearing plate bars, crossing sleeper bars, fish
plates, bearing plates, crossing sleepers and pressed steel sleepers,
rails-heavy and light crane rails;
(xiv) wheels, tyres, axles and wheel sets;
(xv) wire rods and wires-rolled, drawn, galvanised, aluminised, tinned
or coated such as by copper;
(xvi) defectives, rejects, cuttings or end pieces of any of the above
categories;

2. Subs. for "ingot moulds, bottom plates" by Repealing and Amending Act, 1978.
(v) jute, that is to say, the fibre extracted-from plants belonging

to the species Corchorus capsularies and Corchorus olitorius and the
fibre known as mesta or bimli extracted from plants of the species
hibiscus cannabinus and Hibiscus sabdariffa-Var altissima and the fibre
known as Sunn or Sunnhemp extracted from plants of the species
Crotalaria juncea whether baled or otherwise;
1
[(va) liquefied petroleum gas for domestic use ;]
(vi) oilseeds, that is to say,–
(i) Groundnut or Peanut (Arachis hypogaea);
(ii) Sesamum or Til (Sesamum orientale);
(iii) Cotton seed (Gossypium Spp.);
(iv) Soyabean (Glycine seja);
(v) Rapeseed and Mustard–
(1) Toria (Brassica compestris var toria);
(2) Rai (Brassica juncea);
(3) Jamba-Taramira (Eruca Sativa);
(4) Sarson, yellow and brown (Brassica campestris var sarson);
(5) Banarsi Rai or True mustard (Brassica nigra);
(vi) Linseed (Linum usitatissimum);
(vii) Castor (Ricinus communis);
(viii) Coconut (i.e., Copra excluding tender coconuts) (Coconucifera);
(ix) Sunflower (Helianthus annus);
(x) Nigar seed (Guizotia abyssinica);
(xi) Neem, vepa (Azadirachta indica);
(xii) Mahua, illupai, Ippe (Madhuca indica M. Latifolia, Bassia,
Latifolia and Madhuca longifolia syn. M. Longifolia);
(xiii) Karanja, Pongam, Honga (Pongamia pinnata syn. P. Glabra);
(xiv) Kusum (Schleichera oleosa syn. S. Trijuga);
1. Inserted by Finance Act, 2006 (Act No. 21 of 2006), w.e.f. 18-4-2006.

(xv) Punna, Undi (Calophyllum inophyllum);

(xvi) Kokum (Corcinia indica);
(xvii) Sal (Shorea robbusta);
(xviii) Tung (Aleurites fordii and A. montana);
(xix) Red palm (Elaeis guinensis);
(xx) Safflower (Carthanus tinctorius);
1
[(via) pulses, that is to say,–
(i) gram or gulab gram (Cicerarietinum L.);
(ii) tur or arhar (Cajanus cajan);
(iii) moong or green gram (Phaseolus aureus);
(iv) masur or lentil (Lens esculenta Moench, Lens culinarie Medic);
(v) urad or black gram (Phaseolus mungo);
(vi) moth (Phaseolus aconitifolius Jacq);
(vii) lakh or Khesari (Lathyros rativus L.)
2
[(vii) man-made fabrics covered under heading Nos. 54.08, 54.09,
54.10, 54.11, 54.12, 55.07, 55.08, 55.09, 55.10, 55.11, 55.12, 58.01, 58.02,
58.03, 58.04, 58.05, 3[58.06,] 59.01, 59.02, 59.03, 59.05, 59.06 and 60.01
of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986);
(viii) sugar covered under sub-heading Nos. 1701.20, 1701.31, 1701.39
and 1702.11 of the Schedule to the Central Excise Tariff Act, 1985 (5
of 1986);
4
[(ix) xxx]

4. Omitted by Act No. 16 of 2007, w.e.f. 1-4-2007.
prior to its substitution it read as below:
"unmanufactured tobacco and tobacco refuse covered under sub-heading No. 2401.00,
cigars and cheroots of tobacco covered under heading No. 24.02, cigarettes and cigarillos
of tobacco covered under sub-heading Nos. 2403.11 and 2403.21, and other manufactured
tobacco covered under sub-heading Nos. 2404.11, 2404.12, 2404,13, 2404.19, 2404.21,
2404.29, 2404.31, 2404.39, 2404.41, [2404.50 and 2404.60], of the Schedule to the
Central Excise Tariff Act, 1985 (5 of 1986);]
(x) woven fabrics of wool covered under heading Nos. 51.06, 51.07,
58.01, 58.02, 58.03 and 58.05 of the Schedule to the Central Excise Tariff
Act, 1985 (5 of 1986).]
15. Restrictions and conditions in regard to tax on sale or
purchase of declared goods within a State:– Every sales tax law of
a State shall, insofar as it imposes or authorises the imposition of a tax
on the sale or purchase of declared goods, be subject to the following
restrictions and conditions, namely:–
(a) the tax payable under that law in respect of any sale or purchase
of such goods inside the State shall not exceed 1[five] per cent of the
sale or purchase price thereof 2[x x x];
(b) where a tax has been levied under that law in respect of the
sale or purchase inside the State of any declared goods and such goods
are sold in the course of inter-State trade or commerce, and tax has been
paid under this Act in respect of the sale of such goods in the course
of inter-State trade or commerce, the tax levied under such law shall be
reimbursed to the person making such sale in the course of inter-State trade
or commerce in such manner and subject to such conditions as may be
provided in any law in force in that State;
3
[(c) where a tax has been levied under that law in respect of the
sale or purchase inside the State of any paddy referred to in sub-clause
(i) of clause (1) of Section 14, the tax leviable on rice procured out of
such paddy shall be reduced by the amount of tax levied on such paddy;
4
[(ca) where a tax on sale or purchase of paddy referred to in sub-
clause (i) of clause (1) of Section 14 is leviable under that law and the
rice procured out of such paddy is exported out of India, then, for the
purposes of sub-section (3) of Section 5, the paddy and rice shall be treated
as a single commodity;]
(d) each of the pulses referred to in clause (via) of Section 14, whether
whole or separated, and whether with or without husk, shall be treated
as a single commodity for the purposes of levy of tax under that law.]
1. Subs. for "four" by the Finance Act, 2011.

2. Words ", and such tax shall not be levied at more than one stage" omitted by the
Finance Act, 2002, w.e.f. 11-5-2002.
4. Inserted by the Finance (No. 2) Act, 1996, w.e.f. 28-9-1996.
CHAPTER V

16. Definitions:– In this Chapter,–
(a) “appropriate authority”, in relation to a company, means the
authority competent to assess tax on the company;
(b) “company” and “private company” have the meanings respectively
assigned to them by clauses (i) and (iii) of sub-section (1) of Section
3 of the Companies Act, 1956 (1 of 1956).
17. Company in liquidation:– (1) Every person–
(a) who is the liquidator of any company which is being wound
up, whether under the orders of a Court or otherwise; or
(b) who has been appointed the receiver of any assets of a company
(hereinafter referred to as the liquidator) shall, within thirty days after
he has become such liquidator, give notice of his appointment as such
to the appropriate authority.
(2) The appropriate authority shall, after making such inquiry or
calling for such information as it may deem fit, notify to the liquidator
within three months from the date on which he receives notice of the
appointment of the liquidator the amount which, in the opinion of the
appropriate authority would be sufficient to provide for any tax which
is then, or is likely thereafter to become payable by the company.
(3) The liquidator shall not part with any of the assets of the
company or the properties in his hands until he has been notified by
the appropriate authority under sub-section (2) and on being so notified,
shall set aside an amount equal to the amount notified and, until he
so sets aside such amount, shall not part with any of the assets of the
company or the properties in his hands :
Provided that nothing contained in this sub-section shall debar the
liquidator from parting with such assets or properties in compliance with
any order of a Court or for the purpose of the payment of the tax payable
by the company under this Act or for making any payment to secured
creditors whose debts are entitled under law to priority of payment over
debts due to Government on the date of liquidation or for meeting such
costs and expenses of the winding up of the company as are in the
opinion of the appropriate authority reasonable.
(4) If the liquidator fails to give the notice in accordance with
sub-section (1) or fails to set aside the amount as required by, or parts
with any of the assets of the company or the properties in his hands in
contravention of the provisions of sub-section (3), he shall be personally
liable for the payment of the tax which the company would be liable to
pay :
Provided that if the amount of any tax payable by the company is
notified under sub-section (2), the personal liability of the liquidator under
this sub-section shall be to the extent of such amount.
(5) Where there are more liquidators than one, the obligations and
liabilities attached to the liquidator under this section shall attach to all the
liquidators jointly and severally.
(6) The provisions of this section shall have effect notwithstanding
anything to the contrary contained in any other law for the time being in
force.
18. Liability of directors of private company in liquidation:–
Notwithstanding anything contained in the Companies Act, 1956 (1 of
1956), when any private company is wound up after the commencement
of this Act, and any tax assessed on the company under this Act 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 the private company
at any time during the period for which the tax is due shall be jointly and
severally liable for the payment of such tax unless he proves that the non-
recovery cannot be attri-buted to any gross neglect, misfeasance or breach
of duty on his part in relation to the affairs of the company.
1
[CHAPTER VA
Appeals to the Highest Appellate Authority
of the State
18A. Appeals to highest appellate authority of State:— (1)
Notwithstanding anything contained in a State Act, any person aggrieved
by an order made by the assessing authority under sub-section (2) of section
6A, or an order made under the provisions of sub-section (3) of that section,
may, notwithstanding anything contained in the general sales tax law of
the appropriate State, prefer an appeal to the highest appellate authority
of the State against such order:
Provided that any incidental issues including the rate of tax, computation
of assessable turnover and penalty may be raised in such appeal.
(2) An appeal under sub-section (1) shall be filed within sixty days
from the date on which the order referred to in that sub-section is
communicated to the aggrieved person:

Provided that any appeal forwarded by the highest appellate authority

of a State to the first appellate authority under the proviso to sub-section
(2) of Section 25 and pending before such authority immediately before
the appointed day shall be transferred, on such appointed day, to the highest
appellate authority of the State and the same shall be treated as an appeal
filed under sub-section (1) and dealt with accordingly.
Explanation : For the purposes of this sub-section, “appointed day”
means such date as the Central Government may, by notification in the
Official Gazette* appoint.
(3) The highest appellate authority of a State may, after giving both
the parties an opportunity of being heard, pass appropriate order.
(4) The highest appellate authority of the State may, as far as
practicable, hear and decide such appeal within a period of six months from
the date of filing of the appeal.
(5) Notwithstanding anything contained in a State Act, the highest
appellate authority of a State may, on the application of the appellant and
after considering relevant facts, including the deposit of any amount towards
local or Central Sales Tax in other States on the same goods, pass an
order of stay subject to such terms and conditions as it thinks fit, and such
order may, inter alia, indicate the portion of tax as assessed, to be deposited
prior to admission of the appeal.
Explanation: For the purposes of this section and Sections 20, 21,
22 and 25, “highest appellate authority of a State”, with its grammatical
variations, means any authority or tribunal or court, except the High Court,
established or constituted under the general sales tax law of a State, by
whatever name called.]
1
[CHAPTER VI
Authority to settle disputes in course of

inter-state Trade or Commerce
19. Central Sales Tax Appellate Authority:– (1) The Central
Government shall constitute, by notification in the Official Gazette, an
Authority to settle inter-State disputes falling under 2[Section 6A read with
Section 9] of this Act, to be known as “the Central Sales Tax Appellate
Authority (hereinafter referred to as the Authority)”.
(2) The Authority shall consist of the following Members appointed
by the Central Government, namely:–
* 1-6-2010, vide GSR 415 (E), dt. 28-5-2010.
1. Chapter VI inserted by the Central Sales Tax (Amendment) Act, 2001 (41 of 2001),
w.e.f. 17-3-2005.
2. Subs. for "Section 6A or Section 9" by Finance (No. 2) Act, 2004, w.e.f. 10-9-2004.
(a) a Chairman, who is a retired Judge of the Supreme Court, or

a retired Chief Justice of a High Court;
(b) an officer of the Indian Legal Service who is, or is qualified to
be an Additional Secretary to the Government of India; and
(c) an officer of a State Government not below the rank of Secretary
or an officer of the Central Government not below the rank of Additional
Secretary, who is an expert in sales tax matters.
1
[(2A) Notwithstanding anything contained in sub-section (2), the
Chairman or a Member holding a post as such in the Authority for Advance
Rulings appointed under clause (a) or clause (c), as the case may be, of
sub-section (2) of Section 245-O of the Income-tax Act, 1961 (43 of 1961)
may, in addition to his being the Chairman or a Member of that Authority,
be appointed as the Chairman or a Member, as the case may be, of the
Authority under this Act.]
(3) The salaries and allowances payable to, and the terms and
conditions of service of, the Chairman and Members shall be such as may
be prescribed.
(4) The Central Government shall provide the Authority with such
officers and staff as may be necessary for the efficient exercise of the
powers of the Authority under this Act.
1
[19A. Vacancies, etc., not to invalidate proceedings:– No
proceeding before the Authority shall be questioned or shall be invalid on
the ground merely of the existence of any vacancy or defect in the
constitution of the Authority.]
2
[20. Appeals:– 3[(1) An appeal shall lie to the Authority against
any order passed by the highest appellate authority of a State under this
Act determining issues relating to stock transfers or consignments of goods,
in so far as they involve a dispute of inter-State nature.]
(2) Notwithstanding anything contained in the general sales tax
law of a State, the Authority shall adjudicate an appeal filed under sub-
section (1).
(3) An appeal under sub-section (1) may be filed within ninety days
from the date on which the order referred to in that sub-section is served
on any aggrieved person :
2. Subs. by Ibid.
Provided that the Authority may entertain any appeal after the expiry
of the said period of ninety days, but not later than one hundred and fifty
days from the date of such service, if it is satisfied that the appellant was
prevented by sufficient cause from filing the appeal in time :
Provided further that the Authority may entertain any appeal from
an aggrieved person within sixty days from the commencement of the
Central Sales Tax (Amendment) Act, 2005, where such aggrieved person
had the right to file an appeal against the order of the highest appellate
authority of the State under sub-section (1) as it stood immediately before
the commencement of the said Act, but has not availed of the right to
file the appeal during the period commencing on and from the 3rd day
of December, 2001 and ending with the 16th day of March, 2005.
(4) The application shall be made in quadruplicate and be accompanied
by a fee of five thousand rupees.]
21. Procedure on receipt of application:– (1) On receipt of an
appeal, the Authority shall cause a copy thereof to be forwarded to the
1
[assessing authority concerned as well as to each State Government
concerned with the appeal and to call upon them to furnish the relevant
records:
Provided that such records shall, as soon as possible, be returned to
the assessing authority 2[or such State Government concerned, as the case
may be.]
(2) The Authority shall adjudicate and decide upon the appeal filed
against an order of the 3[highest appellate authority.]
(3) The Authority, after examining the appeal and the records called
for, by order, either allow or reject the appeal:
Provided that no appeal shall be rejected unless an opportunity has
been given to the appellant of being heard in person or through a duly
authorised representative, 3[and also to 4[each] State Government concerned
with the appeal of being heard :]
Provided further that whether an appeal is rejected or accepted,
reasons for such rejection or acceptance shall be given in the order.
(4) The Authority shall make an endeavour to pronounce its order
in writing within six months of the receipt of the appeal.
1. Subs. for "assessing authority concerned and to call upon it" by the Finance Act, 2003.
2. Inserted by the Finance Act, 2003.
3. Subs. for "assessing authority" by the Central Sales Tax (Amendment) Act, 2005, w.e.f.
1-3-2006.
4. Subs. for "the" by the Finance (No. 2) Act, 2004.
(5) A copy of every order made under sub-section (3) shall be sent
to the 1[appellant, assessing authority, respondent and highest appellate
authority of the State Government concerned.]
22. Powers of the Authority:– (1) The Authority shall have the
same powers as are vested in a court under the Code of Civil Procedure,
1908 (5 of 1908), while trying a suit in respect of the following matters,
namely:–
(a) enforcing the attendance of any person, examining him on oath
or affirmation;
(b) compelling the production of accounts and documents;
(c) issuing commission for the examination of witnesses;
(d) the reception of evidence on affidavits;
(e) any other matter which may be prescribed.
2
[(1A) The Authority may grant stay of the operation of the order
of the highest appellate authority against which the appeal is filed before
it or order the 3[deposit] of the tax before entertaining the appeal and while
granting such stay or making such order for the 3[deposit] of the tax, the
Authority shall have regard, if the assessee has made 3[deposit] of the
tax under the general sales tax law of the State concerned, to such 3[deposit]
or pass such appropriate order as it may deem fit.]
4
[(1B) The Authority may issue direction for refund of tax collected
by a State which has been held by the Authority to be not due to that
State, or alternatively, direct that State to transfer the refundable amount
to the State to which Central Sales Tax is due on the same transaction:
Provided that the amount of tax directed to be refunded by a State
shall not exceed the amount of Central Sales Tax payable by the appellant
on the same transaction.]
(2) Every proceeding before the Authority shall be deemed to be a
judicial proceeding within the meaning of Sections 193 and 228 of the Indian
Penal Code (45 of 1860) and the Authority shall be deemed to be a civil
court for the purposes of Section 195 and Chapter XXVI of the Code
of Criminal Procedure, 1973 (2 of 1974).
1. Subs. for "appellant and to the assessing authority", by the Central Sales Tax
(Amendment) Act, 2005, w.e.f. 1-3-2006.
2. Subs. by Ibid. Prior to its substitution, it read as below :
"(1A) The Authority may grant stay of the operation of the order of the assessing
authority against which the appeal is filed before it or order the pre-deposit of the
tax before entertaining the appeal and while granting such stay or making such order
for the pre-deposit of the tax, the Authority shall have regard, if the assessee has
already made pre-deposit of the tax under the general sales tax law of the State
concerned, to such pre-deposit.
3. Subs. the word "pre-deposit" by Finance Act, 2010, w.e.f. 8-5-2010.
4. Ins. by Ibid.
23. Procedure of the Authority:– The Authority shall, subject to

the provisions of this Chapter, have power to regulate its own procedure
1
[in all matters, including stay of recovery of any demand] arising out of
the exercise of powers under this Act.
24. Authority for Advance Rulings to function as Authority
under this Act:– (1) Notwithstanding anything contained in any other law
for the time being in force and in Section 19 of this Act, the Authority
for Advance Rulings constituted under Section 245-O of the Income-tax
Act, 1961 (43 of 1961) shall be notified by the Central Government in the
Official Gazette, with such modifications as may be necessary, to make
its composition in conformity with Section 19 of this Act, as the Authority
under this Act till such time an Authority is constituted under that section.
(2) On and from the date of the constitution of the Authority in
accordance with the provisions of Section 19 of this Act, the proceedings
pending with the Authority for Advance Rulings shall stand transferred to
the Authority constituted under that section from the stage at which such
proceedings stood before the date of constitution of the said Authority.
2
[25. Transfer of pending proceedings:– (1) On and from the
commencement of the Central Sales Tax (Amendment) Act, 2005, all
appeals (except appeals against orders of the highest appellate authority
of the State) pending before the Authority notified under sub-section (1)
of Section 24 shall stand transferred together with the records thereof to
the highest appellate authority of the concerned State.
(2) Such highest appellate authority of the State to which such appeal
has been transferred under sub-section (1) on receipt of such records shall
proceed to deal with such appeal so far as may be in the same manner
as in the case of an appeal filed before such highest appellate authority
of the State according to the general sales tax law of the appropriate State,
from the stage which was reached before such transfer or from any earlier
stage or de novo as such highest appellate authority of the State may deem
fit :
3
[xxx]
26. Applicability of order passed:– An order passed by the Authority
under this Chapter shall be binding on 4[each State Government concerned,
the assessing authorities] and other authorities created by or under any law
relating to general sales tax, in force for the time being in any State 5[xxx].
——
2. Subs. by the Central Sales Tax (Amendment) Act, 2005, w.e.f. 1-3-2006.
3. Proviso omitted by Finance Act 2010, w.e.f. 8-5-2010.
4. Subs. by the Finance (No. 2) Act, 2004.
5. The words "or Union Territory" omitted by the Central Sales Tax (Amendment) Act,
2005, w.e.f. 1-3-2006.
THE CENTRAL SALES TAX (REGISTRATION
AND TURNOVER) RULES, 1957
1
[Notification S.R.O.No. 644, dated 28-2-1957]
In exercise of the powers conferred by sub-section (1) of Section 13
of the Central Sales Tax Act, 1956 (74 of 1956), the Central Government
hereby makes the following rules, namely:
RULES
PART 1
Preliminary
1. These rules may be called the Central Sales Tax (Registration &
Turnover) Rules, 1957.
2. In these rules, unless, the context otherwise requires–
(a) ‘Act’ means the Central Sales Tax Act, 1956
2
[(aa) ‘authorised officer’ means an officer authorised by the Central
Government under clause (b) of sub-section (4) of Section 8 ;]
3
[(aaa) ‘Company’ means a company as defined in Section 3 of the Companies
Act, 1956 (1 of 1956) and includes a foreign company within the
meaning of Section 591 of that Act;]
(b) ‘Form’ means a form appended to these rules
(c) ‘Notified authority’ means the authority specified under sub-section
(1) of Section 7
2
[(cc) ‘Prescribed authority’ means the authority empowered by the Central
Government under 4[sub-section (2) of Section 9], or the authority
prescribed by State Government under clause (e) of sub-section (4)
of Section 13, as the case may be ;]
(d) ‘Section’ means a section of Act
(dd) 5[x x x]
(e) ‘Warehouse’ means any enclosure, building or vessel in which a
dealer keeps a stock of goods for sale.
1. Pub. in Gazette of India Ext., Part II, Section 3(i), dt. 28-2-1957 page 1039.
2. Ins. by SRO 896, dt. 23-9-1958, w.e.f. 1-10-1958.
3. Ins. by GSR 26(E), dt. 1-2-1974.
4. Subs. by GSR 56(E), dt. 9-2-1973, w.e.f. 1-4-1973.
5. Omitted by GSR 56(E), dt. 9-2-1973, w.e.f. 1-4-1973.
639
3. Certificate of Registration:– (1) An application for registration under

Section 7 shall be made by a dealer to the notified authority form ‘A’ and
shall be–
(a) Signed by the proprietor of the business, or, in the case of a film,
by one of its partners, or, in the case of a Hindu Undivided Family,
by the Karta or manager of the family, or, in the case of a company
1
[x x x] by a director, managing agent or principal officer thereof,
or, in the case of a Government, by an officer duly authorised by
that Government, or, in the case of any other association of individuals,
by the principal officer managing the business; and
(b) Verified in the manner provided in the said Form ‘A’.
(2) Where a dealer has more than one place of business within a State,
he shall make a single application in respect of all such places, name in such
application one of such places as the principal place of business for the
purposes of these rules and submit such application to the notified authority
specified in respect of the principal place of business so named:
Provided that any place so named shall not in any case be different from
the place, if any, declared by him to be the principal place of business, by
whatever name called, under the general sales tax law of the State.
4. (1) An application for registration under sub-section (1) of Section
7 shall be made not later than thirty days from the date on which the dealer
becomes liable to pay tax under the Act.
(2) An application for registration under sub-section (2) of Section 7 may
be made at any time after the commencement of the Act.
2
[(3) A fee of 3[rupees twenty-five] shall be payable in respect of every
application for registration under sub-rule (1) or sub-rule (2) and such fee may
be paid in the form of court-fee stamps 4[affixed to such application].
5. (1) Where the notified authority is satisfied, after making such enquiry
as it thinks necessary, that the particulars contained in the application are correct
and complete 5[and the fee referred to in sub-rule (3) of rule 4 has been paid],
it shall register the dealer and grant him a certificate of registration in Form
1. The words "incorporated under the Companies Act, 1956" omitted by GSR No. 26(E),
dt. 1-2-1974.
2. Ins. by GSR No. 896, dt. 23-9-1958.
3. Subs. for "Rs. 5" by the Central Sales Tax (Registration and Turnover) (Amendment)
Rules, 1987, w.e.f. 14-4-1987.
4. By GSR No. 401, dated 9-3-1963, in the application of these Rules to the Union
Territory of Goa, Daman and Diu, the words "local revenue stamps" were sub. for
"court-fee stamps". Later on, w.e.f. 1-11-1964, by notification No. 1584, dated 26.10.1964,
"court-fee stamps" were again subs. for "local revenue stamps".
5. Ins. by GSR No. 896, dt. 23-9-1958.
R. 8] Central Sales Tax (Regn. & Tur.) Rules, 1957 641
‘B’ and also a copy of such certificate for every place of business within the
State other than the principal place of business mentioned therein.
1
[(2) When the said authority is not satisfied that the particulars contained
in the application were correct and complete, or where the fee referred to in
sub-rule (3) of rule 4 has not been paid, he shall reject the application for
reasons to be recorded in writing:
Provided that before the application is rejected, the applicant shall be
given an opportunity of being heard in the matter and, as the case may be,
of correcting and completing the said particulars or complying with the
requirements of sub-rule (3) of rule 4.]
6. The certificate of registration granted under sub-rule (1) of rule 5 shall
be kept at the principal place of business mentioned in such certificate and
a copy of such certificate granted under the said sub-rule shall be kept at
every place of business within the State other than the principal place of
business, mentioned in such certificate.
7. (1) Where a dealer desires the certificate of registration granted to
him under these rules to be amended, he shall submit an application for this
purpose to the notified authority setting out the specific matters in respect of
which he desires such amendment and the reasons therefor, together with the
certificate of registration and the copies thereof, if any, granted to him; and
such authority may, if satisfied with the reasons given, make such amendments
as it thinks necessary, in the certificate of registration and the copies thereof,
if any, granted to him.
(2) The provisions of Rule 6 shall apply in relation to such amended
certificate and copies thereof, as they apply in relation to the original certificate
and copies thereof.
2
[8. (1) Where the certificate of registration granted to a dealer is lost,
destroyed, defaced or mutilated, he may on application made in this behalf
to the notified authority and on payment of a fee of 3[rupees five] obtain a
duplicate copy of such certificate.
(2) The fee payable under sub-rule (1) shall be paid in the form of 4[court-
fee stamps]
1. Subs. by GSR No. 896, dated 23-9-1958.
2. Subs. by SRO No. 3613, dated 6-11-1957.
3. Subs. for "two rupees" by the Central Sales Tax (Registration and Turnover) (Amendment)
Rules, 1987, w.e.f. 14-4-1987.
4. In the application of these Rules to the Union Territory of Goa, Daman and Diu,
the words "Local Revenue Stamps" by GSR No. 401, dated 9-3-1963 ; were substituted
for "court-fee stamps". Later on, w.e.f. 1-11-1964, by Notification No. 1584, dated
26.10.1964, "court fee stamps" were again substituted for "Local Revenue Stamps".
In its application to Pondicherry, "Local Revenue Stamps" were substituted by GSR
No. 956, dated 1-6-1963 for "court-fee stamps".
8)6`"
1
[9. Amendment or cancellation of certificate of registration:— (1)
A notified authority shall, before amending or cancelling, as the case may
be, the certificate of registration of a dealer under sub-section (4) of Section
7 give him an opportunity of being heard in the matter.
(2) If the certificate of registration is proposed to be amended, the dealer
shall forthwith produce to the notified authority the certificate of registration
and the copies thereof, if any, granted to him, for having them amended.
(3) If the certificate of registration is cancelled, the dealer shall forthwith
surrender to the notified authority the certificate of registration and the copies
thereof, if any, granted to him.]
10. If any dealer desires to apply under sub-section (5) of Section 7 for
the cancellation of his registration, he shall submit within the time specified
in that sub-section to the notified authority an application in that behalf together
with the certificate of registration and copies thereof, if any, granted to him;
and such application shall be dealt with in accordance with the provisions
of the sub-section.
11. Determination of turnover:— 2[(1)] The period of turnover in
relation to any dealer liable to pay tax under this Act shall be the same as
the period in respect of which he is liable to submit returns under the general
sales tax law of the appropriate State:
Provided that in relation to a dealer who is not liable to submit returns
under the general sales tax law of the appropriate State, the period of turnover
shall be a quarter ending on the 30th June, 30th September, 31st December
and 31st March, as the case may be, in a financial year.]
(2) 3[x x x]
4
[12. (1) The declaration and the certificate referred to in sub-section
(2) of Section 8 shall be in Forms “C” and “D” respectively:
5
[Provided that form “C” in force before the commencement of the Central
Sales Tax (Registration and Turnover) (Amendment) Rules, 1974, or before
the commencement of the Central Sales Tax (Registration and Turnover)
(Amendment) Rules, 1976, may also be used upto the 31st December, 6[1980]
with suitable modifications:]
7
[x x x]
1. Substituted by GSR No. 896, dated 23-9-1958.

2. Rule 11 renumbered as sub-rule (1) by SRO No. 3613, dt. 6-11-1957.
3. Omitted by GSR No. 1362, dated 9-6-1969.
4. Subs. by GSR No. 896, dated 23-9-1958.
5. Subs. by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 1976.
6. Subs. for "1979" by the Central Sales Tax (Registration and Turnover) (Amendment)
Rules, 1979.
7. Omitted by the Central Sales Tax (Registration and Turnover (Amendment) Rules, 1998,
w.e.f. 20-11-1998.
1
[Provided further that a single declaration may cover all transactions of
sale, which take place in a quarter of a financial year between the same two
dealers:]
1
[Provided also that where, in the case of any transaction of sale, the
delivery of goods is spread over to different quarters in a financial year or
of different financial years, it shall be necessary to furnish a separate declaration
or certificate in respect of goods delivered in each quarter of a financial year.]
2
[(2) Where a blank or duly completed form of declaration is lost, whether
such loss occurs while it is in the custody of the purchasing dealer or in transit
to the selling dealer, the purchasing dealer shall furnish in respect of every
such form so lost an indemnity bond 3[in for ‘G’] to the notified authority
from whom the said form was obtained, for such sum as the said authority
may having regard to the circumstances of the case, fix. Such indemnity bond
3
[in for ‘G’] shall be furnished by the selling dealer to the notified authority
of his State if a duly completed form of declaration received by him is lost,
whether such loss occurs while it is in his custody or while it is in transit
to the notified authority of his State :
3
[Provided that where more than one form of declaration is lost, the
purchasing dealer or the selling dealer as the case may be, may furnish one
such indemnity bond to cover all the forms of declarations so lost.]
(3) Where a declaration form furnished by the dealer purchasing the goods
or the certificate furnished by the Government has been lost, the dealer selling
the goods, may demand from the dealer who purchased the goods or, as the
case may be, from the Government, which purchased goods, a duplicate of
such form or certificate, and the same shall be furnished with the following
declaration recorded in red ink and signed by the dealer or authorised officer
of the Government, as the case may be, on all the three portions of such form
or certificate,—
“I here by declare that this is the duplicate of the declaration form/
certificate No. .............. signed on ......... and issued to ........... Who is registered
dealer of ......... (State) and whose registration certificate nuder is .........”
4
[(4)] The certificate referred to in sub-section (2) of Section 6 shall be
in Form ‘E-1’ or ‘E-11’, as the case may be.
1. Subs. by the Central Sales Tax (Registration and Turnover) (Third Amendment) Rules,
2005, w.e.f. 1-10-2005.
2. Sub-rules (2) and (3) were inserted by GSR No. 2017, dated 4-11-1968, w.e.f.
1.12.1968.
3. Ins. by GSR No. 597(E), dated 30-12-1975, w.e.f. 30-12-1975.
4. Sub-rule (2) renumbered as sub-rule (4) by GSR No. 2017, dated 4-11-1968, w.e.f.
1.12.1968.
1
[(5) The declaration referred to in sub-section (1) of Section 6-A shall
be in Form ‘F’.
2
[Provided that a single declaration may cover transfer of goods, by a
dealer, to any other place of his business or to his agent or principal, as the
case may be, effected during a period of one calendar month :
Provided further that if the space provided in Form ‘F’ is not sufficient
for making the entries, the particulars specified in Form ‘F’ may be given
in separate annexures attached to that form so long as it is indicated in the
form that the annexures form part thereof and every such annexure is also
signed by the person signing the declaration in form ‘F’
Provided further that form ‘P’ in force before the commencement of the
Central Sales Tax (Registration and Turnover) (Second amendment) Rules,
1973 may continue to be used up to 31st day of December 3[1980] with suitable
modifications.]
(6) Form ‘C’ referred to in sub-rule (1) or as the case referred to in
sub-rule (5), shall be the one obtained by the purchasing dealer or, as the
case may be, the transferee in the State in which the goods covered by such
form are delivered.
4
[Explanation:— Where, by reason of the purchasing dealer not being
registered under Section 7 in the State in which the goods covered by Form
‘C’ referred to in sub-rule (1) are delivered ; he is not able to obtain the
said Form in that State, Form ‘C’ may be the one obtained by him in the
State in which he is registered under the said section.]
5
[(7) The declaration in Form C or Form F or the certificate in Form
E-I or Form E-II shall be furnished to the prescribed authority within three
months after the end of the period to which the declaration or the certificate
relates :
Provided that if the prescribed authority is satisfied that the person
concerned was prevented by sufficient cause from furnishing such declaration
or certificate within the aforesaid time, that authority may allow such declaration
or certificate to be furnished within such further time as that authority may
permit.]
1. Sub-rules (5) to (9) inserted by GSR No. 56(E), dated 9-2-1973, w.e.f. 1-4-1973.
2. Inserted by GSR No. 519(E), dated 13-12-1973.
3. Subs. for "1979" by the Central Sales Tax (Registration and Turnover) (Amendment)
Rules, 1979.
4. Inserted by GSR 26(E), w.e.f. 1-2-1974.
5. Subs. by the Central Sales Tax (Registration and Turnover) (Third Amendment) Rules,
2005, w.e.f. 1-10-2005.
(8)(a) The person referred to in clause (a) of sub-rule (1) of rule 3 shall
alone be competent to sign the declaration in Form ‘C’ of Form ‘F’ or the
certificate in Form ‘E-I’ or ‘E-II’.
1
[Provided that where such person is a proprietor of any business or a
partner or a firm or a karta or manager of a Hindu Undivided Family, any
other person authorised by him in writing may also sign such declaration or
certificate :]
2
[Provided further that in the case of 1[a company such declaration or
certificate] can also be signed by any other officer of the company authorised
under the Memorandum or Articles of Association of the company or under
any other special or general resolution of the company or under a resolution
passed by the Board of Directors of the company, to authenticate any document
on behalf of such company.]
(b) Such person shall signify on such declaration or certificate his status
and shall make verification in the manner provided in such declaration or
certificate.]
(9) 3[(a)] The Provisions of 4[5[x x x] sub-rule (2)] and sub-rule (3) shall
with necessary modifications, apply to the declaration in Form ‘F’ or the
certificate in Form ‘E-I’ or Form ‘E-II’.
6
[(b) The provisions of the second and third provisos to sub-rule (1) shall,
with necessary modifications apply to certificates in Form E-I or Form E-II.]
7
[(10) 8[(a) The declaration referred to in sub-section (4) of Section 5
shall be in Form H and shall be furnished to the prescribed authority upto
the time of assessment by the first assessing authority.]
9
[x x x]
1. Subs. by GSR No. 26(E), w.e.f. 1-2-1974.

2. Ins. by GSR No. 519(E), w.e.f. 13-12-1973.
3. The existing provisions renumbered as clause (a) by the Central Sales Tax (Registration
and Turnover) (Amendment) Rules, 1987, w.e.f. 14-4-1987.
4. Subs. for "sub-rule (2)" by the Central Sales Tax (Registration and Turnover) (Amendment)
Rules, 1979.
5. The words "the second and the third provisos to sub-rule (1)" omitted by the Central
Sales Tax (Registration and Turnover) (Amendment) Rules, 1987, w.e.f. 14-4-1987.
6. Inserted by the Central Sales Tax (Registration and Turnover) (Amendment) Rules,
1987, w.e.f. 14-4-1987.
7. Inserted by the Central Sales Tax (Registration and Turnover) (Amendment) Rules,
1977.
8. Subs. by the Central Sales Tax (Registration and Turnover) (Second Amendment) Rules,
2005, w.e.f. 14-7-2005.
9. Proviso omitted by the Central Sales Tax (Registration and Turnover) (Second
Amendment) Rules, 2003, w.e.f. 23-5-2003.
646 Central Sales Tax (Regn. & Tur.) Rules, 1957 [R. 14
(b) The provisions of the rules framed by the respective State Governments
under sub-sections (3), (4) and (5) of Section 13 relating to the authority
from whom and the conditions subject to which any form of certificate in
Form ‘H’ may be obtained, the manner in which such form shall be kept
in custody and records relating thereto maintained and the manner in which
any such forms may be used and any such certificate may be furnished in
so far as they apply to declaration in Form ‘C’ prescribed under these rules
shall mutatis mutandia apply to certificate in Form ‘H’.]
1
[(11) The declaration referred to in sub-section (8) of Section 8 of
the Act, shall be in Form I.]
2
[(11A) The certificate referred to in sub-section (4) of Section 6 shall
be in Form J and shall be furnished to the prescribed authority upto the
time of assessment by the first assessing authority.]
3
[13. Prescription of goods for certain purposes:– The goods referred
to in clause (b) of sub-section (3) of Section 8 which a registered dealer
may purchase, shall be goods intended for use by him as raw materials,
processing materials, 4[machinery, plant,] equipment, tools, stores, accessories,
fuel or lubricants, in the manufacture or processing of goods for sale or
5
[in the telecommunications network or] in mining, or in the generation or
distribution of electricity or any other form of power.
6
[14. If any person commits a breach of any of these rules, he shall
be punishable with fine which may extend to five hundred rupees and when
the offence is a continuing offence, with a daily fine which may extend to
fifty rupees for every day during which the offence continues.]
1. Subs. by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 2005,
w.e.f. 7-6-2005.
2. Inserted by the Central Sales Tax (Registration and Turnover) (Second Amendment)
Rules, 2005, w.e.f. 14-7-2005.
3. Inserted by GSR 896, dated 23-9-1958.
4. Subs. for "machinery plant," by GSR 1059, dated 29-10-1958.
5. Ins. by GSR 183 (E), dt. 11-3-2010.
6. Ins. by GSR No. 56(E), dated 9-2-1973, w.e.f. 1-4-1973.
F. A] Central Sales Tax (Regn. & Tur.) Rules, 1957 647
FORM A
[See Rule 3]
Application for registration under Section 7(1)/7(2) of the
Central Sales Tax Act, 1956
To1
I, ......................... son of ............................. on behalf of the dealer
carrying on the business known as2 .................... within the State of3 ......................
hereby apply for a certificate of registration under Section 7(1)/7(2) of the
Central Sales Tax Act, 1956, and give the following particulars for this
purpose:—
1. Name of the person deemed to be the Manager in
relation to the business of the dealer in the said State.
2. Status or relationship of the person who makes this
application (e.g., manager, partner, proprietor, director,
officer-in-charge of the Government business).
3. Name of the principal place of business in the said
State and address thereof.
4. Name(s) of the other place(s) in the said State in which
business is carried on and address of every such place.
5. Complete list of the warehouses in the said State in
which the goods relating to the business are warehoused
and address of every such warehouse.
6. List of the places of business in each of the other States
together with the address of every such place (if separate
application for registration has been made, or separate
registration obtained under the Central Sales Tax Act,
1956, in respect of any such place of business,
particulars thereof should be given in details.)
7. 4The business is:
Wholly
Mainly
1. Here enter the authority specified in the general or special order issued by the Central
Government under Section 7(1) of the Act.
2. Here enter the name and style under which the business is carried on.
3. Here enter the name of the State in which the application for registration is made.
4. Enter here whether business is wholly agriculture, horticulture, mining, manufacturing,
wholesale, distribution, retail distribution, contracting or catering, etc., or any combination
of two or more of them.
648 Commentary on A.P. Value Added Tax [F. A
Partly
Partly
Partly
8. Particulars relating to the registration, licence,
permission, etc., issued under any law for the time
being in force, of the dealer.
9. We are members of1 ..........................................
10. We keep our accounts in language and script.
2
11. Name(s) and address(es) of the proprietor of the
business/partners of the business/all persons having
any interest in the business together with their age,
father’s name, etc.
Sl. Name Father’s/ Age Extent of
Permanent address
address of witness
attesting signature
Present address
No. in full husband’s interest
Signature and
Signature3
name in the
in Col. 8
business
1 2 3 4 5 6 7 8 9
12. Business in respect of which this application is made,

was first started on.........
13. The first sale in the course of inter-State trade was
effected on...........
14. We observe the4......... calendar and for purposes of
accounts our year runes from the (English date)5 .....
day of ........ (Indian date)5 ......... day of ......... to the
(English date/Indian date)6 ................... day of .........
1. Here enter the name of the Chamber of Commerce, Trade Association or commercial
body, of which the dealer is a member.
2. To be filled in if the applicant is not a company. *[x x x]
* The words "incorporated under the Companies Act, 1956 (1 of 1956), or under
any other law" omitted by GSR 26(E), dated 1-2-1974.
3. Signature of each of the persons concerned should be obtained and attested.
4. Enter here English, Bengali, Fasli, Hijri, Marwari, or other calendar followed.
5. In filling up these entries dealers who do not observe the English calendar should
give the dates according to their own calendar and the corresponding date of the English
calendar.
6. Here name the goods or classes of goods against each category.
F. B] Central Sales Tax (Regn. & Tur.) Rules, 1957 649
15. We make up our accounts of sales to date at the end

of every month/quarter/half-year/year.
1
[16. The following goods or classes of goods are purchased
by the dealer in the course of inter-State trade or
commerce for–
(a) 2[resale............]
(b) use in the manufacture or processing of goods
for sale........
(c) use in mining........
(d) use in the generation or distribution of electricity
or any other form of power........
(e) use in the packing of goods for sale/resale........
17. We manufacture, process, or extract in mining the
following classes of goods or generate or distribute the
following form of power, namely:–.........................]
18. The above statements are true to the best of my
knowledge and belief.
Name of the Applicant in full .................
Signature ..............................
Status in relation to the dealer ................
Date :
Strike out portion or paragraph whichever is not applicable.
——
FORM B
[See Rule 5(1)]
Certificate of registration
No. ....... (Central)
This is to certify that3 ............... whose principal place of business within
the State of ............ is situated at......... has been registered as a dealer under
Section 7(1)/7(2) of the Central Sales Tax Act, 1956.
The business is:
wholly4
mainly
1. Subs. by G.S.R. 896, dt. 23.9.1958.
2. Corrected by corrigenda G.S.R. 1059, dt. 29.10.1958.
3. Here enter the name and style under which the business is carried on.
4. Enter here whether business is wholly agriculture, horticulture, mining, manufacturing,
wholesale distribution, retail distribution, contracting or catering etc., or any combination
of two or more of them.
650 Commentary on A.P. Value Added Tax [F. B
partly
partly
partly
1
[The class(es) of goods specified for the purposes of sub-sections (1)
and (3) of Section 8 of the said Act is/are as follows and the sales of these
goods in the course of inter-State trade to the dealer shall be taxable at the
rate specified in that sub-section subject to the provisions of sub-section (4)
of the said section:—
(a) for resale ..........................................................
(b) for use in the manufacture or processing of goods for sale.......
(c) for use in mining ...........................................
(d) for use in the generation or distribution of electricity or any other
form of power .................................................
(e) for use in the packing of goods for sale/resale ..............................
The dealer manufactures, processes, or extracts in mining the following
class of goods or generates or distributes the following form of power,
namely:—
.........................................]
The dealer’s year for the purpose of accounts runs from.......... day
of.......... to the......... day of.........
The dealer has no additional place of business/has additional place(s)
of business as stated below:—
(a) in the State of registration
(b) in other States
The dealer keeps warehouses at the following places within the State
of registration:—
(1)
(2)
(3)
This certificate is valid from...... until cancelled.
Date : Signed ....................
(Seal) (Notified authority)
——
1. Subs. by GSR 896, dt. 23.9.1958.

F. C]
Counterfoil Duplicate Original
The Central Sales Tax (Registration and The Central Sales Tax (Registration and The Central Sales Tax (Registration and
Turnover) Rules, 1957 Turnover) Rules, 1957 Turnover) Rules, 1957
1 1 1
Form ‘C’ Form ‘C’ Form ‘C’
Central Sales Tax (Regn. & Tur.) Rules, 1957

Form of Declaration Form of Declaration Form of Declaration
[See Rule 12(1)] [See Rule 12(1)] [See Rule 12(1)]
Name of the Issuing State .............................. Name of the Issuing State .............................. Name of the Issuing State ..............................
Office of Issue ................................................. Office of Issue ................................................. Office of Issue .................................................
Date of Issue ...................................................... Date of Issue ...................................................... Date of Issue ......................................................
Name of the purchasing dealer to whom issued Name of the purchasing dealer to whom issued Name of the purchasing dealer to whom issued
along with his Registration Certificate No. ....... along with his Registration Certificate No. ....... along with his Registration Certificate No. .......
Date from which registration is valid ........... Date from which registration is valid ........... Date from which registration is valid ...........
Seal of Seal of Seal of
issuing authority issuing authority issuing authority
Serial No. .......... Serial No. .......... Serial No. ..........
To To To
......... +(Seller) ......... +(Seller) ......... +(Seller)
2 2 2
[Certified that the goods [Certified that the goods [Certified that the goods
**Ordered for in our purchase order No. ..... **Ordered for in our purchase order No. ..... **Ordered for in our purchase order No. .....
dated ...... and supplied as per Bill/cash memo/ dated ...... and supplied as per Bill/cash memo/ dated ...... and supplied as per Bill/cash memo/
Challan No. ....... dated.... as stated below*/ Challan No. ....... dated.... as stated below*/ Challan No. ....... dated.... as stated below*/
purchased from you as per Bill/cash memo/ purchased from you as per Bill/cash memo/ purchased from you as per Bill/cash memo/
Challan No. .......... dated........ as stated below*] Challan No. .......... dated........ as stated below*] Challan No. .......... dated........ as stated below*]
are for **resale ................... use in manufacture/ are for **resale ................... use in manufacture/ are for **resale ................... use in manufacture/
processing of goods for sale ............... use in processing of goods for sale ............... use in processing of goods for sale ............... use in
mining. mining. mining.
1. Subs. by G.S.R. 896, dt. 23.9.1958 and thereafter corrected by corrigenda G.S.R. 1059, dt. 29.10.1958.
651
2. Subs. by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 1976.
652
............................................................................ ............................................................................ ............................................................................
use in generation/distribution of power use in generation/distribution of power use in generation/distribution of power
............................................................................ ............................................................................ ............................................................................
.................... packing of goods for sale/resale .................... packing of goods for sale/resale .................... packing of goods for sale/resale
and are covered by my/our registration certificate and are covered by my/our registration certificate and are covered by my/our registration certificate
No. ......... dated.......... issued under the Central No. ......... dated.......... issued under the Central No. ......... dated.......... issued under the Central
Sales Tax Act, 1956. 1[It is further certified Sales Tax Act, 1956. 1[It is further certified Sales Tax Act, 1956. 1[It is further certified
Commentary on A.P. Value Added Tax

that I/we am/are not registered under Section that I/we am/are not registered under Section that I/we am/are not registered under Section
7 of the said Act in the State of ............. in
7 of the said Act in the State of ............. in 7 of the said Act in the State of ............. in
which the goods covered by this form are/will
which the goods covered by this form are/will which the goods covered by this form are/will
be delivered.]
be delivered.] be delivered.]
Name and address of the purchasing dealer in
Name and address of the purchasing dealer in Name and address of the purchasing dealer in full .....................................................................
full ..................................................................... full ..................................................................... Date :
Date : Date : 2
[The above statements are true to the best of
2 2
[The above statements are true to the best of [The above statements are true to the best of my knowledge and belief.
my knowledge and belief. my knowledge and belief. (Signature)
(Signature) (Signature) (Name of the person signing the declaration)
(Name of the person signing the declaration) (Name of the person signing the declaration) (Status of the person signing the declaration in
(Status of the person signing the declaration in (Status of the person signing the declaration in relation to the dealer.)]
relation to the dealer.)] relation to the dealer.)] *Particulars of Bill/Cash Memo 3[/Challan]
Date...... No. .... Amount.........
*Particulars of Bill/Cash Memo 3[/Challan] *Particulars of Bill/Cash Memo 3[/Challan] +
Name and address of the seller with name of
Date...... No. .... Amount......... Date...... No. .... Amount......... the State
+ +
Name and address of the seller with name of Name and address of the seller with name of ** Strike out whichever is not applicable.
the State the State (Note:— To be furnished to the prescribed
** Strike out whichever is not applicable. ** Strike out whichever is not applicable. authority in accordance with the rules framed
(Note:— To be retained by the purchasing (Note:— To be retained by the selling dealer). under Section 13(4)(e) by the appropriate State
dealer). Government.
1. Ins. by GSR 26(E), dated 1-2-1974.
[F. C
2. Subs. by GSR 56(E), dated 9-2-1973, w.e.f. 1-4-1973.
3. Ins. by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 1976.
F. D]
1 1
Form ‘D’ 1
Form ‘D’ Form ‘D’

Form of Certificate for making Form of Certificate for making Form of Certificate for making
Government purchase Government purchase Government purchase
[See rule 12(1)] [See rule 12(1)] [See rule 12(1)]
(To be used when making purchases by (To be used when making purchases by (To be used when making purchases by
Government not being a registered dealer) Government not being a registered dealer) Government not being a registered dealer)
Central Government/Name of the State Central Government/Name of the State Central Government/Name of the State
Government ........................................................ Government ........................................................ Government ........................................................
Name of Issuing Ministry/Department ........... Name of Issuing Ministry/Department ........... Name of Issuing Ministry/Department ...........
Name and address of Office of Issue ........... Name and address of Office of Issue ........... Name and address of Office of Issue ...........
To To To
.................... *(Seller) .................... *(Seller) .................... *(Seller)
................... ................... ...................
Certified that the goods Certified that the goods Certified that the goods
2 2
[**ordered for in our purchase order No. ...... 2
[**ordered for in our purchase order No. ...... [**ordered for in our purchase order No. ......
dated...... and supplied as per Bill/Cash Memo/ dated...... and supplied as per Bill/Cash Memo/ dated...... and supplied as per Bill/Cash Memo/
Challan No., the.......dated....... as stated below] Challan No., the.......dated....... as stated below] Challan No., the.......dated....... as stated below]
............................................................................ ............................................................................ ............................................................................
1. Ins. by G.S.R. 896, dt. 23.9.1958 and thereafter corrected by corrigenda G.S.R. 1059, dt. 29.10.1958.
2. Subs. for the asterisks and words **ordered for in our purchase order No. ...... dated............*, in the counterfoil,
duplicate and original by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 1987, w.e.f.
653
14.4.1987, as corrected by G.S.R. 954(E), dt. 28.9.1988.
654
purchased from you as per bill/cash memo stated purchased from you as per bill/cash memo stated purchased from you as per bill/cash memo stated
below* below* below*
............................................................................. ............................................................................. .............................................................................
supplied under your challan No. ............. date supplied under your challan No. ............. date supplied under your challan No. ............. date
........ are purchased by or on behalf of the ........ are purchased by or on behalf of the ........ are purchased by or on behalf of the
Government of ............ Government of ............ Government of ............

Date........... Signature....... Date........... Signature....... Date........... Signature.......
Designation of the authorised officer of the Designation of the authorised officer of the Designation of the authorised officer of the
Government....... Government....... Government.......
Seal of the duly authorised officer of the Seal of the duly authorised officer of the Seal of the duly authorised officer of the
Government Government Government
*Particulars of Bill/Cash Memo *Particulars of Bill/Cash Memo *Particulars of Bill/Cash Memo
Date......... No. ....... Amount Date......... No. ....... Amount Date......... No. ....... Amount
+ Name and address of the seller with name + Name and address of the seller with name + Name and address of the seller with name
of the State. of the State. of the State.
** Strike out whichever is not applicable. ** Strike out whichever is not applicable. ** Strike out whichever is not applicable.
(Note:– To be retained by the authorised officer). (Note:– To be retained by the selling officer). (Note:– To be furnished to the prescribed
authority, in accordance with the rules framed
under Section 13(3) by the appropriate State
Government).
[F. D
F. E-1]
1 1 1
Form E-1 Form E-1 Form E-1
Name of State Name of State Name of State

Serial No. Serial No. Serial No.
Certificate under sub-section (2) of Section 6 Certificate under sub-section (2) of Section 6 Certificate under sub-section (2) of Section 6
2 2 2
[See rule 12(4)] [See rule 12(4)] [See rule 12(4)]
[To be issued (in duplicate) (i) by the selling [To be issued (in duplicate) (i) by the selling [To be issued (in duplicate) (i) by the selling
dealer who first moved the goods in the case dealer who first moved the goods in the case dealer who first moved the goods in the case
of a sale falling under Section 3(a) or (ii) by of a sale falling under Section 3(a) or (ii) by of a sale falling under Section 3(a) or (ii) by
the dealer who makes the first inter-State sale the dealer who makes the first inter-State sale the dealer who makes the first inter-State sale
during the movement of the goods from one during the movement of the goods from one during the movement of the goods from one
State to another in the case of a sale falling State to another in the case of a sale falling State to another in the case of a sale falling
under Section 3(b).] under Section 3(b).] under Section 3(b).]
A. Name of the selling dealer ........................ A. Name of the selling dealer ........................ A. Name of the selling dealer ........................
B. (i) Name of the purchasing dealer ........... B. (i) Name of the purchasing dealer ........... B. (i) Name of the purchasing dealer ...........
(ii) Address (with name of the State) ..... (ii) Address (with name of the State) ..... (ii) Address (with name of the State) .....
C. (i) Name of place and State in which the C. (i) Name of place and State in which the C. (i) Name of place and State in which the
movement commenced ......................... movement commenced ......................... movement commenced .........................
(ii) Name of place and State to which the (ii) Name of place and State to which the (ii) Name of place and State to which the
goods have been consigned by the goods have been consigned by the goods have been consigned by the
signatory ................................................ signatory ................................................ signatory ................................................
D. (i) Invoice No. and date .......................... D. (i) Invoice No. and date .......................... D. (i) Invoice No. and date ..........................
(ii) Description, quantity and value of goods (ii) Description, quantity and value of goods (ii) Description, quantity and value of goods
............................................................... ............................................................... ...............................................................
(iii) No. and date of the declaration form (iii) No. and date of the declaration form (iii) No. and date of the declaration form
‘C’ received from purchasing dealer ‘C’ received from purchasing dealer ‘C’ received from purchasing dealer
with name of State of issue ............. with name of State of issue ............. with name of State of issue .............
1. Ins. by GSR 896, dated 23-9-1958 and thereafter corrected by GSR 1059, dated 29-10-1958.
655
2. Subs. for "see rule 12(2)" by the GSR 56(E), dated 9-2-1973, w.e.f. 1-4-1973.
656
(iv) No. and date of the Railway Receipt/ (iv) No. and date of the Railway Receipt/ (iv) No. and date of the Railway Receipt/
Trip Sheet of lorry/or any other Trip Sheet of lorry/or any other Trip Sheet of lorry/or any other
document of other means of transport document of other means of transport document of other means of transport
.................................................................. .................................................................. ..................................................................
I/We the selling dealer mentioned above do I/We the selling dealer mentioned above do I/We the selling dealer mentioned above do
certify that I/We am/are registered under the certify that I/We am/are registered under the certify that I/We am/are registered under the
Act and am/are holding registration certificate Act and am/are holding registration certificate Act and am/are holding registration certificate
No. .......... dated .......... in the State of ........ No. .......... dated .......... in the State of ........ No. .......... dated .......... in the State of ........

1 1 1
[I/We further certify that (i) I/We will pay/have [I/We further certify that (i) I/We will pay/have [I/We further certify that (i) I/We will pay/have
paid tax under the Act or (ii) no tax was payable paid tax under the Act or (ii) no tax was payable paid tax under the Act or (ii) no tax was payable
under the Act in view of the general exemption under the Act in view of the general exemption under the Act in view of the general exemption
referred to in sub-section (2A) 2[or in pursuance referred to in sub-section (2A) 2[or in pursuance referred to in sub-section (2A) 2[or in pursuance
to any exemption or concession granted under to any exemption or concession granted under to any exemption or concession granted under
sub-section (5)] of Section 8, on the sale of sub-section (5)] of Section 8, on the sale of sub-section (5)] of Section 8, on the sale of
goods covered by documents whose particulars goods covered by documents whose particulars goods covered by documents whose particulars
are given above, to the appropriate sales tax are given above, to the appropriate sales tax are given above, to the appropriate sales tax
authority of the State of ..............................] authority of the State of ..............................] authority of the State of ..............................]
3 3 3
[The above statements are true to the best of [The above statements are true to the best of [The above statements are true to the best of
my knowledge and belief. my knowledge and belief. my knowledge and belief.
Signature ............... Signature ............... Signature ...............
(Name of the person signing the certificate) (Name of the person signing the certificate) (Name of the person signing the certificate)
(Place) (Place) (Place)
(Status of the person signing the certificate in (Status of the person signing the certificate in (Status of the person signing the certificate in
relation to the dealer)]. relation to the dealer)]. relation to the dealer)].
Date : Date : Date :
Address (with name of the State) .................. Address (with name of the State) .................. Address (with name of the State) ..................
4 4 4
[Explanation:— In this form, item D(iii) shall [Explanation:— In this form, item D(iii) shall [Explanation:— In this form, item D(iii) shall
not be applicable in cases covered by the second not be applicable in cases covered by the second not be applicable in cases covered by the second
proviso to sub-section (2) of Section 6.] proviso to sub-section (2) of Section 6.] proviso to sub-section (2) of Section 6.]
[N.B.:— To be retained by the dealer issuing [N.B.:— To be retained by the dealer receiving [N.B.:— To be furnished to the prescribed
the certificate.] the certificate.] authority in accordance with the rules framed
[F. E-1
1. Subs. by GSR 1321, dated 27-11-1959. Government.
2. Ins. by the Central Sales Tax (Registration and Turnover) (Amndt.) Rules, 1987, w.e.f. 14-4-1987.
4. Ins. by GSR 597(E), dated 30-12-1975.
F. E-II]
8)6`"
*Form E-II *Form E-II *Form E-II

Name of the State ................. Name of the State ................. Name of the State .................
Certificate under sub-section (2) of Section 6 Certificate under sub-section (2) of Section 6 Certificate under sub-section (2) of Section 6
1 1
[See Rule 12(4)] 1
[See Rule 12(4)] [See Rule 12(4)]
[To be issued (in duplicate) by the first or [To be issued (in duplicate) by the first or [To be issued (in duplicate) by the first or
subsequent transferor in the series of sales subsequent transferor in the series of sales subsequent transferor in the series of sales
referred to in Section 6(2)(a) or second or referred to in Section 6(2)(a) or second or referred to in Section 6(2)(a) or second or
subsequent transferor in the series of sales subsequent transferor in the series of sales subsequent transferor in the series of sales
referred to in Section 6(2)(b).] referred to in Section 6(2)(b).] referred to in Section 6(2)(b).]
A. Name of the dealer effecting a sale by A. Name of the dealer effecting a sale by A. Name of the dealer effecting a sale by
transfer of the documents of title to the transfer of the documents of title to the transfer of the documents of title to the
goods ............................................................... goods ............................................................... goods ...............................................................
B. (i) Name of the purchasing dealer........... B. (i) Name of the purchasing dealer........... B. (i) Name of the purchasing dealer...........
(ii) Address (with name of State) ................ (ii) Address (with name of State) ................ (ii) Address (with name of State) ................
C. (i) Name of place and State in which C. (i) Name of place and State in which C. (i) Name of place and State in which
movement commenced ......................... movement commenced ......................... movement commenced .........................
(ii) Name of place and State to which the (ii) Name of place and State to which the (ii) Name of place and State to which the
goods have been consigned .................... goods have been consigned .................... goods have been consigned ....................
D. (i) Invoice No. and date ........................... D. (i) Invoice No. and date ........................... D. (i) Invoice No. and date ...........................
(ii) Description, quantity and value of goods (ii) Description, quantity and value of goods (ii) Description, quantity and value of goods
............................................................... ............................................................... ...............................................................
1. Ins. by G.S.R. 896, dt. 23.9.1958 and corrected by G.S.R. 1059, dt. 29.10.1958.
657
2. Subs. for “see Rule 12(2)” by G.S.R. 56(E), dt. 9.2.1973, w.e.f. 1.4.1973.
658
(iii) No. and date of the declaration Form (iii) No. and date of the declaration Form (iii) No. and date of the declaration Form
‘C’ received from purchasing dealer with ‘C’ received from purchasing dealer with ‘C’ received from purchasing dealer with
name of the State of issue............ name of the State of issue............ name of the State of issue............
(iv) No. and date of the Railway Receipt/ (iv) No. and date of the Railway Receipt/ (iv) No. and date of the Railway Receipt/
Trip Sheet of lorry/or any other Trip Sheet of lorry/or any other Trip Sheet of lorry/or any other
document of other means of transport...... document of other means of transport...... document of other means of transport......

I/We the selling dealer do certify that— I/We the selling dealer do certify that— I/We the selling dealer do certify that—
(a) I am/we are registered under the Act and (a) I am/we are registered under the Act and (a) I am/we are registered under the Act and
am/are holding registration certificate No. ...... am/are holding registration certificate No. ...... am/are holding registration certificate No. ......
dated...... in the State of................ dated...... in the State of................ dated...... in the State of................
(b) I/We, having purchased the documents of (b) I/We, having purchased the documents of (b) I/We, having purchased the documents of
title to the goods during their movement from title to the goods during their movement from title to the goods during their movement from
one State to another referred to in item C above, one State to another referred to in item C above, one State to another referred to in item C above,
against a certificate No. ........ in Form EI/EII, against a certificate No. ........ in Form EI/EII, against a certificate No. ........ in Form EI/EII,
have now effected a subsequent sale during have now effected a subsequent sale during have now effected a subsequent sale during
such movement by transferring the same in such movement by transferring the same in such movement by transferring the same in
favour of the purchasing dealer whose address favour of the purchasing dealer whose address favour of the purchasing dealer whose address
is given in this certificate; is given in this certificate; is given in this certificate;
(c) 1[The dealer from whom I/we purchased the (c) 1[The dealer from whom I/we purchased the (c) 1[The dealer from whom I/we purchased the
documents of title to the goods during the documents of title to the goods during the documents of title to the goods during the
movement referred to in (b) above, has certified movement referred to in (b) above, has certified movement referred to in (b) above, has certified
(i) that he has paid/will pay the tax or (ii) that (i) that he has paid/will pay the tax or (ii) that (i) that he has paid/will pay the tax or (ii) that
the tax has been/will be paid by any of the the tax has been/will be paid by any of the the tax has been/will be paid by any of the
preceding transferors of documents of title to preceding transferors of documents of title to preceding transferors of documents of title to
the goods or (iii) that no tax was payable under the goods or (iii) that no tax was payable under the goods or (iii) that no tax was payable under
1. Subs. for the following by G.S.R.No. 1321, dt. 27.11.1959:–
[F. E-II
“The dealer from whom I/we purchased the documents of title to the goods during the movement referred to in
(b) above, has certified (i) that he has paid/will pay the tax or (ii) that the tax has been/will be paid by way
of the preceding transferors of documents of title to the goods.”
F. E-II]
the Act in view of the general exemption referred the Act in view of the general exemption referred the Act in view of the general exemption referred
to in sub-section (2A) 1[or in pursuance to any to in sub-section (2A) 1[or in pursuance to any to in sub-section (2A) 1[or in pursuance to any
exemption or concession granted under sub- exemption or concession granted under sub- exemption or concession granted under sub-
section (5) of Section 8. 2[The above statements section (5) of Section 8. 2[The above statements section (5) of Section 8. 2[The above statements
are true to the best of my knowledge and belief. are true to the best of my knowledge and belief. are true to the best of my knowledge and belief.

Signature.......... Signature.......... Signature..........
(Name of the person signing the certificate) (Name of the person signing the certificate) (Name of the person signing the certificate)
(Status of the person signing the certificate in (Status of the person signing the certificate in (Status of the person signing the certificate in
relation to the dealer.)] relation to the dealer.)] relation to the dealer.)]
(Place).......... Date............ (Place).......... Date............ (Place).......... Date............
Address (with name of the State).......... Address (with name of the State).......... Address (with name of the State)..........
3
[Explanation 4[(1)–In this Form ‘transferor’ 3
[Explanation 4[(1)– In this Form ‘transferor’ 3
[Explanation 4[(1)—In this Form ‘transferor’
means any person who effects a sale in the means any person who effects a sale in the means any person who effects a sale in the
mode referred to in clause (b) of Section 3.] mode referred to in clause (b) of Section 3.] mode referred to in clause (b) of Section 3.]
4 4 4
[Explanation (2)– In this form, item D(iii) shall [Explanation (2)– In this form, item D(iii) shall [Explanation (2)— In this form, item D(iii)
not be applicable in cases covered by the second not be applicable in cases covered by the second shall not be applicable in cases covered by the
proviso to sub-section (2) of Section 6.] proviso to sub-section (2) of Section 6.] second proviso to sub-section (2) of Section 6.]
N.B.:– To be retained by the dealer issuing the N.B.:– To be retained by the dealer receiving N.B.:— To be furnished to the prescribed
certificate]. the certificate]. authority in accordance with the rules framed
Government].
* Ins. by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 1987, w.e.f. 14.4.1987.
* Subs. for the following by G.S.R.No. 56(E), dt. 9.2.1973, w.e.f. 1.4.1973.
* Signatures..........
Place...................*
* Ins. by G.S.R. 56(E), dt. 9.2.1973, w.e.f. 1.4.1973.
* Explanation has been renumbered as ‘Explanation (1)’ and ‘Explanation (2)’ inserted by G.S.R. 597(E), dt.
659
30.12.1975.
660
1 1 1
Form F Form F Form F
(Form of declaration to be issued by the (Form of declaration to be issued by the (Form of declaration to be issued by the
transferee) transferee) transferee)

Serial No. .................................................. Serial No. .................................................. Serial No. ..................................................
Name of the issuing State ....................... Name of the issuing State ....................... Name of the issuing State .......................
Office of issue .......................................... Office of issue .......................................... Office of issue ..........................................
Date of issue ............................................. Date of issue ............................................. Date of issue .............................................
Name and address of the person to whom issued Name and address of the person to whom issued Name and address of the person to whom issued
along with his Registration Certificate No. .......... along with his Registration Certificate No. .......... along with his Registration Certificate No. ..........
Date from which registration is valid ............ Date from which registration is valid ............ Date from which registration is valid ............
Seal of issuing authority Seal of issuing authority Seal of issuing authority
To To To
(Transferor) (Transferor) (Transferor)
............................................................................. ............................................................................. .............................................................................
Registration Certificate No. of the Transferor. Registration Certificate No. of the Transferor. Registration Certificate No. of the Transferor.
Certified that the goods transferred to me/us as Certified that the goods transferred to me/us as Certified that the goods transferred to me/us as
per details below have been received and duly per details below have been received and duly per details below have been received and duly
accounted for:— accounted for:— accounted for:—
Description of the goods sent ....................... Description of the goods sent ....................... Description of the goods sent .......................
Quantity or weight .......................................... Quantity or weight .......................................... Quantity or weight ..........................................
Value of goods .................................................. Value of goods .................................................. Value of goods ..................................................
Number and date of invoice 2[or challan or any Number and date of invoice 2[or challan or any Number and date of invoice 2[or challan or any
other document under which goods were sent.] other document under which goods were sent.] other document under which goods were sent.]
[F. F
1. Ins. by G.S.R.No. 56(E), dt. 9.2.1973, w.e.f. 1.4.1973.
2. Ins. by G.S.R. 519(E), dt. 13.12.1973.
F. F]
............................................................................. ............................................................................. .............................................................................
Name of Railway, Steamer or Ferry Station or Name of Railway, Steamer or Ferry Station or Name of Railway, Steamer or Ferry Station or
Air Port or Post Office or Road Transport Air Port or Post Office or Road Transport Air Port or Post Office or Road Transport
Company’s Office from where the goods were Company’s Office from where the goods were Company’s Office from where the goods were
despatched. despatched. despatched.

............................................................................. ............................................................................. .............................................................................
No. and date of Railway Receipt or Postal No. and date of Railway Receipt or Postal No. and date of Railway Receipt or Postal
Receipt or Goods Receipt with Trip sheet of Receipt or Goods Receipt with Trip sheet of Receipt or Goods Receipt with Trip sheet of
lorry or any other document indicating the means lorry or any other document indicating the means lorry or any other document indicating the means
of transport of transport of transport
............................................................................. ............................................................................. .............................................................................
Date on which delivery was taken by the Date on which delivery was taken by the Date on which delivery was taken by the
transferee. transferee. transferee.
The above statements are true to the best of my The above statements are true to the best of my The above statements are true to the best of my
knowledge and belief. knowledge and belief. knowledge and belief.
Signature .......... Signature .......... Signature ..........
(Name of the person signing the declaration) (Name of the person signing the declaration) (Name of the person signing the declaration)
*(Status of the person signing the declaration *(Status of the person signing the declaration *(Status of the person signing the declaration
in relation to the transferee.) in relation to the transferee.) in relation to the transferee.)
*(Status of the person signing the declaration *(Status of the person signing the declaration *(Status of the person signing the declaration
in relation to the transferor.) in relation to the transferor.) in relation to the transferor.)
*Strike out whichever is not applicable. *Strike out whichever is not applicable. *Strike out whichever is not applicable.
(Note:— To be retained by the transferee.) (Note:— To be retained by the transferee.) [Note:— To be furnished to the assessing
authority in accordance with the rules framed
under Section 13(4)(e).]
661
662 Commentary on A.P. Value Added Tax [F. G
THE CENTRAL SALES TAX (REGISTRATION AND

TURNOVER) RULES, 1957
1
FORM G
[See Rules 12(2) and 12(9)]
Form of Indemnity Bond
Know all men by these presents that* I ....................... S/o. .................

registered dealer under the Central Sales Tax Act, 1956, under registration
No. ............... dated ............. in the State of ................ *We/M/s. ..................
*a firm/*a company registered under the laws of India and having its registered
Office at....... registered dealers under the Central Sales Tax Act, 1956, under
registration No. .................... In the State of ............ (hereinafter called the
Obligor) *Is/are* held and firmly bound unto the President of India/Governor
of ................... (hereinafter called the Government) in the sum of ................
[Rupees ................ (in words)] well and truly to be paid to the Government
on demand and without demur for which payment to be well and truly made
*I bind myself and my heirs, executors, administrators, legal representatives
and assigns/*we bind ourselves, our successors and assigns and the persons
for the time being having control over our assets and affairs.
Signed this .............. day of ................ one thousand nine hundred and
............... Whereas sub-rule (2) of Rule 12 of the Central Sales Tax (Registration
and Turnover) Rules, 1957, requires that in the event a blank or a duly
completed form of declaration is lost while it is in the custody of the purchasing
dealer or in transit to the selling dealer, the purchasing dealer and, as the
case may be, also a selling dealer each to furnish an indemnity bond to, in
the case of purchasing dealer, the notified authority from whom the said form
was obtained and in the case of a selling dealer, the notified authority of his
State.
And whereas the Obligor herein is such *purchasing dealer/*selling
dealer.
And whereas the Obligor has lost the declaration in *Form C/*Form F/
*the certificate in *Form EI/*Form EII, bearing No. ........ *which was blank/
(name and designation of the authority) .......................... and sent to .............
(selling dealer) ............................../*received by him from ........ (name of the
purchasing dealer) ...................... and sent to ................................. (notified
authority of the selling dealer’s State) in respect of the goods mentioned below
(hereinafter referred to as the ‘Form’)
1. Ins. by GSR No. 597(E), dated 30-12-1975.

F. G] Central Sales Tax (Regn. & Tur.) Rules, 1957 663
Sl. No. of Bill Date Description Quantity Amount

No. Invoice/Challan of Goods
Now the condition of the above written bond or obligation is such that
the Obligor shall in the event of a loss suffered by the Government (in respect
of which the decision of the Government or the authority appointed for the
purpose shall be final and binding on the Obligor) as a result of the misuse
of the form, pay to the Government or demand and without demur the said
sum of Rs. ...... [Rupees ....... (in words)] and shall otherwise indemnify and
keep to Government harmless and indemnified against and from all liabilities
incurred by the Government as a result of the misuse of such form. Then
the above written bond or obligation shall be void and of no effect but otherwise
shall remain in full force, effect and virtue. The obligor further undertakes
to mortgage/charge the properties specified in the Schedule hereunder written
by execution of proper deed of mortgage/charge for the payment of the said
sum, 1[whenever called upon to do so by the assessing authority].
Schedule
(Give details of properties mortgaged/charged)
And these presents also witnesseth that the liability of the Obligor
hereunder shall not be impaired or discharged by reason of any forbearance,
act or omission of the Government of for any time being granted or indulgence
shown by the Government 1[or by reason of any charge in the constitution
of the Obligor in cases where the Obligor is not an individual].
The Government agrees to bear the stamp duty, if any, chargeable on

these presents.
In witness whereof the Obligor *has set his hand/*has caused these
presents executed by its authorised representatives, on the day, month and year
above written.
Signed by the above named Obligor in presence of

1.
2.
(Obligor's signature)
Accepted for and on behalf of the President of India/Governor of.......
by name description of the Officer duly authorised in pursuance of Article
299(1) of the Constitution, to accept the bond for and on behalf of the President
of India/Governor of...........
664 Commentary on A.P. Value Added Tax [F. H
In presence of
1.
2.
Name and Designation of the Officer
*Strike out which is not applicable.
Counterfoil
1
[FORM H
[See Rule 12(10)]
Certificate of Export
Sl.No.
Name of issuing State ........
Office of issue .................... Seal of
Date of issue ..................... issuing authority
Name and complete address of the exporter..............
Registration No. of the exporter under the Central Sales Tax Act, 1956, if
any .................................................................................................................
To
...................................................
...................................................
(Name and complete address of the seller)
Sales tax registration number of the seller:–
(a) under the relevant State Sales Tax Law............
(b) under the Central Sales Tax Act, 1956...........
Certificate I:– Certified that the goods (the particulars whereof have been
specified in items (1) and (2) of the Schedule below) supplied in presence
of our purchase order No. ........... dated....... purchased from you as per bill/
cash memo/challan No. ....... dated ........ of Rs. ..... have been sold by me/
us, in the course of export out of the territory of India, as per details given
in items (3) to (6) of the said Schedule, and that the said goods were purchased
F. H] Central Sales Tax (Regn. & Tur.) Rules, 1957 665
from you by me/us after, and for the purpose of complying with, the agreement
or order No. ...... dated .......... for or in relation to such export.
Certificate II:– It is further certified that non-liability to tax under the
Central Sales Tax Act, 1956, in respect of goods referred to in Certificate
I has not been claimed from any other person and that no other certificate
for such non-liability has been issued to any other person in India in respect
of those goods.
Certificate III:– It is further certified that in case the goods covered
by this certificate are reimported into India by me/us after their export, I/we
undertake to inform the sales tax authority of the person to whom this certificate
has been supplied, about the fact of such reimport within a period of one
month from the date of reimport of the said goods into India.
The Schedule
A–Particulars of goods
(1) Description of goods:
(2) Quantity of goods:
B–Details regarding export
(3) Name of airport, seaport or land customs station through which the
goods have been exported.
(4) Name of the airlines/ship/railway/goods vehicle or other means of
transport through which the export has taken place.
(5) Number and date of air consignment note/bill of lading/railway receipt
or goods vehicle record or postal receipt or any other document in proof of
export of goods across the customs frontier of India (certified copy of such
air consignment note/bill of lading/railway receipt/goods vehicle record/postal
receipt/other document to be enclosed).
(6) Description, quantity/weight and value of the goods exported under
the document referred to in item (5) above.
Verification
The above statements are true to the best of my knowledge and belief
and nothing has been concealed therefrom.
Signature with date ..................
Name of the person signing the
certificate .....................................
Status of the person signing the
certificate in relation to the exporter
........................................
Note:–
For Counterfoil:– To be retained by the exporter.
Duplicate
1
FORM H
[See Rule 12(10)]
Sl.No.
Name of issuing State
Office of issue Seal of the
Date of issue issuing authority
Name and complete address of the exporter ..........................................
Registration No. of the exporter under the Central Sales Tax Act, 1956, if
any .................................................................................................................
To
.................................
.................................
Sales tax registration number of the seller
(a) under the relevant State sales tax law............
(b) under the Central Sales Tax Act, 1956..........
specified in items (1) and (2) of the Schedule below) supplied in pursuance
of our purchase order No. ....... dated......... purchased from you as per bill/
cash memo/challan No. ......... dated........ for Rs. ......... have been sold by
me/us, in the course of export out of the territory of India, as per details given
in items (3) to (6) of the said Schedule, and that the said goods were purchased
or order No. ....... dated...... for or in relation to such export.

of those goods.
The Schedule
A–Purchase of goods
(1) Description of goods
(2) Quantity of goods
Verification
Signature with date ...................
certificate .....................................
.......................................
Note:– To be retained by the dealer selling goods to the exporter.
Original
1
[FORM H
[See Rule 12(10)]
Sl.No.
Name of issuing State Seal of issuing
Office of issue authority
Date of issue
Name and complete address of the exporter,
Registration No. of the exporter under the Central
Sales Tax Act, 1956, if any.
To
....................................
....................................
Sales tax registration number of the seller
(a) under the relevant State Sales tax law ....................
(b) under the Central Sales Tax Act, 1956 ...................
specified in items (1) and (2) of the Schedule below) supplied in pursuance
of our purchase order No. ..... dated...... purchased from you as per bill/cash
memo/challan No. ........ dated ....... for Rs. ........ have been sold by me/us,
in the course of export out of the territory of India, as per details given in
items (3) to (6) of the said Schedule, and that the said goods were purchased
or order No. .... dated....... for or in relation to such export.
of those goods.

The Schedule
A–Particulars of goods
(1) Description of goods
(2) Quantity of goods
Verification
Signature with date ...................
certificate ....................................
......................................
Note:– To be furnished to the prescribed authority in accordance with
the rules made by the State Government under Section 13.
——
670
1 1 1
Form ‘I’ Form ‘I’ Form ‘I’
Sl.No. .................................................................. Sl.No. .................................................................. Sl.No. ..................................................................

Issuing Authority ................................................. Issuing Authority ................................................. Issuing Authority .................................................
............................................................................. ............................................................................. .............................................................................
Date of issue ..................................................... Date of issue ..................................................... Date of issue .....................................................
Details of the SEZ dealer, to whom issued Details of the SEZ dealer, to whom issued Details of the SEZ dealer, to whom issued
(a) Name and Address ...................................... (a) Name and Address ...................................... (a) Name and Address ......................................
(b) Number and Date of Registration under the (b) Number and Date of Registration under the (b) Number and Date of Registration under the
Central Sales Tax Act, 1956 (74 of 1956) Central Sales Tax Act, 1956 (74 of 1956) Central Sales Tax Act, 1956 (74 of 1956)
....................................................................... ....................................................................... .......................................................................
(c) Number and Date of Registration No. issued (c) Number and Date of Registration No. issued (c) Number and Date of Registration No. issued
by the Development Commissioner, SEZ by the Development Commissioner, SEZ by the Development Commissioner, SEZ
concerned, along with details of goods concerned, along with details of goods concerned, along with details of goods
specified in the Certificate of Registration specified in the Certificate of Registration specified in the Certificate of Registration
....................................................................... ....................................................................... .......................................................................
Seal of the Seal of the Seal of the
issuing authority issuing authority issuing authority
To To To
.............................................................................. .............................................................................. ..............................................................................
............................................................................. ............................................................................. .............................................................................
[F. I
1. Subs. by the Central Sales Tax (Registration and Turnover) (Amendment) Rules, 2005, w.e.f. 7-6-2005.
F. I]
(Name and address of the Seller, with name of (Name and address of the Seller, with name of (Name and address of the Seller, with name of
the State) the State) the State)
*[ordered for in our Purchased Order Number *[ordered for in our Purchased Order Number *[ordered for in our Purchased Order Number

.............. dated ............... and supplied by you .............. dated ............... and supplied by you .............. dated ............... and supplied by you
as per your Bill/Cash Memo./Challan] Number as per your Bill/Cash Memo./Challan] Number as per your Bill/Cash Memo./Challan] Number
.............. dated .................. for an amount of Rs. .............. dated .................. for an amount of Rs. .............. dated .................. for an amount of Rs.
............. are for the purposes specified under ............. are for the purposes specified under ............. are for the purposes specified under
sub-section (6) of Section 8 of the Central Sales sub-section (6) of Section 8 of the Central Sales sub-section (6) of Section 8 of the Central Sales
Tax Act, 1956. Tax Act, 1956. Tax Act, 1956.
The above statements are true to the best of my The above statements are true to the best of my The above statements are true to the best of my
knowledge and belief. knowledge and belief. knowledge and belief.
(Signature) (Signature) (Signature)
Name of the person signing the Declaration, on Name of the person signing the Declaration, on Name of the person signing the Declaration, on
behalf of the SEZ dealer ................................ behalf of the SEZ dealer ................................ behalf of the SEZ dealer ................................
Status of the persons signing the Declaration, Status of the persons signing the Declaration, Status of the persons signing the Declaration,
in relation to the SEZ dealer .......................... in relation to the SEZ dealer .......................... in relation to the SEZ dealer ..........................
* Strike out, whichever is not applicable. * Strike out, whichever is not applicable. * Strike out, whichever is not applicable.
(Note:– To be retained by the SEZ dealer). (Note:– To be retained by the SEZ dealer). (Note:– To be retained by the SEZ dealer).
1. Ins. by GSR 26(E), dated 1-2-1974.

671
672
1 1 1
Form ‘J’ Form ‘J’ Form ‘J’
[See Rule 12(11A)] [See Rule 12(11A)] [See Rule 12(11A)]
Form of Certificate for Claiming Form of Certificate for Claiming Form of Certificate for Claiming

Exemption under Section 6(4) Exemption under Section 6(4) Exemption under Section 6(4)
(To be used when making purchase by diplomatic (To be used when making purchase by diplomatic (To be used when making purchase by diplomatic
mission, consulates, United Nations and other mission, consulates, United Nations and other mission, consulates, United Nations and other
international body and diplomatic agent, consular, international body and diplomatic agent, consular, international body and diplomatic agent, consular,
officials or personnel thereof). officials or personnel thereof). officials or personnel thereof).
Name of the mission, consulate, United Nations Name of the mission, consulate, United Nations Name of the mission, consulate, United Nations
or other international body and of the diplomatic or other international body and of the diplomatic or other international body and of the diplomatic
agent, consular, official or personnel thereof, agent, consular, official or personnel thereof, agent, consular, official or personnel thereof,
making the purchase .......................................... making the purchase .......................................... making the purchase ..........................................
Country to which the purchaser belongs .......... Country to which the purchaser belongs .......... Country to which the purchaser belongs ..........
............................................................................... ............................................................................... ...............................................................................
(Designation and office address of the purchaser (Designation and office address of the purchaser (Designation and office address of the purchaser
(with Tel. No., Fax No., E-mail address etc.) (with Tel. No., Fax No., E-mail address etc.) (with Tel. No., Fax No., E-mail address etc.)
.............................................................................. .............................................................................. ..............................................................................
............................................................................. ............................................................................. .............................................................................
To To To
................................................. *(seller) ................................................. *(seller) ................................................. *(seller)
[F. J
1. Inserted by the Central Sales Tax (Registration and Turnover) (Second Amendment) Rules, 2005, w.e.f. 14-7-2005.
THE A.P. TAX ON PROFESSIONS, TRADES,
CALLINGS AND EMPLOYMENTS ACT, 1987
1
[Act No. 22 of 1987]
[As amended by Act No. 10 of 2010]
An Act to provide for the levy and collection of a Tax on Professions,
Trades, Callings and Employments.
Pradesh in the Thirty-eighth Year of the Republic of India as follows:–
2
Statement of Objects and Reasons
At present the levy and collection of profession tax is administered by
the local authorities under different enactments. In order to rationalise the
levy and collections of profession tax and also with a view to improve the
collections thereof, it is decided by the Government to enact a single
comprehensive enactment for the purpose of levy and collection of profession
tax instead of under different enactments and to entrust the administration
thereof to the Commercial Tax Department for effective collection, persons
whose salary or wages does not exceed rupees one thousand per month,
persons in professions whose annual income does not exceed Rs. 12,000/
- and traders whose total turnover in any year does not exceed rupees one
lakh are exempt from the levy of profession tax.
It has also been decided to provide for the annual grant to the local
authorities concerned an amount based on the highest collections of taxes,
penalties and interest in any year during the three years immediately preceding
the commencement of this Act to compensate the loss of revenue to these
local authorities since the said local authorities shall not collect any cess or
tax on professions, trades, callings and employment on and from the date
of commencement of this Act.
(Act No. 17 of 2003)3
The licensed horse owners, trainers, book makers and jockeys are liable
to pay profession tax as per entry No. 7 of Schedule to the Andhra Pradesh
Tax on Professions, Trades Callings and Employments Act, 1987. Most of
the licensed persons are residing outside the State and come to the State
only during the season when the races are held in Hyderabad. As they do
not have any permanent residence in the State it has become difficult to collect
profession tax from them. In order to recover the profession tax from them,
the Government have decided to make the Hyderabad Race Club responsible
to collect the tax and to pay to the Government.
To achieve the above object in view, the Government have decided
to amend the Andhra Pradesh Tax on Professions, Trades, Callings and
Employments Act, 1987 suitably.
1. Received the assent of the Governor on the 16-4-1987 and the said assent is hereby
first Pub. on the 18-4-1987 in the A.P. Gazette, Part IV-B, (Ext.)
2. As appended to L.A. Bill No. 30 of 1987.
3. Appended to L.A. Bill No. 14 of 2003, Pub. in A.P. Gazette, Part IV-A,
Ext-No. 14, dt. 26-9-2003.
674
A.P. Tax on Professions, Trades ... Act, 1987 675
(Act No. 16 of 2008)1
The Government of Andhra Pradesh enacted the Andhra Pradesh Tax
on Professions, Trades, Callings and Employments Act, 1987 to collect
Profession Tax from persons engaged in various Professions and Employments
for strengthening the resources of local bodies and entrusted collection of
Profession Tax to Commercial Taxes Department.
In the said Act all procedural aspects are made similar to the Andhra
Pradesh General Sales Tax Act for levy and Collection of Profession Tax.
Section 15 of the said Act makes provision for filing appeals by assessee
aggrieved by the orders passed under the provisions of the Act but excluded
the best judgment assessments passed under Section 8(3) of the Act which
is discriminative. Similarly under Section 15(2) of the Act, total amount of
Tax disputed has to be paid for filing an appeal whereas under the APVAT
Act, 2005 and the repealed Andhra Pradesh General Sales Tax Act, 1957,
only 12.5% of the disputed Tax has to be paid. Under Section 16(1) the
Commissioner of Commercial Taxes is vested with revision power to be
exercised ‘Suo Motu’ or on application made by an assessee whereas in
APVAT Act, 2005 and the repealed Andhra Pradesh General Sales Tax Act,
1957, the power of revision vested in Commissioner of Commercial Taxes
is limited to the cases where order passed by the lower authorities are
prejudicial to the interests of Revenue ie., no revision can be made by the
Commissioner of Commercial Taxes on the application of assessess who have
recourse to regular appellate forums.
In order to remove the aforesaid disparties and deficiencies in the
Profession Tax Act and to make the provisions similar to that of APVAT
Act, 2005 which is a comprehensive Act, the present amendments are proposed
for amending the sub-sections (1), (2) & (3) of Section 15 and sub-sections
(1) (2) & (5) of Section 16 of the Andhra Pradesh Tax on Professions,
Trades, Callings and Employments Act, 1987.
The Profession Tax Act was introduced in 1987 and as per the structure
of the Wages/Salaries then existing the threshold limit for exempting the wage
earners & employees below that threshold limit was adopted as Rs.1500/-
P.M. Due to increase in the wage/salary structure over a long period of 20
years and with an intention to grant relief to about 10 lakhs low paid employees
the threshold limit is proposed to be enhanced to Rs. 5000/- PM.
2
(Act No. 10 of 2010)
According to Section 4 of the A.P. Tax on Professions, Trades,
Callings and Employments Act, 1987, tax shall be levied and collected on
Professions, Trades, Callings and Employments from persons engaged in
Ext-No. 19, dt. 25-3-2008.
Ext-No. 9, dt. 19-3-2010.
any profession, trade calling and employment, falling under any one or other
of the classes specified in column (2) of the First Schedule, at the rate
specified in the corresponding entry in column (3) thereof.
As per the provision of Section 35 of the said Act, out of the proceeds
of the tax, penalties, interest or other amounts recovered under this Act,
there shall be apportioned and paid annually to the local bodies i.e. Municipal
Corporations, Municipalities and Gram Panchayats.
The Government in G.O.Ms.No. 179, M.A. & U.D. Department dated
25-2-2009 issued orders for payment of salaries and pension to the Municipal
Employees, including Municipal Teachers, in all the Municipalities and
Municipal Corporations except Greater Hyderabad Municipal Corporation,
Greater Visakhapatnam Municipal Corporation and Vijayawada Municipal
Corporation from the consolidated fund of the State.
In order to provide funds for payment of salaries to Municipal employees
it is proposed to retain the amount of Profession Tax collected in the
respective Municipalities and Municipal Corporations in the consolidated fund
of the State without apportioning it to the concerned Local Bodies.
Therefore, it is decided to amend Section 35 of the A.P. Tax on
Professions, Trades, Callings and Employments Act, 1987, to retain the
amount of Profession Tax collected in the respective Municipalities and
Municipal Corporations in the consolidated fund of the State.
(Act No. 14 of 2012)1
According to sub-section (2) of section 6 of the Andhra Pradesh Tax
on Professions, Trades, Callings and Employments Act, 1987, every assessee
(other than a person earning salary or wages, in respect of whom the tax
is payable by his employer) liable to pay tax under this Act, shall obtain
certificate of enrolment from the assessing authority in the prescribed
manner.
Sub-section (4) thereof contemplates that, the assessing authority, shall
mention in every certificate of enrollment, the amount of tax payable by
the holder according to the First Schedule and the date by which it shall
be paid, and that such certificate shall serve as a notice of demand for
the purpose of imposing penalty under section 12, for non-payment of tax.
In practical implementation of the provision of the Act, it is observed
that in majority of Taxation Laws the certificate of enrollment may not
be used as a notice of demand for the purpose of payment of the Tax.
Further the rate of tax mentioned in such enrolment certificate at the time
of its issue is based upon the category and turnover of the assessee at
that time. But it is observed that due to subsequent growth in the business
of the assessee he may fall under a higher rate of tax. In such cases
it becomes practically difficult to demand the higher tax amount, than the
amount mentioned in the enrolment certificate, from the assessee and it
Ext-No. 19, dt. 2-10-2011.
A.P. Tax on Professions, Trades ... Act, 1987 677
is also practically very difficult and cumbersome to bring frequent changes
in the enrollment certificate. As such requirement of initial indication of
amount of tax payable in the enrolment certificate becomes inappropriate.
Therefore, it has been felt necessary to dispense with the above
provision. Accordingly, it is decided to omit sub-section (4) of section 6.
of the Act.
Section 15 of the Act, provides for filing appeal by the assessees
except the assessees who are officer of the State or Central Government,
against the orders passed by an assessing authority. To avoid discrimination
it is decided to provide the remedy of appeal to the assessees who are
officers of State or Central Government by suitably amending the said
provision.
Further, in this sub-section, the existing words “any authority” is prone
to misinterpretation that any order passed by any authority, including any
revision by the Commissioner (CT) can be appealed against to the Appellate
Deputy Commissioner who is a relatively junior level Officer. Hence, it
is desirable to limit the scope of the provisions to the orders passed by
the ‘assessing authorities’ only, by suitably amending the said provision.
Entry No. 18 of First Schedule to A. P. Tax on Professions, Trades,
Callings and Employments Act, 1987, provides that for “Banking Companies”,
as defined in the Banking Regulations Act, 1949" the profession tax would
be @ 2500/- per annum. Certain banks, which were nationalised after the
coming into force of the Banking Regulation Act, 1949, such as, Vijaya
Bank, Oriental Bank of Commerce etc., are not covered under the definition
of “Banking Companies” under the above said Act. Hence such Banks
have been claiming that they are not liable to pay Profession Tax although
they have been conducting Banking transactions like any other Bank. In
order to remedy the situation, it is imperative to incorporate necessary
amendment to Entry No. 18 of the First Schedule so as to include all banks
which came into existence after 1949 through separate Act(s), but whose
operations are governed by the Banking Regulation Act, 1949.
The Hon’ble A.P. High Court in the W.P.No. 27367 of 2008, dt.
23.04.2008 in a case filed by the State Bank of Hyderabad held that there
is no distinction in regard to the activities of the Extension Counters or
the ATMs of a Bank from that of the branch or Head Quarters office.
In fact, the main organisation extends its activity through the branches and
the branches extend their activities through extension counters and ATMs.
Hence the Hon’ble Court held that the extension counters and the ATMs
would fall well within the purview of the definition of ‘person’ and attract
the provisions of A.P. Tax on Professions, Trades, Callings and Employments
Act, 1987 the levy of tax”.
Hence an amendment to this effect is necessary with retrospective
effect from 15-6-1987 i.e. the date of coming into force of the A.P. Tax
on Professions, Trades, Callings and Employments Act, 1987.
This Bill seeks to give effect to the above decisions.

1. Short title, extent and commencement:– (1) This Act may
be called the Andhra Pradesh Tax on Professions, Trades, Callings and
Employments Act, 1987.
(3) It shall come into force on such date1 as the Government may,
by notification, appoint.
2. Definitions:– In this Act, unless the context otherwise requires:–
(a) “appellate authority” means the appellate authority appointed
under Section 3;
(b) “assessee” means a person or employer by whom tax is payable
under this Act ;
(c) “assessing authority” means an assessing authority appointed
under this Act ;
(d) “Commissioner” means the Commissioner of profession tax
appointed under Section 3 ;
(e) “employee” means a person employed on salary or wages and
includes,–
(i) an employee of the Central Government or any State Government
to whom the salary is paid either from the Consolidated Fund
of India or of a State;
(ii) a person in the service of a body, whether incorporated or not,
which is owned or controlled by the Central Government or any
State Government where the body operates in any part of the
State, even though its headquarters may be situated outside the
State ; and
(iii) a person engaged in any employment of an employer not covered
by items (i) and (ii) above ;
(f) “employer” in relation to an employee earning any salary or
wages on regular basis under him, means the person or the officer who
is responsible for disbursement of such salary or wages ; and includes
the head of the Office or any establishment as well as the manager or
agent of the employer;
(g) “Government” means the State Government of Andhra Pradesh;
(h) “local authority” means–
(i) in the City of Hyderabad and in the City of Secunderabad,
excluding the Cantonment area, the Municipal Corporation of
Hyderabad and in the city of Vijayawada, the Municipal
Corporation of Vijayawada and in the city of Visakhapatnam,
the Municipal Corporation of Visakhapatnam and in any other
1. Came into force from 15-6-1987 G.O.Ms.No. 557 Rev. (S), dated 8-6-1987 (Printed infra).
Sec. 2] A.P. Tax on Professions, Trades ... Act, 1987 679
Municipality, the Municipal Council concerned ;
(ii) in any area which is comprised within the jurisdiction of Gram
Panchayat, the Gram Panchayat concerned ; and
(iii) in any other area, the authority legally entitled or entrusted by
the Government with the control or management of a profession
tax ;
(i) “notification” means a notification published in the Andhra
Pradesh Gazette, and the word ‘notified’ shall be construed accordingly ;
(j) “person” means any person who is engaged in any profession,
trade, calling or employment in the State of Andhra Pradesh and includes
a Hindu Undivided Family, Firm, Company, Corporation or other corporate
body, any society, club or association, so engaged but does not include
any person who earns wages on a casual basis.
Explanation:– Every branch of a firm, company, corporation or
other corporate body, any society, club or association shall be deemed
to be a person ;
(k) “prescribed” means prescribed by rules made by the Government
under this Act.
(l) “profession tax” means a tax leviable under this Act ;
(m) “salary or wages” includes pay or wages, dearness allowances
and all other remunerations received by any assessee on regular basis,
whether payable in cash or kind and also includes requisitions and profits
in lieu of salary as defined in Section 17 of the Income-tax Act, 1961,
but does not include bonus in any form and on any account or gratuity;
(n) “Schedule” means a Schedule appended to this Act ;
(o) “year” means the twelve months ending on the 31st day of
March.
CASE LAW
Section 2(e) – Under the Act there is no provision for granting exemption
even with reference to the members of the Armed Forces of the Union. M.E.S.
Employees Union, A.P. Area, Secunderabad v. Govt. of A.P. and others,
2001 (4) ALD 832 (DB).
Section 2(j) – “The consequence of the incorporation of the fiction
in Explanation to definition of the word “person” and also Explanation No.
I to the First Schedule of the Act is not to tax a person at a rate higher
than Rs. 2,500/- per annum, per person, but to treat even a branch of a
firm, company, corporation or other corporate body, any society, club or
association as a separate person, and therefore, a separate “assessee” within
the meaning of Section 2(b) of the Act and the Andhra Pradesh State
Legislature has undoubtedly the legislative power to adopt such a devise of
taxation and in adopting such a devise, the Andhra Pradesh State Legislature
has not violated the mandate of Article 276(2) of the Constitution.” Shaw
680 Commentary on A.P. Value Added Tax [Sec. 5A
Wallace & Co. Ltd. v. Deputy Commercial Tax Officer, Secunderabad and
another, 2001 (4) ALD 790 (DB).
3. Appointment of Commissioner and other officers:– (1) The
Government may, by notification, appoint a Commissioner of Profession
Tax to exercise the powers and perform the functions conferred on or
entrusted to him by or under this Act.1
(2) The Government may also appoint an assessing authority, appellate
authority and such number of other officers as they deem fit for the purpose
of exercising the powers and performing the functions respectively conferred
on or entrusted to them by or under this Act.
4. Levy and charge of tax:– (1) There shall be levied and collected
a tax on professions, trades, callings and employments for the benefit of
the State.
(2) Every person engaged in any profession, trade, calling, employment
in the State falling under any one or other of the classes specified in column
(2) of the First Schedule, shall be liable to pay a tax at the rate specified
in the corresponding entry in column (3) thereof.
5. Employer’s liability to deduct and pay tax on behalf of
employees:– (1) The tax payable under this Act, by any person earning
a salary or wage, shall be deducted by his employer from the salary or
wage payable to such person, before such salary or wage is paid to him,
and such employer shall, irrespective of whether such deduction has been
made or not, when the salary or wage is paid to such persons, be liable
to pay tax on behalf of all such persons :
Provided that, where the employer is an officer of the State
Government, or the Central Government, the manner in which such
employer shall discharge the said liability shall be such as may be prescribed:
Provided further that, where any person earning a salary or wage—
(a) is also covered by one or more entries other than Entry 1 in
the First Schedule and the rate of tax under any such other entry
is more than the rate of tax under Entry 1 in that Schedule ;
or
(b) is simultaneously engaged in employment under more than one
employer ;
and such person furnishes to his employer or employers a certificate in
the prescribed form declaring, inter-alia, that he shall get enrolled under
sub-section (2) of Section 6 and pay the tax himself ; then the employer
or employers of such person shall not deduct the tax from the salary
or wage payable to such person and such employer or employers, as
the case may be, shall not be liable to pay tax on behalf of such person.
1. Pl. See. G.O. Ms. No. 557 Rev. (S), dt. 8-6-1987 (printed infra).
2. Inserted by Act No. 17 of 2003, w.e.f. 1-9-2004, vide G.O.Ms. No. 666, Rev.
(CT-IV), dt. 27-8-2004.
2
[5-A. Licensing Turf Club's liability to collect and pay tax on
behalf of the licensed persons:– The tax payable under this Act by
the licensed horse owners, trainers, book-makers and jockeys shall be
collected by the turf clubs, and such clubs shall, irrespective of whether
such collection has been made or not, be liable to pay tax on behalf
of the above cases of persons licensed by it, and the tax so collected
or due shall be received by the stewards of the club on behalf of the
Government and remit the same in the Government Treasury as may
be prescribed.]
6. Registration and enrolment:– (1) Every assessee (not being
an officer of the State Government or the Central Government) liable to
pay tax under Section 5 shall obtain a certificate of registration from the
assessing authority in the prescribed manner.
(2) Every assessee (other than a person earning salary or wages,
in respect of whom the tax if payable by his employer), liable to pay
tax under this Act, shall obtain a certificate of enrolment from the assessing
authority in the prescribed manner.
(3) Every assessee required to obtain a certificate of registration or
enrolment under this Section shall,–
(a) within thirty days from the date of commencement of this Act;
or
(b) if he has not engaged in any profession, trade, calling or employment
on the date of such commencement, within thirty days of his
becoming liable to pay tax ;
apply for a certificate of registration or enrolment or a revised certificate
of enrolment, as the case may be, to the assessing authority in the
prescribed form and the assessing authority shall after making such enquiry
as may be necessary within thirty days of the receipt of the application
(which period in the first year from the commencement of this Act, shall
be extended to ninety days) if the application is in order, grant him such
certificate of registration or enrolment.
(4) 1[xxx]
(5) Where an assessee liable to registration or enrolment has wilfully
failed to apply for such certificate within the time specified in sub-section
(3), the assessing authority may, after giving him a reasonable opportunity
of being heard, impose a penalty which shall not be less than rupees ten
but which shall not exceed rupees twenty for each day of delay in case
1. Sub-section (4) of Section 6 omitted by Act No. 14 of 2012, w.e.f. 14-5-2012.
Prior to omission it read as below:
"(4) The assessing authority, shall mention in every certificate of enrolment, the amount
of tax payable by the holder according to the First Schedule and the date by which
it shall be paid, and such certificate shall serve as a notice of demand for purpose
of Section 12."
of an employer and not exceeding rupees five for each day of delay in
the case of others.
(6) Where an assessee liable to registration or enrolment has
deliberately given false information in any application submitted under this
section, the assessing authority may, after giving him a reasonable opportunity
of being heard, impose a penalty which shall not be less than rupees one
hundred but which shall not exceed rupees one thousand.
7. Returns:– (1) Every assessee registered under this Act, shall
submit to the assessing authority a return in such form, for such period
or periods and by such dates as may be prescribed showing therein the
salaries and wages paid by him and the amount of tax deducted by him
in respect thereof.
(2) Every such return shall be accompanied by a treasury challan
in proof of payment of full amount of tax due according to the return
and return without such proof of payment shall not be deemed to have
been duly submitted.
(3) Where an assessee has without reasonable cause failed to submit
such return within the specified period, the assessing authority may, after
giving him a reasonable opportunity of making representation impose upon
him a penalty which shall not be less than rupees five but which shall
not exceed rupees one hundred for each day of delay.
8. Assessment of an assessee:– (1) If the assessing authority is
satisfied that the return submitted by an assessee is correct and complete,
it may accept the return. If the return appears to it to be incorrect or
incomplete it shall, after giving the assessee a reasonable opportunity of
proving the correctness or completeness of the return submitted by him
and making such enquiry as it deemed necessary, assess to be best of
its judgment, the amount of tax due from the assessee.
(2) The amount of tax due from any assessee shall be assessed
separately for each year within a period of four years from the expiry
of the year to which the assessment relates.
(3) If any assessee has failed to get himself registered or having
been registered, has failed to submit any return, the assessing authority
shall, after giving the assessee a reasonable opportunity of making
representation after making such inquiry as he deems necessary pass an
order assessing the amount of tax due, to the best of its judgment.
(4) The amount of tax so assessed shall be paid within fifteen days
of receipt of the notice of demand from the assessing authority.
(5) In making an assessment under sub-section (1), the assessing
authority if it is satisfied that the escaped assessment was due to wilful
non-disclosure of information or attempt to evade the tax by the assessee,
the assessing authority may also direct to pay in addition to tax assessed,
Sec.10] A.P. Tax on Professions, Trades ... Act, 1987 683
a penalty which shall not be less than one and half times the tax so assessed
but which shall not exceed three times the tax so assessed :
Provided that no penalty under this sub-section shall be imposed
unless the assessee affected has had a reasonable opportunity of showing
cause against the imposition of such penalty.
9. Assessment of escaped or underassessed tax:– If for any
reason any tax payable under this Act, has escaped assessment or has
been underassessed or assessed at a lower rate than the rate at which
it is assessable, the assessing authority may, at any time within four years
from the expiry of the year to which the tax relates, proceed to assess
or reassess the tax, as the case may be, to the best of its judgment after
issuing a notice to the assessee concerned and after making such enquiry
as it considers necessary:
Provided that the tax shall be charged at the rate at which it would
have been charged if such tax had not escaped assessment or, as the
case may be, had not been underassessed or assessed at a rate lower
than the rate at which it was assessable.
10. Payment of tax by certain assessees:– The amount of tax
due from the assessees for each year as specified in their enrolment
certificate shall be paid:–
(a) before 30th June, in respect of an assessee who stands enrolled
before the commencement of a year or is enrolled on or before
the 31st May of a year ; and
(b) within one month of the date of enrolment in respect of an assessee
who is enrolled after the 31st May of year, in the prescribed
manner.
1
[(c) Notwithstanding anything contained in clauses (a) and (b), the
amendment made to the First Schedule except serial No. 1 relating
to salary and wage earners in the First Schedule shall be deemed
to have come into force from 1st April, 1996 and the tax paid
by any assessee for the year 1996-97 as per the pre-amended
schedule shall be deducted from the amount due from the assessee
as per the rates under the amended schedule and the balance amount
shall be paid on or before 30th September, 1996.]
2
[(d) in the case of licensed horse owners, trainers, jockeys, book-makers
shall be paid within a week of the commencement of the racing
at the turf-clubs in the prescribed manners].
1. Inserted by A.P. Act No. 29 of 1996, w.e.f. 1-8-1996. Published in A.P. Gazette,
Pt. IV-B, (Ext.), No. 53, dt. 17-10-1996.
2. Added by Act No. 17 of 2003, w.e.f. 1-9-2004, vide G.O.Ms.No. 666, Rev. (CT-
IV), dt. 27-8-2004.
11. Consequences of failure to deduct or to pay tax:– (1) If

an assessee (not being an officer of the State Government or the Central
Government) does not deduct the tax at the time of payment of salary
or wages or after deducting, fails to pay the tax as required by or under
this Act ; he shall–
(a) be deemed to be an assessee in default in respect of the tax; and
(b) be liable to pay such interest as may be prescribed on the amount
of tax due for each month or part thereof for the period for which
the tax remains unpaid.
(2) If an enrolled person fails to pay the tax as required by or under
this Act, he shall be liable to pay interest at the rate and in the manner
laid down in sub-section (1).
12. Penalty for non-payment of tax:– If any assessee fails, without
reasonable cause to make payment of any amount of tax within the time
specified in the notice of demand, the assessing authority may, after giving
him a reasonable opportunity of making his representation, impose upon
him a penalty which shall not be less than twenty-five per cent but not
exceeding fifty per cent of the amount of tax due. This penalty shall be
in addition to the interest payable under sub-section (1) or sub-section
(2) of Section 11.
13. Recovery of tax etc.:– There arrears of tax, penalty, interest
or any other amount due under this Act, shall be recoverable as an arrear
of land revenue.
14. Appointment of collecting agents:– (1) The Government may,
for carrying out the purposes of this Act, appoint any Government
Department Officer, or Local Authority as its agent (hereinafter called “the
collecting agent”) who shall be responsible for the collection of the tax
under this Act, from such assessees or class of assessees as may be
prescribed and thereupon it shall be the duty of such collecting agent to
carryout the functions under this Act, in such manner as may be prescribed
and to render full and complete account of the tax collected, to the
Commissioner in such manner and at such times as may be prescribed.
(2) The collecting agent and every officer authorised by it in this
behalf shall, for the purpose of collection of the tax, have all the powers
of the assessing authority and also any other powers that may be prescribed.
(3) A local authority appointed as a collecting agent under sub-section
(1), shall be paid such collection charges as may be determined by the
Government.
(4) It shall be lawful for the Commissioner or any Officer duly
authorised by him, to have access to and to require production and
examination of books, registers, accounts or documents maintained or
required to be maintained by the collecting agent shall, whenever called
upon so to do produce such books, registers, accounts or documents
for inspection.
15. Appeals:– (1) Any assessee 1[xxx] aggrieved by any order
passed by 2[any assessing authority] under the provisions of this Act, 3[xxx]
may within thirty days from the date on which the order was served on
him, appeal to the appellate authority:
Provided that the appellate authority may for sufficient cause shown,
admit an appeal preferred after the expiry of the period of thirty days
aforesaid.
4
[(2) No appeal shall be entertained unless 12.5% of the amount
of disputed tax or penalty or interest besides the admitted tax, in full,
is paid.]
5
[(3) The appeal shall be in such form and verified in such manner,
as may be prescribed.]
(4) The appellate authority may after giving the appellant an opportunity
of being heard and subject to such rules of procedure as may be
prescribed:–
(a) confirm, reduce, enhance or annul or otherwise modify the
assessment, penalty or interest as the case may be;
(b) set aside the assessment, penalty or interest as the case may
be and direct the assessing authority to pass a fresh order after
such further inquiry as may be directed ; or
(c) pass such other orders as it may think fit.
(5) Before passing orders under sub-section (4), the appellate authority
may make such inquiry as it deems fit or remand the case to any
subordinate officer or authority for an inquiry and report on any specified
point or points.
(6) Every order passed in appeal under this section shall subject
to the provisions of Section 16 be final.
16. Revision:– 6[(1) The Commissioner may, call for and examine
the record of the proceedings of any order made by the assessing authority,
or, the appellate authority for the purpose of satisfying himself as to the
1. The words "not being an officer of the State Government or the Central Government"
omitted by Act 14 of 2012, w.e.f. 14-5-2012.
2. Subs. for the words "any authority" by Ibid.
3. The words "not being an order passed under sub-section (3) of Section 8" omitted
by Act No. 16 of 2008, w.e.f. 1-1-2008.
4. Subs. by Act No. 16 of 2008.
5. Subs. by Ibid.
6. Subs. by Ibid.
(2) 1[xxx]
(3) The powers of revision shall be exercised within such period
not exceeding four years from the date on which the order was served
on the assessee.
(4) No order which adversely affects any assessee shall be passed
under section, unless such assessee has been given a reasonable opportunity
of being heard.
(5) 2[xxx]
17. Accounts:– (1) If the assessing authority is satisfied that the
books of account and other documents maintained by an assessee in the
normal course of his business are not adequate for verification of the returns
submitted by the employer under this Act, it shall be lawful for the assessing
authority to direct the employer to maintain the books of account or
other documents in such manner as he may in writing direct, and thereupon
the assessee shall maintain such books or other documents accordingly.
(2) Where an assessee wilfully fails to maintain the books or other
documents as directed under sub-section (1), the assessing authority may,
after giving him a reasonable opportunity of being heard, impose a penalty
not exceeding rupees five for each day of delay.
18. Special mode:– (1) Notwithstanding anything contained in law
or contract to the contrary, 3[the Commissioner or the Deputy Commissioner
(CT) or the Commercial Tax Officer or the Deputy Commercial Tax
Officer or the Profession Tax Officer may], by notice in writing, a copy
of which shall be forwarded to the assessee at his last address known
to the assessing authority, require,–
(a) any person from whom any amount of money is due, or may
become due to an assessee on whom notice of demand has been
served under this Act ; or
(b) any person who holds or may subsequently hold money for
or accounts of such assessee, to pay the assessing authority,
1. Omitted by Act No. 16 of 2008, Prior to its omission it read as below:
"No application under sub-section (1) shall be entertained if it is not made within
a period of four months from the date of receipt of the order and unless it is
accompained by a fee calculated at the rate of two per cent of the tax or penalty
under dispute subject to a minimum of rupees one hundred and a maximum of
rupees two thousand."
2. Omitted by Act No. 16 of 2008. Prior to its omission it read as below:
"Where the Commissioner rejects any application for revision under this Section,
he shall record the reasons for such rejection"
3. Subs. for "the Commissioner may" by Act No. 3 of 2003, w.e.f. 1-5-2003
vide G.O.Ms. No. 5 Rev. (CT-III), dt. 3-1-2004, Pub. in A.P.Gazette, Pt. I, (Ext.),
No. 6, dt. 5-1-2004.
either forthwith upon the money becoming due or being held or

at or within the time specified in the notice (but not before
the money becomes due or is held as aforesaid), so much of
the money as is sufficient to pay the amount due by the assessee
in respect of the arrears of tax, penalty or interest under this
Act ; or the whole of the money when it is equal to or less
than that amount.
Explanation:— For the purposes of this section, the amount of
money due to an assessee from, or money held for or on account of
an assessee by any person shall be calculated after deducting therefrom
such claims if any lawfully subsisting, as may have fallen due for payment
by such assessee to such person.
(2) 1[The Commissioner or the Deputy Commissioner (CT) or the
Commercial Tax Officer or the Deputy Commercial Tax Officer or the
Profession Tax Officer may], amend or revoke or any such notice, or
extend the time for making any payment in pursuance of the notice.
(3) Any person making any payment in compliance with a notice
under this section shall be deemed to have made the payment under the
authority of the assessee and the receipt of the assessing authority shall
constitute a good and sufficient discharge of the liability of such a person,
to the extent of the amount referred to in the receipt.
(4) Any person discharging any liability to the assessee after receipt
of the notice referred to in this section, shall be personally liable to the
assessing authority to the extent of the liability discharged or the extent
or the liability of the assessee for the amount due under this Act, whichever
is less.
(5) Where any person to whom a notice under this section is sent
proved to the satisfaction of the assessing authority that the sum demanded
or any part thereof is not due by him (assessee) or that he does not
hold any money for or on account of the assessee, then, nothing contained
in this section shall be deemed to require such person to pay any such
sum or part thereof, as the case be, to the assessing authority.
1. Subs. for "the Commissioner may" by Act No. 3 of 2003, w.e.f. 1-5-2003 vide
G.O.Ms. No. 5 Rev. (CT-III), dt. 3-1-2004, Pub. in A.P.Gazette, Pt. I, (Ext.), No.
6, dt. 5-1-2004.
(6) Any amount of money which a person is required to pay the

assessing authority or for which he is personally liable to the assessing
authority under this section, shall, if it remains unpaid, be recoverable as
an arrear of land revenue.
1
[18.A Special powers of Deputy Commissioner under the
Revenue Recovery Act:– (1) A Deputy Commissioner shall have the
powers of a Collector under the Andhra Pradesh Revenue Recovery Act,
1864 (Act 2 of 1864) for the purpose of recovery of any amount due
under this Act.
(2) Subject to the provisions of sub-section (3), all Deputy Commercial
Tax Officers shall, for the purposes of recovery of any amount due under
this Act, have the powers of the Mandal Revenue Officer under the Andhra
Pradesh Rent and Revenue Sales Act, 1839 (Act VII of 1839) for the
sale of property distrained for any amount due under this Act.
(3) Notwithstanding anything contained in the Andhra Pradesh Rent
and Revenue Sales Act, 1839, the Deputy Commercial Tax Officer in
exercise of the powers conferred by sub-section (2) shall be subject to
the control and superintendence of the Deputy Commissioner.]
19. Recovery of tax where trade, calling etc., of employer is
transferred:– Where the ownership of the profession, trade, calling or
employment of an assessee liable to pay tax is transferred, any tax, penalty
or interest or other amount payable under this Act, in respect of such
business and remaining unpaid at the time of the transfer, may without
prejudice to any action that may be taken for its recovery from the
transferor, be recoverable from the transferee as if he were the assessee
liable to pay such tax, penalty or interest or other amount.
20. Production and inspection of accounts and documents and
search of premises:– Any officer or authority under this Act, may inspect
and search premises, where any profession, trade, calling or employment
liable to tax under this Act, is carried on or is suspected to be carried
on and may require production and examination of books, registers,
accounts or documents relating thereto and may seize such books, registers,
accounts or documents as may be necessary :
Provided that, if the said officer or authority removes from the said
premises any book, register, account or document, he or it shall give to
1. Inserted by Act No. 3 of 2003, w.e.f. 1-5-2003.

the person-in-charge of the place, a receipt describing the book, register,

account or document so removed and retain the same only for so long
as may be necessary for the purpose of examination thereof or for the
prosecution.
21. Refund of excess:– The assessing authority shall refund to the
assessee the amount of tax, penalty; interest or other amount, if any paid
by such assessee in excess of the amount due from him. The refund
may be made either by cash or, at the option of the assessee by deduction
of such excess from the amount of tax, penalty, interest or other amount
due in respect of any other period :
Provided that the assessing authority shall first apply such excess
towards the recovery of any amount due in respect of which a notice
under Section 8 has been served, and shall then refund the balance, if
any.
22. Offences and penalties:– Any assessee who, without sufficient
cause, fails to comply with any of the provisions of this Act or the rules
made thereunder shall, on conviction, be punished with fine which shall
not be less than five hundred rupees but shall not exceed five thousand
rupees, and, when the offence is a continuing one, with fine which shall
not be less than ten rupees but shall not exceed fifty rupees per day
during the period of the continuance of the offence.
23. Offences by companies:– (1) Where an offence under this
Act, has been committed by a company, every person who at the time
the offence was committed was incharge of and was responsible to the
company for the conduct of the 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 :
Provided that, nothing contained in this sub-section shall render any
such person liable to any punishment, 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.
(2) Notwithstanding anything contained in sub-section (1), where any
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 or
is attributable to any neglect on the part of any director, manager, secretary
or other officer of the company, such director, manager, secretary or other
officer shall be deemed to be guilty of that offence and shall be liable

to be proceeded against and punished accordingly.
Explanation:— For the purposes of this section:–
(a) “company” means any body corporate and includes a firm or
other association of individuals ; and
(b) “director” in relation to a firm means a partner in the firm.
24. Power to transfer proceedings:– The Commissioner may,
after giving the parties a reasonable opportunity of being heard, wherever
it is possible so to do, and after recording his reason for doing so, by
order in writing transfer any proceedings or class of proceedings under
any provision of this Act, from himself to any other officer, and he may
likewise transfer any such proceedings (including a proceeding pending
with any officer or already transferred under this section) from any officer
to any other officer or to himself :
Provided that nothing in this section shall be deemed to require
any such opportunity to be given where the transfer is from any officer
and the officers of the both are situated in the same city, locality or place.
Explanation:– In this section, the word “Proceedings” in relation
to any assessee concerned is specified in any order issued thereunder
means all proceedings under this Act, in respect of any year which may
be pending on the date of such order or which may have been completed
on or before such date, and includes also all proceedings under this Act,
which may be commenced after the date of such order in respect of any
year in relation to such assessee.
25. Compounding of offences:– (1) The assessing authority may,
either before or after the institution of proceedings for an offence under
this Act, permit any assessee ; charged with the offence to compound
the offence on payment of such sum, not exceeding five thousand rupees
or double the amount of tax recoverable, whichever is greater.
(2) On payment of such sum as may be determined by the assessing
authority under sub-section (1), no further proceedings shall be taken
against the person in respect of the same offence.
(3) Any order or proceeding recorded by the assessing authority
under sub-section (1), shall be final and no appeal or application for
revision shall lie therefrom.
26. Powers to enforce attendance, etc.:– The Commissioner, and

other authorities under this Act, shall have the same powers as are vested
in a Court under the Code of Civil Procedure, 1908 (V of 1908) while
trying a suit, for the purpose of enforcing the attendance of and examining
any person on oath or affirmation or for compelling the production of
any document.
27. Bar of jurisdiction of Courts:– No Court shall entertain any
suit, or other proceeding to set aside or modify, or question the validity
of any assessment, order or decision made or passed by any other officer
or authority under this Act or the rules made thereunder or in respect
of any other matter falling within its or his scope.
28. Protection of acts done in good faith:– No suit, prosecution,
or other proceedings shall lie against the Government or any officer,
authority or person empowered to exercise the powers and perform the
functions by or under this Act, for anything which is in good faith done
or intended to be done under this Act or the rules or orders made
thereunder.
29. Power to delegate:– The Commissioner may, subject to such
conditions and restrictions as the Government may, by general or special
order impose, by order in writing delegate to any office or authority
subordinate to him, either generally or in respect of any particular matter
or class of matters any of his powers under this Act.
30. Powers to make rules:– (1) The Government may, by
notification, make rules to carry out all or any of the purposes of this
Act.
foregoing power, such rules may provide for the fees payable in respect
of any applications to be made, forms to be supplied, certificates to be
granted and appeals and applications for revision to be made under this
Act and also any applications for certified copies of documents filed and
orders made under this Act.
(3) Every rule made under this Act shall immediately after it is made,
be laid before the Legislative Assembly of the State if it is in session,
and if it is not in session, in the session immediately following for a total
period of fourteen days which may be comprised in one session or in
two successive sessions and if, before the expiration of the session in
which it is so laid or the session immediately following the Legislative
Assembly agrees in making any modification in the rule or in the annulment

of the rule, the rule shall, from the date on which the modification or
annulment is notified, have effect only in such modified form or shall
stand annulled, 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.
31. Power to exempt:– The Government may, by notification, make
an exemption or reduction in the rate of tax payable under this Act by
any specified class of assessees subject to such restrictions and conditions
as may be specified in the notification.
32. Local authorities not to levy profession tax:– Notwithstanding
anything in any enactment, governing the constitution of establishment of
a local authority, no local authority shall, on or after the commencement
of this Act, levy any tax on professions, trades, callings or employments.
33. Amendment of certain enactments:– (1) The enactments
specified in column (2) of the Second Schedule are hereby amended in
the manner and to the extent specified in the corresponding entry in column
(3) thereof :
Provided that, nothing in the said amendment shall affect or be
deemed to affect–
(i) any right, obligation or liability already acquired, accrued or
incurred or anything done or suffered, in respect of any period
preceding the date of coming into force of these amendments;
(ii) any legal proceedings or remedy whether initiated or availed of
before or after the date of coming into force of these amendments,
in respect of any such right, obligation or liability.
(2) The levy, assessment or recovery of any tax or the imposition
or recovery of any penalty in respect of such period, under the provisions
of the relevant enactments and all proceedings under them in respect of
all matters aforesaid shall be initiated and disposed of, or continued and
disposed of, as the case may be, as if this Act had not been enacted.
34. Cesses not to be levied in certain cases:– Notwith-standing
anything in any law for the time being in force no cess shall be levied,
on tax on professions, trades, callings and employments under any such
law and the provisions in such law authorising such levy and collection
shall, on and from the date of commencement of this Act, stand repealed.
35. Grant to local authorities for loss of revenue:– Out of the
proceeds of the tax, penalties, interest or other amounts recovered under
this Act, there shall be paid annually to such local authorities 1[except
Municipalities and Municipal Corporations whose employees are getting
salaries and pensions through Government treasuries] as were levying a
tax on professions, trades, callings and employments, immediately before
the commencement of this Act, such amounts on the basis of the highest
collections of such taxes, penalties and interest made by them in any year
during the period of three years immediately preceding such commencement
as may be determined by the Government in this behalf.
36. Power to remove difficulties:– If any difficulty arises in giving
effect to the provisions of this Act, the Government may, by notification
make such provisions, not inconsistent with this Act, as appears to them
to be necessary or expedient for removing the difficulty.
37. Power to amend First Schedule:– (1) The Government may,
by notification, alter, add to or cancel any items or entry in the First
Schedule.
(2) Where a notification has been issued under sub-section (1) there
shall, unless the notification is in the meantime rescinded, be introduced
in the Legislative Assembly, as soon as may be, but in any case during
the next session of the Legislative Assembly following the date of the
issue of the notification, a Bill on behalf of the Government, to give effect
to the alteration, addition or cancellation as the case may be, of the
alteration, addition or cancellation ; as the case may be, of the said
Schedule specified in the notification and the notification shall cease to
have effect when such Bill becomes law, whether with or without
modifications, but without prejudice to the validity of anything previously
done thereunder :
Provided that if the notification under sub-section (1) is issued when
the Legislative Assembly is in session, such Bill shall be introduced in
the Legislative Assembly during that session :
not become law within six months from the date of its introduction in
the Legislative Assembly, the notification shall cease to have effect on
the expiration of the said period of six months.
(3) All references made in this Act, to any items or entries of the
said Schedule shall be construed as relating to the item of the Schedule
as for the time being amended in exercise of the powers conferred by
this Section.
1. Subs. by Act 10 of 2010.
1
[FIRST SCHEDULE
(See Section 3)
Sl. Classes of Assessees Rate of tax

No. or description Per Month
1 2 3
2
[1. Salary and Wage earners, whose
monthly salaries or wages in rupees
(i) Upto Rs. 5,000/- Nil
(ii) From Rs. 5,001 to Rs. 6,000 60 PM
(iii) From Rs. 6,001 to Rs. 10,000 80 PM
(iv) From Rs. 10,001 to Rs. 15,000 100 PM
(v) From Rs. 15,001 to Rs. 20,000 150 PM
(vi) Above Rs. 20,000 200 PM]
2. Legal Practitioners including Solicitors and Notaries
Public and Technical and Professional Consultants
other than those mentioned elsewhere in the Schedule
and Tax Consultants whose standing in the profession.
(a) In the Hyderabad and Secunderabad Urban
Agglomeration or within the Municipal limits
of District Headquarters/town is:–
(i) Upto three years Nil
(ii) Three to seven years 500/-PA
(iii) Above 7 years 1,000/- PA
(b) In any other area in the State is:–
(i) less than two years Nil
(ii) Two years or more but less than
seven years 300/-PA
(iii) Seven years or more 750/-PA
3. (i) Chief agents, Principal agents, Special agents,
Insurance agents and Surveyors or loss assessors
1. Subs. by A.P. Act No. 29 of 1996, w.e.f. 1-8-1996. Published in A.P. Gazette, Pt.
IV-B, (Ext.) No. 53, dt. 17-10-1996.
2. Subs. by A.P. Act No. 16 of 2008, w.e.f. 1-1-2008.
Sch. I] A.P. Tax on Professions, Trades ... Act, 1987 695
1 2 3
registered or licensed under the Insurance Act,
1938. (Central Act IV of 1938) whose annual
income is not les than 1[Rs. 60,000/-] 550/-PA
(ii) Pigmy Agents or UTI Agents whose annual
income is not less than 1[Rs. 60,000/-] 120/-PA
4. Members of Stock-Exchanges recognised under 2,500/-PA
Security Contracts (Regulation) Act, 1956
Auctioneers, Commission Agents and Del
Credere agents
5. (a) Estate Agents or Brokers 550/-PA
(b) Contractors
(i) Contractors falling in the categories mentioned
below as per the guidelines issued by the
Government from time to time for registration
of contractors.
(a) Class I Contractors 2,500/- PA
(b) Class II Contractors 1,500/- PA
(c) Class III Contractors 500/- PA
(ii) Contractors not falling in sub-category (i)
mentioned above and the amount of works contract
executed by them during a year is–
(a) below rupees ten lakhs 500/-PA
(b) above rupees ten lakhs 1,500/-PA
6. Directors (other than those nominated by the
Government) of Companies Registered
under the Companies Act, 1956. 2,500/-PA
7. (a) (i) Race horse owners and trainers
licensed by the turf clubs. 2,500/-PA
(ii) Jockeys licensed by the turf clubs 550/-PA
(b) Book Makers licensed by turf
clubs of Hyderabad Race Club
or any other Race Club. 2,500/-PA
8. Self-employed persons in the motion picture
industry as follows:–
(a) Writers, Cameraman, still Photographers. 1,500/-PA
(b) Lyricists, directors, actors and actresses 2,500/-PA
(including Junior artists), playback singers,
recordists, editors and producers of films.
1. Subs. for "Rs. 18,000/-" by G.O.Ms.No. 527, Rev. CT-IV, dt. 22-5-2009,
w.e.f. 1-1-2008.
1 2 3
(c) Junior artists, production managers,
assistant directors, assistant cameraman,
assistant recordists, assistant editors,
musicians and dancers: 500/-PA
1
[9. Dealers registered or liable to be registered under
Andhra Pradesh Value Added Tax Act, 2005 (Act
5 of 2005) (other than those mentioned in item
(19) whose total turnover in any year ranges.
(a) Upto Rs. 5,00,000/- Nil
(b) from Rs. 5,00,001/- to 10,00,000/- 800/-PA
(c) from Rs. 10,00,001/- to 25,00,000/- 1200/-PA
(d) from Rs. 25,00,001/- to 50,00,000/- 1500/-PA
(e) from Rs. 50,00,001/- and above 2500/-PA]
10. Occupiers of factories as defined under the
Factories Act, 1948 who are not
covered by item 9 1,000/-PA
11. Employers of establishments as defined under the
Andhra Pradesh Shops and Establishments Act,
1988 such employers of establishments who are
not dealers covered by item 9)
(i) Where there are no employees. Nil
(ii) Where not more than 5
employees are employed. 110/-PA
(iii) where more than 5 but not more
than 10 employees are employed : 400/-PA
(iv) where there are more than 10
employees but not more than
20 are employed. 1,000/-PA
(v) where more than 20 employees
are employed 2,500/-PA
12. (a) Owners or lessees of petrol/diesel
filling stations and service stations
garrage and workshops of automobiles 2,500/-PA
(b) Owners or lessees of Jute Mills, Rice
Mills, Oil Mills, Spinning Mills, Paper
Mills, Dall Mills, Power-looms, Mini Steel
Plants, Rerolling Mills, Khandasari Sugar
1. Subs. by Act No. 4 of 2006, w.e.f. 1-4-2006, pub. in A.P. Gaz. Pt. IV-B, Ext. No.
4, dt. 2-1-2006.
1 2 3
Factories, Sugar Factories, Foundaries,
Tanneries, Stone Crushers, Bottling Units,
Distilleries, Tiles Factories, Biscuit
Factories, Chemicals and Pharma-ceutical
Labs., Printing Presses (With
power) Fruit Canning Units. 2,500/-PA
(c) Owners or lessees of Nursing Home
and Hospital other than those run
by the State or Central Government. 2,500/-PA
(d) Owners or lessees of Pathological
Testing Lab. and X Ray Clinics 550/-PA
(e) Owners or lessees of Beauty Parlours,
Dry Cleaners and Interior Decorators. 550/-PA
(f) Owners or lessees of Oil ghanies (with power),
Oil rotaries (with power) Huller Mills, Cashew
Factories, Decorticating Mills, Saw Mills, Cotton
Ginning or Pressing Factories, Small Flour Mills,
(Working on Hire-Basis) Gum manufacturing units,
Bakeries, Hosiery manufacturing units, Cement
flooring or stone manufacturing units
other than those covered by Entry 9. 1,500/-PA
13.(a) Owners of Residential Hotels or Lodging
Houses having not less than 20 rooms
2,500/-PA
(b) (i) Owners of theatres 2,500/-PA
(ii) Owners of touring talkies 1,000/-PA
(iii) Owners of Video parlours 500/-PA
(iv) Cable TV operators 2,500/-PA
1
[14. Holders of permits of transport vehicles (other
than auto-rickshaws) granted under the
Motor Vehicles Act, 1988, if possesses permit,–
(i) for one vehicle: 750/-PA
(ii) for two vehicles: 1,500/-PA
(iii) for three vehicles: 2,250/-PA
(iv) for more than three vehicles: 2,500/-PA]
15. Money lenders, licensed under the law relating
to money lenders, for the time being in
force in the State.
(a) those who lend rupees fifteen lakhs
and above in a year 2,500/-PA
(b) other than those specified at (a) above 550/-PA
1. Subs. by Act 14 of 2012, w.r.e.f. 2-12-2010.

1 2 3
16. Individuals of institutions conducting Chit Funds 2,500/-PA
17. Co-operative Societies registered under the A.P.
Co-operative Societies Act, 1964 and engaged in
any profession, trade or calling:–
(i) State level societies. 2,500/-PA
(ii) Co-operative Sugar Factories,
Spinning mills, banks 2,500/-PA
(iii) District level societies 330/-PA
(iv) Mandal level societies 220/-PA
1
[(v) Village level societies 150/-PA]
2
[18. Banking Companies as defined in the 2,500/-PA
Banking Regulations Act, 1949: per each
Explanation:– For the purpose of this entry branch/
"banking companies" shall mean and include ATM/exten-
any bank, which come into existence after the sion counter
year 1949 through separate Acts but whose in addition
operations are governed by the provisions of the to the Area
Banking Regulations Act, 1949 (Central Act 10 Office/Zonal
of 1949) irrespective of how the bank(s) Office/Head
came into existence. Office.]
19. All Companies Registered under the
Companies Act, 1956 and engaged
in a profession, trade or calling 2,500/-PA
20. Each partner of a firm engaged in
any profession, trade or calling 500/-PA
20(A) Chartered Accountants where the
standing in profession is:—
(i) Not less than 2 years, but
less than 5 years 550/-PA
(ii) Not less than five years 2,500/-PA
20(B) Medical practitioners including Medical Consultants
(Other than Practitioners of Ayurvedic, Homeopathic
and Unani systems of Medicines) Dentists,
Radiologists, Pathologists and persons engaged in
other similar professions or callings of a Paramedical
nature,–
(a) in Hyderabad and Secunderabad Urban Agglomeration
or other Corporation areas or in special grade,
1. Added by Act No. 7 of 2006, w.e.f. 1-4-2006 (vide G.O.Ms.No. 182, Rev. CT. IV,
dt. 15-2-2006, pub. in A.P. Gaz. No. 109, dt. 28-2-2006.
2. Subs. by Act 14 of 2012, w.r.e.f. 15-6-1987, Prior to its substitution it read as below:
"Banking Companies as defined in the
Banking Regulations Act, 1949– 2,500/-PA"
1 2 3
selection grade and first grade Municipalities where
the standing in profession is:–
(i) less than 2 years Nil
(ii) two years or more but
less than 5 years 1,000/-PA
(iii) five years or more 2,500/-PA
(b) in any other area in the State:–
(ii) two years or more but less
than 5 years 500/-PA
(iii) five years or more but less
than 10 years 1,000/-PA
(iv) ten years or more 1,500/-PA
20(C) Engineers, RCC Consultants, Architects
and Management Consultants.
(a) in the Hyderabad & Secunderabad Urban
Agglomeration or within the Municipal
Limits of the District Headquarters town,
where the standing in profession is:—
than five years 550/-PA
than ten years 1,000/-PA
(b) in any other area in the State is:—
than five years 330/-PA
than ten years 750/-PA
20(D) (a) Film Distributors and travel agents
not falling under sub item (b) below:– 550/-PA
(b) Air travel agents 2,500/-PA
20(E) Journalists 550/-PA
20(F) Advertising Firms/Agencies 2,500/-PA
20(G) Persons using Photocopying machines
for job works 550/-PA
20(H) Video Cassette Libraries 660/-PA
1 2 3
1
[20(I) Educational Institutions and Tutorial
Colleges or Institutes other than those
owned by the State or
Central Government as follows:-
(i) Tutorials running classes upto
7th standard; 750/- PA
(ii) Tutorials running classes upto
10th standard; 1,500/- PA
(iii) Junior Colleges and all other
Educational Institutions and
Tutorial Colleges running
Classes above 10th standard: 2,500/- PA]
20(J) Typewriting institutes/teaching
shorthand and typing 750/-PA
20(K) Persons owning/running STD/ISD
Booths other than those owned run by
Government or physically
handicapped persons 250/-PA
20(L) Property Developers including Land Developers
and Building/Flat Developers 2,500/-PA
20(M) Persons owning/running
(a) Computer institutes selling time 1,000/-PA
(b) Computer Training institutes 2,500/-PA
(c) Driving Institutes/Technical Training
Institutes 500/-PA
20(N) Persons owning Marriage Halls/Kalyana
Mantapams 2,500/-PA
20(O) (a) Cinematograph film processors 2,500/-PA
(b) Owners of outdoor film shooting units 2,500/-PA
20(P) (a) Forest Contractors 750/-PA
(b) Transport Companies and
transport contractors including
forwarding and clearing agents 2[other
than holders of permits of transport
vehicles. 2,500/-PA]

1 2 3
(c) Bankers who are financing the

trade against hundies or other
securities by way of short-term
advance on interest 2,500/-PA
20(Q) (a) Authorised assistants recognised
by stock exchange 550/-PA
(b) Sub-brokers recognised by the

Stock Exchange Board of India 1,000/-PA
(c) Persons running weigh bridges 500/-PA

(d) Persons operating courier service 1,500/-PA
21. Persons, other than those mentioned in

any of the preceding entries, who are
engaged in any profession, trade
or callings or employments 750/-PA
Explanation No. I:– Notwithstanding anything contained in the schedule,

every branch of any self-employed assessee enumerated in items 2 to 21
of the schedule shall be deemed to be a separate assessee for the purpose
of levy of profession tax specified in the schedule.
Explanation No. II:– Notwithstanding anything contained in this schedule,

where an assessee is covered by more than one entry in this schedule, the
highest rate of Tax specified under any of those entries shall be applicable
in his case.
Explanation No. III:– For the purpose of determining the liability the
rate of tax in regard to entries in Serial No. 11 in this Schedule and the
higher number of workers and/or employees at any time during the year shall
be reckoned as the basis.]
CASE LAW
The mere suspension or keeping in abeyance of the enhancement of

tax in regard to a particular employee does not confer any right to invoke
‘equality clause’ under Art. 14 of the Constitution. Fixation of Rs. 2500
as the maximum tax cannot be said to be unjustifiable and discriminatory.
As such the matter does not fall within the writ jurisdiction of the High
Court. ECIL Officers Association v. Government of A.P. and Ors., 1998
(4) ALD 66 = 1998 (3) ALT 749 (DB) = 1998 (2) APLJ 343.
702 Commentary on A.P. Value Added Tax [Sch. II
SECOND SCHEDULE
Sl. Short title, number Amendments
No. of enactments
1 2 3
1. The Hyderabad (a) In Section 197, in sub-section (1) in Clause
Municipal Corporation (i), sub-clause (e) shall be omitted ;
Act, 1955 (Act No. II (b) Section 257 shall be omitted ;
of 1956)
(c) In Sec. 277, in sub-section (1) the words
“or professional tax” shall be omitted;
(d) In Section 278, the words “or profession
tax” shall be omitted ;
(e) Schedule I shall be omitted.
2. The Andhra Pradesh (a) In Section 69 in sub-section (1) Clause
Gram Panchayats Act, (b) shall be omitted ;
(Act No. 2 of 1964)
(b) Section 72 shall be omitted ;
(c) In Section 79, in sub-section (2) in Clause
(i), the words ‘the profession tax’ shall
be omitted ;
(d) In Schedule II—
(i) the words “C-Profession tax Levy of
Maximum and Minimum Rates” and
Rules 14 to 21 shall be omitted;
(ii) In Rule 27, for Clause (b), the
following Clause shall be substituted
namely:-
“(b) the imposition by the executive authority
of tax on any vehicle ; and”
(iii) in Rule 33,—
(a) in sub-rule (2), the expression “Rule
19 or” and the words “Occupation” shall
be omitted.
(b) in sub-rule (3), the expression “Rule 19
or” shall be omitted ;
(iv) in Rule 34, the expression “Rule 19
or” shall be omitted ;
(c) Appendix ‘A’ shall be omitted ;
Sch. II] A.P. Tax on Professions, Trades ... Act, 1987 703
1 2 3
3. The Andhra Pradesh (a) In section 81, in sub-section (1), in Clause

Municipalities Act, (a), sub-clause (ii) shall be omitted ;
1965 (Act No. 6 of
(b) The heading “(ii) Profession Tax, and
1965)
Sections 96 to 102” shall be omitted;
(c) In Section 326 in sub-section (2), in clause
(m), words “profession tax” shall be
omitted.
(d) In Schedule II–
(i) the heading "Assessment of profession
tax" and Rules 17 to 20 shall be omitted.
(ii) in Rule 22, in sub-rule (1), clause (c) shall
be omitted.
(iii) in Rule 25, in clause (a), in sub-clause
(i) for the expression "in Sections 99 and
109" the expression "in Section 109" shall
be substituted.
(iv) in Rule 29, the expression "Section 99 or"
in the two places where it occurs shall
be omitted.
(v) in Rule 30 in sub-rule (1) for the expression
"in Sections 99 and 109" the expression
"in Section 109" shall be substituted.
——
1
THE ANDHRA PRADESH TAX ON
PROFESSIONS, TRADES, CALLINGS AND
EMPLOYMENTS RULES, 1987
[G.O.Ms.No. 556, Revenue (S), dt. 8-6-1987]
In exercise of the powers conferred by Section 30 of the Andhra Pradesh
Tax of Professions, Trades, Callings and Employments Act, 1987 (Andhra
Pradesh Act No. 22 of 1987) the Governor of Andhra Pradesh hereby makes
the following rules:–
1. Short title and commencement:– (1) These rules may be called
the Andhra Pradesh Tax on Professions, Trades, Callings and Employments
Rules, 1987.
(2) They shall come into force on the 15th day of June, 1987.
PART I
2. Definitions:– (1) In these rules unless the context otherwise requires,–

(a) “Act” means the Andhra Pradesh Tax on Professions, Trades,
Callings and Employments Act, 1987;
(b) “Form” means a form appended to these rules ;
(c) “Month” means a calendar month ;
(d) “Place of work” in relation to person or employer, means the place
where such person or employer ordinarily carries on his profession,
trade, calling or employment ;
(e) “Section” means a Section of the Act ;
(f) “Treasury” means a treasury or sub-treasury of the State
Government.
(2) Words and expressions used, but not defined, in these rules shall
have the meanings respectively assigned to them in the Act.
PART II
Registration and Enrolment
3. Grant of certificate of Registration:– (1) An application for a
certificate of registration under sub-section (1) of Section 6 shall be made
in Form-I. An applicant having places of work within the jurisdiction of
different assessing authorities shall make an application for registration separately
to each such authority in respect of his place of work, without the jurisdiction
of that authority.
1. R.S. to Part I (Ext.) A.P. Gazette, dt. 10-6-1987.
704
R. 5] A.P. Tax on Professions, Trades ... Rules, 1987 705
(2)(a) On receipt of an application for certificate of registration the
assessing Authority shall grant to the applicant a certificate of
registration in Form 1-A if he is satisfied that the application is
in order and that the particulars furnished therein are correct and
complete.
(b) If the assessing authority finds that the application is not in order
or all the particulars necessary for issue of the certificate of
registration have not been furnished or that the particulars furnished
are not correct and complete, he shall direct the applicant to file
a revised application or to furnish such additional information as
may be considered necessary. After considering the revised
application and the additional information, if any, and after making
such enquiry as he considers necessary the assessing authority shall
grant a certificate of registration in Form 1-A.
4. Grant of Certificate of Enrolment:– (1) An application for a
certificate of enrolment under sub-section (2) or sub-section (3) of Section
6 of the Act, shall be made in Form II. An applicant having more than one
place of work in the State of Andhra Pradesh whether within the jurisdiction
of the assessing authority or outside such jurisdiction, shall be granted only
on certificate of enrolment.
(2) Where an applicant has more than one place of work within the State
of Andhra Pradesh he shall make a single application in respect of all such
places, name in such applicantion, one of such places as the principal place
of work for the purposes of these rules and submit such application to the
assessing authority in whose jurisdiction the said principal place of work
is situated.
(3) On receipt of an application in Form-II, the assessing authority may
call upon the applicant to furnish such additional information or evidence as
may be necessary for determining the amount of tax payable by him according
to the Schedule to the Act.
(4) After considering the application and such additional information or
evidence as may be furnished and after making such enquiry as he considers
necessary, the assessing authority shall grant a certificate of enrolment in Form
II-A.
(5) Where the applicant has more than one place of work in the State,
as many copies of the certificates shall be issued to him as there are places
of work, in addition to the principal place of work.
5. Amendment of certificate of registration:– Where the holder of a
certificate of registration granted under Rule 3 desires the certificate to be
amended, he shall submit an application for this purpose to the assessing
authority setting out the specific matters in respect of which he desires such
amendment and reasons therefor, together with the certificate of registration,

and such authority may, if satisfied with the reasons given, makes such
amendments as it thinks necessary in the certificate of registration.
6. Amendment of certificate of Enrolment:– (1) The certificate of
enrolment granted under Rule 4 shall remain valid as long as it is not cancelled
under sub-rule (2) of Rule 7.
(2) An application for a revised certificate of enrolment shall be made
in Form-II. On receipt of such application the assessing authority may call
upon the applicant to furnish such additional information or evidence as may
be necessary for determining the amount of tax payable by him according
to the first Schedule to the Act and after determining the amount of tax
payable by the applicant, the assessing authority shall make necessary
amendments in the certificate of enrolment under his dated signature, indicating
the year from which the tax at the revised rate shall be payable.
7. Cancellation of certificate:– (1) The certificate of registration
granted under Rule 3, may be cancelled by the assessing authority after he
has satisfied himself that the employer to whom a certificate was granted
has ceased to be an employer.
(2) The certificate of enrolment granted under Rule 4 may be cancelled
by the assessing authority after he is satisfied that the enrolled person is dead
or his liability to pay tax has ceased.
8. Exhibition of certificate:– The holder of the certificate of registration
or the certificate of enrolment, as the case may be, shall display conspicuously
at his place of work the certificate of registration or the certificate of
enrolment or a copy thereof.
9. Issue of duplicate copy of certificate:– If a certificate of registration
or a certificate of enrolment granted under these rules, is lost, destroyed or
defaced or mutilated or becomes illegible, the holder of the certificate shall
apply to the assessing authority for grant of a duplicate copy of such
certificate. The said authority shall after such verification as may be necessary
to issue to the holder of the certificate a copy of the original certificate,
after stamping thereon the words “Duplicate Copy”.
10. Certificate to be furnished by an employee to his employer:–
The certificate to be furnished by a person to his employer under the second
proviso to Section 5 shall be in Form III or, as the case may be, in
Form IV.
PART III
Returns, Notices and Payment of Tax

1
[11. xxx]
1. Rule 11 omitted by G.O.Ms.No. 171, Rev. (CT-II) Dept., dt. 24-2-2011.

Prior to its omission it read as below:
11. "Commissioner to give a Public Notice:-- The Commissioner shall, in the month
of April every year, give a public notice by publication in the local newspapers having
wide circulation directing all persons liable to pay tax under the Act to get themselves
registered or enrolled, as the case may be (unless they are already registered or enrolled),
and to furnish returns and pay the tax according to provision of the Act and these rules).
12. Returns and assessment:– (1) The return under sub-section (1)
of Section 7 shall be furnished in Form-V 1[along with the payment of tax
due, on or before 10th day of the month succeeding the month for which
the return has to be filed.]
(2) Before an order of assessment is made under sub-section (1) or
under sub-section(3) of Section 8 the assessee shall be afforded a reasonable
opportunity of showing cause against such assessment and for this purpose
he shall be served with a notice in Form-XI.
13. Payment of tax by employers:– An employer shall make payment
of tax and interest and penalty (if any) by deposit of the requisite amount
in the Treasury by Challan in Quadruplicate. The copies marked original and
duplicate shall be returned to the employer duly receipted, of which the copy
marked duplicate shall be submitted by the employer ; other than an officer
referred to in Rule 15 to the assessing authority along with the return prescribed
by Rule 12. An officer referred to in Rule 15 shall forward such receipted
copies of challans marked duplicate to the assessing authority along with
statements prescribed in the said rule.
14. Payment of tax by enrolled persons:– (1) A person enrolled under
sub-section (2) of Section 6 and liable to pay the tax shall make payment
of tax within the period prescribed in Section 10 by paying the requisite amount
into the Treasury by Challan in Quadruplicate. The copies marked original
and duplicate shall be returned to the person duly receipted of which the
copy marked duplicate shall be submitted by him to the assessing authority
as proof of payment of tax.
(2) Where payment of tax, interest and penalty (if any) if required to
be made to a Collecting Agent appointed under Section 14 such payment
shall be made within such time as may be notified by means of a paying-
in-slip-duly filled in Form VI in duplicate.
(3) The Collecting Agent shall credit to the treasury by challan in
Quadruplicate on or before the 10th of each month the amount of tax, interest
and penalty collected by him during the preceding month under sub-rule (2)
and forward the receipted copy of the challan marked duplicate to such
authority as may be specified by the Commissioner along with a statement
of collection in Form VII signed and verified by him.
15. Deduction of Tax Amount from the salary or wages of
Employees:– (1) The drawing and disbursing officer shall be responsible
for the deduction of due amount of tax from the pay bill of the
employees. The deduction shall be made every month, and the pay of
wages of such an employee for the month of February shall not be
permitted to be drawn unless the cash for the period from March to
February or part thereof or from the month in which the employee
has attracted liability to pay the tax to February, as the case may be,
has been fully deducted and a statement showing such deduction has
1. Added by G.O.Ms.No.1629, Rev. (CT-IV), dt. 17-8-2011.

been enclosed with the pay bill. The drawing and disbursing officer, shall
furnish to the assessing authority not later than the 30th April, a statement
relating to the payment of salary made to the Government Servant along with
a certificate that the tax payable in respect of the employees for whom they
drew during the year immediately preceding has been deducted in accordance
with the provisions of the First Schedule to the Act. Such statement shall show
the name of the employee, the details of salary drawn, the amount of tax
deducted therefrom and the period to which the tax relates.
(2) Notwithstanding the provisions contained in Rule 13 and sub-rule
(1) of this rule the liability of an employee to pay the tax shall not cease
until the due amount of tax in respect of him has been fully paid to the
Government account, and without prejudice to the aforesaid provisions, the
said amount may be recovered from him if the employer or the assessing
authority is satisfied that the amount has not been deducted from his salary
or wages.
16. Notice under Sections 6(6), 7(3) and 8(6):– The notice under sub-
section (6) of Section 6, under sub-section (3) of Section 7 or sub-section(1)
or sub-section (3) of Section 8, shall be issued by the assessing authority
in Form VIII.
17. Notice under Section 6(5) and Section 12:– The notice under sub-
section (5) of Section 6 or under Section 12 shall be issued by the assessing
authority in Form IX.
18. Notice of demand under Section 8(4) etc.:– The notice of demand
under sub-section (4) of Section 8 and other demands ; including any penalty
or interest imposed under the Act, shall be issued by the assessing authority
in Form X.
19. Collecting Agents to maintain an account of collection of tax
etc.:– Every Collecting Agent shall maintain proper accounts of the tax and
other amounts collecting by him under the Act. He shall also maintain a register
in Form XVII in which he shall enter the tax and other amounts as and when
collected.
20. Employer to keep account of deduction of tax from salary of
the employees:– Every employer liable to pay tax shall maintain a register
in which shall be entered the amount of salary and wages paid to each of
the person in his employ and the said register shall contain a column in which
shall be shown the amount deducted from the salary and wages of the employee
on account of the tax.
PART IV
Appeals and Revision
21. Appeal to the Appellate Deputy Commissioner:— (1) Subject to
the provision of sub-section (1) of Section 15, any person aggrieved by an
order passed or proceeding recorded under the provisions of the Act may
prefer appeal to the Appellate Deputy Commissioner of the area concerned:
Provided that when an appeal pending before an Appellate Deputy
Commissioner is transferred to another Appellate Deputy Commissioner under
Section 24, the order of such transfer shall be communicated to kthe appellant
or petitioner, to every person affected by the order, the authority against whose
orders the appeal or petition was preferred and to the Appellate Deputy
Commissioner.
(2)(i) Every such appeal shall be in Form XII and verified in the manner
specified therein.
(ii) It shall be in duplicate.
(iii) 1[xxx]
(3) The appeal may be sent to the Appellate Authority by registered
post or be presented to that authority or to such officer the Appellate Authority
may appoint, in this behalf by the appellant or by his authorised agent or
a legal practitioner.
(4) The Appellate Authority shall after giving the appellant a reasonable
opportunity of being heard, pass orders as laid down in sub-section (4) of
Section 15.
22. 2[xxx]
PART V
Miscellaneous
23. Action for default by an Enrolled Person:— If a person, liable
to pay tax has wilfully failed to get himself enrolled, then without prejudice
to the action that may be taken against him under sub-section (5) of Section
6, the assessing authority shall after giving that person a reasonable opportunity
of being heard and after such enquiry, as may be deemed fit, or otherwise,
assess the tax due to the best of its judgment and serve on him a notice
of demand in Form XIV to pay the tax within fifteen days of receipt of
the notice. Notice of hearing in such a case shall be issued by the assessing
authority in Form XIII. The notice under sub-section (6) of Section 6 in
respect of persons liable for enrolment shall also be in Form XIII.
24. Interest on Tax, if failure to deduct or fails to pay the Tax:– If
the assessee does not deduct the tax at the time of payment of salary or
1. Rule 21(2)(iii) omitted by G.O.Ms.No. 235, Rev. CT-IV, dt. 27-2-2007, Pub. in A.P.
Gaz. RS to Pt. I Ext. dt. 5-3-2007. Prior to its omission it read as below:
"(iii) A Treasury Challan in support of having paid the fee calculated at the rate of
two percent of the tax, penalty or interest under dispute subject to a minimum of
rupees fifty and maximum of rupees one thousand."
2. Rule 22 omitted by G.O.Ms.No. 1195, Rev. CT-IV, Dept. dt. 25-11-2009, Prior to
its omission it read as below:
"Revision to the Commissioner:– An application for revision under Section 16 shall
be made in Form XII and accompanied by a Treasury Challan in support of having
paid the fee calculated at the rate of two per cent of the tax, penalty or interest under
dispute subject to a minimum of rupees one hundred and maximum of rupees two
thousands."
wages after deducting, fails to pay tax or if an enrolled person fails to pay the
tax as required by or under the Act, he shall pay in addition to the amount of
such tax, interest at the rate of 1[one rupee] for every one hundred rupees of
part thereof for every month or part thereof from the day/date specified for its
payment.
25. Rectification of mistakes:– Any assessing, appellate or revisional
authority may, at any time within four years from the date of any order
passed by him rectify any clerical or arithmetical mistake apparent on the
record :
Provided that no such rectification which has the effect of enhancing
as assessment or any penalty or fee shall be made unless the assessing,
appellate or revisional authority has given notice to the assessee of his intention
to do so and has allowed him a reasonable opportunity of being heard.
(2) Any order passed under sub-rule(1) shall be deemed to be an order
passed under the same provision of law under which the original order, the
mistake in which was rectified, has been passed.
26. Shifting of place of work:– (1) If the holder of a certificate of
registration or a certificate of enrolment in one area shifts his place of work
to another area, he shall within fifteen days of such shifting, give notice
thereof to the assessing authority from whose office the certificate was issued,
and shall, at the same time, send a copy of such notice, etc., to the assessing
authority exercising jurisdiction over the area to which the place of work
is being or has been shifted.
(2) With effect from the commencement of the month immediately
succeeding that in which the notice is given, the assessing authority having
jurisdiction over the area to which the place of work has been shifted shall
exercise all powers and discharge all functions pertaining to the determination
and recovery of tax, and matters ancillary thereto, in respect of the sender
of such notice.
27. Service of notices:– (1) Notices under the Act or the rules made
thereunder may be served by any of the following methods, namely:—
(i) by delivering or tendering a copy of the notice to the addressee
or any adult member of his family residing with him or to a
person regularly employed by him ; or
(ii) by Registered post :
Provided that, if upon an attempt having been made to serve any such
notice by any of the above mentioned methods the authority under whose orders
the notice was issued is satisfied that the addressee is keeping out of the way
for the purpose of avoiding service or that for any other reasons, the notice
cannot be served by any of the above mentioned methods, the said authority
shall order the service of the notice to be effected by affixing a copy thereof
on some conspicuous part of the addressee’s place of work or residence last
1. Subs. for "two rupees" by G.O.Ms.No. 235, Rev. CT-IV, dt. 27-2-2007.
notified by him and such service shall be deemed to have been made on the
addressee personally.
(2) When the serving officer delivers or tenders a copy of the notice
to the addressee personally or to any of the persons referred to in Clause (i)
to sub-rule (1), he shall require the signature of the person to whom the copy
is so delivered or tendered to an acknowledgement of service endorsed on
the original notice.
(3) When the notice is served by affixing a copy thereof in accordance
with the sub-rule (1) the serving officer shall return the original to the authority
which issued a notice with a report endorsed thereon or annexed thereto stating
that he so affixed the copy, the circumstances under which he did so and
the name and address of the person, if any, by whom the addressee’s place
of work or residence is or was located was identified and in whose presence
the copy was affixed. The serving officer shall also obtain the signature or
thumb impression of the person identifying the addressee’s place of work or
residence to him report.
(4) The authority under whose orders the notice was issued shall, on
being satisfied from the report of the messenger or the postal acknowledgement
or by taking such evidence as he deems proper that the notice has been served
in accordance with the rule, record the fact and make an order to that effect.
(5) If the authority is not satisfied that the notice has been properly served,
he may after recording an order to that effect, direct the issue of a fresh notice.
28. Grant of Copies:– (1) If any assessee wants to have a certified copy
of a document filed by him or of an order concerning him passed by any
authority, he shall make to the authority concerned an application bearing
adhesive Court-fee stamp of the value of rupee one and twenty-five paise for
a copy which he desires to be supplied within two days of his applying for
the same.
(2) On receipt of the application, the said authority shall inform the
applicant of the amount of the Court-fee stamps required under the provisions
of sub-rule (3) for supply of the copy. After the requisite amount of Court-
fee stamp is furnished by the applicant the said authority shall cause a certified
copy of the document or order to be prepared and granted to the applicant.
(3) Additional fee in the shape of Court-fee stamp shall be payable for
the grant of copies at the rates given below:
(a) Copy for the first 200 words Seventy-five paise
or less of the documents.
(b) For every additional 100 words Forty paise or fraction thereof.
29. Refund of Tax:— Every claim for refund under Section 21 of the
Act, shall be made to the assessing authority in Form XV and shall be verified
in the manner specified therein.
712 Commentary on A.P. Value Added Tax [F. I
FORM-I
[See Rule 3(1)]
Application for Registration
To
The Professional Tax Officer,
I hereby apply a certificate of Registration under the above mentioned Act
as per particulars given below:
(PLEASE TYPE OR USE BLOCK LETTERS ONLY)

Name of the Applicant.
Address Building Street Road
Municipal Ward
Town/City Pin Code
Taluk District
Status of person signing this form
Put () mark below the heading whichever is applicable.
Proprietor Partner Principal Agent Manager Director Secretary

Officer
Class of Employer
Put () mark below the heading whichever is applicable
Individual Firm Company Corporation Society Club Association
If registered under the APGST Act, 1957/Central Sales Tax Act, 1959 the
numbersof registration Certificates held:–
A.P.G.S.T. R.C.No. C.S.T. R.C.No.
Names and addresses of other places of work, if any, in Andhra Pradesh
Name Address
1.
2.
3.
4.
F. IA] A.P. Tax on Professions, Trades ... Rules, 1987 713
The above statements are true to the best of my knowledge and belief.
Date Signature Status
(For Office use only)
Registration Certificate No.
Signature of the Officer issuing
the certificate.
Acknowledgement
(Particulars of name and address to be filled in by the applicant)
Received an application for registration in Form I :
Name of the Applicant:
Full Postal Address:
Date:
Receiving Officer’s Signature
1
[FORM I-A
[(See Rule 3(2)]
Certificate of Registration
Office of CTO ...........................................................................................
Date :
Employer Name :
Main Profession :
Sl.No. Salary Slab (Rs.) No. of Employees
1. 5,001 to 6,000
2. 6,001 to 10,000
3. 10,001 to 20,000
4. 20,001 and above
Postal Address :
Street/Road Number :
Locality :
City :
Mandal :
District :
PIN :
Mobile Number : +91
Email :
Effective Date of Registration :
The holder of this Certificate shall abide by all the provisions of Andhra Pradesh
Tax on Professions, Trades, Callings and Employments Act, 1987 and the Rules
framed there under as amended from time to time.
Date : Signature of Competent Authority.]
1. Subs. for Form 1-A by G.O.Ms.No.721, Rev. (CT-IV), Dept., dt. 30-7-2010,
w.e.f. 3-8-2010.
714 Commentary on A.P. Value Added Tax [F. II
FORM II
Application for Certificate for Enrolment/Revision of Certificate of
Enrolment under the Andhra Pradesh Tax on Professions, Trades,
Callings and Employments Act, 1987
[See Rules 4(1) and 6(2)]
To
The Professional Tax Officer,
...........................................
I hereby apply for a certificate of enrolment/revision of certificate of
enrolment under the above mentioned Act as per particulars given below:
1. Name of the applicant
2. Full Postal Address
3. Date of birth and Age
4. Profession, Trade or Calling
5. Period of standing in profession in
years and months
6. Numbers of other places of works
(Please give the address of the places)
7. Annual turnover of all sales/purchases
*8. Number of workers engaged in the factory
*9. Number of employees in the establishment
*10. If Co-operative Society whether State Level,
District Level or Mandal Leval
*11. Number of Vehicles for which permit under M.V. Act is held:
2 wheelers
Trucks and
Buses
Total :
*12. Enrolment No. of previous certificate, if any
*13. If registered under APGST
Act 1957/CST Act, 1956 the No. of registration
certificates held
APGST Act, 1957
CST Act, 1956
F. IIA] A.P. Tax on Professions, Trades ... Rules, 1987 715
*14. Grounds on which revision is sought:
The above statements are true to the best of my knowledge and belief.
Dated:
Signature with status.
*Please fill up whichever is applicable.
For Office Use Only
Enrolment No.
Date of Enrolment Signature of Issuing Officer.
Acknowledgement
(Particulars of name and address to be filled by applicant)
Received an application for enrolment in Form
from
Name : Application No.
Address: Date:
Signature of Receiving Officer.
——
1
[FORM II-A
[See Rule 4(4)]
Certificate of Enrolment
Office of CTO ............................................................................................

Date :
Professional's Name :
Main Profession :
Commencement of Profession (Year) :
Postal Address :
Street/Road Number :
Locality :
City :
Mandal :
District :
PIN :
Mobile Number : +91
1. Subs. for Form II-A by G.O.Ms.No.721, Rev. (CT-IV), Dept., dt. 30-7-2010,
w.e.f. 3-8-2010.
716 Commentary on A.P. Value Added Tax [F. III
Email :
Effective Date of Enrolment :
The holder of this Certificate shall abide by all the provisions of Andhra Pradesh
Tax on Professions, Trades, Callings and Employments Act, 1987 and the Rules
frramed there under as amended from time to time.
Date:
Signature of Competent Authority]
——
FORM-III
[See Rule 10]
Certificate to be furnished by a person to his employer
I, .............................................. (Name) .......................... (Address)

hereby certify that I am engaged in the profession/trade/calling of
............................ specified in the ................................ Schedule I appended
to the Andhra Pradesh Tax on Professions, Trades, Callings and Employments
Act, 1987 and that the rate of tax payable by me under the said entry, namely
Rs. ..................... per annum is more than the rate of tax payable by me under
Entry I in the said schedule in respect of employment with
(Name of the employer)
..............................................................................................................
(his address)
I also certify I shall get myself enrolled and shall pay the Tax/I have got
myself enrolled under enrolment certificate.
No. ................. dated ............................................... and I have paid the tax/
shall pay the tax.
Place :
Date :
(Signature)
——
Note:— Strike out whichever is not applicable.

F. V] A.P. Tax on Professions, Trades ... Rules, 1987 717
FORM IV
[See Rule 10]
Certificate to be furnished by person who is simultaneously engaged in
employment of more than one employer
I, ........................................................ hereby certify that I am engaged in
employment with the following employers, namely:—
Name of the Employer Address of the Employer
1.
2.
3.
4.
5.
and that I shall get myself enrolled and I shall pay the tax
I have got myself enrolled and have paid the tax shall
I hold the enrolment Certificate No................................... pay the tax
Dated:
Place: Signature
——
FORM-V
[See Rule 12]
Returns of tax payable by employer under sub-section (i) of
Section 7 of the Andhra Pradesh Tax on Professions, Trades,
Callings and Employments Act, 1987
Return of tax payable for the month ending on
Name of the employer
Address
Number of employees during the month in respect of whom the tax is payable
is as under:
Employees whose monthly salaries Number of Rate of Tax Amount of

or wages or both are employees. per month Tax deduction.
(i) Does not exceed Rs. 1,000

(ii) Exceeds Rs. 1,000 but does
not exceed Rs. 1,250
(iii) Exceeds Rs. 1,250 but does
(iv) Exceeds Rs. 1,500 but does
not exceed Rs. 1,750/-
(v) Exceeds Rs. 1,750 but does
718 Commentary on A.P. Value Added Tax [F. V
(vi) Exceeds Rs. 2,000 but does
(vii) Exceeds Rs. 2,250
Total Rs.
Add Simple interest payable (if any) on the above amount
at two per cent per month or part thereof (Vide Section
II of the Act).
Grand Total Rs.
Amount paid under Challan Rs. ................... Dated ...................... .

I certify that all the employees who are liable to pay the tax in my employ
during the period of return have been covered by the foregoing particulars. I
also certify that the necessary revision in the amount of tax deductible from the
salary or wages of the employees on account of variation in the salary or earned
by them has been made wherever necessary.
I, Shri ................................................. solemnly declare that the above
statements are true to the best of my knowledge and belief.
Place Signature
(Employer)
Date Status
(For Official use)
The return is accepted on verification

Tax assessed Rs.
Tax paid Rs.
Balance Rs.
Assessing Authority
Note:- Where the Return is not acceptable, separate order of assessment

should be passed.
——
F. VI] A.P. Tax on Professions, Trades ... Rules, 1987 719
FORM VI
[See Rule 14 (2)]
ORIGINAL
(For the Payer)
Paying in slip for making payment to the Collecting Agents. The A.P.
Tax on Professions, Trades, Callings and Employments Act, 1987
Paying in slip for tax, interest, penalty and composition money paid to
............................................................................. .
(Name of the Collecting Agent)
for the period from
By whom tendered.
Payment on Amount
account of (in figures)
Rs. Ps.
.........................................................
Name and address of the person in whose
behalf the money is paid (a) Tax
(b) Interest
(c) Penalty
(d) Composition money
Total
Enrolment Certificate No.
Rupees (in words)
Date: Signature
(To be used by the Collecting Agent)

Received the payment of Rupees (in figures)
Rupees (in words)
Date:
Slip No. Receiving Officer.
——
720 Commentary on A.P. Value Added Tax [F. VIII
FORM VII
[See Rule 14 (3)]
Receipt for the amount of tax, interest and penalty under the Andhra
Pradesh Tax on Professions, Trades, Callings and Employments Act,
1987 credited to the Government Treasury by the Collecting Agent
Name of the Collecting Agent
Address of the Collecting Agent
Statement for the month of
Sl. No. Name and address Name of enrol- The period to Amount
of the person from ment certificate which the
whom the amount of the person payment
was collected relates
1 2 3 4 5
Total Rs.
(Rupees )
Credited to ......................... (Treasury) under Challan No. .........)
dated ............................... Certified that the above particulars are true to the best
of my knowledge and belief.
Place Signature
Date Designation
——
FORM VIII
(See Rule 16)
Notice for hearing to an employer under sub-section (6) of Section 6,
sub-section (3) of Section 7, sub-section (1) or sub-section (3) of Section
8 of the Andhra Pradesh Tax on Professions, Trades, Callings and
Employments Act, 1987
To
......................................
.......................................
(of any)
F. IX] A.P. Tax on Professions, Trades ... Rules, 1987 721
(a) Whereas being liable to registration you have deliberately given,
false information in your application under Section 6.
I hereby give you notice to attend in person or through an authorised
representative and show cause why a penalty not exceeding rupees one thousand
should not be imposed upon you under sub-section (6) of Section 6.
(b) Whereas I am not satisfied that the returns furnished by you for
the month/period is/are correct and complete.
representative, along with the accounts, papers and other evidence in support
of your return(s).
(c) Whereas you have wilfully failed to get yourself registered/having
been registered you have failed to file the return(s) within the required
time for the month/period.
representative and show cause why a penalty not exceeding rupees five for each
day of delay should not be imposed upon you.
representative along with the accounts and other evidence relating to your
employees and the monthly gross expenditure, incurred over the disbursement
of salaries and wages to them.
Please taken notice ex-parte orders may be passed in the event of default
to appear personally or through an authorised representative on ........... at
.................. .
(Seal) Signature
Place: Designation
——
FORM IX
[See Rule 17]
Notice for showing cause under sub-section (5) of Section 6 or Section
12 of the Andhra Pradesh Tax on Professions, Trades, Calling, and
To
........................................
........................................
........................................
(Address)
722 Commentary on A.P. Value Added Tax [F. X
Whereas being a registered employer/enrolled person, you have failed to

pay tax within the required time.
You are hereby given notice to show cause why a penalty of Rs....... should
not be imposed on you according to Law.
Whereas being liable to registration enrolment under Section 6 of the A.P.
Tax and Professions, Trades, Callings and Employments Act,
1987, you have failed to apply for a certificate of Registration Enrolment within
the required time:
You are hereby given notice to show cause why a penalty not exceeding
Rs. 29,000/-, Rs. 5.00 for each day of delay should not be imposed on you
according to law.
Please take notice that the cause shown by you will be heard by the
undersigned on ...................... at ......................
Seal:
Place: Signature
Date: Designation
——
FORM X
[See Rule 18]
Notice of demand for payment of tax, interest, penalty under
the Andhra Pradesh Tax on Professions, Trades Callings
and Employments Act, 1987
To
Enrolment Certificate No. Please take notice that
Whereas your Assessment
Appeal
Revision
Rectification
Penalty
Proceedings for the period ..................... has been duly disposed of under
section/under rule ....................... you are hereby directed to deposit the following
amount in the Government Treasury within 15 days of receipt of the notice :
(i) Tax assessed Rs. Ps.
(ii) Interest payable, if any
(iii) Penalty, if any
Total
F. XI] A.P. Tax on Professions, Trades ... Rules, 1987 723
Less amount already paid, if any
Net Demand/Excess Amount in words
(Seal)
Place :
Date :
Signature
Designation
——
FORM XI
(See Rule 12 (2)]
Proposition Notice
Office of
Dated
To
M/s
Whereas you have failed to comply with the terms of the Notice in Form
VIII served upon you/whereas in the opinion of the undersigned the accounts
and papers produced by you in response to the notice in Form VIII are incorrect
or unreliable, it is proposed to assess the tax payable by you to the best of
judgment as follows:
(a) Reasons for non-acceptance of return (specify)—
(b) Basis of the proposed assessment (specify)—
You are hereby called upon to show cause against the proposed assessment
adducing evidence, if any, either in person or through a legal practitioner or an
agent authorised in writing at ......................... failing which it will be presumed
that you have no objection to the proposed assessment and orders deemed fit
will be passed.
Place :
Dated :
Assessing Authority.
——
724 Commentary on A.P. Value Added Tax [F. XII
FORM XII
[See Rules 21 1[xxx]]
Appeal/2[xxx] Application against an order of assessment
appeal penalty interest
To
I hereby appeal 3[xxx] and furnish the necessary particulars :
(i) Registration Certificate No. ............................. Enrolment Certificate
No. ................................
(ii) Name of the Employer or Status
(iii) Style of Profession, Trade, Calling, etc.
(iv) Location and address
(v) Period involved under impugned orders against which Appeal 2[xxx]
is preferred i.e., from
(vi) (a) Name of the authority who passed the impugned order4
(b) Date of passing of the impugned order
(c) Date of Service of Notice of Demand
(d) Amount of
(i) Tax
(ii) Penalty
(iii) Interest
Total
(e) Amount of admitted Tax
(f) Amount paid
(i) Tax
(ii) Penalty
(iii) Interest
(g) Amount in dispute
Grounds
The above statement is true to the best of my knowledge and belief and
the tax, penalty and interest payable by me has been paid in full.
Place: Signature
Date: Status
Note:— (1) The Appeal 2[xxx] application accompanied by the order
appealed 2[xxx] against in original or by a certified copy thereof unless the
omission to produce such order or copy is explained to the satisfaction of the
appellate 2`[xxx] authority.
1. The figures "& 22" omitted by G.O.Ms.No. 1195, Rev. CT-IV, Dept., dt. 25.11.2009.
2. The word "Revision" omitted by Ibid.
3. The words "apply for revision" omitted by Ibid.
4. A original certified copy of the impugned order is attached.
F. XIII] A.P. Tax on Professions, Trades ... Rules, 1987 725
(2) The appeal 1[xxx] should be written in English and should setforth
concisely and under distinct heads the grounds should be numbered consecutively.
(3) (i) The appeal 1[xxx] shall be in duplicate.
(ii) The appeal shall be accompanied by a Treasury Challan in support
of having paid the fee calculated at the Rate of Rs. 20/- of the
tax, penalty, or interest under dispute, subject to a minimum of Rs. 50
and maximum of Rs. 1,000/-.
(iii) 2[xxx]
FORM XIII
[See Rule 23]
Notice of hearing under Rule 23, of the Andhra Pradesh Tax on
Professions, Trades, Callings and Employments Rules, 1987 to a
person who has failed to get himself enrolled
To
*(a) Whereas I am satisfied that you are liable to payment of tax and
enrolment under Section 6(2) of the Andhra Pradesh Tax on Professions, Trades,
Callings and Employments Act, 1987 ;
And whereas you have failed to get yourself enrolled and to pay the tax
due from you ;
You are hereby given notice to appear in person or through an authorised
representative on ............................ at ....................... before the undersigned
with accounts, registers, documents and other evidence as have been maintained
by you.
*(b) Whereas I am satisfied that being liable to enrolment you have
deliberately given false information in the application submitted under Section
6 ;
You are hereby given notice to appear in person or through an authorised
representative on ......................... at ............................. before the undersigned
and show cause why a penalty not exceeding rupees one thousand should not
be imposed upon you.
Place: Signature
Date: Designation
*Strike off whichever is not applicable.
——
1. The words "Revision" omitted by G.O.Ms.No. 1195, Rev. CT-IV, Dept., dt. 25.11.2009.
2. Clause (iii) omitted by G.O.Ms.No. 1195, Rev. CT-IV, Dept. dt. 25.11.2009, Prior
to its omission it read as below:
"An application for revision shall be accompanied by a Treasury Challan in support
of having paid the fee calculated at the rate of 2/- of the tax, penalty or interest under
dispute, subject to a minimum of Rs. 100/- and maximum of Rs. 2,000/-."
726 Commentary on A.P. Value Added Tax [F. XV
FORM XIV
[See Rule 23]
Notice of demand under Rule 23 of the Andhra Pradesh Tax on
Professions, Trades, Callings and Employments Rules, 1987 to a person
who has failed to get himself enrolled
To
(Address)
Whereas the proceedings against you under Rule 23 have been disposed
................................. and an amount of tax of Rs. ...............
........................................... has been assessed as payable by you in respect of
the period ..................................
You are hereby directed to pay the said amount within a period of 15 days
of the receipt of this notice, failing which appropriate action will be taken against
you for the recovery of the amount.
(Seal)
Place: Signature
Date: Designation
——
FORM XV
(See Rule 29)
Claim for Refund
1. Name of the Claimant.
2. If refund is sought in pursuance of an order
of assessment.
(i) No. and date of order of assessment.
(ii) Date of notice of final assessment and
refund order.
(iii) Date on which the notice of final
assessment and refund order was
served on the dealer.
(iv) Amount of refund ordered.
3. If refund is sought in pursuance of an
order passed in appeal or revision.
(i) No. and date of order of the appellate
or revisionary authority.
F. XVI] A.P. Tax on Professions, Trades ... Rules, 1987 727
(ii) Date of revised notice of final
assessment and order of refund.
(iii) Date on which notice of final
assessment and order of refund was
served on the dealer.
(iv) Amount of refund due.
Signature of the Claimant.
Signature of the Authorised Representative, if any;
Verification
I/We .............................. the claimant(s) do hereby declare that what is
stated herein is true to the best of my/our knowledge and belief.
Verified today the ............................... day of ............. 19 ..............
Signature of the Claimant.
Signature of the Authorised Representative, if any.
Note:- This should be accompanied by the order of assessing, appellate
or revisional authority in pursuance of which the claim is preferred.
——
FORM XVI
[See Section 9 and Rule 25]
Notice to an employer or a person when it is proposed to pass an
order which affects him adversely under Section 9 of the Andhra
Pradesh Tax on Professions, Trades, Callings and Employments Act,
1987 and Rule 25 of the Andhra Pradesh Tax on Professions, Trades,
Callings and Employments Rules, 1987
To
......................................
......................................
Registration Certificate No. Enrolment Certificate No. .................. Whereas
it appears that in the ................... order dated the ............................... passed
given by ......................... for the period from .................... to .................... in your
case there is the following mistake, namely:–
Whereas it has notified that you have been under assessed to the tax payable
by you the A.P. Tax on Professions, Trades, Callings and Employments Act,
1987, for the period from .................... to .............. under the order passed on
............................... .
728 Commentary on A.P. Value Added Tax [F. XVII
You are hereby given notice under Section 9 of the said Act/ Rule
25 of the said Rules that if you wish to prefer any objection against the proposed
revision/rectification, you should attend either personally or through an authorised
representative at the office of the undersigned at ..................... or .......................
day of (place).
List of the revision/rectification proposed to be made:
(Seal)
Place: Signature
Date: Designation
——
FORM XVII
[See Rule 19]
Registration of Collection to be maintained by a Collection
Agent under the Andhra Pradesh Tax on Professions,
Trades, Callings and Employments Act, 1987
Date Name of the Number of Amounts Whether Period
person from the enrol- collected tax, interest which the
whom the tax ment certifi- or penalty payment
or other cate of the relates
amount is person from
collected whom
collection
is made.
1 2 3 4 5 6
——
NOTIFICATIONS
1. The Andhra Pradesh Tax on Professions, Trades, Callings and
Employments Act, 1987 – Commencement of the Act and Appointment
of Officers.
1
[G.O.Ms.No. 557, Revenue (s), dt. 8-6-1987]
I. In exercise of the powers conferred by sub-section (3) of Section 1
of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments
Act, 1987 (Andhra Pradesh Act No. 22 of 1987), the Governor of Andhra
Pradesh hereby appoints the 15th day of June, 1987, as the date on which
all the provisions of the Act shall come into force.
II. In exercise of the powers conferred by sub-section (1) of Section
3 of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments
Act, 1987 (Andhra Pradesh Act No. 22 of 1987), the Governor of A.P. hereby
appoints the Commissioner of Commercial Tax as the Commissioner of
Profession Tax to exercise the powers, perform the functions conferred or
entrusted to him by or under the Act.
III. In exercise of the powers conferred by sub-section (2) of Sec. 3
of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments
Act, 1987 (Andhra Pradesh Act 22 of 1987), the Governor of A.P. hereby
appoints the Deputy Commerical Tax Officers to exercise the powers, and
perform the functions on an assigning authority under the said Act and the
rules made thereunder within their respective jurisdictions as notified under
the Andhra Pradesh General Sales Tax Act, 1957 (Andhra Pradesh Act No.
VI of 1957.)
IV. In exercise of the powers conferred by sub-section (2) of Section
3 of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments
Pradesh hereby appoints the Appellate Deputy Commissioners of Commerical
Taxes to exercise the powers of the appellate authority under Section 15 of
the said Act in their respective jurisdiction as notified under the Andhra Pradesh
General Sales Tax Act, 1957 (Andhra Pradesh Act No. VI of 1957).
V. In exercise of the powers conferred by sub-section (2) of Section
3 of the A.P. Tax on Professions, Trades, Callings and Employments Act,
1987 (Andhra Pradesh Act No. 22 of 1987) the Governor of Andhra Pradesh
hereby appoints the Joint Commissioners of Commercial Taxes, Deputy
Commissioners of Commercial Taxes, Assistant Commissioners of Commercial
Taxes, Commercial Tax Officers, and Assistant Commercial Tax Officer to
exercise the powers and perform the functions of inspections audit of accounts
etc., under the said Act and such other functions as delegated by the
1. Published in A.P. Gazette, Part I (Ext.), dt. 10-6-1987 No. 449.
729
Commissioner of Profession Tax within their respective jurisdictions as notified

under the A.P. General Sales Tax Act, 1957 (A.P. Act No. VI of 1957).
1A. Exemption from payment of Profession Tax by totally blind
persons under the A.P. Tax on Professions, Trades, Callings and
[G.O.Ms.No. 32, Rev. (CT III), dated 13-1-1988]
Tax on Professions, Trades, Callings and Employments Act, 1987 (A.P. Act
22 of 1987), the Governor of A.P. hereby exempts with effect from the 15th
June, 1987, the totally blind persons in the State from the Tax payable under
the said Act.
2. Self-employed persons and totally crippled persons - exemption
1
[G.O.Ms. No. 95, Rev. (CT III), dated 7-2-1990]
Tax on Professions, Trades, Callings and Employments Act, 1987 (A.P.Act
22 of 1987), the Governor of Andhra Pradesh hereby exempts with effect from
the 15th June, 1987, the following categories of self-employed persons and
totally crippled persons in the State from the tax payable under the said Act:
1. Agriculturist 9. Professional persons engaged in

2. Goldsmith performing religious duties in
various religions
3. Blacksmith
10. Carpenter
4. Pot-maker
11. Book-binder
5. Cobbler
12. Basket-maker
6. Tailor
13. Totally crippled person
7. Washerman
8. Barber
3. Tax payable by “ICRISAT” Patancheru, Hyderabad and foreign

nationals working in institute - Exemption (Andhra Pradesh)
1
[G.O.Ms. No. 105, Rev. (CT III), dated 9-2-1990]
22 of 1987), the Governor of Andhra Pradesh hereby exempts the “ICRISAT”
(International Crop Research Institute for the Semi-Arid Tropics), Patancheru,
Hyderabad, and the foreign nationals working in the said institute from payment
of the tax payable under the said Act, with effect from the 15th June, 1987.
1. Published in the A.P. Gazette, Part-I (Ext.) No. 68, dated 15-2-1990.
Notifications 731

Employment Act, 1987 - Vesting of Powers on the Officers of the Department
of Vigilance and Enforcement drawn from Commercial Taxes Department.
[G.O.Ms.No. 1136, Rev., (CT III), dt. 4-12-1987]
Under sub-section (2) of Section 3 of the Andhra Pradesh Tax on

Professions, Trades, Callings and Employments Act, 1987 (Act No. 22 of
1987), the Governor of Andhra Pradesh hereby appoints the Task Force
Officers at the Headquarters and the Task Force Officers at the District
Headquarters under the Vigilance and Enforcement Department not below the
rank of an Assistant Commercial Tax Officer drawn from the Commercial
Taxes Department, to exercise the powers specified under Section 20 of the
said Act anywhere in the State.
5. Profession Tax – Ordinance to amend the Andhra Pradesh Tax

on Professions, Trades, Callings and Employments Act, 1987 (Ordinance
No. 21 of 1996) – Collection and Recovery of Tax – Revised Orders- Issued.
[G.O.Ms.No. 227, Finance and Planning (Fin. Wing - EBS.

Revenue) Department, dt. 21-9-1996]
Read the following :
G.O.Ms.No. 202, Fin. & Plg. (FW. F.P.I) Department, dt. 21-8-1987
ORDER :
1. In pursuance of the Andhra Pradesh Tax on Professions, Trades,

Callings and Employments Act, 1987 (Act 22 of 1987) instructions were issued
in the Government Order cited above for the levy of Professions Tax on persons
earning a salary or wage and deduction of tax payable by such persons from
the salary or wage paid to them by the employer. The employer is liable
to pay the tax on behalf of all such persons irrespective of whether such
deductions have been made or not when the salary is paid. The Government
Order has specified that the tax shall be deducted from the monthly pay bills
of the employees at rates prescribed in the First Schedule to the Act. By
the Ordinance promulgated by the Governor on 1st August, 1996 the rates
of tax prescribed in the First Schedule to the Act have been enhanced.
2. By virtue of the ordinance promulgated on 1st August, 1996, the

Government hereby order that the profession Tax shall be levied and collected
at the following revised rates from the monthly pay bills of employees.
Sl. No. Class of Assessees Rate of Tax per

month
1. Salary and wage earners, such persons
whose monthly salaries or wages
(i) Upto Rs. 1,500/- Nil
(ii) Range from Rs. 1500/- to Rs. 2000/- Rs. 16/-
(iii) Range from Rs. 2000/- to Rs. 3000/- Rs. 25/-
(iv) Range from Rs. 3000/- to Rs. 4000/- Rs. 35/-
(v) Range from Rs. 4000/- to Rs. 5000/- Rs. 45/-
(vi) Range from Rs. 5000/- to Rs. 6000/- Rs. 60/-
(vii) Range from Rs. 6000/- to Rs. 10000/- Rs. 80/-
(viii) Range from Rs. 10000/- to Rs. 15000/- Rs. 100/-
(ix) Range from Rs. 15000/- to Rs. 20000/- Rs. 150/-
(x) Range above Rs. 20000/- Rs. 200/-
3. The revised rates prescribed in para 2 above have come into force
from 1st August, 1996. All departments of Secretariat and the Heads of
departments are requested to communicate these rates to all the drawing and
disbursing officers with a specific stipulation that the Drawing Officer concerned
shall deduct the amounts as indicated in para two above from the salary bill
of each employee who has to pay the tax. The deduction of tax at the revised
rates shall commence from the pay bill for the month of September, 1996
and thereafter the deduction shall be made every month. The arrears of tax
for the month of August, being the difference between the revised rates and
pre-revised rates, shall also be recovered from the pay bill for the month of
September, 1996. It must also be specified that the drawing officers are
responsible if any deduction is omitted from the pay bills of the employees.
The drawing and disbursing officer shall furnish to the assessing authority not
later than the 30th April of every year, a statement relating to the payment
of salary made to the employee along with a certificate that the tax payable
in respect of the employees for whom they drew the pay and allowances during
the year immediately preceding has been deducted in accordance with the
provisions of the First Schedule to the Act. The deduction made from the
salary bills shall be credited to the following Head of Account.
"0028. Other Taxes on income and expenditure
M.H. 107 Taxes on professions, trades, calling and employment,
S.H. (01) Receipts from professions, trades, calling and employment."
4. The above order will apply to the employees working under State
Government and Panchayat Raj Institutions, Municipalities, Municipal
Notifications 733
Corporations, Urban Development Authorities, Allied Institutions, Corporations,

Companies, Societies, Universities, Educational Institutions etc., departments
of the Secretariat are requested to communicate this order to the Institutions
mentioned above with instructions to deduct tax as prescribed in para 2 above.
For any clarification, of these orders, reference may be made to the Commissioner
of Commercial Taxes or to the Revenue Department in the Secretariat.
5. These orders are issued in supersession of the orders issued in the
Government, Order cited above.
(By Order and in the name of the Governor of Andhra Pradesh)
6. Profession Tax – Ordinance to amend the Andhra Pradesh Tax
on Professions, Trades, Callings and Employments Act, 1987 (Ordinance
No. 21 of 1996) – Collection and Recovery of Tax – Postponement of
recovery at the enhanced rates by one month – Orders – Issued.
1. G.O.Ms.No. 202, Fin. & Plg. (FW. P.F.I) Dept., dt. 21-08-1987.
2. G.O.Ms.No. 227, Fin. & Plg. (FW. EBS Rev.) Department, dt.
21.09.1996.
ORDER :
1. In the Government order 2nd read above, Government had ordered
collection of Profession Tax at the enhanced rates from the monthly pay bills
of the employees from 1st August, 1996. The Associations of State Government
employees have represented to the Hon'ble Chief Minister for the postponement
of the recovery of Profession Tax at the enhanced rates from the salaries of
the State Government employees by one month.
2. Government, after careful consideration of the representation of the
Employees Associations, hereby order postponement by one month of recovery
of Profession Tax at the enhanced rates ordered in the G.O. 2nd read above
from the salaries of the employees for the month of October 1996, payable
in November 1996. The recovery of Profession Tax for the month of October,
1996 shall be effected at the pre-enhanced rates. The recovery of tax from
the salaries of the employees from the month of November 1996, onwards
shall be at the enhanced rates.
3. Orders in respect of recovery of arrears of tax for the months of August,
September and October, 1996 being the difference between enhanced rates
and pre-enhanced rates, will issue separately.
7. Recovery of arrears of tax for the months of August, September

and October, 1996 in instalments.
[G.O.Ms. No. 315, Finance & Planning (Finance Wing - EBS.
Rev.) Department, dated 13-11-1996]
Read the following:–
1. G.O.Ms. No. 202, Finance & Planning (FW.DF.I) Department, dated
21-8-1987.
2. G.O.Ms. No. 227, Finance & Planning (FW. EBS. Rrv.) Department,
dated 21-9-1996.
3. G.O.Ms. No. 235, Finance & Planning (FW.EBS. Rev.) Department,
dated 29-10-1996.
ORDER:
1. In the Government Order 2nd read above, Government had issued
orders enhancing the rates of profession tax with effect from 1-8-1996. The
Associations of State Government Employees had represented to the Hon’ble
Chief Minister for the postponement of the recovery of profession tax at the
enhanced rates by one month. After carefully considering the representations
of the employees’ Associations, Government had ordered postponement by one
month of recovery of profession tax at the enhanced rates from the salaries
of the employees for the month of October, 1996, payable in November, 1996.
It was also ordered therein that orders for the recovery of arrears of tax for
the months of August, September and October, 1996, being the difference
between the enhanced rates and pre-enhanced rates, would be issued separately.
2. Government, after careful consideration, hereby order that the arrears
of tax for the months of August, September and October, 1996 shall be
recovered in three equal instalments from the salaries of November, 1996,
December, 1996 and January, 1997 respectively in addition to the regular
recovery of tax at the enhanced rates from the salaries of the employees for
these months.
3. Where the profession tax had already been recovered at the enhanced
rates from the salaries of employees for the months of August and September,
1996, the arrears of tax for the month of October, 1996 only shall be recovered
from the salaries for the month of November, 1996, along with the tax payable
for the month.
4 In case of employees retiring in November, 1996, Government hereby
order that the arrears of tax for the months of August, September and October,
1996 shall be recovered in one go from the salary for the month of November,
1996. For the employees retiring in December, 1996 the arrears of tax for
the month of August, 1996 shall be recovered from the salary for November,
1996 and the arrears in respect of September and October, 1996 shall be
recovered from the salary for the month of December, 1996.
Notifications 735
8. Postponement of recovery of Profession Tax at the enhanced rates

till the end of January, 1997
1. G.O.Ms.No. 202, Fin. & Plg. (FW P.F.I) Department, dt. 21.08.1987.
21.09.1996
29.10.1996.
13.11.1996.
ORDER :
1. In the Government Order 2nd read above, Government had issued
orders enhancing the rates of Profession Tax with effect from 1-8-1996. After
carefully considering the representations received from the Employees'
Associations, Government had issued orders in the Government Order 3rd read
above for the postponement by one month of recovery of Profession Tax at
the enhanced rates from the salaries of employees for the month of October,
1996. Consequent to the postponement of recovery of Profession Tax by one
month, orders were issued in Government Order 4th read above for the recovery
of arrears of tax for the months of August, September and October, 1996 from
the salaries of November 1996, December, 1996 and January, 1997 respectively,
in addition to the regular recovery of tax at the enhanced rates from the salaries
of the employees for these months.
2. The Andhra Pradesh Non-Gazetted Officers' Association in its
memorandum submitted on 13-11-1996 to the Honourable Chief Minister had
requested postponement of collection of Profession Tax at the revised rates.
3. Government, after careful consideration of the memorandum submitted
by the A.P. Non-Gazetted Officers' Association, hereby order postponement
of recovery of Profession Tax at the enhanced rates ordered in the Government
Order 2nd read above and the recovery of the arrears of tax ordered in the
Government order 4th read above, till the end of January, 1997. The recovery
of Profession Tax for the months of November, 1996, December, 1996 and
January, 1997 shall be at the pre-enhanced rates.
4. Orders in respect of recovery of arrears of tax from August, 1996
to January, 1997 being the difference between the enhanced rates and pre-
enhanced rates, will issue separately.

-- Clarification -- Issued.
1. G.O.Ms.No. 202, Fin. & Plg. (FW P.F.I) Department, dt. 21.08.1987.
21.09.1996
29.10.1996.
13.11.1996.
23.11.1996.
ORDER :
1. In the Government Order last read above, Government had ordered
postponement of collection of Profession Tax at the enhanced rates till the
end of January, 1997. Commissioner, Commercial Taxes, in a letter addressed
to the Government had sought a clarification, whether the postponement is
applicable only for Non-Gazetted Officers of the State Government or to all
the assessees under the A.P. Tax on Professions, Trades, Callings and
Employments Act, 1987.
2. Government hereby clarify that the orders of postponement issued in
Government order last read above are applicable only to the Non-Gazetted
Officers of the State Government. The recovery of tax from all other assessees
shall continue to be made at the enhanced rates ordered in Government order
2nd read above.
till February, 1997
[G.O.Ms. No. 337, Finance & Planning (Finance Wing - EBS.
Rev.) Department, dated 21-2-1997]
Read the following :—
1. G.O.Ms. No. 202, Finance & Planning (FW.PF.I) Department, dated
21-8-1987.
2. G.O.Ms. No. 227, Finance & Planning (FW.EBS.Rev.) Department,
dated 21-9-1996.
Notifications 737
3. G.O.Ms. No. 235, Finance & Planning (FW.EBS. Rev.) Department,

dated 29-10-1996.
dated 13-11-1996.
dated 23-11-1996.
ORDER :
1. In the Government Order 2nd read above, orders were issued enhancing
the rates of Profession Tax with effect from 1-8-1996. After carefully considering
the representations received from the Employees’ Associations, Government
had issued orders in the G.O. 5th read above for the postponement of recovery
of Profession Tax at the enhanced rates from the salaries of Non-Gazetted
employees of the State Government till the end of January, 1997.
2. After carefully considering the matter further, Government hereby
extend the postponement of recovery of profession tax at the enhanced rates
from the Non-Gazetted employees of the State Government till the end of
February, 1997. However, the Profession Tax shall be recovered from the
salaries of the Non-Gazetted employees for the month of February, 1997 at
the pre-enhanced rates.
3. Orders in respect of recovery of arrears of tax in respect of Non-
Gazetted Officers of State Government for the period August, 1996 to February,
1997, being the difference between the enhanced rates and Pre-enhanced rates,
will issue separately.
11. Keeping the recovery of Profession Tax at the enhanced rates
from the salaries of the Non-Gazetted employees of the State Government
in abeyance till further orders -- Orders -- Issued.
[G.O.Ms.No. 48, Finance and Planning (Fin. Wing – EBS.
1. G.O.Ms.No. 202, Fin. & Plg. (FW P.F.I.) Department, dt. 21.08.1987.
21.09.1996
29.10.1996.
13.11.1996.
23.11.1996.
VAT–47
21.2.1997
7. Representation from the Chairman, Joint Action Committee of
Employees, Teachers and Workers, A.P., dt. 1-3-1997.
8. Representation from the TNGOS Association.
9. Representation from the A.P. Secretariat Association.
ORDER :
1. In the Government order 2nd read above, orders were issued enhancing
the rates of Profession Tax with effect from 1-8-1996. After carefully considering
the representations received from the Employees Associations, Government had
issued orders in the Government Order 6th read above for the postponement
of recovery of Profession Tax at the enhanced rates from the salaries of the
Non-Gazetted Employees of the State Government till the end of February,
1997.
2. After careful consideration of the matter further, Government hereby
order that the recovery of Profession Tax at the enhanced rates from the Non-
Gazetted employees of the State Government, be kept in abeyance till further
orders. However, Profession Tax shall continue to be recovered from the
salaries of the Non-Gazetted employees of the State Government at the pre-
enhanced rates.
3. These orders are applicable only to the Non-Gazetted Employees of
the State Government and Profession Tax shall continue to be recovered at
the enhanced rates from all other categories.
Employments Act, 1987 - 95% of the collection to be passed on the local
Bodies on quarterly basis
[G.O.Ms.No. 544 Revenue (CT.II) Department dated 12-07-1999]
Read the following:—
From the C.P., R & R.E. Lr.No.12583/98, dated 09-03-1999.
ORDER :
Profession Tax is being levied and collected from the persons engaged
in Profession, Trade, Callings and Employment in the State and it is being
distributed to the Local Bodies on yearly basis. The Andhra Pradesh Panchayat
Sarpanches Association has been brought to the notice of the Government that
the Local Bodies are unable to take up the developmental works in time as
they are not getting timely releases of funds relating to Profession Tax
collections. Therefore, they have requested the Government that collection of
Profession Tax may be released on quarterly basis as being done in the case
of Entertainment Tax.
Notifications 739
The Government after careful consideration of the matter have decided

to release 95% collection of the Profession Tax to the Local Bodies on quarterly
basis with immediate effect after deducting 5% of the Profession Tax towards
administrative charges.
The Commissioner of Commercial Taxes is therefore, requested to take
necessary action accordingly.
This order issue with the concurrence of Finance and Planning U.O.No.
1589/100/A2/EBS/PER/99, dated 13-4-1999.
13. A.P. Profession Tax Act, 1987 - 95% of the collections to be
passed on the Local Bodies on quarterly basis - Clarification
[G.O.Ms.No. 793 Revenue (CT.III) Department, dated 7-11-2000]
Read the following:
1. G.O.Ms.No. 544, Revenue (CT.III) Department, dated 12-7-1999.
2. G.O.Ms.No. 587, Revenue (CT.III) Department, dated 1-8-2000.
3. From the Commissioner of Commercial Taxes, Hyd., Lr. No. AIII(2)/
642/99, dated 14-7-2000.
ORDER:
Orders were issued in G.O.Ms.No. 544, Revenue (CT.III) Department,
dated 12-7-1999 for distribution of 95% of Collections of Profession Tax to
the local bodies on quarterly basis. However certain problems arose in the
implementation of the above orders. The issues were discussed in detail and
the following clarifications are issued.
(1) The Procedure of devolution of Profession Tax to local bodies by
Commercial Tax Officers shall come into force with effect from 1st April,
2000 and Commercial Tax Officers will transfer to local bodies the amounts
of Profession Tax collected on or after 1-4-2000.
(2) One of the Commercial Tax Officers in the District-Headquarters will
be authorised by the Commissioner of Commercial Taxes to issue adjustment
orders of Profession Tax to the Personal Deposit Accounts of the Gram
Panchayats and Municipalities after re-conciliation with the District Treasury
Officer for the amounts collected in the previous quarter of the year. The
reconciliation of the receipts should be to the extent of total receipts of the
entire district and not of the individual challans.
(3) For Municipal Corporation of Hyderabad one of the Deputy
Commissioners of Commercial Taxes of twin cities will be nominated by the
Commissioner of Commercial Taxes for making the reconciliation with the
District Treasury Officer (Urban) and for transferring the collected amounts
of Profession Tax directly to Municipal Corporation of Hyderabad. The amount
of Rs. 4,03,75,000/- already released to Municipal Corporation of Hyderabad

towards profession tax vide G.O.Ms.No. 428; M.A. dated 27-7-2000 of Municipal
Administration and Urban Development Department shall be adjusted against
the amount due to Municipal Corporation of Hyderabad towards Profession
Tax collections during 2000-01.
(4) In respect of Ranga Reddy District, collection of Profession Tax shall
be made on separate counters though it is paid in Hyderabad and the amount
so collected shall be adjusted to the respective Municipalities/panchayats by
the Commercial Tax Officer who has been authorised by the Commissioner
of Commercial Taxes in this regard.
(5) The amount of Rs. 18,16,41,200/- released by the Government vide
G.O.Ms.No. 987, dated 20-7-2000, Panchayat Raj Department shall be adjusted
to local bodies, against the arrears of Profession Tax of the previous years
including 1999-2000.
(6) Any amount already adjusted by the Commercial Tax Officer to the
local bodies during this financial year will be taken into account against the
releases that are to be made in this current year by the Head quarters
Commercial Tax Officer.
2. The Commissioner of Commercial Taxes shall issue necessary
instructions to the concerned Commercial Tax Officers in this regard.
3. This order issued with the concurrence of Finance and Planning
(Fin.Exp.P.R.) Department vide their U.O.No. 38970-B/583/Expr.PR/A2/2000,
dated 4-11-2000.
——
14. Collection of profession tax at pre-revised rates from the employees
of Singareni Colleries
[G.O.Rt.No. 153, Rev. (CT-III) Dept., dt. 16-01-2001]
Read the following:
(1) G.O.Ms.No.227, Fin. & Pig. (Fin. Wing-EBS.Rev.) Dept., dt.
21.9.1996.
(2) From Energy Forests Environment Science & Technology Department
Lr.No.1286/Pr. I-2/87-2, dt. 27.11.87.
(3) Govt. Memo. No.590/CT.III(1)/87-13, dt. 3.2.97.
(4) From the C & MD. the Singareni Colleries Co. Ltd. Lr.No.CMD/
PS/ H/87, dt. 21.2.97.
(5) Govt.Memo. No.590/CT.III(1)/87-14, dt. 16.5.97.
Notifications 741
(6) From the C& MD. Singareni Colleries Ltd. Lr.No.CMD/PS/H/427,

dt. 4.10.97.
(7) Govt. Memo. No.590/CT.III(1)/87-17, dated 5.11.97.
(8) From C & MD Singareni Colleries Co.Ltd.No.P.23/4619/IR/2519, dt.
14.10.2000.
ORDER
Government have reviewed the issue relating to the collection of Profession
Tax from the employees of Singareni Colleries Company Limited and decided
that the Profession Tax shall be collected from the employees of Singareni
Colleries Company Limited at the pre-revised rates from the month of January,
2001 onwards.
2. Government have also decided to collect Profession Tax at the revised
rates from the Executives and from the Officer‘s cadre.
3. The Commissioner of Commercial Taxes shall take necessary further
action in the matter immediately and report compliance.
(By order and in the name of the Governor of Andhra Pradesh)
——
15. Exemption from Payment of Profession Tax in respect of certain
categories
[G.O.Ms.No. 511, Revenue (CT-III), dated 25.7.2001]1
Tax on Professions, Trades, Callings and Employments Act, 1987 (Andhra
Pradesh Act No. 22 of 1987), the Governor of Andhra Pradesh hereby exempts
the following categories from the tax payable under the said Act, namely:–
(i) Minor Children and Housewives who are partners in a firm.
(ii) Companies registered under Indian Companies Act, 1956 with NIL
turnover.
(iii) Sleeping partner and honorary Directors who are not drawing any
salary or honorarium.
——
16. Exemption from the levy of Profession Tax to the Philanthropic
Educational Institutions
1. Pub. in the A.P. Gaz., Part I, Ext. No. 318, dt. 28.7.2001.
2. Pub. in the A.P. Gaz., Part I, Ext. No. 211, dt. 20.5.2003.
In exercise of the powers conferred by Section 31 of the A.P. Tax

on Professions, Trades, Callings and Employments Act, 1987 (A.P. Act No.
22 of 1987), the Governor of Andhra Pradesh hereby grants exemption from
the payment of Profession Tax by the philanthropic institutions which impart
education free of charge to the students provided such institutions produce
a certificate issued by the District Collector concerned to the effect that
education is imparted to the students in that institution without charging
anything towards fee.
This notification shall come into force with immediate effect.
------
17. Appointment of Revenue Divisional Officers as Agents for Collection
of Profession Tax from Fair Price Shops
22 of 1987), the Governor of Andhra Pradesh hereby appoints the Revenue
Divisional Officers, as the Collecting Agents for collection of Professional
Tax from the dealers of Fair Price Shops in their respective divisions as
provided under item 9 of the first schedule to the Andhra Pradesh Tax on
Professions, Trades, Callings and Employments Act, 1987.
------
18. Exemption from payment of tax by the Chief Justice and other
Judges of High Court of Andhra Pradesh.
[G.O.Ms.No. 234, Revenue (CT-IV), dated 27-2-2007]2
22 of 1987), the Governor of Andhra Pradesh hereby exempts the Chief Justice
and other Judges of the Hon’ble High Court of Andhra Pradesh from payment
of tax payable under the said Act with effect from the 15th June, 1987.
------
19. Exemption from payment of Profession Tax to Toddy Tappers
[G.O.Ms.No. 512, Revenue (CT-IV), dated 13-8-2012]
In exercise of the powers conferred by Section-31 of the Andhra Pradesh
Tax on Professions, Trades, Callings and Employments Act, 1987 (Act No.22
of 1987), the Governor of Andhra Pradesh hereby exempts Toddy Tappers
from payment of tax payable under the said Act.
------
1. Pub. in the A.P. Gaz., Part I, Ext. No. 17-C, dt. 13-1-2004.
2. Pub. in the A.P. Gaz., Part I, Ext. No. 130, dt. 5-3-2007.
CIRCULAR'S
I. Increase in the rate of tax by ordinance No. 21/96 – Instructions Issued
[Circular No. AII(3)/2112/87, dated 30/08/1996]

By Ordinance No. 21/96, rates of Profession Tax have been enhanced
raising the limit from Rs. 250/- to Rs. 2,500/- per annum. Revised rates came
into effect from 1.8.96.
Among the assessees under Profession Tax Act, salary or wage earners
are liable to pay tax at fixed rate per month. All other persons are taxed at
a fixed amount per annum. In case of salaried persons the tax is paid by the
employer every month. If other assessees who are liable to pay tax per annum
have paid the tax before 1.8.96 for the year 1996-97, the tax so paid by them
as per the previous rates would be deducted from the revised rates and
differential amount has to be collected from the assessee. In case of salaried
class the revised rates come into effect from 1.8.96 only. They need not pay
for the months preceding to 1.8.96.
A critical analysis of collections under Profession Tax in different divisions
shows that there is need to step up the efforts for collection of the Profession
Taxes. In very few areas only the data has been collected on systematic lines.
In many Units the officers do not have the basic information about the
assessees. Though the administration of the Act has been with the department
for the last Nine years, the collection work has been organised on adhoc basis
and mostly relying on the voluntary compliance of the assessee.
The Government has increased the tax rates only with the idea of
mobilising additional revenues from this Tax. The collections cannot be stepped
up unless there is a well planned effort. So the following instructions are issued:
The CTO (Int.) in the Division shall be kept incharge of the collection
of the data relating to the assessees under Profession Tax. He shall not be
entrusted with any other work till he completes the survey of assessees in
the Division. He shall complete this before the end of October. He should
collect and also coordinate the work of collection of data by other officers
in the division. Deputy Commissioner shall allocate the work for the CTO
(Int.) and DCTOs if he finds it necessary. He should hold a meeting once
in every fortnight with the CTO (Int) and also the DCTOs. The CTO(lnt)
shall collect the information about the major categories of assessees in the
Head quarters and other areas. He shall process it unitwise and send this
information to the DCTOs concerned. The DCTOs shall collect information
about the category of assessees not covered by CTO (Int.). They shall collect
the taxes due for the year before end of October under any circumstances.
743
The data about the assessees liable to pay tax under Professional Tax
may be collected from the following sources.
(a) The list of consumers available with the Gas dealers. Mostly a person
who has a connection may be having income levels to become liable to pay
Profession Tax. This information can be cross checked with other records.
It shall be processed on the computer and notice may be sent to the person
concerned requiring him to reply whether he is an assessee under Profession
Tax, whether he has paid profession tax or not. To that notice the details
of rates of tax for that category of assessees may be enclosed.
(b) Telephone Directory of the area may be taken, and it can be checked
whether a person having a Telephone is an assessee under Profession Tax
or not.
(c) The latest Electoral roll may be taken as a basis and it may be verified
whether the persons are assessees under Profession Tax or not. While comparing
the list of the voters of assessees it may be necessary to go by area wise
approach. In some areas many voters may not be liable to pay the Profession
Tax. This has to be analysed carefully.
The DCTOs of the Unit are personally responsible to collect the information
about the assessees under Profession Tax Act. This is a priority item for them
and percentage of increase in collections will be taken for evaluating their
performance for the year.
(d) Extensive street survey shall be organised in the area covered by
every unit.
(e) A list of members of different profession at Trade Associates may
be collected.
If any assessee or group of persons are not complying with the notices
issued for payment of the Profession Tax, the DCTO shall take steps for
launching prosecution against the assessees concerned so that it would have
deterrent effect on other defaulters. The Dy. Commissioners (CT) shall send
information every month in the proforma enclosed as a part of monthly statistics
sent for Dy. Commissioners conference.
The Receipt of the Circular shall be acknowledged by return of post.
——
II. Clarifications
[CCT’s Ref. No. AII(3)/2789/96, dated 1-7-1997]
Sub:– Profession Tax Act,’96 – Certain Clarifications Request – Reg.
Ref:– 1. DC (CT), Vizianagaram Rc. No. 858/96, D2, dated 10-1-1997.
2. DC (CT), Charminar Rc. No. MA/765/96, dated 18-1-1997.
3. From CTO (Retd), Karimnagar representation, dated 6/1997.
Circulars 745
In the reference cited some doubts have been raised on the levy of
Profession Tax, 1996. The same are clarified as follows:
1. Whether the C.As who are partners of firm have to pay PT. under
entry 20 of the First Schedule of P.T. Act at Rs. 500/- as a partner of a firm
or he has to pay tax under entry 20(A) - Specific entry for C.As liability.
For the above query it is clarified that as per the explanation II where
any assessee is covered by two categories he shall be liable to pay under the
Entry where the liability is higher. So C.A. is liable to tax under entry 20-
A but not under entry 20.
2. What is the partner's liability in case the firm in which he is partner
is exempted from tax i.e., the firm having turnover below Rs. 1 lakhs ?
It is clarified that partner of a firm is liable to tax irrespective of the
liability of the firm.
3. Whether non-resident directors and partners are liable to tax under
the Act or not ?
It is clarified that partners residing at outside the State of Andhra Pradesh
and also drawing salaries from the branches outside the State are not liable
to pay Profession Tax in Andhra Pradesh.
4. Whether the dealer has to pay tax for Additional place of activity
such as godown, Administrative Office, Registered Office under Explanation
I of Act.
The above mentioned places shall not come under definition of branch.
Hence there may be no liability of Professional Tax for these places.
5. If an individual paid tax as partner/director can he be exempted to
pay tax as proprietor, if he happended to be proprietor of other firm vice versa.
In the above cases as per the explanation II where any assessee is covered
by two assessees, he shall be liable to tax under the entry where higher liability
is mentioned.
6. Whether Aided Schools or Institutions being run by private management
are liable to pay Profession Tax. Whether they fall under entry No. 20(i) or
not.
These institutions cannot be treated as owned by the State or Central
Governments. This will come under entry 20(i) for the purpose of Profession
Tax and they are liable to pay tax at Rs. 2,500/- P.A.
7. As per representation of Sri V. Chandraiah, C.T. Officer (Retired),
Karimnagar, whether a private person can be appointed as a collecting Agent
under Profession Tax Act.
It is not possible to appoint a private person as a collecting agent under

Profession Tax Act.
This is for information and necessary action. The Deputy Commissioners
(CT) in the State are requested to communicate the above clarifications in
turn to their P.T.Os for necessary action.
——
III. Clarifications
[CCT’s Ref.AII(3)/2789/96, dated 29-11-1997]
Sri. R.P. Singh, I.A.S, Commissioner of Commercial Taxes
Sub:– Profession Tax Act – Certain Clarifications – Reg.
Ref:– 1. CCT’s Ref. AII(3)/2789/96, dated 1-7-1997.
2. Govt. Memo No. 43507/CT. III(1)/97-2, dated 8-9-1997 from
Govt. Rev. (CT. III) Department.
In the reference 1st cited, certain clarifications on Profession Tax was
issued. At item No. 3 of the 1st reference it was discussed whether non-resident
directors and partners are liable to tax under the Act or not. It is clarified
as partners residing at outside the State of Andhra Pradesh and also drawing
salaries from the branches outside the State are not liable to pay Profession
Tax in Andhra Pradesh.
But in the reference 2nd cited, the Government clarified that under the
provisions in Section 4(2) of the Profession Tax Act there is no restriction
to the residence of the person in the State and employment in the State is
sufficient for liability of tax under the provisions of the Act. Therefore a non-
resident partner/Director is liable for tax under the Andhra Pradesh Tax on
Professions Trades, Callings and Employments Act, 1987, if he is drawing
salary or any remuneration from the branches/factories situated in Andhra
Pradesh.
This is for favour of information and necessary action. The Deputy
Commissioners (CT) in the State are requested to communicate to the Profession
Tax Officers for necessary action.
——
IV. Collection of the Profession Tax from the employees of Singareni
Colleries Company Limited
[Memo. No. 590/CT-III(1)/87-17, dt. 5-11-1997]
Sub:– Singareni Colleries Company Limited – Collection of the Profession
Tax from the employees – Reg.
Ref:– Govt. Memo. No. 590/CT. III(1)/87-15, dt. 2-8-1997.
Circulars 747
In partial modification of the orders issued in Government Memo. cited,

in view of the peculiar problems and certain anomalies indicated by the workers
representatives of the Singareni Colleries Company Limited, Government hereby
temporarily stay the collection of Profession Tax from the workers of Singareni
Colleries Company Limited.
This temporary stay does not apply to the officers working in Singareni
Colleries Company Limited and also to any other category of employees,
workers or officers of any other organisation, department or company, etc.,
and this should not be quoted as precedent in any other case.
The Commissioner of Commercial Taxes is requested to take necessary
further action in the matter and report compliance.
——
V. Inspections conducted by the Vig. & Enft. Department deducted loss
of revenue due non-payment of Prof. Tax by certain assesses.
[Circular No. AI(4)/641/2005, date 30-06-2005]
Sub:– Inspections conducted by the Vig & Enft Dept deducted loss of
revenue due non-payment of Prof.Tax by certain assesses.
Ref:– 1. Letter from DG (Vig & Enft) Dept, Alert Note No.42, dt. 4.4.2005.
2. Letter from DG (Vig & Enft) Dept, Alert Note No.45, dt. 6.4.2005.
The attention of all the Dy. Commissioners in the State is invited to
the references cited, wherein the Vigilance adn Enforcement Department
pointed out that profession tax is not paid by certain categories of individuals
to the Department. In this regard, a report on the matter has been sent tot
he concerned Deputy Commissioners by the REgional Vigilance & Enforcement
Officers concerned for necessary follow up action. The Director General (V&
E) also requested this department to issue necessary instructions to all the
Deputy Commissioners to levy and collect profession tax from the categories
of indivudals, pointed out to the vigilance & Enforcement Department.
In this regard, all the Deputy Commissioner (CT) int he State are hereby
instructed to examine the issue of non-payment of profession tax by certain
categories under Profession Tax Act and further they are also directed to issue
strict instructions to all the P.T.O. (DCTOs) to take action for collection of
profession tax from all categories of individuals in general as per 1st schedule
of the ACt, and in particular from such categories of individuals as pointed
out by Director General (V&E).
Deputy Commissioners may also confirm that the instructions issued
aariler to look over Depot Managers of APBCL in collection of professional
tax from wine shop owners hase been fully implemented and professional tax
are being remitted by APBCL.
Copy of the references cited is sent herewith enclosed.
The receipt of the circular may be acknowledged immediately and also
a copy of the instructions issued in this regard to the sub-ordinate officers
should also be furnished to this office.
Sd/- (V. Bhasakar)
Alert No. 386/Y&E/R/2005
GOVERNMENT OF ANDHRA PRADESH
GENERAL ADMINISTRATION (VIGILANCE &
ENFORCEMENT) DEPARTMENT
Alert Note No. 42, dated 4-4-2005
Sub:– General Administration (Vilgilance & Enforement) Department –
Non Payment of Profession Tax by the Money Lenders and Pawn Brokers
in Krishna District-Evasion of Tax to a tune of Rs.1.48 lakhs – Regarding.
1. The Vigilance & Enforcement Department gathered information from
the Revenue Division Officer, Gudivada and Sub-Collector, Vijayawada,
regarding non payment of PRofession Tax by the Money Lenders and Pawan
Brokers.
2. The evaded Profession Tax by the Money Lenders and Pawan Brokers
in Krishna District worked out to Rs.1,47,400/-. A report on the matter has
been sent to Deputy Commissioners No.I & II Division Vijayawada vide
C.No.35/RV&EO-VJA/Rev/2005, dt.28-2-2005 of Regional Vigilance &
Enforcement Officer, Vijayawada for necessary follow up action.
3. Under Section 8 of the A.P.Tax on Professions, Trades, Callings and
Employement Act 1987, the Deputy Commercial Tax Officer, having jrisdiction
over the area where the Money Lenders and Pawan Brokers are located, shall
levy and collect Profession Tax under Sec. 4(2), read with item 15(b) of the
First Schedule.
4. The Commissioner of Commercial Taxes, A.P., Hyderabad is requested
to issue necessary instructions to all the Deputy Commissioners (CT) to levy
and collect Profession Tax from the Money Lenders and Pawan Brokers in
their respective jurisdiction.
Circulars 749
5. Action taken in this regard may be intimated at an early date.
(A.K. Mohanty)
Director General (Vig. & Enf.) &
E.O. Prl. Secy. to Govt. GAD

AlertNo. 45(37)/V&E/RI/2005, dt. 4-4-2005

Non Payment of Profession Tax by the staff of Velugu project in Kaddapah
and Chittoor Districts-Evasion of Tax to a tune of Rs.3.98 lakshs – Reg.
1. The Vigilance & Enforcement Department gathered information fromthe

office of the District Poverty Initiatives Project, Chittoor, regarding the particulars
of the staff of Velugu Project, in Kaddapah and Chittoor Districts and noticed
non payment of Profession Tax by the staff of Velugu Project, in Kaddapah
and Chittoor Districts
2. The evaded Profession Tax by the staff of Velugu Project, in Cuddapah

and Chittoor Districts worked out to Rs.3,98,320/- (Rs.2,20,990/- in Kadapa
District and Rs.1,77,330/- in Chittoor District)

Employement Act 1987, the Deputy Commercial Tax Officer, having jurisdiction
over the area where in various Velugu Project works are locatedm shall levy
and collect Profession Tax under Section 4(2) read with entry I of the Firstt
Schedule, fromt he staff.
4. Reports of the subject has been sent to DC(CT), Chittoor & Cuddapah
from Regional Vigilance & Enforcement Officer, Tirupathi vide C.No.244/
RV&EO/CT/TPT/2004, dt.3.12.2004 for following up action
5. The Commissioner, Commercial Taxes, A.P., Hyderabad is therefore,

requested to issue necessary instructions to all the Deputy Commissioners(CT)
to levy and collect Profession Tax from the staff of Velugu projects in the
State, in their respective jurisdictions.
(A.K. Mohanty)

C.No. 865/V&E/RI/2005
Alert Note No. 49, dt. 4-4-2005
Non Payment of Profession Tax by the employees working in the templs
(Religious and Charitable Institutions) in the State-Evasion of tax to a tune
of Rs.1 Crore – Reg.
the authorities of Endowments Department, Guntur regarding the particulars
of the employees working in the temples(Religious and Charitable Institutions)
and noticed non payment of Profession Tax by the employees working in the
temples(Religious and Charitable Institutions)
2. The evaded Profession Tax by the employees working in the
temples(Religious and Charitable Institutions) in Guntur District worked out
to Rs.5 laksh and through-out the State may work out to about Rs.1 crore.
Employment Act, 1987, the Deputy Commercial Tax Officer, having jurisdiction
over the area where the employees working in the temples (Religious and
Charitable Institutions) in the State are located, shall levy and collect Profesion
Tax under under Section 4(2), read with entry I of the First Schedule.
4. The Commissioner of Commercial Taxes, A.P., hyderabad is therefore,
requested to issue necessary instructions to all the Deputy Commissioners (CT)
to levy and collect Profession Tax from the employees working int he
temples(Religious and Charitable Institutions) in the State,, in their respective
jurisdictions.
5. Action taken in this regard may be intimated at an early date.
(A.K. Mohanty)
(C.No. 1172V&E/RI/2005)
Non Payment of Profession Tax by the Legal Practitioners (Advocate) in
Vijayawad – Evasion of Tax to a tune pf Rs.33.38 lakhs – Regarding.
Circulars 751

the Bar Association,Vijaywada regarding the list of Legal Practitioners
(Advocates) in Vijayawada.
2. The evaded Profession Tax by the Property Developers including Land/
Building/Flat Developers in Krishan District worked out to Rs.1,45,000/-.
3. Under Section 8 of the A.P. Tax on Profession, Trades, Callings and
Employment ACt, 1987, the Deputy Commercial Tax Officer, having jurisdiction
over the area where the Property Develpers including Land/Building/Flat
Developers are locatedm shall levy and collect Profession Tax under Section
4(2), read with itme 20(L) of the First Schedule.
4. A report on the subject was sent to DC(CT) No.I & II Division,
Vijaywada-II from REgional Vigilance & Enforcement OFficer,
Vijayawada.Lr.C.No.16/V/VJA/REV/2005, dt.31-01-05 for further up action.
5. The Commissioner, Commercial Taxes, A.P., Hyderabad is requested
to issue necessary instructions to all Deputy Commissioner (CT) to levy and
collect Profesion Tax from the Property Developers including Land/Building/
Flat Developers in the respective jurisdictions.
(A.K. Mohanty)

Alert Note No. 53(428/V & E/RI/05), dt. 6-4-2005
Sub:– General Administration(Vilgilance & Enforement) Department-
Non Payment of Profession Tax by the Property Developers including Land
Buliding/Flat Developers in Krishna District-Evasion of Tax to a tune of
Rs.1.45 lakhs-Reg
the authorities of UDA VGTM, Vijayawad. regarding the list of Propertly
Developers including Land/Building/Flat Developers in Krishna District, verified
and notice non payment of Profession Tax by the Propertly Developers Land/
Building/Flat Developers.
2. The evaded Profession Tax by the Property Developers including Land/
Building/Flat Developers in Krishan District worked out to Rs.1,45,000/-.
3. Under Section 8 of the A.P.Tax on Profession, Trades, Callings and
Employment ACt, 1987, the Deputy Commercial Tax Officer, having jurisdiction
over the area where the Proerty Develpers including Land/Building/Flat
Developers are located shall levy and collect Profession Tax under Section
4(2), read with itme 20(L) of the First Schedule.
4. A report on the subject was sent to DC(CT) No.I & II Division,
Vijaywada-II from REgional Vigilance & Enforcement OFficer,
Vijayawada.Lr.C.No.16/V/VJA/REV/2005, dt.31-01-05 for further up action.
5. The Commissioner, Commercial Taxes, A.P., Hyderabad is requested
to issue necessary instructions to all Deputy Commissioner(CT) to levy and
collect Profesion Tax from the Property Developers including Land/Building/
Flat Developers in the respective jurisdictions.
(A.K. Mohanty)
(C.No.1037/V & E/RI/05)

Non Payment of Profession Tax by the Cable T.V.Operators – Alert Notre
– Regarding.
1. The Vigilance & Enforcement Department gathered information in the
districts of Nellore, Prakasam, Krishna and Hyderabad Rural Division and
Tirupathi Region, regarding the Cable T.V.Operators, and noticed that they
failed to pay Profession Tax for the years 2000-01 to 2004-05.
2. The evaded Profession Tax by the Cable T.V.Operators in the above
districts worked out to Rs.1,91,51,500/-.
3. Under Section 8 of the A.P.Tax on Profession , Trades, Callings and
over the area in which the Cable T.V.Operators are located, shall levy and
collect Profession Tax under Sec4(2), read with entry 13(b)(iv) of the First
Schedule @Rs.2,500/- p.a.
4.Report on the subject has been sent to concerned assessing authorities
vide references 1) Lr.No.130/V&E/NLR/04, dt.30-10-04, 2) C.No.3/RV&EO/
VJA/Rev/2005, dt.12-01-05 and 3) C.No.3/I/RV&EO-HR/Rev.Wing/2004, dt.31-
01-2005 form REgional Vigilance & Enforcement Officers, Nellore, Vijayawada
and Hyderabad Rural respectively for follow up action.
requested to issue necessary instructions to all the Deputy Commissioner(CT)
Circulars 753
to levy and collect Profession Tax from the Cable T.V.Operators in a systematic
manner and on regular basis.
(A.K. Mohanty)
(C.No.531/V&E/RI/05)
Alert Note No. 72 Dated: 6-4-2005
Non Payment of Profession Tax by the persons owning Photo Studios in
Chittoor District Evasion of Tax to a tune of Rs.2,97,750/- – Regarding.
the Deputy Commercial Taxes Officer, Tirupathim regarding non payment of
Profession Tax by the Persons owning Photo Studios in Chittoor District.
2. The evaded Profession Tax by the Persons owning Photo Studios in
Chittoor District worked out to Rs. 2,97,750/-
3. Under Section 8 of the A.P.Tax on Profession , Trades, Callings and
over the area where the persons owning Photo Studios are located, shall levy
and collect Profession Tax under Section 4(2), read with entry 21 of the First
Schedule.
4. Report on the subject has been sent to the Deputy
Commissioner(Commercial Taxes), Chittoor from the REgional Vigilance &
Enforcement Officer, Tirupathi vide., Lr.C.No.90/RV&EO/REV/CII/TPR/2005,
dated 28-03-2005, for follow up action.
to levy and collect Profession Tax from from the persons owning Photo Studios
in their respective jurisdiction.
(A.K. Mohanty)
(C.No.532/V & E/RI/05)
Alert Note No.73, dated 25-5-2005
VAT–48

Non Payment of Profession Tax by the persons owning Beauty Parlours in
Chittoor District – Evasion of Tax to a tune of Rs.51,150/- – Regarding.
the Deputy Commercial Taxes Officer, Tirupathi and Customs and Central
Excise, Tirupathi, regarding non payment of Profession Tax by the Persons
owning Beauty Parlours in Chittoor District.
2. The evaded Profession Tax by the Persons owning BeautyParlours
in Chittoor District worked out to Rs. 51,150/-.
3. Under Section 8 of the A.P.Tax on Profession, Trades, Callings and
over the area where the persons owning BeautyParlours are located, shall
levy and collect Profession Tax under Section 4(2), read with entry 12 of
the First Schedule.
4. Report on the subject has been sent to the Deputy Commissioner
(Commercial Taxes), Chittoor from the REgional Vigilance & Enforcement
Officer, Tirupathi vide., Lr.C.No.91/RV&EO/REV/CII/TPR/2005, dated 28-03-
2005, for follow up action.
to levy and collect Profession Tax from from the persons owning BeautyParlours
in their respective jurisdiction.
(A.K. Mohanty)
Director General (Vig. & Enf.)
& E.O. Prl. Secy. to Govt.
GAD
OFFICERS APPOINTED AS COLLECTING AGENTS TO
COLLECT PROFESSION TAX IN VARIOUS DEPARTMENTS
[G.O.Ms.No. 497, Revenue (CT-IV), dt. 3-8-2012]
1) G.O.Ms.No.801, Rev. (CT-III) Dept., dt.18-07-2003.
2) G.O.Ms.No.13, Rev. (CT-III) Dept., dt.06-01-2004.
3) G.O.Ms.No.610, Rev. (CT-IV) Dept., dt.30-05-2006.
4) G.O.Ms.No.1193, Rev. (CT-IV) Dept., dt.25-11-2009.
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In exercise of the powers conferred by section-14 of the Andhra Pradesh
Tax on Professions, Trades, Callings and Employments Act, 1987 (A.P. Act 22
of 1987), and in supersession of the notifications issued in G.O.Ms.No.801,
Rev.(CT-III) Dept., Dt.18-07-2003; G.O.Ms.No.13, Rev.(CT-III) Dept.,
Officers Appointed as Collecting Agents (....) Departments 755
dt.06.01.2004; G.O.Ms.No.610, Rev.(CT-IV) Dept., Dt.30-05-2006 and

G.O.Ms.No.1193, Rev.(CT-IV) Dept., Dt.25-11-2009, the Governor of Andhra
Pradesh hereby appoints the following officers mentioned in Column (3) of the
Table given below as Collecting Agents in respect of the departments mentioned
in Column (2) for collection of Profession Tax from the categories as mentioned
in column (4) of the Table given below in their respective jurisdictions as
provided under the First Schedule to the said Act, 1987.
TABLE
Sl. Name of the Name of the Responsible for collecting tax from
No. Dept. Collecting Agent
(1) (2) (3) (4)
1. Transport Transport (i) Holders of permits of transport vehicles
Dept. Commissioner (other than auto rickshwas)
RTOs/Deputy (ii) Transport Companies and Transport
Commissioner Contractors
(Transport)/ (iii) Drivers of Commercial Transport
Joint Commissioner vehicles.
(Transport), Hyd. city
2. Revenue Revenue Divisional Dealers of fair price shops in their res-
Dept. Officers pective jurisdictions except the shops
falling under the jurisdictions of
GHMC, GVMC and VMC.
3. Education . District Educational Schools and School Teachers in private
Dept Officers sector except those falling under the
jurisdictions of GHMC, GVMC, VMC.
Regional Joint Director Colleges and College Lecturers in private
(Higher Education) sector except those falling under the
Regional Joint Director Polytechnic colleges in private sector
(Polytechnic) and Lecturers therein except those
falling under the jurisdictions of GHMC,
GVMC, VMC.
4. Works/ Pay and Accounts Works contractors
Engineering Officer concerned
Dept. like
I & CAD, TR
& B Depts.
5. Municipal Municipal Municipal works, contractors, Land
Administration Commissioners other developers, realtors and Builders not
Dept. than GHMC, GVMC, falling under the jurisdictions of
VMC. GHMC, GVMC, VMC.
(1) (2) (3) (4)
6. Co-operation Dist. Cooperative Cooperative Banks/Cooperative Societies

Dept. Officer and their employees working therein not
falling under the jurisdictions of
GHMC, GVMC, VMC.
7. Industries Dept. General Manager, Industrial Cooperative Societies not
District Industries falling under the jurisdictions of
Center GHMC, GVMC, VMC.
8. Excise Dept. Excise Superintendent Toddy Cooperative Societies not falling
under the jurisdictions of GHMC,
GVMC, VMC Distilleries, Wineries and
Breweries
Depot. Manger, APBCL Liquor retail shops
9. Fisheries Dept. Assistant Director, Fishermen Cooperative Societies not
Fisheries Dept. falling under the jurisdictions of
GHMC, GVMC, VMC.
10. A.P. Dairy Dy. Registrar of Milk Cooperative Societies not falling
Development Cooperative under the jurisdictions of GHMC,
Cooperative Societies, GVMC, VMC.
Federation Ltd. Milk Project
11. Handlooms and Asst. Director, Handlooms and Weavers Co-operative
Textiles Dept. Handlooms and Societies not falling under the
Textiles Dept. jurisdictions of GHMC, GVMC, VMC.
12. Horticulture Asst. Director, Horticulture Societies not falling under
Dept. Horticlture Dept. the jurisdictions of GHMC, GVMC,
VMC.
13. Animal Joint Director, Animal Sheep BCS not falling under the
Husbandry Husbandry Dept. jurisdictions of GHMC, GVMC, VMC.
Dept.
14. Commissioner Commissioner Sugar Cooperatives not falling under the
& Director of of Sugar jurisdictions of GHMC, GVMC, VMC.
Sugar and Cane
15. Sericulture Asst. Director, Sericulture Societies not falling under
Dept. Sericulture Dept. the jurisdictions of GHMC, GVMC,
VMC.
16. Marketing Asst.Director, Agricultural Market Committees/Cold
Dept. Marketing storage units and the employees
working therein not falling under the
17. Endowments Executive Officers of Employees and others, who are
Dept. the temples/ Asst. associated with Endowments Dept.,
Officers Appointed as Collecting Agents (....) Departments 757
(1) (2) (3) (4)
Commissioners but not directly on the Departmental

(Endowment) Rolls, and not falling under the
18. Registration & Sub-Registrar Chit Fund Companies and employees
Stamps Dept. working therein not falling under the
2. The officers appointed as Collecting agents therein shall for the purposes
of collection of the tax have the powers of Assessing Authority and shall collect
the tax, from all the persons except the categories of persons noted above and
credit the proceeds of collection of Profession Tax into the Treasury under the
“Head 0028 -Other taxes on Income & Expenditure; MH 107 - Taxes on
Professions, Trades, Callings and Employment; SH (01) - Tax collections”.
However the Collecting Agents mentioned at Sl.No.1,3,5 and 9 shall credit the
proceeds of collection of Profession Tax in respect of the persons located in
the jurisdictions of Greater Hyderabad Municipal Corporation area; Greater
Visakhapatnam Municipal Corporation area; Vijayawada Municipal Corporation
area to the Treasury under the “Head 0028 -Other taxes on income & Expenditure;
MH 107 - Taxes on Professions, Trades, Callings and Employment; SH (02) -
Tax collections in Greater Hyderabad Municipal Corporation area; SH (03) - Tax
collections in Greater Visakhapatnam Municipal Corporation area; SH (04) - Tax
collections in Vijayawada Municipal Corporation area and the remittance in the
newly created sub-head shall be reconciled and arrangements for transfer of
collected amount to respective corporations may be made on a monthly basis.
3. The officers who are appointed as Collecting Agents for the Government
shall maintain complete and full accounts of the tax collected and furnish a
statement of Profession Tax collected and remitted to the relevant Head of
Accounts every month to the Deputy Commissioner of Commercial Taxes
concerned and the respective Commissioners of Greater Municipal Corporations.
4. The concerned Head of the Department shall take necessary action.
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APPOINTMENT OF COLLECTING AGENTS IN GREATER
HYDERABAD MUNICIPAL CORPORATION, GREATER
VISAKHAPATNAM MUNICIPAL CORPORATION AND
VIJAYAWADA MUNICIPAL CORPORATION.
[G.O.Ms.No. 498, Revenue (CT-IV), dt. 3-8-2012]
Notification
In exercise of the powers conferred by section-14 of the Andhra

Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987(A.P.
Act 22 of 1987), the Governor of Andhra Pradesh hereby appoint the
Commissioners of Greater Hyderabad Municipal Corporation, Greater
Visakhapatnam Municipal Corporation and Vijayawada Municipal Corporation
as the Collecting Agents for collection of Profession Tax in their respective
jurisdictions from all the categories of persons except (i) Transport companies
and Transport Contractors; (ii) Drivers of Commercial transport vehicles;
(iii) Works Contractors other than Municipal Contractors; (iv) Retail Liquor
shops; (v) Distilleries/wineries/Breweries as provided under the First Schedule
to the said Act, 1987.
2. The officers appointed as Collecting Agents herein shall have, for
the purpose of collection of tax, the powers of the Assessing Authority.
The Collecting Agents shall credit the proceeds of collection of Profession
Tax to the Government Treasury under the Head 0028 -Other taxes on
income & Expenditure; MH 107 - Taxes on Professions, Trades, Callings
and Employment; SH (02) - Tax collections in Greater Hyderabad Municipal
Corporation area; SH (03) - Tax collections in Greater Visakhapatnam
Municipal Corporation area; SH (04) - Tax collections in Vijayawada
Municipal Corporation area and the remittance in the newly created sub-
head shall be reconciled and arrangements for transfer of collected amount
to respective corporations may be made on a monthly basis.
3. The officers who are appointed as Collecting Agents for the
Government shall maintain complete and full accounts of the tax collected
and furnish a statement of Profession Tax collected and remitted to the
relevant Head of Account every month.
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758
THE ANDHRA PRADESH TAX ON
ENTRY OF MOTOR VEHICLES INTO
LOCAL AREAS ACT, 19961
[Act No. 26 of 1996]
[As Amended by Act No. 26 of 2008, w.e.f. 1-10-2008]
The following Act of the Andhra Pradesh Legislative Assembly received
the assent of the Governor on the 15th October, 1996 and the said assent
is hereby first published on the 17th October, 1996 in the Andhra Pradesh
Gazette for general information:–
An Act to Provide for the levy of tax on entry of Motor Vehicles
into local areas in the State of Andhra Pradesh and for the matters
connected therewith or incidental thereto.
2
It is observed that proper tax is not being realised by the State on
all the Motor Vehicles which are being used in Andhra Pradesh. Many
Vehicles are purchased at low tax in the neighbouring States and brought
and used in the State. Since no sales took place within our State the
Government is not getting any revenue on such vehicles. To overcome such
problem, neighbouring States like, Tamil Nadu and Kerala have introduced
Entry Tax on Motor Vehicles and in Karnataka it is being levied on all
the commodities except 35 specified items. Entry Tax was introduced in
our State in the year 1987 on Textiles, Tobacco and Sugar and it was
subsequently withdrawn from 1st April, 1990. It is decided to levy Entry
Tax on Motor Vehicles only to arrest tax evasion. The rate of tax on the
local sales on motor vehicles is increased from 4% to 8% on the first
sales and Entry Tax is levied at the rate of 8%. Entry Tax is not leviable
if the motor vehicles suffer tax under local Sales Tax Act. The levy of
entry tax on motor vehicles is therefore mainly meant to plug the leakage
of revenue. To achieve the above object, Government have decided to enact,
a separate law for the purpose.
As the Legislative Assembly of the State was not then in session,
having been prorogued and it has been decided to give effect to the above
decision immediately, the Andhra Pradesh tax on Entry of Motor Vehicles
into Local Areas Ordinance 1996 (Andhra Pradesh Ordinance No. 22 of
1996) has been promulgated by the Governor on 1st August, 1996.
1. Published in A.P. Gazette Part IV-B (Ext.) No. 50, dt. 17-10-1996.
2. Appended to L.A. Bill No. 28 of 1996.
759

Pradesh in the Forty-seventh year of the Republic of India, as follows:–
1. Short title extent and commencement:– (1) This Act may be
called the Andhra Pradesh Tax on Entry of Motor Vehicles into Local
Areas Act, 1996.
(3) It shall be deemed to have come into force with effect from
1st August, 1996.
CHAPTER I
2. Definitions:– (1) In this Act unless the context otherwise requires,–

(a) ‘accessories’ means car air conditioner, music system or any
other article fitted to a motor vehicle which is not included in
the original invoice;
(b) ‘appellate authority’ means an appellate authority appointed
under Section 6;
(c) ‘assessing authority’ means an assessing authority appointed
under Section 5;
(d) ‘entry of motor vehicle into a local area’ with all its grammatical
variations and cognate expressions, means entry of motor vehicle
into a local area from any place outside the State for use or
sale therein;
(e) 1[‘Value Added Tax Act’ means the Andhra Pradesh Value
Added Tax Act, 2005 (Act No. 5 of 2005);]
(f) ‘Government’ means the State Government;
(g) ‘Importer’ means a person who brings a motor vehicle into a
local area from any place outside the State for use or sale therein
or who owns the vehicle at the time of its entry into the local
area;
(h) ‘local area’ means the area of jurisdiction of a local authority;
(i) ‘local authority’ means the area within the limits of, a city as
declared under the Hyderabad Municipal Corporation Act, 1955,
or the Visakhapatnam Municipal Corporation Act, 1979, or the

A.P. Tax on Entry of M.V. into Local Areas Act 761
Vijayawada Municipal Corporation Act, 1981 or any other

Municipal Corporation in the State, as in force or a municipality
as constituted or deemed to have been constituted under the
Andhra Pradesh Municipalities Act, 1965, or any notified area,
as declared under Section 389-A of the Andhra Pradesh
Municipalities Act, 1965 or the area within the limits of Gram
Panchayats, under Andhra Pradesh Panchayat Raj Act, 1994.
(j) ‘Motor vehicle’ means a motor vehicle defined in Clause (28)
of Section 2 of the Motor Vehicles Act, 1988 (Central Act, 59
of 1988);
(k) ‘notification’ means a notification published in the “Gazette”;
(l) ‘person’ includes any company or association or body of individuals
whether incorporated or not, a firm, a local authority, a Hindu
undivided family, society, club, an individual, the Central
Government or the Government of any other State or Union
Territory ;
(m) ‘prescribed’ means prescribed by rules made under this Act’;
(n) ‘purchase value’ means the value of a motor vehicle, as ascertained
from the original invoice and includes the value of accessories
fitted to the vehicle, insurance, excise duties, countervailing duties,
sales tax, transport fee, freight charges and all other charges
incidentally levied on the purchase of a motor vehicle:
Provided that, where the purchase value of a motor vehicle is not
ascertainable on account of non-availability or non-production of the
original invoice or when the invoice produced is proved to be false or
if the motor vehicle is acquired or obtained other wise than by way of
purchase, then the purchase value shall be the value or price at which
a motor vehicle of like kind or quality is sold or is capable of being
sold, in open market;
(o) ‘State’ means the State of Andhra Pradesh;
(p) ‘tax’ means tax payable under this Act.
(2) Words and expressions used, but not defined in this Act, and
defined in 1[the Value Added Tax Act], shall have the meanings respectively
assigned to them under that Act.
1. Subs. for "the General Sales Tax Act" by Act No. 4 of 2006, w.e.f. 1-4-2005.
CHAPTER II
Levy of Tax
3. Levy of tax:– (1) Subject to the provisions of this Act, there
shall be levied and collected tax on the entry of any motor vehicle into
any local area for use or sale therein which is liable for registration in
the State under the Motor Vehicles Act, 1988 (Central Act 59 of 1988).
The tax levied shall be at such rate or rates as may be fixed by the
Government, by notification, on the purchase value of the motor vehicle
but not exceeding 1[the rates specified for motor vehicles in the Fifth
Schedule to the Value Added Tax Act, 2005:]
Provided that no tax shall be levied and collected in respect of any
motor vehicle which was registered in any Union Territory or any other
State under the provisions of the Motor Vehicles Act, 1988, prior to
period of fifteen months or more from the date on which, it is registered
in the State:
Provided further that no tax shall be levied and collected in respect
of any motor vehicle which is owned by Central Government and is used
exclusively for the purposes relating to the Defence of India.
(2) The tax shall be payable by the importer in such manner and
within such time as may be prescribed.
(3) Where the motor vehicle is taken delivery of, on its entry into
a local area or brought into a local area by a person other than an importer,
the importer who takes delivery of the motor vehicle from such person
shall be deemed to have brought or caused to have brought the motor
vehicle into the local area.
CASE LAW
Levy of tax under Section 3 of the Act is only compensatory in the

nature to obviate the loss of revenue to the State as the vehicle was
purchased outside the State and the purchasers avoided payment of sales
tax or purchase tax which were to be paid had the vehicle been purchased
within the State. Transport Corporation of India and others v. Transport
Commissioner, Hyderabad and others, 2003 (1) ALT 620 (DB).
4. Reduction in tax liability:– (1) Where an importer of a motor
vehicle liable to pay tax under this Act, being a dealer in motor vehicles,
becomes liable to pay tax under 1[the Value Added Tax Act], as a result,
of the sale of such motor vehicle, then the amount of tax payable under
1
[the Value Added Tax Act], shall be reduced by the amount of the tax
paid under this Act.
(2) An importer, other than a dealer, liable to pay tax under this
Act, causes entry of motor vehicle into a local area for use or sale therein,
shall pay tax to such authority, as Commissioner may notify within fifteen
days from the date of entry of such vehicle into a local area or before
an application is made for registration of the said vehicle or assignment
of a new registration mark to such vehicle under the Motor Vehicles Act,
1988, whichever is earlier.
(3) Where an importer who, not being a dealer in motor vehicles,
had purchased a motor vehicle for his own use in any Union Territory
or any other State, then the tax payable by him under this Act shall,
subject to such conditions as may be prescribed, be reduced by the amount
of tax paid, if any, under the law relating to 1[Value Added Tax or 2[Central
Sales Tax Act] in force in that Union Territory or State.
CHAPTER III
Assessing and Appellate Authorities
5. Assessing Authorities:– The Government, may by notification
appoint the officers of the Commercial Taxes Department not below the
rank of Deputy Commercial Tax Officer to be the assessing authority for
the purposes of this Act and may assign to them such local area or local
areas as may be specified in such notification.
6. Appellate Authorities:– The Government may, by notification
appoint such officers of the Commercial Taxes Department of the rank
of Deputy Commissioner of Commercial Taxes to be the appellate authorities
for the purposes of this Act and may assign to them such local area or
local areas as may be specified in such notification.
CHAPTER IV
Returns, Assessment, Payment, Recovery and
Refund of Tax
7. Returns:– Every importer who is a dealer liable to pay tax under
this Act shall furnish returns in such form, for such period, by such dates
and to such authority, as may be prescribed.
2. Ins. by Act No. 26 of 2008, w.e.f. 1-10-2008, vide G.O.Ms.No.1154, Rev. (CT-II)
Dept., dt. 1-10-2008.
8. Assessment:– (1) The amount of tax due from a person liable

to pay tax under this Act shall be assessed separately for such period
(2) If the assessing authority is satisfied that the return furnished by
a person liable to pay tax is correct and complete, he shall assess the
amount of tax due from the person on the basis of such return.
(3) If the assessing authority is of the opinion that the return furnished
by a person liable to pay tax is not correct and complete, he shall serve
on such person, in the prescribed manner a notice requiring him, to attend
on a date and at a place specified therein, and produce or cause to be
produced, all evidence on which the said person relies in support of his
return or to produce such evidence as specified in the notice and on the
date specified in the notice, and as soon as may be, thereafter, the
assessing authority shall after considering all the evidence which may be
produced, assess the amount of tax due from the person.
(4) If a person fails to comply with the requirements of any notice
issued under sub-section (3), the assessing authority shall determine the
purchase value of the motor vehicle under the proviso to Clause (n) of
Section 2 to the best of his judgment and assess the amount of tax due
from him and may direct the importer to pay in addition to the tax so
assessed penalty as specified in sub-section (1) of Section 18.
(5) No order of assessment under sub-section (3) or sub-section
(4) or any period shall be made after the expiry of three years from the
last date prescribed for filing of returns for that period. If, for any reason
such order is not made within the period aforesaid, then the return so
filed shall be deemed to have been accepted as correct and complete
for assessing the tax due from such person.
9. Reassessment:– If, after a person liable to pay tax has been
assessed under Section 8 for any period, the assessing authority has reason
to believe that any purchase value or part thereof has, in respect of that
period, escaped assessment or has been under assessed or assessed at
a lower rate, then the assessing authority may within four years from the
date of the order of assessment of the particular period and after giving
the person a reasonable opportunity of being heard, reassess the tax due
from him and may direct him to pay in addition to the tax so assessed,
penalty as specified in sub-section (1) of Section 18.
10. Payment of Tax:– (1) The tax shall be paid in the manner
hereinafter provided.
(2) a person liable to pay the tax shall, before furnishing returns as
required by sub-section (1) of Section 7, pay into the Government
Treasury, in the prescribed manner, the whole of the amount of tax due
from him according to such return.
(3) The amount of–
(i) the tax due, where return has been furnished without full payment
thereof;
(ii) the difference in the tax assessed under Section 8 or reassessed
under Section 9 for any period, and the sum already paid by
the person in respect of such period, and ;
(iii) the penalty, if any, levied under Section 18, shall be paid by
the person into the Government Treasury by such date, which
shall be after twenty one days from the date of service of the
notice, as may be specified in the notice issued by the assessing
authority for this purpose.
(4) Any tax or penalty which remains unpaid after the date specified
in the notice for payment, shall be recoverable as if it were an arrear
of land Revenue.
11. Refund of Tax:– (1) The assessing authority shall refund to
a person the amount of the tax and the penalty, if any, paid by such
person in excess of the amount due from him for any period and the
refund may be either by cash payment or at the option of the person,
by reduction of such excess from the amount of the tax and the penalty,
if any, due from that person in respect of any other period:
Provided that the assessing authority shall first apply such excess
towards the recovery of any amount due in respect of which a notice
under sub-section (4) of Section 10 has been issued, and shall then refund
the balance, if any.
(2) Where as a result of any order passed in appeal or other
proceeding under this Act, refund of any amount becomes due to the
importer, the assessing authority shall refund the amount to the importer
without his having to make any claim in that behalf, or adjust or apply,
such amount as provided in sub-section (1).
(3) Where a levy and collection of tax is held invalid by any judgement
or order of a Court or Tribunal, it shall not be necessary to refund any
such tax to the importer unless it is proved by the importer to the
satisfaction of the assessing authority that the tax has not been collected
from the purchaser of the motor vehicle.
11-A. Refund on appeal etc.:– Where as a result of any order
passed in appeal or other proceeding under this Act, refund of any amount
becomes due to the importer, the assessing authority shall refund the
amount to the importer without his having to make any claim in that behalf,
or adjust or apply, such amount as provided in Section 11.
11-B. Non-refund of tax in certain cases:– Where a levy and
collection of tax is held invalid by any judgment or order of a Court
or Tribunal, it shall not be necessary to refund any such tax to the importer
unless it is proved by the dealer to the satisfaction of the assessing authority
that the tax has not been collected from the purchaser of the Motor
Vehicle.
12. Exemptions and Reductions:– Subject to such conditions as
they may impose, the Government may, if it is necessary so to do in
the public interest, by notification, reduce the rate of tax on any type
of Motor Vehicle or exempt any specified class of importers or type of
Vehicles from payment of the whole or part of the tax payable under
this Act.
CHAPTER V
Appeals and Revision
13. Appeals:– (1) An appeal from every original order under this
Act shall lie to the appellate authority.
(2) No appeal shall be entertained by the appeallate authority unless
it is filed within thirty days from the date of receipt of the order appealed
against by the assessee, and unless the entire amount of tax and penalty,
if any, has been remitted by the assessee in the Government Treasury.
(3) Subject to such rules as may be made in this behalf every
appellate authority referred to in sub-section (1) shall have the following
powers, namely:–
(a) in an appeal against an order of assessment to confirm, reduce,
enhance or annul the assessment, or set aside the assessment
and refer the case back to the assessing authority for making
a fresh assessment in accordance with the direction given by it
or him; and
(b) in any other case, to pass such orders in the appeal as may
be deemed just and proper.
14. Revision:– (1) The Commissioner of Commercial Taxes may
suo-motu call for and examine the records of the proceedings of any
order made by any authority, officer or person subordinate to it under
the provisions of this Act including sub-section (2) of this section and
if such order or proceeding recorded is prejudicial to the interests of
revenue and may make such enquiry or cause such enquiry to be made
and subject to the provisions of this Act, may initiate proceedings to revise,
modify or set aside such order or proceeding and may pass such order
in reference thereto as it thinks fit.
(2) Powers of the nature referred to in sub-section (1) may also
be exercised by the Additional Commissioner, Joint Commissioner and
Deputy Commissioner in the case of orders passed or proceedings
recorded by authorities, officers or persons subordinate to them.
(3) The powers conferred by sub-section (1) shall be exercised within
a period of four years from the date on which the said order was served
on the Importer.
15. Appeal to Appellate Tribunal:– (1) Any importer objecting
to an order passed or proceeding recorded–
(a) by any appellate authority on appeal under Section 13; or
(b) by a Joint Commissioner or Deputy commissioner suo-motu
under sub-section (2) of Section 14 may appeal to the Appellate
Tribunal within sixty days from the date on which the order or
proceeding was served on him.
(2) The Appellate Tribunal may admit an appeal preferred after the
period of sixty days mentioned in sub-section (1), if it is satisfied that
the importer had sufficient cause for not preferring the appeal within that
period.
(3) The appeal shall be in the prescribed form shall be verified in
the prescribed manner and shall be accompanied by such fee, calculated
at the rate of two percent of the tax or penalty under dispute subject
to a minimum of one hundred rupees and a maximum of two thousand

rupees.
(4) The Appellate Tribunal may, after giving both parties to the appeal
a reasonable opportunity of being heard–
(i) confirm, reduce, enhance or annul the assessment or the penalty
or both;
(ii) set aside the assessment or the penalty or both and direct the
assessing authority to pass fresh order after such further inquiry
as may be directed; or
(iii) pass such order as it may think fit:
Provided that if the appeal involves a question of law, decision on
which is pending in any proceeding before the High Court or the Supreme
Court, the Appellate Tribunal may defer the hearing of the appeal before
it till such proceeding is disposed of.
(5) Before passing any order under sub-section (4), the Appellate
Tribunal may make such inquiry as it deems fit or remand the case to
the appellate authority against whose order the appeal was preferred or
to the assessing authority concerned for an inquiry and report on any
specified point or points.
(6) Notwithstanding anything in sub-section (4), where the importer
who has filed an appeal under this Section to the Appellate Tribunal fails
to appear before the Appellate Tribunal, either in person or by counsel
when the appeal is called on for hearing, it shall be open to the Appellate
Tribunal to make an order dismissing the appeal:
Provided that the Appellate Tribunal, may on an application made
by the importer within thirty days from the date of communication of the
order of dismissal and on sufficient cause being shown by him for his
non-appearance when the appeal was called on for hearing, re-admit the
appeal on such terms as it thinks fit, after giving notice thereof to the
authority against whose order or proceeding the appeal is preferred.
(7) Except as provided in the rules made under this Act, the Appellate
Tribunal shall not have power to award costs to either of the parties to
the appeal.
(4) shall be communicated by it to the importer, the authority against whose
order the appeal was preferred, the Commissioner and such other authorities
(4) shall, subject to the provision of Section 14, be final.
16. Revision by High Court:– (1) Within ninety days from the
date on which an order under sub-section (4) of Section 15 was
communicated to him, the importer or the authority prescribed in this behalf
may prefer a petition to the High Court against the order on the ground,
that the Appellate Tribunal has either decided erroneously, or failed to
decide, any question of law :
Provided that the High Court may admit a petition preferred after
the period of ninety days aforesaid if it is satisfied that the petitioner had,
sufficient cause for not preferring the petition within that period.
(2) The petition shall be in the prescribed form, shall be verified
in the prescribed manner, and shall, where it is preferred by the importer,
be accompanied by a fee of five hundred rupees.
(3) If the High Court, on perusing the petition considers that there
is no sufficient ground for interfering, it may dismiss the petition summarily:
Provided that no petition shall be dismissed unless the petitioner has
had a reasonable opportunity of being heard in support thereof.
(4)(a) If the High Court does not dismiss the petition summarily,
it shall, after giving both parties to the petition, a reasonable opportunity
of being heard, determine the question or questions of law raised and
either reverse, affirm or amend the order against which the petition was
preferred or remit the matter to the Appellate Tribunal with the opinion
of the High Court on the question or questions of law raised, or pass
such other order in relation to the matter as the High Court thinks fit.
(b) Where the High Court remits the matter to the Appellate Tribunal
under Clause (a) with its opinion on the question or questions of law
raised, the Appellate Tribunal shall amend the order passed by it in
confirmity with such opinion.
(5) Before passing an order under sub-section (4), the High Court
may, if it considers it necessary so to do, remit the petition to the Appellate
Tribunal and direct it to return the petition with its finding on any specific
question or issue.
VAT–49
(6) Notwithstanding that a petition has been preferred under sub-

section (1) tax shall be paid in accordance with the assessment made
in the case:
Provided that the High Court may, in its discretion, permit the
petitioner to pay the tax in such number of instalments, or give such other
direction in regard to the payment of tax as it thinks fit:
Provided further that if, as a result of the petition any change becomes
necessary in such assessment, the High Court may authorise the assessing
authority to amend, the assessment and on such amendment being made
the excess amount paid by the importer shall be refunded to him without
interest, or the further amount of tax due from him shall be collected in
accordance with the provisions of this Act, as the case may be.
(7)(a) The High Court may, on the application of the importer or
the prescribed authority review any order passed by it under sub-section
(4) on the basis of facts which were not before it when it passed the
order.
(b) The application for review shall be preferred within such time
and in such manner as may be prescribed, and shall, where it
is preferred by the importer, be accompanied by a fee of five
hundered rupees.
(8) The payment of tax and penalty if any due in accordance with
the order of the Appellate Tribunal in respect of which a petition has
been preferred under sub-section (1) shall not be stayed pending the
disposal of the petition but if such amount is reduced as a result of such
petition, the excess tax paid shall be refunded in accordance with the
provisions of Section 11.
(9) In respect of every petition or application preferred under sub-
section (1) or sub-section (7) the costs shall be in the discretion of the
High Court.
17. Appeal to High Court:– (1) Any importer objecting to an order
relating to assessment passed by the Commissioner suo-motu under sub-
section (1) of Section 14 may appeal to the High Court within sixty days
from the date on which the order was communicated to him:
Provided that the High Court may admit an appeal preferred after
the period of sixty days aforesaid if it is satisfied that such importer had
sufficient cause for not preferring the appeal within that period.

the prescribed manner and shall be accompanied by a fee calculated at
the rate of two percent of tax or penalty under dispute subject to a
minimum of one hundred rupees and a maximum of two thousand rupees.
(3) The High Court shall, after giving both parties to the appeal a
reasonable opportunity of being heard, pass such order thereon as it thinks
fit.
(4) The provisions of sub-sections (6) (7), (8) and (9) of Section
16 shall apply in relation to appeal preferred under sub-section (1) as
they apply in relation to petitions preferred under sub-section (1) of
Section 16.
CHAPTER VI
Penalty and Checking of Motor Vehicles
18. Penalty:– (1) Where any person liable to pay tax under this
Act, fails to comply with any of the provisions of this Act, the assessing
authority may, after giving such person a reasonable opportunity of being
heard, by order, in writing, impose on him, in addition to any tax payable,
a sum by way of penalty not exceeding twice the amount of the tax due.
(2) If any person liable to pay tax under this Act, does not, without
reasonable cause, pay the tax within the time he is required by or under
the provisions of this Act, to pay it, the assessing authority may, after
giving such person a reasonable opportunity of being heard by order, in
writing, impose upon him by way of penalty, in addition to the amount
of tax and penalty under sub-section (1), a sum equal to,–
(a) one and a half per cent of the amount of tax for each month
for the first three months after the last date by which the person
should have paid the tax; and
(b) two per cent of amount of tax per each month thereafter during
the time the person continues to make default in the payment
of the tax.
19. Officers competent to check Motor Vehicles in Local
areas:– (1) Any officer of the Commercial Taxes Department authorised
by the Government under sub-section (3) shall have power to stop any
motor vehicle that is being brought into any local area for sale or use
and examine the documents relating to purchase of the vehicle and payment
of tax due thereon under this Act.
(2) The person incharge of the vehicle shall stop the vehicle and
keep the vehicle stationary so long as it is necessary for examination
mentioned in sub-section (1) and shall give the details about the purchase
of the vehicle and payment of tax under this Act.
(3) The Government may authorise any officer of the Commercial
Taxes Department, not below the rank of Commercial Tax Officer to
exercise the powers specified in sub-section (1) in such local areas or
part thereof as may be notified from time to time.
20. Impounding of Motor Vehicle on Import of which Tax is
not paid:– If a person liable to pay tax in the manner as laid down
under sub-section (2) of Section 4 fails to pay tax within 15 days from
the entry of motor vehicle into the local area or before an application
is made for registration of the vehicle under the Motor Vehicles Act, 1988,
whichever is earlier, then the designated officer shall forthwith impound
the vehicle in respect of which tax has remained unpaid and keep the
vehicle impounded till the amount of tax and penalty due and payable
is paid in full:
Provided that, if the amount of tax and penalty is not paid within
one month of impounding of the vehicle, the designated officer shall have
power to sell the vehicle in the prescribed manner, by auction and apply
the sale proceeds towards recovery of the tax, penalty and costs. The
remainder, if any, shall be refunded to the importer :
Provided further that, if, at any time before the auction of the vehicle,
the importer pays the tax, penalty and costs, if any, incurred towards
holding the auction, then, the designated officer may, after satisfying that
all the dues as aforesaid have been fully paid by the importer cancel the
auction and return the vehicle to the importer.
CHAPTER VII
Miscellaneous
21. Officers and Employees to be Public Servants:– All officers
and employees acting under the provisions of this Act, shall be deemed
to be public servants within the meaning of Section 21 of the Indian Penal
Code, 1860 (Central Act 45 of 1860).
22. Protection of action taken in good faith:— No suit, prosecution

or other legal proceeding shall lie against the Government or any officer
or employee for anything which is, in good faith, done or intended to
be done under this Act.
23. Restriction on registration:— Notwithstanding anything
contained in any other law for the time being in force, where the liability
to pay tax in respect of a motor vehicle arises under this Act, and such
motor vehicle is required to be registered in the State under the Motor
Vehicles Act, 1988 (Central Act 59 of 1988), no registration authority
shall register such motor vehicle, unless payment of such tax has been
made by the person concerned in respect of that vehicle.
CASE LAW
It cannot be said that the provisions of Section 23 of the A.P. Entry

of Motor Vehicles into Local Areas Act, 1996 are in conflict with the
provisions under Section 45 of the Motor Vehicles Act, 1988. Transport
Corporation of India and others v. Transport Commissioner, Hyderabad
and others, 2003 (1) ALT 620 (DB).
24. Offences:– (1) Any person, who–
(a) fails to pay, within the time allowed any tax assessed or any
penalty imposed on him under this Act; or
(b) wilfully acts in contravention of the provisions of this Act or the
rules made thereunder; shall, on conviction, be liable to be
punished with fine which may extend to two thousand rupees.
(2) Any person, who,–
(a) wilfully submits an untrue return or fails to submit a return as
required by the provisions of this Act or the rules made thereunder;
or
(b) Fraudulently evades the payment of any tax, and other amount
due from him under this Act, shall on conviction, be liable to
be punished, if it is a first offence, with fine which may extend
to two thousand rupees, and if it is a second or subsequent
offence, with simple imprisonment which may extend to six months
or with fine which may extend to two thousand rupees or with
both.
(3) Any person who makes any statement or declaration in any of

the records or documents which statement or declaration he knows or
has reason to believe to be false shall, on conviction, be liable to be
punished with simple imprisonment which may extend to six months or
with fine which may extend to two thousand rupees or with both.
(4) Any person, who is in any way knowingly concerned in any
fraudulent evasion or attempt at evasion or abetment of evasion of any
tax payable under this Act, shall, on conviction, be liable to be punished
with simple imprisonment which may extend to six months or with fine
which may extend to two thousand rupees or with both.
25. (1) No Court other than the Court of a Magistrate of the First
Class shall take cognizance of, or try, an offence under this Act.
(2) No prosecution for an offence under sub-section (2) of Section
24 or for any second or subsequent offence under sub-section (2) of
that section shall be instituted except with the written consent of the Deputy
Commissioner having jurisdiction over the local area.
26. (1) The prescribed authority may accept from any person, who
has committed or is reasonably suspected of having committed an offence
under this Act by way of composition of such offence,–
(a) where the offence consists of failure to pay, or the evasion of,
any tax recoverable under this Act, in addition to the tax so
recoverable a sum of money not exceeding two thousand rupees
or double the amount of the tax recoverable, whichever is greater;
and
(b) in other cases, a sum of money not exceeding two thousand
rupees.
(2) Any order passed or proceeding recorded by the prescribed
authority under sub-section (1), shall be final and no appeal or application
for revision shall lie therefrom.
27. An assessing authority, an appellate authority or a revision
authority shall, for the purpose of this Act, have power:–
(a) to summon and enforce the attendance of any person to examine
him on oath or affirmation; and
(b) to require the production of any document.
28. Save as otherwise expressly provided in this Act, no Court shall

entertain any suit or other proceeding to set aside or modify or question
the validity of an assessment order or decision made or passed by any
officer or authority under this Act or any rules made thereunder or in
respect of any other matter falling within its or his scope.
29. No assessment made, penalty or compounding fee levied or
other order passed by any officer or authority under this Act, shall be
set aside merely on account of any defect or irregularity in the procedure
relating thereto, unless it appears that such defect or irregularity has in
fact occasioned material hardship or failure of justice.
30. Power to make Rules:– (1) The Government may, by
notification, make rules, either prospectively or retrospectively, for carrying
out the purposes of this Act.
foregoing power, such rules may provide for the following matters, namely;
(a) the duties and powers of officers appointed for the purpose of
enforcing the provisions of this Act;
(b) all matters expressly required or allowed by this Act, to be
prescribed;
(c) generally regulating the procedure to be followed and the forms
to be adopted in the proceedings under this Act;
(d) any other matter including levy of fees for which there is no
specific provision in this Act, and for which provision is in the
opinion of the Government, necessary for giving effect to the
purposes of this Act ; and
(e) the procedure for any other matter incidental to the disposal of
appeal and the value of Court-Fee Stamp which a memorandum
of appeal or revision should bear.
(3) Every rule made under this section shall immediately after it is
made, be laid before the Legislative Assembly of the State if it is in session
and if it is not in session, in the session immediately following for a total
period of fourteen days which may be comprised in one session, or in
two successive sessions and if before the expiration of the session in which
it is so laid or the session immediately following the Legislative Assembly
agrees in making any modification in the rule or in the annulment of the
rule, the rule shall form the date on which the modification or annulment
is notified have effect only in such modified form or shall stand annulled
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.
31. Repeal of Ordinance 22 of 1996:— The Andhra Pradesh Tax
on Entry of Motor Vehicles into Local Areas Ordinance, 1996 is hereby
repealed.
——
ANDHRA PRADESH TAX ON ENTRY OF
MOTOR VEHICLES INTO LOCAL
AREAS RULES, 1996
[G.O.Ms.No. 849, Rev. (CT-II) Deptt., dt. 18-10-1996]
Pradesh Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (A.P.
Act No. 26 of 1996), the Governor of Andhra Pradesh hereby makes the
following Rules.
1. Title and commencement:–
(i) These rules may be called the Andhra Pradesh Tax on Entry of
Motor Vehicles into Local Areas Rules, 1996.
(ii) They shall come into force with effect on and from the 1st August,
1996.
2. Definitions:– (1) In these Rules, unless the context otherwise
requires:–
(a) ‘Act’ means the Andhra Pradesh Tax on Entry of Motor Vehicles
into Local Areas Act, 1996.
(b) ‘Form’ means a form appended to these rules.
(c) ‘Government Treasury’ means a Treasury or sub-treasury of the
Government.
(d) ‘Month’ means a calendar month.
(e) ‘Section’ means a Section of the Act.
(2) Words and expressions used but not defined in these rules shall
have the same meaning respectively assigned to them in the Act.
3. Returns:– (1) Every Importer other than those falling under sub-
rule (6), liable to pay tax under Section 3 of the Act, shall submit, so as
to reach the assessing authority on or before the 20th of every month,
a return in Form M-1 in duplicate showing the total and net purchase price
of all or any of the motor vehicles on which tax is payable for the preceding
month and along with the return he shall submit a receipt from the
Government Treasury or a crossed demand draft in favour of the assessing
authority for the full payment of tax payable for the month to which the
return related.
(2) In the case of an importer having more than one place of business
in the local area, all returns prescribed by these rules shall be submitted
777
by the principal place of business in the local area in the State and shall
include the total purchase value of all or any of the motor vehicles of all
the places of his business. Each place of business in any local area shall
also–
(a) Submit to the assessing authority of the local area in which it is
situated a return of the total and net purchase value of the motor
vehicles of the place of business in Form M-1 ; and
(b) intimate to such authority the fact that the return of the total and
net purchase value of all motor vehicles is included in the return
submitted by its principal place of business in the local area and
specify the name and address of such principal place of business
in the local area.
(3) The returns so filed shall subject to the provisions of sub-rules
(4) and (5) be provisionally accepted.
(4) Where any importer fails to submit the return in respect of any
month before the date prescribed in that behalf or if the return submitted
appears to be incorrect or incomplete the assessing authority shall after
following the procedure prescribed in Rule 4 determine the purchase value
to the best of the judgement and provisionally assess the tax or taxes payable
for the month and shall serve upon the dealer a notice in Form D-1 and
the importer shall pay the sum demanded within the time and in the manner
prescribed in the notice.
(5) Where any importer submits a return without a Government
Treasury receipt or crossed demand draft for the full amount of the tax
payable the assessing authority shall provisionally assess the taxes payable
for the month and shall serve upon the dealer a notice in Form D-1 for
the tax due and the importer shall pay the sum demanded within the time
specified in the notice.
(6)(a) An importer other than a dealer shall file a return in Form
M2 along with the proof of payment of tax due thereon before such authority,
as may be notified by the Commissioner, within Fifteen days from the date
of Entry of such vehicle into a local area or before an application is made
for registration of the said vehicle or assignment of a new registration mark
to such vehicle under the Motor Vehicles Act, 1988, whichever is earlier.
(b) Tax due thereon shall be paid by tendering a challan or a demand
draft or payment order issued in favour of such authority.
(c) If such authority is satisfied that return is true, correct and complete
he shall pass an order in Form M3 and a copy shall be marked
to the importer.
A.P. Tax on Entry of M.V. into Local Areas Rules 779
(d) If the return filed in Form M-2 does not appear to be correct
and complete the designated authority shall determine the purchase
value of motor vehicle and tax to be paid thereon and serve on
the importer a notice in Form M-4 and the importer shall pay the
sum demanded within the time and in the manner specified in the
notice.
4. Assessment:– (1) After the close of the year for which returns
have been submitted under Rule 3 or in the course of the year, where
an importer has discontinued business, the assessing authority shall if he
is satisfied after such scrutiny of the accounts and making such enquiry
as he considers necessary that the returns filed are correct and complete,
finally assess in a single order on the basis of the return(s), the tax payable
for the year to which the return(s) relate.
(2) Where any importer to fails to submit return or returns before
the date prescribed in that behalf or if any return or returns submitted by
him appears to the assessing authority to be incorrect or incomplete, the
assessing authority shall after giving the dealer an opportunity as mentioned
in sub-section (3) of Section 8 determine the purchase value of motor
vehicles to the best of his judgment and finally assess in a single order
the tax or taxes payable.
(3) If on final assessment under sub-rule (1) or sub-rule (2), any tax
is found to be due from the importer after deducting the tax or taxes paid
by him towards the provisional assessment made under Rule 3, the assessing
authority shall serve on the importer a notice in Form D-2, and the dealer
shall pay the sum demanded in the notice therein. If, however, any refund
of tax, is found to be due to the dealer, the assessing authority shall serve
on him a notice in Form R.
5. (1) Where any business carried on by a firm, a Hindu undivided
family or an association has been discontinued or dissolved, the assessing
authority shall make an assessment under Section 8 of the Act on the firm,
the Hindu undivided family or association as if no such discontinuance or
dissolution had taken place, and all the provisions of the Act including the
provisions relating to the levy of penalty or any other sum chargeable under
the provisions of the Act shall apply, so far as may be to such assessment.
(2) Every person who was at the time of such discontinuance or
dissolution, a partner of such firm or a member of such Hindu undivided
family or association and legal representative of any such persons who is
deceased shall be jointly and severally liable for the amount of the tax,
penalty or other sum payable, and all the provisions of the Act, so far
as may be, shall apply to any such assessment or levy of penalty or other
sum.
6. (1) Subject to provisions of Section 13 any person aggrieved by

an order passed or proceedings recorded under the provisions of the Act
may appeal to the Appellate Deputy Commissioner of Commercial Taxes
having jurisdiction over the area :
Provided that the Commissioner may, either suo-motu or on an
application, for the reasons to be recorded in writing, transfer an appeal
pending before an Appellate Deputy Commissioner of Commercial Taxes
to another Appellate Deputy Commissioner of Commercial Taxes ;
Provided further that the order of transfer shall be communicated to
the appellant or petitioner, to every person affected by the order, the
authority against whose order the appeal or petition was preferred and to
the Appellate Deputy Commissioner of Commercial Taxes.
(2)(i) Every such appeal shall be in Form-1 and verified in the manner
specified therein.
(ii) It shall be in duplicate.
(iii) It shall be accompanied by the following documents namely:–
(a) Where it is an appeal against an order of assessment, by a
Government Treasury receipt in support of having paid the fee
calculated at the rate of two per cent of the disputed tax or penalty
subject to a minimum of fifty rupees and a maximum of rupees
one thousand.
(b) Where it is an appeal against an order not being an order of
assessment or penalty by Court fee stamps of the value of three
rupees affixed to one of the copies.
(3) The appeal may be sent to the appellate authority by registered
post or be presented to that authority or to such officer as the appellate
authority may appoint in this behalf by the appellant or by his authorised
agent or a legal practitioner.
(4) The appellate authority after giving the appellant reasonable
opportunity of being heard pass such orders as laid down in sub-section
(3) of Section 13 of the Act.
7. For the purpose of the exercise of the powers of the nature referred
to in sub-section (1) of Section 14, the authorities specified in Column (1)
of the Table below shall be deemed to be subordinate to the authority
specified in the corresponding entry in Column (2) thereof.
TABLE
1 2
1. Additional Commissioners of Commissioner of Commercial
Commercial Taxes Taxes.
2. Joint Commissioner of Commercial Commissioner of Commercial
Taxes including Appellate Deputy Taxes.
Commissioner of Commercial Taxes,
Assistant Commissioners of
Commercial Taxes and Commercial Tax
Officers.
3. Deputy Commissioner of Commercial Additional Commissioner of
Taxes (including Appellate Deputy Commercial Taxes.
Commissioners of Commercial Taxes,
Assistant Commissioners of
Commercial Taxes and Commercial Tax
Officers).
4. Assistant Commissioners of Commercial Deputy Commissioner of
Taxes and Commercial Tax Officers. Commercial Taxes of the
Division concerned.
8. Every order of an Appellate or Revising authority under Section

13 or Section 14 respectively, as the case may be, shall be communicated
to the Appellant or the party affected by the order, to the assessing authority
against whose order the appeal was filed or to any authority concerned.
9. (1) (i) Every appeal preferred under Section 15 to the Appellate
Tribunal shall be in Form-II and shall be verified in the manner specified
therein.
(2)(i) Every such appeal shall clearly set forth the grounds of appeal
and the relief prayed for ; and shall be accompanied by the following;
namely:–
(a) four spare copies thereof ;
(b) five copies of the order appealed against (one of which shall be
the original or the authenticated copy) ; and
(c) four copies of the order of the assessing authority,
(ii) it shall be accompanied by a Treasury receipt in support of having
paid–
(a) in cases where the levy of tax or penalty is disputed ; a fee
calculated at the rate of two per cent of the disputed tax subject
to a minimum of rupees one hundred and a maximum of rupees
two thousand ; and
(b) a fee of rupees one hundred in all other cases.

(2) If the Appellate Tribunal allows any appeal preferred by an
assessee under Section 15, it may in its discretion, by order refund either
wholly or partly the fees paid by the assessee under sub-section (3) of
Section 15.
(3) Every order passed by the Appellate Tribunal under Section 15
shall be communicated to the Appellate Deputy Commissioner and to the
State Representative before the Appellate Tribunal, in addition to those
specified in the sub-section (8) of Section 15.
10. (1) Within ninety days from the date on which the order of the
Appellate Tribunal, under sub-section (4) of Section 15 was communicated
to the importer, he or the State Representative may prefer a petition to
the High Court of Andhra Pradesh under Section 16 against the order on
the ground that the Appellate Tribunal has decided either erroneously or
has failed to decide any question of law.
(2) Every petition under sub-section (1) of Section 16 of the Act to
the High Court shall be in Form-III and shall be verified in the manner
specified therein.
(3) Such petition shall be accompanied by a certified copy of the order
of the Appellate Tribunal and where it is preferred by the proprietor be
accompanied by a fee of rupees five hundred.
11. Every appeal under sub-section (1) of Section 17 to the High
Court shall be in Form-IV and shall be verified in the manner specified
therein. It shall be preferred within sixty days from the date on which the
order was communicated and shall be accompanied by a certified copy
of the order of the Commissioner appealed against and a fee calculated
at the rate of two per cent of tax or penalty under dispute subject to a
minimum of one hundred rupees and a maximum of two thousand rupees.
12. (1) Every application for review under Section 16 or Section 17
to the High Court shall in either Form-V or in Form-VI respectively and
shall be verified in the manner specified therein.
(2) It shall be preferred within one year from the date of communication
to the petitioner of the order sought to be reviewed, and where it is preferred
by the importer be accompanied by a fee of Rupees five hundred.
ACCOUNTS
13. (1) Every importer who is a dealer in Motor Vehicle and who
is liable to tax under the Act shall keep and maintain a true and correct
account promptly in any of the languages specified in the Eighth Schedule
to the Constitution of India, or in English language showing—
(i) the value of Motor Vehicle bought by him ;

(ii) names and addresses of each of the person from whom Motor
Vehicles were purchased and supported by a bill or delivery note
issued by the seller ; and
(iii) the descriptive and quantitative particulars of Motor Vehicles. In
case they are not bought but received into or a godown of the
importer with the names and addresses of the owners supported
by necessary vouchers and the circumstances under which they
are received or kept.
2. An Importer not being a dealer shall keep minimum accounts to
indicate the details such as purchase value etc., in respect of the entry
of Motor Vehicle into local area effected by him.
MISCELLANEOUS
14. (1) Any assessing, Appellate or revising authority may, at any
time within four years from the date of any order passed by him, rectify
any clerical or arithmetical mistake apparent from the record :
Provided that no such rectification which has the affect of enhancing
an assessment or any penalty shall be made unless the assessing or appellate
authority has given notice to the dealer of his intention to do so, and has
allowed him a reasonable opportunity of being heard.
15. If an importer enters into a partnership in regard to his business,
he shall report the fact to the assessing authority within thirty days of his
entering into such partnership. The importer and the partner shall jointly
and severally be responsible for the payment of the tax or renewal of penalty
leviable under the Act.
16. In case of default of payment of the tax or penalty leviable under
the Act, the properties of the firm may be proceeded against, in the first
instance for the recovery of the amount due from the firm.
17. If a partnership is dissolved, every person who as a partner shall
send a report of the dissolution to the assessing authority within thirty days
of such dissolution.
18. If at any time a dealer–
(a) discontinues or sells or otherwise disposes of the whole or any
part of any business carried on by him ; or
(b) changes his place of business or any of his places of business; or
(c) opens a new place of business ; or
(d) changes the name of any business carried on by him, the dealer
or if he is dead, the legal representative of the deceased, shall
notify the fact to the assessing authority concerned within thirty
days thereafter.
19. Any assessing, or revising authority may issue summons in Form
IX for the production of any document or for the appearance of any person.
20. The service on a dealer of any notice, summon, order or proceedings
under the Act or under these rules, may be effected in any of the following
ways, namely:–
(a) by delivering or tendering it to such importer or to his manager
or to his agent who is concerned with the business ; or
(b) if such importer or his manager or agent is not found, by leaving
it at his last known place of business or residence or by delivering
or tendering to some adult member of his family ; or
(c) if the address of such importer is known to the assessing authority,
by sending it to him by registered post with acknowledgment due;
or
(d) if any or all of the modes aforesaid is not practicable, by affixing
it in some conspicuous place at his last known place of business
or residence.
21. Designated officer to ascertain payment of amount of tax:–
The designated officer, who is notified under sub-section (2) of Section
4 of the Act, shall ascertain whether the importer not being a dealer has
paid the amount of tax due in full within the period of fifteen days from
the date of entry of the Motor Vehicle into a local area or before an
application is made for registration under the Motor Vehicles Act, 1988,
whichever is earlier, by obtaining from the Assessing Authority a copy of
the order in Form M-3 issued by the Assessing Authority to the importer.
If the importer has not paid the tax, then the designated officer shall impound
the vehicle forthwith.
22. Reduction of tax paid by an importer under the General Sales
Tax Law in force in any other State or Union Territory.
(1) In assessing the amount of tax payable in respect of any period
by an importer, who is not a dealer in motor vehicles the Assessing Authority
shall, in respect of his purchase of motor vehicle, the entry of which into
the Local area of the State is liable to tax, as the case may be, reduce
the following amounts, namely:–
(a) the sum collected separately by way of sales tax from the importer
by the manufacturer/authorised dealer, situated in any other State or
Union Territory in respect of the motor vehicle so purchased under
the law relating to General Sales Tax as may be in force in that
State or Union Territory; or
(b) In case not covered in Clause (a) above, the sum assessed by a
competent authority and in fact paid into the Government Treasury
of any other State or Union Territory in respect of a motor vehicle
which is subsequently purchased by the importer :
Provided that, no reduction under Clause (b) shall be granted unless
the importer proves that the said tax has in fact been assessed by a
competent authority and has in fact been paid into the Government Treasury
of the concerned State or Union Territory.
23. Notice for payment of penalty as specified in Section 18, shall
be issued in Form-VII.
CASELAW
Entry tax on motor vehicles is constitutionally valid. Vijaya Traders, Kadapa
and others v. The Commercial Tax Officer-I, Kadapa & Ors., (2011) 53 APSTJ 47
= 2012 (2) ALD 250 (DB).
FORM M-1
Monthly Return of Purchase Value
[To be filed by Importer who is a dealer]
[See Rule 3(1) and (4)]
To
The Commercial Tax Officer ..................................
I ................................................. Son/Daughter/Wife of .......................
being the importer on behalf of dealer carrying on business known as
........................................... furnish herewith the statement of total and net
purchase value of the Motor Vehicles entered into local area (s) during
the ................ (month/year) and give the following connected particulars:
(1) Name and address of the manager of the business ...........................
.......................................................................................................................
(2) Status or relationship of the person who signs this form ................
................................................................................................ (Manager/
Partner/Proprietor etc..)
(3) Name and address of the Principal place of business with particulars
of registration.
Name :
A.P.T.E.M.V. into Local Areas Act A.P.G.S.T. C.S.T.
VAT–50

Address :
.................................
.................................
.................................
(4) Name(s) of the other places of business in notified local areas
and the address of every such place (if space provided for is not sufficient
information shall be furnished in a separate sheet and enclosed to this return).
Statement of Monthly total and net purchase price of
motor vehicles entered into the local area(s)
Local Description of Total Purchase price Net Purchase

area Motor Vehicles Purchase on which value
value exemption
1 2 3 4 5
Amount Rs.
Demand Draft and
date/Challan Number and
Date, Treasury
Total
Rate of Tax due Tax Balance of Particulars of

tax provisionally tax due balance due
paid
6 7 8 9 10
Total :
Declaration
I, .................................. Son/Daughter/Wife of ..............................
declare that, to the best of my knowledge and belief the information furnished
in the above statement is true and complete.
Signature
Name (in Block Letters)
Status and Relation to the importer.
Place :
Date :
Note:– 1. Show the purchase value in respect of motor vehicle in

each local area in separate line and then strike the total in the last line.
——
FORM-D1
Notice of provisional monthly assessment
and demand
[See Rule 3(4)]
To,
Importer Assessment No. ...................
Take notice that you have been provisionally assessed under the
Andhra Pradesh Tax on Entry of Motor Vehicles into Local Areas Act,
1996 to a tax of Rs. .................... (Rupees ....................................................
only) (in words) for the month/months of ............................... and after
deducting the payment(s) already made by you towards the tax for (that
month those months) you have to pay a (further) sum of Rs. .......................
(Rupees ....... ........................................................... only) (in words). This
balance of tax shall be paid from the date of service of this Notice
................................... by demand draft in favour of the undersigned
.............................................. or by remittance into the Government Treasury
at ......................................... failing which the amount will be recovered
as if it were an arrear of land revenue and you will also be liable to penal
interest as provided in Section 18 of the Andhra Pradesh Tax on Entry
on Motor Vehicles into Local Areas Act, 1996. Purchase price as determined
by the Assessing Authority in respect of ...............................................
Description of the Rate of tax Taxable Tax payable

Motor Vehicles purchase value
1 2 3 4
Total Rs. ...................

Place :
Date :
Note:— If payment is made by demand draft, the demand draft shall
be crossed and shall be such as under the Andhra Pradesh Treasury Code,
may be received by the Treasury concerned.
——
FORM D2
Notice of annual assessment and demand
[See Rule 4(3)]
To
Importer
Take notice that you have been finally assessed under the Andhra
Pradesh Tax on Entry of Motor Vehicles into Local Areas Act, 1996 to
a tax of Rs. .............................. (Rupees ................................................
only) (in words) only for the year ending ..................................... and that
after deducting the total amount of the monthly payment(s) already made
by you towards the tax for that year, you have to pay a (further) sum
of Rs. ............ (Rupees ...........................................) (in words) only. This
balance of tax shall be paid within (.................... days) from the date of
service of this notice ............................ by demand draft in favour of the
undersigned or by remittance into the Government Treasury at .....................
failing which the amount will be recovered as if it were an arrear of land
revenue and you will also be liable to penal interest as provided in Section
18 of the Andhra Pradesh Tax on Entry of Motor Vehicles into Local
Areas Act, 1996.
Purchase price as determined by the Assessing Authority in respect
of .............................................
Description of the Rate of tax Taxable Tax payable

Motor Vehicles purchase value
1 2 3 4
Total Rs. ........................

Place :
Date :
Note:– If payment is made by demand draft, the demand draft shall
——
FORM M-2
Return of purchase price by an importer other
than a dealer
[See Rule 3(6)(a)]
To
The Commercial Tax Officer.
I, .................................. Son/Daughter/Wife of ..........................
........................................... furnish herewith the statement of total and net
purchase price of the Motor Vehicle entered into local area(s) and give
the following connected particulars :
(1) Name of the Vehicle : ..............................................................
(Model & Make, Chassis No.)
(2) Name and address of the seller of the vehicle .................................
(3) Date of entry into the Local area in the State ................................
(4) Invoice and purchase value ..............................................................
(Invoice price, Insurance, Freight value of accessories to be stated)
(5) Place of registration ........................................................................
(If vehicle is registered in other States or Union Territory)
(6) Entry Tax due to be paid on purchase value of motor vehicle ........
.......................................................................................................
(7) Tax paid in other State or Union Territory .....................................
(8) Tax to be paid ............................................................................
(6-7)
I hereby declare that the particulars furnished above are true and
correct.
Signature of owner of vehicle.
——
FORM-M3
[See Rule 3(6)(c)]
ORDER
Received Demand Draft/Pay Order No. .................. dated ...................
drawn in favour of Commercial Tax Officer for Rs................... .................
(in figures) Rupees ....................................................... ................................
(in words ) from Shri ........................................................................ Address
.............................................................................................................
........................................................................................................................
issued by (bank) ..................................................................................
(branch) .................................................... being full payment of the Andhra
Pradesh Tax on Entry of Motor Vehicles into Local Areas Act, 1996 on
import of following vehicle :
1. Model : .............................................................................
2. Engine No. : ............................................................................
3. Chassis No. : ..........................................................................
4. Purchase Price : .......................................... Rs. ........................
(including incidential charges paid prior to Registration under Motor
Vehicles Act, 1988)
5. Amount of Tax (and penalty if
any) payable : Rs. ..................................
6. Less : Local Sales Tax paid,
if any, in the State where the
vehicle is purchased : Rs. ...................................
7. Amount of Tax under the Act
paid by Demand Draft/Pay
Order. : Rs. ...................................
8. Balance Tax payable under
the Act. : Rs. ...................................
9. Shri ................................................. an importer has paid in full
the amount as per return filed by above mentioned Demand Draft/Pay
Order. The Return filed by him is accepted and balance tax payable is
Nil (subject to realisation of Demand Draft/Pay Order).
Seal :
Place :
Date :
Designation
——
FORM-M4
Notice of final assessment
[See Rule 3(6)(d)]
To
(Importer)
a tax of Rs. ............... (Rupees ..................................................................
only) (in words). The total amount of tax paid by you already is Rs. .........
(Rupees ...................................................................... only) (in words).
You have to pay a further sum of Rs. .............. (Rupees ................................
........................... only) (in words). This balance of tax shall be paid within
....... days from the date of service of this notice by Cheque/D.D. in favour
of undersigned or by remittance into the Government Treasury at ................
failing which the amount will be recovered as if it were as arrear of land
revenue and you will also be liable to interest.
Purchase value and total tax payable as determined by the
assessing authority in respect of:—
Description of Rate of Taxable Tax Tax paid Balance to

the Motor tax purchase payable be paid
Vehicle value
1 2 3 4 5 6
Total Rs. ........................

Place :
Date :
Note:– If payment is made by demand draft, the demand draft shall

——
FORM R
Notice of Annual Assessment and Refund Order
[See Rule 4(3)]
To
(Importer)
a tax of Rs. ..................... (Rupees .....................................................
only) (in words) for the year ending the ............................................. The
total amount of tax paid by you already is Rs. ...................... (Rupees
................................................ .......................................... only) (in words)
that is Rs. ........................... in excess of the tax due.
(2) Out of the above excess a sum of Rs. .............. will be adjusted
towards tax due from you for the period.
A refund order for the amount of Rs. .................. is enclosed. You
should apply to the Government Treasury at ......................................... (for
the refund of the sum) . ............................................... within three months
from the date of issue of this notice failing which the amount will lapse
to the Government.
Purchase value as determined by the assessment authority in
respect of ........................
Description of Rate of tax Taxable purchase Tax payable

Motor Vehicles value
1 2 3 4
Place :
Date :
* In para 3 the in applicable portion shall be scrored out.
——
FORM-I
Form of appeal under Section-13
[See Rule 6(2)(i)]
To
The Appellate Deputy Commissioner of
Commercial Taxes of ...........................
The ............... day of ...... 19 ...
1. Name(s) of appellant(s)
2. Assessment Year
3. Authority passing the order or proceeding disputed.
4. Date on which the order or proceeding was communicated.
5. Address to which notice may be sent to the Applicant.
6. Relief claimed in appeal
a. Purchase value of determined by the assessing authority.
b. If value is disputed
(i) disputed value
(ii) tax on disputed value
c. If rate of tax is disputed
(i) Value of involved
(ii) Amount of tax disputed.
d. Any other relief claimed.
7. Grounds of appeal etc.
(Signed) Appellant(s)
Signed Authorised representative, if any.
Verification
I/We ...................................... the appellant(s) named in the above
appeal to hereby declare that what is stated therein is true to the best
of my/our knowledge and belief.
Verified today the ............ day of .................. 19 .........
(Signed)
Appellant(s) (Signed)
Authorised representative, if any.
Note:– 1. The appeal should be accompanied by the order appealed
against in original or by a certified copy thereof unless the omission to
produce such order or copy is explained to the satisfaction of the appellate

authority.
2. The appeal should be written in English and should set forth concisely
and under distinct the grounds heads of appeal without any argument or
narrative and such grounds should be numbered consecutively.
3. (i) The appeal shall be in duplicate.
(ii) The appeal shall be accompanied ...........
(a) Where it is an appeal against an order of assessment, by a treasury
receipt in support of having paid the fee calculated at the rate
of the disputed tax or penalty subject to a minimum fifty rupees
and a maximum of one thousand rupees. The fee shall be credited
into a Government Treasury to the following Account
“......................”.
(b) Where it is an appeal against an order not being an assessment,
by Court fee stamps of the value of three rupees affixed to one
of the copies.
——
FORM-II
Form of Appeal memorandum to the appellate
Tribunal
[See Rule 9(11)(i)]
Appeal Memorandum to the Appellate Tribunal
In the Appellate Tribunal, Andhra Pradesh.
No. ................... of 19 .......
.................................. ................. Appellant(s)
Versus
.................................. ................. Respondent
1. District in which assessment was
made.
2. Assessment Year.
3. Authority passing the original order in
dispute.
4. Appellate Deputy Commissioner of
Commercial Taxes passing the order
under Section 13(3) or the Deputy
Commissioner or Joint Commissioner/

Additional Commissioner passing an
order under Section 14(2).
5. Date of Communication of the
order now appealed against.
6. Address to which notice may be
sent to the appellant.
7. Address to which notices may be
sent to the respondent.
8. Relief claimed in appeal :
(a) Purchase Value of determined by the assessing authority passing
the assessing order disputed.
(b) Purchase value of confirmed by the Appellate Deputy Commissioner
of Commercial Taxes or by Deputy Commissioner or Joint
Commissioner/Additional Commissioner as the case may be.
(c) If purchase value of is disputed—
(i) Disputed value
(ii) Tax due on the dispute value
(d) If rate of tax is disputed—
(i) Purchase value involved
(ii) Amount of the tax
(e) Specify, if any, other relief claimed.
9. Grounds of appeal etc.
(Signed) Authority representative, if any
Verification
I/We .......................................... the appellant(s) do hereby declare
that what is stated above is true to the best of my/our knowledge and
belief.
Verified today the ............ day of ............ 19 ........
(Signed) Authority representative, if any.
Note:— 1. The appeal should be in quadruplicate and should be

accompanied by four copies (atleast one of which should be the original
or an authenticated copy) of the order appealed against and also three copies
of the order of the assessing authority.
2. The appeal shall be accompanied by a Treasury receipt in support
of having paid of a fee calculated at the rate two percent of the disputed
tax or penalty subject to a minimum of Rs. 100/- and maximum of Rs.
2,000/- in cases where the levy of tax is disputed and fee of Rs. 100
in all other cases. The fee should be credited in a Government Treasury
to the following head of account:–
“...............................”
and under distinct heads the grounds of appeal without any argument or
narrative and such grounds should be numbered consecutively.
——
FORM-III
REVISION PETITION
In the High Court of Andhra Pradesh at Hyderabad
[Appellate Side]
Memorandum of Civil Revision Petition
[Under Section 16(1)]
[See Rule 19(2)]
Civil Revision Petition No. ..........................
.................................. ............... Petitioner
Versus
.................................. ............... Respondent
Revision Petition presented to the High Court to revise the Order of

the Appellate Tribunal.
Date .................. and passed in .........
1. District in which the assessment was
made.
2. Assessment Year.
3. The designation of the Officer whose
orders were appealed against before the
Appellate Tribunal.
4. Date of Communication of the order of

the Appellate Tribunal.
5. Findings of the Appellate Tribunal (State
in serial and appropriate order the relevant
findings arrived at by the Tribunal).
6. Question of law raised for decision by
the High Court.
(here formulate the question of law raised
concisely, etc.)
(Signed) Petitioner(s)
(Signed) Authorised representative, if any.
Certificate
I/We ..................................... the petitioner(s) do hereby declare that
what is stated above is true to the best of my/our knowledge and belief.
Verified to-day the ............ day of ........ 19 ....
Note:— 1. The petition should be accompanied by a certified copy
of the order of the Appellate Tribunal.
2. The petition should (if preferred by a dealer) be accompanied by
a fee of Rs. 500/-
3. The petition should be written in English and should be set forth
concisely and under distinct heads the facts of the case, the findings arrived
at by the Tribunal, and the questions of law, raised consecutively. There
should be no argument or inarrative.
——
FORM-IV
APPEAL
(Appellate Side)
Memorandum of appeal against order
[Under Section 17]
[See Rule 11]
Appeal against order No...................

.................................. ................. Appellant
Versus
.................................. ................. Respondent
Appeal against the order of the Commissioner of Commercial Taxes-
dated .................. and passed in .........................
1. District in which the assessment was
made.
2. Assessment year.
3. Assessing Authority passing the original
order.
4. State if the order was modified at any
time previously by any officer subordinate
to the Commissioner of Commercial Taxes
and if so in what manner (state the results
of modification briefly)
5. Date of communication of the order of
the Commissioner of Commercial Taxes.
6. Address to which notice may be sent to
the appellant.
7. Address to which notice may be sent to
the respondent.
8. Relief claimed in appeal—
(a) Purchase Value of determined by the
assessing authority.
(b) Value as modified prior to suo-motu
revision by the Commissioner of
Commercial Taxes.
(c) Value as modified and fixed by the
Commissioner of Commercial Taxes.
(d) Relief Claimed
(e) Grounds of appeal
(i) State the facts disputed briefly.
(ii) State the question of law revised, for
decision by the High Court.
Verification
I/We ................................................ the applicant(s) do hereby declare
that what is stated as above is true to the best of my/our knowledge and
belief.
Verified to-day the ............. day of ............ 19 ..........
Note:— 1. The appeal should be accompanied by a certified copy
of the order of the Commissioner of Commercial Taxes appealed against.
2. The appeal should be accompanied by a fee calculated at the rate
of two percent of tax or penalty under dispute subject to a minimum of
one hundred rupees and a maximum of two thousand rupees.
and under distinct heads, the facts of the case, the grounds of appeal and
the points of law raised consecutively.
——
FORM-V
REVIEW
[Appellate Side]
Memorandum of Civil Miscellaneous Petition
[Under Section 16]
[See Rule 12(1)]
Civil Miscellaneous Petition No. ...........................
.................................. .............. Petitioner
Versus
.................................. .............. Respondent
Petition for review of the order of the High Court, dated .................
and passed in Civil Revision Petition No. .................................
1. Number and date of the order of the
High Court now sought to be
reviewed.
2. Date of communication of the order.
3. Question of law decided by the High

Court (here formulate the decisions
of the High Court concisely)
4. Fresh facts which were not before
High Court concisely)
5. Questions of law now raised, etc.
(Signed) Applicant(s)
Verification
I/We ........................... the applicant(s) do hereby declare that what
is stated above is true to the best of my/our knowledge and belief.
Verified to-day the ................... day of ............ 19 .......
Note:– 1. The application should be accompanied by a certified copy
of the order of the High Court sought to be reviewed.
2. The application should if it is preferred by a dealer be accompanied
by a fee of Rs. 500/-
3. The applicant should be written in English and should set forth
concisely and under distinct heads of fresh facts which were not before
the High Court at the time of passing original order. There should be no
argument or narrative.
——
FORM-VI
Review Petition
[Appellate Side]
Memorandum of Civil Miscellaneous Petition
[Under Section 17 of the Act]
[See Rule 12(1)]
Civil Miscellaneous Petition .................................
.................................. .............. Petitioner

Versus
.................................. .............. Respondent
Petition for review of the order of the High Court and passed in date
............... appeal against order No. ......................
1. Number and date of the order of the
High Court sought to reviewed.
2. Date of communication of the order.
3. Question of fact decided by the High
Court.
Court.
5. Fresh facts which were not before
the High Court when it passed the
original order (State facts briefly
without a narrative).
6. Questions of fact now raised.
7. Questions of law now raised.
Verification
I/We ............................. the applicant(s) do hereby declare that what
is stated above is true to the best of my/our knowledge and belief.
Verified to-day the ........................ day of .............. 199
Note:– 1. The application should be accompanied by a certified copy
of the order of the High Court sought to be reviewed.
2. The application should, if it is preferred by a dealer be accompanied
by a fee of Rs. 500/-.
3. The application should be written in English and should set forth
concisely and under distinct heads of fresh facts which were not before
the High Court at the time of passing original order and the question of
facts and law raised. There should be no argument or narrative.
——
VAT–51
FORM VII
Notice of penalty and demand
[See Rule 23]
Assessment No. ...........................
Penalty Register No. ...................
To
(Importer)
Take notice that you have to pay a penalty of Rs. .............. (Rupees
..............................................................) (in words) under Section ... of
the Andhra Pradesh Tax on Entry on Motor Vehicles into Local Areas
Act, 1996. The penalty shall be paid within thirty/ ....... days from the date
of receipt of this notice by Demand Draft in favour of the undersigned
............................. or by remittance into the Government Treasury at
................ failing which the amount will be recovered as if it were an
arrear of land revenue.
Place :
Date : Assessing Authority.
Notes:– 1. If payment is made by Demand Draft, the Demand Draft
should be crossed and shall be such as under the Andhra Pradesh Treasury
Code, may be received by the Treasury concerned.
2. Where the assessing authority has for reasons recorded in the
penalty orders proposed that the importer should pay the penalty levied within
a period of less than thirty days he should strike out the words “thirty”,
and note such lessor period specified in the order, and duly attest the entry.
3. The authority imposing penalty shall mention the section(s) under
which the penalty is levied in the space left blank.
——
FORM-IX
Form of Summons under the Andhra Pradesh Tax on
Entry of Motor Vehicles into Local Areas Act, 1996
[See Rule 19]
Summons to appear in person and/or to produce
document.
To
Whereas your attendance is necessary to give evidence/whereas the
following documents (here describe the documents in sufficient detail to
permit of their, identification with reasonable certainity) are required with

reference to an enquiry under the Andhra Pradesh Tax on Entry of Motor
Vehicles into Local Areas Act, 1996 (here enter briefly the subject of
enquiry) now pending before me, you are hereby summoned to appear in-
person/to produce or cause to produce, the said documents before me on
the .................. day of .......19... at .......................‘O’ clock at (place)
................................................... and not to depart thence until permitted
by me*.
Given under my hand and seal this ............................ day of ...............
19 ................
Signature
Official Designation
*These words should be omitted where the summons is for the

production of documents only.
——
NOTIFICATIONS
1. Rate of Entry Tax on Motor Vehicles w.e.f. 1-8-1996

[G.O.Ms.No. 636 Revenue (CT-II) Dept., dt. 2-8-1996]
In exercise of the powers conferred by Section 12 of Andhra Pradesh
Tax on Entry of Motor Vehicles into Local Areas Ordinance, 1996, the
Governor of Andhra Pradesh hereby specifies that, with effect from First
day of August, 1996 tax shall be levied and collected under the said
Ordinance at the rates specified in column (3) of the table given below
on the entry of Motor Vehicles specified in corresponding entries in column
(2) thereof.
S.No. Category of Motor Vehicles Rate of Tax
1 2 3
1. Motor Cars, Motor Taxicabs Eight per cent
2. Jeeps Eight per cent
3. Motor cycles and motor scooters, motorettes. Eight per cent
4. Three wheelers – Tempos, five wheelers and Eight per cent
autorickshaws
5. Motor omnibus Eight per cent
6. Motor Vans Eight per cent
7. Motor-lorries Eight per cent
8. Chassis of Motor Vehicles Tractors and all Eight per cent
other types of motor vehicles
Note:– The above G.O. was superseeded by G.O.Ms.No. 917, Rev.
(CT. II) Dept., dt. 31-12-1999 printed infra.
2. Rate of Tax on Motor Vehicles increased under Andhra Pradesh
General Sales Tax Act – Consequential increase under this Act
[G.O.Ms.No. 917, Rev. (CT.II) Dept., dt. 31.12.1999]
In exercise of the powers conferred under 1[Section 3] of the Andhra
Pradesh Tax on Entry of Motor Vehicles into Local Areas Act, 1996, and
in supersession of orders issued in G.O.Ms.No.636, Revenue (CT.II)
Department dated 2.8.1996, the Governor of Andhra Pradesh hereby specifies
that, with effect from the 1st day of January, 2000 tax shall be levied
and collected under the said Act at the rates specified in Column (3) of
the table given below on the entry of Motor Vehicles specified in corresponding
entries in Column (2) thereof.
1. Subs. for "Section 12" by G.O.Ms.No. 211, Rev. (CT-II) Dept., dt. 21-3-2011.
w.r.e.f. 31-12-1999.
804
Notifications 805

1. Motor Cars, Motor Taxi Cabs Twelve per cent
2. Jeeps Twelve per cent
3. Motor Cycles and Motor Scooters, Motorettes Twelve per cent
4. Three Wheelers – Tempos, Five Wheelers and Twelve per cent
auto-rickshaws.
5. Motor Omnibuses Twelve per cent
6. Motor Vans Twelve per cent
7. Motor – Lorries Twelve per cent
8. Chassis of Motor Vehicles, all other types of Twelve per cent
motor vehicles excluding Tractors, Power tillers.
Note:– The above G.O. was superseeded by G.O.Ms.No. 159, Rev. (CT. II)
Dept., dt. 12-3-2012 printed below.
2A. Enhancing the rates of tax on Entry of M.V. into Local Areas,
in tune with the rates of tax prescribed under APVAT Act, 2005
[G.O.Ms.No. 159 Rev. (CT.II) Dept., dt. 12-03-2012]
In exercise of the powers, conferred by section 3 of the Andhra
Pradesh Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (Act
No.26 of 1996) and in supersession of the orders issued in G.O.Ms.No.917,
Revenue (CT.II) Department, dt.31.12.1999 the Governor of Andhra Pradesh
hereby specifies that the tax shall be levied and collected under the said
Act at the rate of Tax specified in Column (3) of the Table given below
on the entry of Motor Vehicles specified in the corresponding entries in
Column (2) thereof.
1. Motor Cars, Motor Taxi Cabs Fourteen and half per
cent (14.5%)
2. Jeeps Fourteen and half per
cent (14.5%)
3. Motor Cycles and Motor Scooter Fourteen and half per
Motorettes cent (14.5%)
4. Three Wheelers – Tempos, Five Fourteen and half per
Wheelers and auto-rickshaws cent (14.5%)
5. Motor Omnibuses Fourteen and half per
cent (14.5%)
6. Motor Vans Fourteen and half per
cent (14.5%)
7. Motor – Lorries Fourteen and half per
cent (14.5%)
8. Chassis of Motor Vehicles, all other Fourteen and half per
types of motor vehicles excluding cent (14.5%)
tractors, power tillers
3. Exemption from payment of Entry Tax on the dealers registered

under the Andhra Pradesh General Sales Tax Act, 1957.
1
[G.O.Ms.No. 974 Rev. (CT.II) Dept., dt. 26-11-1996]
No. 26 of 1996), the Governor of Andhra Pradesh hereby exempts from
the tax payable under the said Act by any importer who is a registered
dealer 2[pays tax on sale of such vehicle under Section 5(1) of the Andhra
Pradesh General Sales Tax Act] under the Andhra Pradesh General Sales
Tax Act, 1957 (Act No. VI of 1957) on the entry of Motor Vehicles
specified in the Table below into the local areas of the State under Section
3(1) of the Andhra Pradesh Tax on Entry of Motor Vehicles into Local
Areas Act, 1996 (Act 26 of 1996) read with Notification issued in
G.O.Ms.No.636, Revenue (CT.II) Department, dated 2.8.1996 and published
in the Andhra Pradesh Gazette (Part I Extraordinary) No.350, dated the
2nd August, 1996 2[and G.O.Ms.No.974 Revenue (CT.II) Department dated
26th November, 1996].
2. This notification shall be deemed to have come into force with
effect from the 1st August, 1996.
Table
Sl.No. Category of Motor Vehicles
1 2
1. Motor Cars, Motor taxi cabs.
2. Jeeps.
3. Motor Cycles and Motor Scooters, Motorettes.
4. Three wheelers - Tempos, Five wheelers and Auto Rickshaws.
5. Motor Omni Buses.
6. Motor Vans.
7. Motor lorries.
8. Chassis of Motor Vehicles, Tractors and all other types of Motor
Vehicles.
4. Exempting Lepra India, Andhra Pradesh unit from payment of
tax on (25) Vehicles (Jeeps) under the Andhra Pradesh Tax
on Entry of Motor Vehicles into Local Areas Act, 1996
[G.O.Ms.No. 116, Revenue (CT-II) Dept., dt. 17-2-1997]3
(Andhra Pradesh Act No. 26 of 1996), the Governor of Andhra Pradesh
hereby exempts the Lepra India, Andhra Pradesh Unit from payment of
Entry Tax on Twenty Five (25) Vehicles (Jeeps) as these vehicles are
meant for noble purpose.
1. Pub. in A.P. Gaz., Part I Ext. No. 537, dt. 28.11.1996.
2. Ins. by G.O.Ms.No.430 Rev., dt. 21.5.1997 pub. in A.P. Gazette Pt-I, Ext. dt.27.5.1997.
3. Pub. in A.P. Gaz. Pt. I, Ext. No. 70, dt. 20-2-1997.
Notifications 807
5. Exempting – Care India – Andhra Pradesh Unit from payment

of tax on certain vehicles
[G.O.Ms.No. 155, Revenue (CT-II) Dept., dt. 28-2-1997]
(Andhra Pradesh Act No. 26 of 1996) the Governor of Andhra Pradesh
hereby exempts the Care India, Andhra Pradesh unit from payment of Entry
Tax on vehicle which are exclusively used for distribution of food.
6. Reduction in rate of tax on entry of tractors into local area.
[G.O.Ms.No. 570, Revenue (CT-II), dated 7-5-1997]1
In exercise of the powers conferred by section 12 of the Andhra
hereby directs that the tax leviable on the entry of tractors into any local
area be at the reduced rate of 4 paise in the rupee.
7. Exempting – CARE INDIA, Andhra Pradesh Unit from payment
of tax on certain vehicles – Modifications
[G.O.Ms.No. 609 Rev. (CT.II) Dept., dt. 16-7-1997]2
Act 26 of 1996) and in partial modification of the orders issued in G.O.Ms.No.
155, Revenue (CT.II) Department, dated 28.2.1997, the Governor of Andhra
Pradesh hereby exempts CARE INDIA, Andhra Pradesh unit from payment
of Entry Tax on all vehicles brought by CARE for monitoring the distribution
of Food in Andhra Pradesh.
8. Appointment of CTO’s to exercise powers & functions of
assessing authorities
[G.O.Ms.No. 680, Rev. (CT-II) Dept., dt. 12-8-1997]
Notification I
hereby appoints the Commercial Tax Officers to exercise the powers and
perform the functions of assessing authority under the said Act, and rules
made thereunder within their respective jurisdictions as notified under the
Andhra Pradesh General Sales Tax Act, 1957 (Andhra Pradesh Act No.
VI of 1957).
1. Pub. in A.P. Gazette, Ext. No. 255, Part I, dt. 9-7-1997.
9. Appointment of Appellate Deputy Commissioners of Commercial

Taxes to exercise the powers of the appellate authority
Notification II
Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (Andhra
Pradesh Act No. 26 of 1996), the Governor of Andhra Pradesh hereby
appoints Appellate Deputy Commissioners of Commercial Taxes to exercise
the powers of the appellate authority under Section 13 of the said Act in
their respective jurisdictions as notified under the Andhra Pradesh General
Sales Tax Act, 1957 (Andhra Pradesh Act No. VI of 1957).
10. CTO’s to exercise the powers specified in APGST Act, 1957
Notification III
of the Andhra Pradesh Tax on Entry of Motor Vehicles into Local Areas
Pradesh hereby authorises the Commercial Tax Officers to exercise the
powers specified in Section 19 of the said Act within their respective
jurisdiction as notified under the Andhra Pradesh. General Sales Tax Act,
1957 (Andhra Pradesh Act No. VI of 1957).
——
11. Exemption from payment of Entry Tax - State Health Transport
Organisation.
[G.O.Ms.No.831 Rev. (CT-II) Dept., dt. 27.9.1997]
(Andhra Pradesh Act 26 of 1996), the Governor of Andhra Pradesh hereby
exempts the State Health Transport Organisation from payment of Entry
Tax on all vehicles received from Government of India for use in National
Programme for control of Blindness in Andhra Pradesh and also other
vehicles gifted to State Health Department by various other organisations.
——
12. Exempting the Society of St. Anne, Guntur from payment of tax
of Rs. 25,703/- for Tata Sumo Vehicles
[G.O.Ms.No.898 Rev. (CT-II) Dept., dt. 16.11.1998]
Notifications 809

Act 26 of 1996), the Governor of Andhra Pradesh hereby exempts the
Society of St. Anne, Guntur from payment of Entry Tax of Rs. 25,703/
- (Rupees Twenty five thousand seven hundred and three only) on Tata
Sumo Vehicle donated to it.
——
13. Exemption from levy of tax on Motor Vehicles donated to Sri Satya
Sai Central Trust
[G.O.Ms.No. 831 Revenue (CT.II) Dept., dt. 29-11-1999]
Act 26 of 1996), the Governor of Andhra Pradesh hereby grants exemption
from the levy of Entry tax on the Motor Vehicles donated for Charitable
activities to Sri Satya Sai Central Trust, Prashanti Nilayam, Anantapur
District.
——
14. Exemption from levy of tax on Motor Vehicles donated to Action
for Food Production — AFPRO, Secunderabad.
3
[G.O.Ms.No. 377, Revenue (CT. II) Dept., dt. 3-6-2000]
Act 26 of 1996) the Governor of Andhra Pradesh hereby grants exemption
from the levy of Entry Tax on (2) two numbers of Mahindra & Mahindra
Jeeps donated by WEM, Hamburg, Germany to Action for Food Production
-AFPRO, Secunderabad.
——
15. Exempting Lepra India, Andhra Pradesh Unit from Payment of
Tax on (25) Twenty Five Vehicles (Jeeps).
2
[G.O.Ms.No. 301, Revenue (CT. II) Dept., dt. 1.5.2001]
hereby exempts the LEPRA INDIA, Andhra Pradesh Unit from payment

2. Pub. in A.P. Gaz. Pt. I, Ext. No. 181-C, dt. 5-5-2001.
of Entry Tax on Twenty Five (25) Vehicles (Jeeps) as these vehicles are
meant for noble charitable purpose.
16. Exemption of Entry Tax on the Purchase of ‘Battery Operated
Vehicle’ by the Environment Protection Training and Research
Institute.
[G.O.Ms.No. 508, Revenue (CT.II) Dept., dt. 20-7-2001]1
26 of 1996) the Governor of Andhra Pradesh hereby grants exemption from
levy of Entry Tax on the battery operated vehicle purchased by the
Enviornment Protection Training and Research Institute, Hyderabad from
Bharat Heavy Electricals Limited (BHEL), Bhopal.
17. Exemption of Entry Tax on the purchase of vehicle from Mahendra
and Mahendra Limited, Mumbai by the Aliyavar Jung National
Institute for the hearing handicapped, Southern Regional Centre,
Secunderabad.
[G.O.Ms.No.551, Revenue (CT-II) Deptt., dt. 8-8-2001]2
Act 26 of 1996), the Governor of Andhra Pradesh hereby grants exemption
from levy of Entry Tax on the Vehicle purchased from Mahendra and
Mahendra Limited, Mumbai by the Aliyavar Jung National Institution for
the hearing Handicapped, Southern Regional Centre, Secunderabad.
18. Rotary Service Complex Trust (Regd.), Proddatur, from payment
of Entry Tax under the said Act on the ‘L.M.V. Passenger
(Ambulance) bearing Chassis No. 386221 6ZZ 710581
[G.O.Ms.No. 461, Rev. (CT-II) Dept., dt. 31-7-2002]3
Act No. 26 of 1996), the Governor of Andhra Pradesh hereby exempts
the ‘Rotary Service Complex Trust (Regd.), Proddatur, from payment of
Entry Tax under the said Act on the ‘L.M.V. Passenger (Ambulance)
bearing Chassis No. 386221 6ZZ 710581’ as this is meant for operating
free medical services to poor and needy of drought prone areas.
19. Exemption from levy of tax on ‘Maruthi Omni 8 Seater’ donated
to the Aathmeeya Manasika Vikas Kendram donated by Rotary
Club of Secunderabad
[G.O.Ms.No. 564, Revenue (CT.II), dt. 16-9-2002]4

3. Pub. in A.P. Gazette Part-I Extra-ordinary No. 355 dt. 3-8-2002.
Notifications 811

the ‘Maruthi Omni 8 Seater’ donated by Rotary Club of Secunderabad to
the ‘Aathmeeya Manasika Vikas Kendram’ from payment of Entry Tax
under the said Act.
Note:– The above G.O.Ms.No. 564 is superseded by G.O.Ms.No. 452
Rev. (CT.II), dated 24.3.2003, printed below.
Exemption of Sales Tax on one Maruthi Omni 8 seater, donated
by Rotary Club of Secunderabad to Aathmeeya Manasika Vikas
Kendram, Secunderabad
In supersession of the orders issued in G.O.Ms.No. 564, Revenue
Department, dated 16.9.2002, and in exercise of the powers conferred by
sub-section (1) of Section 9 of Andhra Pradesh General Sales Tax Act,
1957 (Act No. VI of 1957) the Governor of Andhra Pradesh hereby exempts
from the tax leviable on the sale of one Omni 8 (MPI) Van bearing Chassis
No. 5191-IN-527043 & Engine No.EBB-IN-2281236, donated by the Rotary
Club of Secunderabad to the ‘Aathmeeya Manasika Vikas Kendram’ under
the said Act.
20. Exemption from levy of tax on the purchase of one Jeep by
M/s. David Rees Leprosy Hospital and Control Project, Yerpedu,
Chittoor District for their official use.
M/s. David Rees Leprosy Hospital and Control Project, Yerpedu, Chittoor
District from payment of Entry Tax under the said Act on the purchase
of one Jeep, which is meant for their official use.
21. Exemption from levy of Tax on the purchase of Eight Volvo
Coaches brought from Bangalore by APTDC – Notification –
Issued.
[G.O.Ms.No.474 Revenue (CT-II) Deptt., dt. 28-3-2003]3
Act No.26 of 1996), the Governor of Andhra Pradesh hereby exempts 8
(eight) Volvo Coaches brought from Bangalore by Andhra Pradesh Tourism
Development Corporation Limited, from payment of Entry Tax under the
said Act.

22. Exemption from Levy of Tax on the Entry of One Crane, to be

used by the Krishna District Lorry Owners Association, Vijayawada
allotted by Ministry of Road Transport and High Ways, Government
of India.
[G.O.Ms.No. 245 Revenue (CT.II) Department dt. 8-3-2004]
Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (A.P. Act No.
26 of 1996), the Governor of Andhra Pradesh hereby exempts one Crane,
allotted by Ministry of Road Transport and Highways, Government of India,
under National Highways Accident Relief Service Scheme (NHARSS) to be
used by the “Krishna District Lorry Owners Association”, Vijayawada, from
levy of Entry Tax under the said Act.
23. Purchase of Vehicle by Ex-Serviceman from Canteen Stores
Department, Jalandhar – Levy of Entry Tax @ 4%
[G.O.Ms.No. 349, Revenue (CT.II), 26th April, 2004]1
26 of 1996), the Governor of Andhra Pradesh hereby directs that the tax
shall be levied @ 4% on the entry of a Motor Vehicle i.e. Ford Icon, bearing
chasis No. 4R-74616, purchased by Sri K.N. Rao, Brigadier (Retd.) from
Canteen Stores Department, Jalandhar, under the said Act, the rate at which
sales tax is leviable under the provisions of APGST Act had the Motor Vehicle
been purchased from Military Canteen Stores in Andhra Pradesh.
24. Purchase of Santro Car by Capt. K.C. Rao, Administrative
Officer, Army Ordnance Corps Records, Secunderabad – Levy
of Entry Tax @ 4%
[G.O. Ms. No. 1106, Revenue (CT. II), dated 29-12-2004]2
26 of 1996), the Governor of Andhra Pradesh hereby directs that the tax
shall be levied @ 4% on the entry of Santro Car, bearing No. TN05 K-
4413, purchased from M/s. TAFE ACCESS Ltd., Chennai, by Capt. K.C.
Rao, Administrative Officer, O/o Army Ordnance Records, Secunderabad,
under the said Act.
25. Certain Exemption to M/s. Hyderabad International Airport Limited,
Hyderabad under the Andhra Pradesh Tax on Entry of Motor
Vehicles into Local Areas Act, 1996
[G.O.Ms.No. 1284, Revenue (CT.II), 30th June, 2005]3
Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (Act No. 26
of 1996), the Governor of Andhra Pradesh hereby directs that the tax leviable
under the said Act on the entry of Motor Vehicles, purchased by M/s.
Hyderabad International Airport Limited or their contractors and sub-contractors
and brought into the local areas of Andhra Pradesh for utilization in execution
of work relating to construction of Hyderabad International Airport, shall be
1. Pub. in A.P. Gaz. Pt-I, Ext. No. 180, dated 27-4-2004.
2. Pub. in the A.P. Gaz., Pt. I, Ext.No. 540, dt. 31.12.2004.
3. Pub. in A.P. Gaz. Pt-I, Ext. No. 484, dt. 7-7-2005.
Notifications 813
exempted under the provisions of the said Act, provided M/s. Hyderabad
International Airport Limited, furnishes a declaration to the effect that the
said Motor Vehicles purchased from outside the State and brought into the
State of Andhra Pradesh are for utilization in execution of works relating
to Hyderabad International Airport.
26. Exemption from levy and collection of Tax on the import of the
Ambulance brought for the use of the Primary Health Centre,
Navipet, Nizamabad District
[G.O. Ms.No. 685, Revenue (CT.II), dated 12-6-2006]1
Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (Act No. 26 of
1996), the Government of Andhra Pradesh hereby directs that the tax leviable
under the said Act on the entry of an Ambulance Vehicle, brought for the use of
Primary Health Centre, Navipet, Nizamabad District, shall be exempted under
the provisions of the said Act.
27. Exemption from levy and collection of Tax on the Entry of Goods/
Vehicles brought into the State of Andhra Pradesh by them for
execution of works for construction of Gangavaram Port
[G.O.Ms.No.703, Revenue (CT. II), dated 15-6-2006]2
II. In exercise of the powers conferred by S. 12 of Andhra Pradesh
Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (Act No. 26
of 1996), the Governor of Andhra Pradesh hereby directs that the tax leviable
under the said Act on the entry of Motor Vehicles, purchased and brought
by M/s. Gangavaram Port Limited, into the local areas of Andhra Pradesh
for utilization in execution of work relating to construction of Gangavaram
Port shall be exempted under the provisions of the said Act, provided M/
s. Gangavaram Port Limited, furnished a declaration to the effect that the
said Motor Vehicles purchased from outside the State and brought into the
State of Andhra Pradesh are for utilization in execution of works for construction
of Gangavaram Port only.
This notification shall be deemed to have come into force with effect
from 1st day of September, 2005, and shall be in force till December, 2008
or the completion of the said project, whichever is earlier.
28. M/s. Sunrock Company Limited – Exemption from levy and collection
of tax on the entry of (6) Tipper Lorries brought into the State
of Andhra Pradesh by them
[G.O. Ms. No. 1078, Revenue (CT. II), dated 4-8-2006]
1996), the Governor of Andhra Pradesh hereby directs that the tax leviable
under the said Act on the entry of (6) Tipper Lorries, purchased and brought at
the cost of Rs. 63,18,060-00, by M/s. Sunrock Company, into the local areas
of Andhra Pradesh, for their quarry mining operations, shall be exempted under
1. Pub. in the A.P. Gaz., Pt. I, Ext., No. 342, dt. 14-6-2006.
2. Pub. in the A.P. Gaz., Pt. I, Ext., No. 357, dt. 20-6-2006.
the provisions of the said Act, provided that the said (6) Tipper Lorries purchased
by M/s. Sunrock Company, from outside the State and brought into the State of
Andhra Pradesh are for use in their 100% EOU quarry mining operations only,
and M/s. Sunrock Company furnishes declaration to that effect.
29. Exemption from Levy and Collection of Tax on the Entry of Goods/
Vehicles brought into the State of Andhra Pradesh by them for
execution of works for construction of M/s. Krishnapatnam Port
Company Limited.
[G.O. Ms. No. 1931, Revenue (CT. II), dated 28-12-2006]
(1) From M/s. Krishnapatnam Port Company Limited, repn. No. KP/
KHP/114, dt. 19-6-2006, addressed to TR&B Department.
(2) U.O.No. 8546/A/2004, dt. 14-11-2006, of TR&B (Ports) Department.
1996), the Governor of Andhra Pradesh hereby directs that the tax leviable
under the said Act on the entry of Motor Vehicles, purchased and brought by
M/s. Krishnapatnam Port Company Limited, into the local areas of Andhra
Pradesh for utilization in execution of work relating to construction of
Krishnapatnam Port shall be exempted under the provisions of the said Act,
provided M/s. Krishnapatnam Port Company Limited, furnishes a declaration to
the effect that the said Motor Vehicles purchased from out side the State and
brought into the State of Andhra Pradesh are for utilization in execution of
works for construction of Krishnapatnam Port, only.
This notification shall be deemed to have come into force with effect
from the month of June, 2006, and shall be in force till April, 2010, or the
completion of the said project, which ever is earlier.
30. Amendment of Section-4 in sub-section (3) of Andhra Pradesh Tax
on Entry of Motor Vehicles into Local Areas (Amendment) Act, 2008
– Date of commencement.
[G.O.Ms. No.1154, Revenue (CT. II), dated 01-10-2008.]
In exercise of the powers conferred by sub-section (2) of Section-1 of
the Andhra Pradesh Tax on Entry of Motor Vehicles into Local Areas
(Amendment) Act, 2008 (Act. No.26 of 2008), the Government of Andhra
Pradesh hereby appoint 1st October, 2008 as the date from which the said
Amendment Act (Act. No.26 of 2008) shall come into force.
31. Exemption from levy of tax for 2 (two) Vehicles donated to the
Central Prison, Rajahmundry.
1
[G.O.Ms.No. 1247, Revenue (CT. II), dated 29-9-2010.]
Tax on Entry of Motor Vehicles into Local Areas Act, 1996 (Act No.26 of
1996), the Government of Andhra Pradesh hereby exempt M/s.GAIL, Pune,
from the payment of Entry Tax under the said Act on the purchase of 2(two)
vehicles donated to Central Prison, Rajahmundry for shifting prisoners to outside
hospitals under their Scheme of “Corporate Social Responsibility”.
-----
1. Pub. in A.P. Gaz. Pt-I, Ext. No. 539, dt. 30-9-2010.
Forms in Department Website and Manuals 815
GOVERNMENT OF ANDHRA PRADESH FORM TOT 018

COMMERCIAL TAXES DEPARTMENT
NOTIFICATION OF COMPULSORY CANCELLATION

OF TOT REGISTRATION
01. Tax Office Address: Date Month Year

............................................
............................................
........................................... 02 GRN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have been advised in Form TOT 013, dated............................... proposing

to cancel your TOT registration for the reasons stated therein:
(1) *You have not responded within the time given to you:
(2) *On consideration of reply filed by you in response to Form TOT 013
I hereby conform the cancellation of your TOT registration for the reasons
given below:
Asst. Commercial Tax Officer
TOT Registering Authority
................. Circle.
*Strike off which is not applicable
---------
816 Forms in Department Website and Manuals

NOTIFICATION OF ADVICE/REDUCTION/REFUSAL
OF REFUND TO A TOT DEALER/OTHERS
Date Month Year

01. Tax Office Address:
............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have filed an application on Form TOT 030, dated............................... for

an amount of Rs....................(Rupees.........................................) as Refund from
the Commercial Taxes Department in pursuance of *Order of Assessment/
Revision/Appeal/Cancellation of Registration/Others.
On scrutiny of your application:
* The refund claim has been accepted
* The refund amount is restricted to Rs.......... (Rupees.........................) for
the reasons ......................................................
* The refund claim is rejected for the reasons .......................................
Now I am herewith enclosing a refund Voucher No............... dated.................
for an amount of Rs....................... (Rupees ...................................) being an
amount of refund made by the Commercial Taxes Department.
Signature of the Officer
Designation Stamp & Seal
(*Strike off which is not applicable)
Note:– Complete in duplicate.
---------
GOVERNMENT OF ANDHRA PRADESH FORM TOT 035A

APPROVAL OF REFUND CLAIM BY COMMISSIONER/

DY. COMMISSIONER TO TOT DEALERS/OTHERS
Date Month Year

............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
The above dealer filed an application on *Form TOT 030 dated.............. for
an amount of Rs.................. (Rupees .............................) as Refund from the
Commercial Taxes Department in pursuance of Order of Assessment/Revision
/Appeal/Cancellation of Registration/Others.
As the refund amount is Rs.......................... which is more than Rs..............
approval may be given for sanction of refund to the above dealer.
On scrutiny of the application :
* The refund claim has been accepted
* The refund amount is restricted to Rs.......... (Rupees.........................) for
the reasons ......................................................
* The refund claim is rejected for the reasons .......................................
Commissioner/Dy. Commissioner.
---------
VAT–52

PAYMENT OF INTEREST BY COMMERCIAL TAXES

DEPARTMENT TO TOT DEALER/OTHERS
01. Tax Office Address: Date Month Year

............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
The above dealer filed an application on Form TOT 030 dated.............. for
an amount of Rs.................. (Rupees .............................) as Refund from the
Commercial Taxes Department in pursuance of Order of Assessment/Revision
/Appeal/Cancellation of Registration/Others which has been accepted on Form
TOT 035 and not been paid as on date.....................which attracts penal interest.
Now I am herewith enclosing a refund Voucher No................... dated............for
an amount of Rs........................ (Rupees...................)being an amount towards
penal interest made by the Commercial Taxes Department.
-------

RESPONSE TO NOTIFICATION OF CHANGES IN TOT

REGISTRATION DETAILS
Date Month Year

............................................
............................................
........................................... 02 GRN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Your notification of changes in registration details in Form TOT 051 dated.............

has been received.
I am to advise you as follows:
*(1) Your change in address has been noted, you submit your TOT Registration
Cetificate to this office for necessary action.
(2) Your change in name/legal status has been noted. I enclose herewith a
Form TOT 014 cancel your current registration and Form TOT 001 to
apply for registration under your new name/legal status.
*(3) I enclose herewith a Form TOT 014 to apply for cancelling your TOT
Registration.
*(4) I have received your notification of a change in composition of the
partnership, director’s etc., but have to advise you that cancellation of
your registration is not appropriate. You must continue to file Quarterly
returns and pay TOT to the Tax Department.
*(5) Your Change in business activities/principle commodities traded has been
recorded.
*(6) Your change in bank account details has been recorded.
Asst. Commercial Tax Officer,
........................... Circle.
---------

NOTIFICAITON OF AMENDED TOT REGISTRATION

CERTIFICATE
Date Month Year

............................................
............................................
........................................... 02 GRN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Your change of address/change of legal status has been recorded and I enclose
herewith an amended TOT Registration Certificate.
You must continue to file TOT Quarterly returns and pay the due taxes.
Asst. Commercial Tax Officer,

................................ Circle.
--------

APPLICATION OF TOT DEALER/OTHERS

FOR PAYMENT OF AMOUNT OUTSTANDING
BY INSTALMENTS
Date Month Year
............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
I/We have to pay the following amount outstanding to the Commercial Taxes
Department as on ..........................................
Tax Rs.
Penalty Rs.
Penal Interest Rs.
----------
Total Rs.
----------
Now I/We am unable to pay the above amount outstanding at one time for
the reasons given below:
..................................................................................................................................
..................................................................................................................................
..................................................................................................................................
Therefore I request you to sanction me approval to pay the above amount
outstanding in ........................ number of instalments.
Signature & Status
---------

APPROVAL/REFUSAL OF PAYMENT OF
AMOUNT OUTSTANDING BY INSTALMENTS
TO A TOT DEALER/OTHERS
Date Month Year
............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have requested on Form TOT 062 dated............................ for payment of

amount outstanding by instalments which consists the following:
Tax Rs.
Penalty Rs.
Penal Interest Rs.
----------
Total Rs.
----------
*I am to notify you that approval has been given for this amount outstanding
to be paid by 6/12 instalments and each instalment alongwith interest @
............% should be paid for an amount of Rs................ (Rupees....................)
by ........................... of each month.
The approval of this arrangement is conditional upon all current tax dues being
paid by the due date.
If you fail to pay any instalment or any current tax due by the due date this
approval will be suspended and action taken forthwith to recover the tax and
any dues outstanding.
*I am refusing to sanction approval for a payment of amount outstanding for

the reasons:
................................................................................................................................
................................................................................................................................
................................................................................................................................
Therefore you are requested to pay the above amount outstanding without any
delay
YOU ARE REMINDED THAT THE APVAT ACT, 2005 EMPOWERS
THE TAX DEPARTMENT TO CONFISCATE AND SELL YOUR GOODS
TO RECOVER THE AMOUNT OUTSTANDING.
Copy to Commercial Taxes Officer, Deputy Commissioner,

................................ Circle. .................. Division

Note:– Complete in triplicate.
--------

NOTIFICATION OF SEIZURE OF THE GOODS

(TOT DEALER/OTHERS)
Date Month Year

............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have requested to pay an amount outstanding which consists the following:–
Tax Rs.
Penalty Rs.
Penal Interest Rs.
----------
Total Rs.
----------
and you were:

1. Notified on Form TOT 010 dated ........................... for payment of
Rs.................................as tax for non filing of TOT return.
2. Notified on Form TOT 009 dated............................ for payment of
Rs............................ as penalty.
3. Notified on Form TOT 011 dated................................ for payment of
Rs........................... as Penal Interest.
4. Notified on Form TOT 012 dated.......................... for payment of
Rs........................ as unpaid Turnover Tax.
5. Notified on Form TOT 061 dated..........................for payment of
Rs................................... from Bank/Third Party.
6. Notified on Form TOT 063 dated....................... for payment of
Rs........................... that your application for sanction of instalments has
been rejected.
You have failed to pay the amount outstanding inspite of reminders issued
to you as listed above.
In these circumstances, I am to notify you that the goods listed in the following
table have been seized and removed for sale.
List of goods seized:
Sl. Description of goods Quantity Approximate Remarks

No. of goods Value of Goods
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Therefore, you are requested to pay the amount outstanding within 7 days
from the date of this notification otherwise auction will be conducted for the
listed goods seized.
Signature of the Officer,
--------


(TOT DEALER/OTHERS)
Date Month Year

............................................
............................................
........................................... 02 GRN /Others
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have to pay the following amount outstanding to the Commercial Taxes
Department.
You are notified on Form TOT 064 dated ...................... that the goods listed
on this form had been seized by the Commercial Tax Department Office.
The amount outstanding consists of:
Tax Rs.
Penalty Rs.
Penal Interest Rs.
Others Rs.
----------
Total Rs.
----------
The above amount outstanding has been paid by you through Cheque/DD/
Challan No.................... Dated .................
Now I am to notify that on payment of the above amount outstanding the
goods listed in the following table are released from the custody of the
Commercial Taxes Department.

No. of goods Value of Goods
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

--------
GOVERNMENT OF ANDHRA PRADESH FORM VAT 101

NOTIFICATION FOR VAT REGISTRATION
Date Month Year

............................................
............................................
...........................................
02. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Receipt of your application for registration dated.......................................... is

acknowledged.
I am to notify you that your TIN is
You must use this number when you issue VAT invoices, on all documents
related to VAT and in all correspondence with the Commercial Taxes Department.
Your application has been accepted. Please find enclosed your VAT Certificate
of Registration.
You should know that your registration for VAT is effective from ...................
From that date you must charge VAT on all your taxable sales, and provide
a VAT tax invoice to those of your customers who are registered as VAT dealers.
If you have been charged VAT on goods including capital goods and assets
which are in stock on ....................... you should apply to this office for a
form so that you can claim a VAT credit in your first return.
COMMERCIAL TAX OFFICER,
VAT REGISTRATION AUTHORITY,
............................. CIRCLE.
Encl. 1. Form VAT 105.
2. Leaflets 01, 02 and 05.
-----
Forms in Department Website and Manuals.


NOTICE OF REFUSAL OF VAT REGISTRATION
Date Month Year

............................................
............................................
...........................................
02. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Receipt of your application for VAT registration dated...................... is

acknowledged.
Your application for VAT registration is refused because:
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
You are requested to file written objections along with documentary evidence
if any within 10 days of date of this notice failing which rejection of your
application will be confirmed without any further notice.

............................. CIRCLE.
-----

NOTIFICATION OF ENDING OF STARTUP BUSINESS

STATUS ON MAKING TAXABLE SALES
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
I have to advise you that consequent upon the receipt of the VAT return for
the period....................... on.................. and the taxable sales declared on that
return, you are no longer registered as a start up business.
You have compiled with the conditions of your start up business registration
and are now registered under the normal VAT conditions.
YOU SHOULD CONTINUE TO MAINTAIN RECORDS, FILE RETURNS
AND PAY VAT AS REQUIRED BY THE APVAT ACT, 2005.

............................. CIRCLE.
-------

NOTICE OF CANCELLATION OF STARTUP

BUSINESS STATUS
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
I have to notify you that since you were registered as a start up business on
.................... but you have failed to make any taxable sales.
As Twenty four months have now elapsed since your registration as a start
up business, I propose to recommend cancellation of your registration.
You are therefore requested to file your objections if any within 10 days of
date of this notice failing which your registration issued under APVAT Act,
2005 shall be cancelled without any further intimation to you in the matter.

............................. CIRCLE.
-------

CANCELLATION OF STARTUP BUSINESS

REGISTRATION
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You are advised by this office notice in Form VAT 108 (Notice of cancellation
of startup business status) dated ........................... that consequent on your
failure to make taxable sales within prescribed period, your registration is
proposed to be cancelled.
Since you have not responded to the above notice, I confirm the cancellation
of your registration as start up business as well as VAT registration.

............................. CIRCLE.
-------

NOTICE OF LIABILITY FOR VAT REGISTRATION

Date Month Year
............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Tax Office records indicate that you have a legal obligation to register for
VAT. I am therefore, enclosing a Form VAT 100 (Application for VAT registration)
together with VAT leaflets 01 and 02 which explain VAT registration requirements.
You must complete Form VAT 100 and return it to this Circle Tax Office
within 10 days of the date of this notification. Failure to do so will result
in your business being compulsorily registered for VAT.
If you consider that you have no obligation to register, you should respond
to this office in writing specifying the reason you consider you are not required
to register.

............................. CIRCLE.
-------
VAT–53

RESPONSE TO NOTIFICATION OF CHANGE IN

VAT REGISTRATION DETAILS
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Your notification of change in registration details dated ....................has been

received.
I am to advise you as follows:–
*(1) Your change in address has been noted, you should submit your VAT
Registration Certificate to this office so that an amended certificate can
be prepared and issued.
*(2) Your change in name/legal status has been noted. I enclose herewith
a Form VAT 121 to cancel your current registration and a Form VAT
100 to apply for registration under your new name/legal status.
*(3) I have received your notification of a change in composition of the
partnership, director’s etc., but have to advise you that cancellation of
your registration is not appropriate. You must continue to charge tax
on your sales, file returns and pay VAT to the Tax Department.
*(4) Your change in business activities/principal commodities traded has been
recorded.
*(5) Your change in commencement/stopping of works contracts for the State
Government and local authorities has been recorded.
*(6) Your change in bank account details has been recorded.
............................. CIRCLE.
*Strike off which is not applicable.
-------

NOTIFICATION OF AMENDED VAT REGISTRATION

CERTIFICATE
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Your change of address/change of legal status has been recorded and I enclose
herewith an amended VAT Registration Certificate.
You should note that you are now registered at the following Tax Office:
............................................................
............................................................
............................................................
and all returns and correspondence will be dealt with by that office.
You must continue to charge VAT and file VAT returns and pay the tax
continuously regardless of the change in your circumstances.

............................. CIRCLE.
Encl. Amended VAT RC
-----

NOTICE OF REFUSAL/REDUCTION OF
SALES TAX CREDIT CLAIM
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Receipt of your claim in Form VAT 115 dated..................................... for sales

tax paid on goods in stock at 01-04-2005 is acknowledged.
*1. I am to notify that this claim cannot be accepted because ....................
.................................................................................................................
*2. I am to notify you that your claim for sales tax credit is restricted to
Rs................................. as against Rs....................... claimed by you. I
herewith furnish the reasons for restriction of sales tax credit.
.....................................................................................................................
.....................................................................................................................
.....................................................................................................................
You are therefore requested to file your written objections if any alongwith
documentary evidence within 10 days of date of this notice failing which the
proposal as stated above will be confirmed without any further notice in the
matter.
............................. CIRCLE.
--------

NOTICE OF REFUSAL/REDUCTION OF
VAT CREDIT CLAIM
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Receipt of your VAT credit claim in Form VAT 118 dated.......................... for
credit of VAT paid on goods on hand at the time of VAT registgration is
acknowledged.
*1. I am to notify that this claim cannot be accepted because :

......................................................................................................................
......................................................................................................................
*2. I am to notify you that your claim is restricted Rs.......................... as

against Rs......................... claimed by you due to the following
reasons : .....................................................................................................
......................................................................................................................
......................................................................................................................
You are requested to file your written objections, if any, along with documentary
evidence within 10 days of date of this notice failing which the proposal as
stated above will be confirmed without any further notice in the matter.

............................. CIRCLE.
---------

RESPONSE TO APPLICATION TO CANCEL

VAT REGISTRATION
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Receipt of your application for cancellation of registration dated................ is

acknowledged.
Your application has been accepted and your registration is proposed to be

cancelled from ..........................you must charge and account VAT upto that
date. After that date you must not charge VAT or issue any tax invoices.
You must complete the enclosed VAT return, Form VAT 200C for the tax
period...................... and on that return account for VAT on stock and assets
on hand at ........................... on which you have received credit for input tax.
You must file this return and pay the tax not later than.........................
*It is noted that you have arrears of VAT unpaid of ...................... payment
of this amount must be made with your final return.
You should return your VAT Certificate of Registration with the final return.
On receipt and acceptance of this final return, tax payment and Certificate
of Registration, you will be notified of the final cancellation of your registration.

............................. CIRCLE.
---------

NOTIFICATION OF REFUSAL/REDUCTION OF
Date Month Year
............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
*1. You are advised by this office notice in Form VAT 117 dated...............
that your application for sales tax credit claim is not accepted for the
reasons detailed and you were requested to file any objections to that
decision. Since you have not responded to the notice/*on considering
your reply, I am confirming the non-acceptance of sales tax credit claim
for the following reasons.’
.....................................................................................................................
.....................................................................................................................
.....................................................................................................................
Hence you are not eligible to claim any sales tax credit as claimed in
your Form VAT 115.
*2. You are advised by this office notice in Form VAT 117 dated.....................
that your application for sales tax credit claim is not accepted for the
entire amount and the claim was proposed to be restricted as per the
reasons mentioned therein. Since you have *not responded/*on considering
your reply, I am confirming the sales tax credit to be claimed by you
to an amount of Rs................... furnishing the reasons as under.
.....................................................................................................................
.....................................................................................................................
You have the right to appeal against this order within 30 days of date
of receipt of this order.
............................. CIRCLE.
--------

NOTIFICATION OF NON-ACCEPTANCE/REJECTION
OF SALES TAX CREDIT CLAIM
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
I am to advise you that your application for sales tax credit in Form VAT
115, which is received in the tax office after due date, cannot be accepted
due to the following reasons:
.....................................................................................................................
.....................................................................................................................
.....................................................................................................................
.....................................................................................................................
You have the right to appeal against this decision within 30 days of date of
receipt of this letter.
DEPUTY COMMISSIONER,
............................. DIVISION.
---------

NOTIFICATION OF REFUSAL/REDUCTION OF
Date Month Year
............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You are advised by this office notice in Form VAT 120 dated............... that
your claim for VAT credit is refused/restricted indicating reasons therewith and
requested to file your written objections.
1. *Since you have *not responded/*on considering your reply, I am
confirming the non-acceptance of your credit claim made in the Form
VAT 118 due to the following reasons:
.....................................................................................................................
.....................................................................................................................
Hence you cannot claim any VAT credit.
*2. *Since you have *not responded/*on considering your reply, I am
confirming the restriction of your credit claim made in Form VAT 118
due to the following reasons:
.....................................................................................................................
.....................................................................................................................
Hence you can claim Rs.................. as VAT credit in Box 08(b) of your
VAT Return.
You have the right to appeal against this order within 30 days of date of receipt
of this order.
............................. CIRCLE.
--------

PRELIMINARY NOTIFICATION OF
VAT REGISTRATION
Date Month Year
............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
It appears from tax office records that you are required to register for VAT
from 1st April, 2005. To effect this registration you are required to declare
your turnover for the 12 months ending 31st Decembe, 2004 on Form VAT
150A enclosed herewith.
If you are eligible for VAT registration, the TIN already allotted to you would
be continued without any change.
To facilitate printing of correct name and address of your business on VAT
registration certificate, please intimate then changes if any relating to your
name, address etc., submitted earlier in Form 100.
On receipt of this declaration you will be issued with your VAT Certificate
of Registration (Form VAT 105) which you will require from 1st April, 2005
to meet your obligations under the APVAT Act, 2005.

............................. CIRCLE.
--------
GOVERNMENT OF ANDHRA PRADESH FORM VAT 150A

DECLARATION OF TURNOVER FOR YEAR 2004

(VAT DEALER)

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
I declare that my total turnover for the twelve months period ending 31st
December, 2004 was Rs...................... (Rupees................................................)
The changes in the Form VAT 100 given earlier are as follows:
Name of the Business :
Address (including branches if any) :
Any other information :
I, ............................................ S/o / W/o............................................................
being (title) ......................................... of the above enterprise do hereby declare
that this information is true and correct.
Date Month Year Signature & Stamp
--------
GOVERNMENT OF ANDHRA PRADESH FORM VAT 150B

NOTIFICATION OF VAT REGISTRATION
Date Month Year

............................................
............................................
...........................................
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Your letter in Form VAT 150A was received in this office and it is confirmed
that you are registered for VAT as per the provisions contained in APVAT
Act, 2005 from 1st April, 2005. Accordingly the TIN allotted to you is your
VAT registration number to be used Form 01-04-2005, which is as under:
TIN
You should use this TIN when you issue VAT invoices, on all documents related
to VAT and in all correspondence with the Commercial Taxes Department.
I am herewith enclosing the registration certificate under APVAT Act, 2005
in Form VAT 105.
............................. CIRCLE.
Encls : Form VAT 105
--------

NOTICE OF REGISTRATION UNDER THE APVAT

ACT, 2005
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Tax office records indicate that you have a libility to register for TOT under
the above Act. I enclose herewith VAT leaftets 01, 02, 03, 05 and 20. You
should consult these leaflets to establish.
– whether you have an obligation to register for VAT;
– if you wish to register for VAT voluntarily; or
– whether you accept registration for TOT.
You should reply to this office within Fourteen days, declaring your turnover
for the year ending 31st December, 2004 together with a declaration of your
obligation for registration as set out above on, Form VAT 151A enclosed
herewith.
If you are eligible for TOT registration under APVAT Act, 2005 the registration
No. allotted to you under APGST Act will be continued without any change.
To faciliate printing of correct name and address of your business on TOT
registration certificate, please intimate the changes if any relating to name and
address of your business etc., submitted earlier to the department.
On receipt of this declaration you will be notified with details of your
registration under the above Act. If you require further information you should
consult this office
VAT Registering Authority
.............................. Circle.
---------
DECLARATION OF TURNOVER OF FORM VAT 151A

YEAR 2004
01. Name : .........................................................................................................
Address : .....................................................................................................

............................................
............................................
I declare that my total turnover for the twelve months period ending 31st
December, 2004 was Rs......................... and that I am not required/required
to *register for VAT/*TOT/*or wish to register voluntarily for VAT.
I also submit the correct name and address etc. of my business as under:
1. Name of the Business:
2. Address:
3. Any other information related to registration details
I,...............................S/o/D/o..................................being (title)................................of
the above enterprise do hereby declare that this information is true and correct.
Date of Declaration Date Month Year Signature & Stamp

NOTIFICATION OF TOT REGISTRATION
Date Month Year
............................................
............................................
...........................................
02. Name : .........................................................................................................

Address : .....................................................................................................
Your letter in Form VAT 151A was received in this office and you are registered
for TOT as per the provisions contained in APVAT Act, 2005. Accordingly
the General Registration Number allotted to you is new registration number
to be used from 01-04-2005, which is as under.
GRN
I am herewith enclosing the TOT Registration Certificate under APVAT Act,
2005 in Form TOT 003.
Commercial Tax Officer VAT Registering Authority
............................... Circle.
---------

NOTICE FOR DELETION OF REGISTRATION/TIN

FROM 01-04-2005
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
It appears from tax officer records that the total turnover scored by you during
the period from 01-01-2004 to 31-12-2004 was less than Rs. 5 lakhs.
* As you may be aware that APVAT Act is being enacted w.e.f. 01-
04-2005 and as per the provisions contained therein, you are not
required to register under APVAT Act since your turnover relating to
taxable goods appears to be below Rs. 5 lakhs in the twelve months
period ending 31-12-2004. Hence, your business will not be registered
w.e.f. 01-04-2005 under the provisions of APVAT Act
* Accordingly the 02 TIN
alloted to you is proposed to be cancelled. You are requested to reply
to this notice within 14 days of this notice failing which the TIN allotted
to you will be cancelled without any further intimation.

................................. Circle.
---------

NOTICE FOR DELETION OF REGISTRATION/TIN

FROM 01-04-2005
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You are advised by this office in Form VAT 152 dated..............................

proposing for *deletion of Registration/*TIN indicating reasons therewith.
Since you have not responded to the notice within 14 days, I am confirming
the deletion of Registration/TIN from 01-04-2005.
You have the right to appeal against this order within 30 days of date of receipt
of this order.
................................ Circle.
---------

NOTIFICATION OF FAILURE TO FILE

VAT RETURN
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
The Tax Office records indicate that the VAT return for the month of ..................
due to be filed not later than 20th of ................. has not been received.
If you have already filed the return you should intimate to the Tax Office
without delay otherwise you will not be charged penalty and penal interest,
and proceedings are taken for prosecution for failure to file the return.
You are reminded that the APVAT Act, 2005 provides that the failure to file
a return can result on to pay a penalty of Rs.2,500/- (Rupees two thousand
five hundred only) where no tax is due, and shall on conviction be punished
with imprisonment for a term which may extend to three months or with fine
or with both.
In all cases where a VAT return is not filed in time, a penalty of 15 per cent
of the amount of unpaid tax will be levied, and penal interest will be charged
at the rate of 1% per month for each day that the payment is delayed.
You should contact the Tax Office above without delay.

............................. CIRCLE.
-----
VAT–54

NOTIFICATION AND DEMAND FOR PENALTY TO A

VAT DEALER
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Tax Office records indicate that you have been given a penalty notice in Form
VAT203A dated................. for committing the following irregularities:
....................................................................................................................................
....................................................................................................................................
*You have not responded to the Penalty notice.
*You have replied to the Penalty notice on............................ and your objections
examined and considered as follows:
....................................................................................................................................
....................................................................................................................................
In view of the above, the proposal for levy of penalty is confirmed and
accordingly you are requested to pay an amount of Rs...........................
(Rupees..................................................................) towards penalty within 15
days of receipt of this order.
THE TAX DEPARTMENT TO CONFISCATE AND SELL YOUR GOODS
TO RECOVER AMOUNT OUTSTANDING.
You have the right to appeal against this order.

............................. CIRCLE.
*(Strike off which is not applicable)
-----

NOTICE FOR PENALTY TO A VAT DEALER
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Tax Office records indicate that you have committed the following irregularity
which is penalised under the provisions of APVAT Act, 2005.
....................................................................................................................................
....................................................................................................................................
Accordingly it is proposed that you are liable to pay Rs............................ as

penalty at ................% on tax of Rs........................... which was due.
Therefore, you are requested to pay the above penalty or file reply within
10 days from the date of this notice failing which the above proposed penalty
will be confirmed without any further notice in the matter.

............................. CIRCLE.
........................... DIVISION.
-----

DEMAND OF PENAL INTEREST TO A VAT DEALER
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Tax Office records indicates that the Return/Tax on assessment is due by

................... but it was received on........................
The tax declared as due on the *VAT return/assessment was Rs...................
Period of Delay ..........................................

Penal interest due on Rs............................ @1% is Rs.......................
You are requested to pay the above amount towards the Penal interest within
15 days of receipt of this order.

THE TAX DEPARTMENT TO SEIZE, CONFISCATE AND SELL YOUR
GOODS TO RECOVER AMOUNT OUTSTANDING.
............................. CIRCLE.
-----

DEMAND FOR PAYMENT OF AMOUNT

OUTSTANDING OF A VAT DEALER FROM THE
BANK/THIRD PARTY
Date Month Year

............................................
............................................
...........................................
*To *To
The Manager, Name of the Dealer/Person
......................................... Branch, Address.............................................
....................................................... ..........................................................
The dealer M/s......................................................................................................
TIN has to pay the following amount

outstanding to the Commercial Taxes Department.
Tax Rs........................................
Penalty Rs........................................
Penal Interest Rs........................................
Total Rs........................................
In accordance with the provisions of Section 29 of the APVAT Act, 2005

(abstract enclosed), you are requested to make the payment of amount
outstanding.
*from the account of the above said Firm/Dealer

* the amount you are due to pay to the above said Firm/Dealer.
You are requested to pay the above amount outstanding within 7 days from
the date of receipt of this notice.

Designation, Stamp and Seal
Note:– Complete in triplicate.
--------

APPLICATION OF A VAT DEALER FOR PAYMENT OF

AMOUNT OUTSTANDING BY INSTALMENTS
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
I/We have to pay the following amount outstanding to the Commercial Taxes
Department.
Tax Rs.
Penalty Rs.
Interest Rs.
----------
Total Rs.
----------
Now I/we am/are unable to pay the above amount outstanding at one time
for the reasons given below:
.................................................................................................................................
.................................................................................................................................
.................................................................................................................................
Therefore I request you to sanction me approval to pay the above amount
outstanding in ...................................... number of instalments.
Signature & Status

---------


(OF A VAT DEALER)
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You are requested to pay an amount outstanding which consists the following:–
Tax Rs.
Penalty Rs.
Interest Rs.
----------
Total Rs.
----------
and you were:

1. Notified on Form VAT 202 dated ........................... for payment of
Rs................................. as unpaid VAT.
2. Notified on Form VAT 203 dated............................ for payment of
Rs............................ as penalty.
3. Notified on Form VAT 204 dated................................ for payment of
Rs........................... as tax for non-filing of VAT Return.
4. Notified on Form VAT 205 dated.......................... for payment of
Rs........................ as Penal Interest.
5. Notified on Form VAT 206 dated..........................for payment of
Rs................................... from Bank/Third Party.
6. Notified on Form VAT 208 dated....................... for payment of
Rs........................... that your application for sanction of instalments has
been rejected.
You have failed to pay the amount outstanding inspite of reminders issued
to you as listed above.
In these circumstances, I am to notify you that the goods listed in the following
table have been seized and removed for sale.
Therefore, you are requested to pay the amount outstanding within 7 days
from the date of this notification otherwise auction will be conducted for the
listed goods seized.

No. Value of Goods
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

--------

NOTIFICATION OF RELEASE OF SEIZED GOODS

(OF A VAT DEALER)
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have to pay the following amount outstanding to the Commercial Taxes
Department.
You were notified on Form VAT 209 dated.......................... that the goods listed
on this form had been seized by the Commercial Tax Department Office.
The amount outstanding consists of :
Tax Rs.
Penalty Rs.
Penal Interest Rs.
Others Rs.
----------
Total Rs.
----------
The above amount outstanding has been paid by you through Cheque/DD/
Challan No............................. Dated...............................
Now I am to notify that on payment of the above amount outstanding the

goods listed in the following table are released from the custody of the

No. Value of Goods
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

--------

SUMMARY OF BUSINESS ACTIVITIES

AND RECORDS
Name of VAT Dealer ........................................... TIN : .................................

Circle .................................................................... Division .............................
1. Authorised Person to contact (and Status)................................................

Telephone Number(s) ..............................................................................
Location of premises................................................................................
2. Effective date of registration ..................................................................
3. Accountant (if any) ...................................................................................
Address .....................................................................................................
Telephone Number ..................................................................................
4. Financial Year ends ...................................................................................
5. Address of principal place of business ...................................................
6. Other Business address............................................................................
7. Main Business activity .............................................................................
8. Subsidiary Business activities ................................................................
(provide approximate % of turnover of each acitivity)
9. Importer (International) YES/NO ............... % of Inputs ......................
Brief description of imports ...................................................................
10. Purchases from other States YES/NO ................. % of Inputs ..............
Brief description of PURCHASES: ........................................................
11. Exporter YES/NO ............ % of Outputs ................................
Brief description of Exports ...................................................................
12. Sales to other States YES/NO................% of Outputs ...........................
Brief description of Exports ...................................................................
13. Branch transfer/consignment sales to other States YES/NO......................
% of Outputs ........................................
Brief description of Branch Transfer/Consignment Sales......................
14. Description of Principal outputs (Ex: Departmental Stores).................
1% Rate....................................................................................................
4% Rate ...................................................................................................
1
[14.5%] Rate ...........................................................................................
Zero-Rate – International Exports...............................................................
Zero-Rate – Inter-State Sale ....................................................................
Exempted goods/transactions ...................................................................
15. Principal inputs ........................................................................................
1% Rate ...................................................................................................
4% Rate ...................................................................................................
1
[14.5%] Rate ..........................................................................................
Exempt goods ...................................................................................................
16. Accounting Method.
Invoice accounting/Cash Accounting for Consumers.
17. Current Accounting Records – Describe overleaf the books and records
used by business.
Highlight those used for accounting for VAT. Identify records where the
VAT account or VAT calculations are maintained.
Date ..................... Recorded by: Officer Name............... Signature..............

Checked by: Officer Name............... Signature.............
Updatedly .................................. Officer Name............... Signature..............
-------
1. Subs. for the figure “12.5%” by Act 9 of 2010, dt. 20-4-2010, w.e.f. 15-1-2010.

VALUE ADDED TAX AUDIT VISIT REPORT
Circle...................................
Division.............................
1. Name of VAT Dealer ....................................................................................
2. TIN ................................................................................................................
3. Address(es) visited .......................................................................................
4. Person(s) interviewed ...................................................................................
5. Date and time of visit from ............................... to ...................................
Summary of Trading activities and Record (From VAT 300) – Updated and
signed ...........................................
Basic Checks (Tick when completed)
(i) Inspected VAT Registration Certificate
(ii) Checked VAT Return Filing Record
(iii) Checked VAT Payment Record
(iv) Compared VAT A/c to Official Summary
(v) Record Tax periods checked .........................................................................
..................................................................................................................................
Details of control checks out. Note the records examined, periods that the
checks were applied to, and any discrepancies found.
Record Calculation of under declaration and assessments issued.
Agreement from the VAT Dealer;

The calculation of under declaration of VAT in any records against VAT
return submitted for the period from ................... to ........................... is
understood and I accept to pay the VAT due along with the penalty and
interest as calculated by the audit officer.
Date: Signature
Status, Stamp & Seal
Audit Officer Name Audit Officer Signature

Designation
-------

VALUE ADDED TAX AUDIT VISIT REPORT
Circle...................................
Division.............................
2. TIN ................................................................................................................
5. Date and time of visit from ............................... to ...................................
Post Visit Action:
Recommendation for further audit action (with reasons)
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
Form VAT ............/Form VAT................. Prepared ...................Amount ............
Date ................... Under-declaration Classification Code(s) ...............................
Noted in Computer Record.
Officer’s Name ......................................... Officer’s Signature ............................
...................................................................................................................................
Checked by Senior Officer
Report reivewed ............................................... Approved/Amended
Signature ............................................................ Head of Audit Unit
Form VAT ............../Form VAT ............... Approved Amount ...........................
Date forwarded to Head of VAT Unit for issue .................................................
Date issued ......................... Head of VAT Unit ....................... Signature............
--------

MISCELLANEOUS VISIT REPORT
Circle...................................
Division.............................
2. VAT Registration TIN ..................................................................................
5. Date and time of visit from ............................... to ....................................
..................................................................................................................................
Person(s) interviewed ............................................................................................
Date and time of visit ............................................................................................
Result of visit (Record essential details of checks completed)
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
...................................................................................................................................
Date.............................
Officer’s Name : .....................................
Officer’s Signature : ............................................
--------

ADVISORY VISIT REPORT
Circle...................................
Division.............................
1. VAT Certificate TIN Number ........................................................................
2. Name of the VAT Dealer ...............................................................................
3. Address visited ...............................................................................................
4. Person(s) interviewed ....................................................................................
5. Date and time of visit from ............................... to .....................................
6. Registration Application Checked ................................................................
7. Registration Certificate Checked .....................................................................
8. Return filing and tax payment procedures explained
VAT taxable person accounting system ............................................................
9. Particular legal provisions specifically related to the business .......................
10. Explanation of VAT return completion provided .........................................
I. Particulars of VAT features .......................................................................
II. VAT rulings given ...................................................................................
III. Transitional issues ...................................................................................
IV. Estimated value of stock on hand ...........................................................
V. Estimated value of assets on hand ...........................................................
11. Assessment of Revenue Reliability
POOR AVERATE GOOD
Officer : Name ............................. Rank ................... Signature ........................

Senior Officers : Name ................................................. Signature ......................
Checked by Head of Section : Name ........................... Signature .......................
-------

NOTIFICATION OF ADVISORY/AUDIT
VISIT TO A VAT DEALER
Date Month Year
............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have been notify that an advisory/audit will be held on ......................

You should produce all your VAT records and business accounts on that date.
If the date prescribed in this notification is not convenient, you should contact
this office without delay, with your convenient appointment date and it should
not be beyond 7 days to the date fixed above.

Designation Stamp Seal.
--------
VAT–55

NOTICE OF ASSESSMENT (OVER DECLARATION)

OF VALUE ADDED TAX
Date Month Year
............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
Examination of your records on ............... has shown that the correct amounts
of Value Added Tax have not been declared in the VAT returns listed below:
Under the provisions of APVAT Act, 2005 the following tax amounts have
been assessed for the tax periods shown below.
Tax Particulars Tax Tax Tax Tax Penalty Interest Total
period (input tax/ declared Found Over under ......% @ 1% Due to
output tax) /net to be declared declared of ...... Tax
credit/ due/net Due to Due to month(s) Dept.
Or credit dealer Tax Dept.
Refund Or
Claimed Refund
due
Total amount due to VAT Dealer

Complete in duplicate
05. Explanation for the above proposals;
The amount shown should be claimed at Box 5 of your next tax return.
An appeal against this order can be filed before the Appellate Deputy
Commissioner within 30 days of receipt of this order.
..................................... CIRCLE.

NOTICE OF UNDER DECLARATION OF

VALUE ADDED TAX
MONDAY VAT dealers name TIN Address Telephone No.

................................................ ............................ .............................
............................ .............................
............................ .............................
............................ .............................
................................................ ............................ .............................
............................ .............................
Date : ............................ .............................
Time : ............................ .............................
TUESDAY VAT dealers name TIN Address Telephone No.

................................................ ............................ .............................
............................ .............................
............................ .............................
............................ .............................
................................................ ............................ .............................
............................ .............................
Date : ............................ .............................
Time : ............................ .............................
WEDNESDAY VAT dealers name TIN Address Telephone No.

................................................ ............................ .............................
............................ .............................
............................ .............................
............................ .............................
................................................ ............................ .............................
............................ .............................
Date : ............................ .............................
Time : ............................ .............................
THURSDAY VAT dealers name TIN Address Telephone No.

................................................ ............................ .............................
............................ .............................
............................ .............................
............................ .............................
................................................ ............................ .............................
............................ .............................
Date : ............................ .............................
Time : ............................ .............................
FRIDAY VAT dealers name TIN Address Telephone No.

................................................ ............................ .............................
............................ .............................
............................ .............................
............................ .............................
................................................ ............................ .............................
............................ .............................
Date : ............................ .............................
Time : ............................ .............................
SATURDAY VAT dealers name TIN Address Telephone No.

................................................ ............................ .............................
............................ .............................
............................ .............................
............................ .............................
................................................ ............................ .............................
............................ .............................
Date : ............................ .............................
Time : ............................ .............................
Complete in Duplicate
--------
Forms in Department Website and Manuals 868(1)

NOTICE FOR PRODUCTION OF

DOCUMENTS AND RECORDS
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You were visited on ................ following an advice-dated.................. This

advice confirmed that you should produce all your VAT records and business
accounts at the date of this audit visit.
On that visit you failed to produce the following records and documents:
.................................................................................................................................
You are now required to produce these documents at this office, address as
above on ...................................
You are reminded that Sec.58 of the APVAT Act, 2005 defines this failure
as an offence.
If the date prescribed in this notice is not convenient, you should contact this
office without delay.
You will be assessed for the tax due if you fail to respond to this notice.

..................................... CIRCLE.
--------
868(2) Forms in Department Website and Manuals

AUDIT REFERENCE FORM
Date Month Year
Issuing Officer ........................................................................................................
Receiving Office .....................................................................................................
Status of reference *Urgent *Routine
Delete as appropriate
Name of VAT dealer audited :
TIN NO:
Address ..................................................................................................................
................................................................................................................................
Name of the dealer referred : TIN/GRN :
Details of invoice(s) to be audited are listed below:
These invoices are inputs/outputs to my dealer (delete as appropriate)
Date Invoice No. Description of Net Value VAT Receiving officers

goods remarks
Issuing officer Reply from receiving officer
Issuing Officer Name Receiving Officer Name

Signature Signature
Date Date
Comments :
--------

CONFIRMATION OF AUDIT VISIT
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
.......................................................................................................
This is to confirm that a VAT audit has been conducted on .....................
The following discrepancies were identified.

..................................... CIRCLE.
Complete in duplicate.
--------

NOTIFICATION OF ADVICE/REDUCTION/REFUSAL
OF REFUND TO A VAT DEALER
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
You have filed an application on Form VAT 200/Form VAT 360, dated..............
for an Amount of Rs.......................... (Rupees .................................................)
As Refund from the Commercial Taxes Department in pursuance of* excess
input tax credit/tax paid on sales or purchases of goods specified in sub-section
(2) of Section 4.
On scrutiny of your application :
*The refund claim has been accepted
*The refund amount is restricted to Rs............. (Rupees ..................................)
for the reasons .....................................................................................................
*The refund claim is rejected for the reasons .................................................
A notice was issued on Form VAT 351 dated ........................ from the Commercial
Tax Department as refund for Rs.................... (Rupees .....................................)
in pursuance of the *Order of Assessment/Revision/Appeal which is confirmed
by you on Form VAT 352 dated.......................
Now I am herewith enclosing a refund Voucher No............. dated ...............
for an amount of Rs................. (Rupees ......................................... ) being an
amount of refund made by the Commercial Taxes Department.
Signature for the Officer
---------

APPROVAL OF REFUND CLAIM BY COMMISSIONER/

DY. COMMISSIONER TO A VAT DEALER
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
The above dealer filed an application on Form VAT 200/Form VAT 360, dated
................................... for an Amount of Rs..................... (Rupees.......................)
as Refund from the Commercial Taxes Department in pursuance of *excess
input tax credit/tax paid on sales or purchases of goods specified in sub-section
(2) of Section 4.
*Confirmation is given by the above dealer as refund for an amount of
Rs..................... on Form VAT 352 dated.................... in pursuance of the
Assessment/Revision/Appeal.
As the refund amount is Rs.................. which is more than Rs................
*approval may be given/may be forwarded to the Commissioner for sanction
of refund to the above dealer.
Signature for the Officer
Note:– Complete in duplicate
On scrutiny of the application :
*The refund claim has been accepted
*The refund amount is restricted to Rs.................. (Rupees.........................)
for the reasons.
..................................................................................................................................
*The refund claim is rejected for the reasons..................................................
...............................................................................................................................
Addl./Jt. Commissioner/Dy. Commissioner.
-------

PAYMENT OF PENAL INTEREST BY COMMERCIAL

TAXES DEPARTMENT TO A VAT DEALER
Date Month Year

............................................
............................................
........................................... 02 TIN
03. Name : .........................................................................................................

Address : .....................................................................................................
.....................................................................................................
*You have filed an application on Form VAT 200/Form VAT 360,

dated..................for an amount of Rs.................(Rupees.........................) as Refund
from the Commercial Taxes Department in pursuance of excess input tax credit/
tax paid on sales or purchase of goods specified in sub-section (2) of Section
4, which had been accepted on Form VAT 355 and not been paid as on
date................... whcih attracts penal interest.
* Confirmation is given by the dealer on Form VAT 352 dated................ for
an amount of Rs........................(Rupees...........................) as refund in pursuance
of the Order of Assessment/Revision/Appeal which has been accepted on Form
VAT 355 and not been paid as on date....................... which attracts penal
interest.
Now I am herewith enclosing a refund Voucher No.................. Dated..........
for an amount of Rs......................... (Rupees......................................) being an
amount towards penal interest made by the Commercial Taxes Department.


Note: Complete in duplicate.
---------

CHECK REGISTER
Circle Name :..................................... Division : .................. Date : .....................
Sl. Link Cheque Date Name Name TIN/ TAX Others Challan
No. No. No./DD of the of the GRN No./
No./ Bank Dealer Remarks
Pay and Rs. Ps.
Penalty
Interest
Order Branch
TOT
VAT
No.
ANDHRA PRADESH RURAL DEVELOPMENT
CESS ACT, 1996
(Act 11 of 1996)
[26th August 1996]
An Act to provide for the levy and collection of cess for the rural
development in the state and to provide for the matters connected therewith
or incidental thereto.
Pradesh in the forty-seventh of the Republic of India as follows:–
called the Andhra Pradesh Rural Development Cess Act, 1996.
(3) It shall be deemed to have come into force with effect on and
from the 30th December, 1995.
2. Definitions:– (1) In this Act, unless the context otherwise requires,
(a) “Board” means the Andhra Pradesh Rural Development Board
established under Section 3;
(b) “Cess” means cess levied and collected under Section 7;
(c) “Dealer” means any person who carries on the business of buying,
selling, supplying or distributing goods directly or otherwise whether
for cash, or for deferred payment, or for commission, remuneration
or other valuable consideration, and includes,
(i) a miller,
(ii) a commission agent, a broker, a delcredere agent, an auctioner
or any other mercantile agent, by whatever name called, who
of goods specified in the Schedule on behalf of any principle or
principles.
(d) “Fund” means the Andhra Pradesh Development Fund constituted
under Section 8;
(e) “Government” means the Government of Andhra Pradesh;
(f) “Goods” means the goods specified in the schedule;
(g) “Miller” means a person who engages himself in milling operations
in any rice mill, oil mill, dall mill, saw mill, ginning mill or a
869
decorticating mill and includes a person who, or the authority which

has the ultimate control over the affairs of such mill, and where
the said affairs are entrusted to a manager, managing director
or managing agent, such manager, managing director or managing
agent;
(h) “Notification” means a notification published in the Andhra Pradesh
Gazette and the word “notified” shall be construed accordingly;
(i) “Prescribed” means prescribed by rules made under this Act;
(j) “Processing” means giving treatment or a series of treatment to
the goods to make them fit for use or consumption and includes
manufacturing out of such goods;
(k) “Regulations” means regulations made under this Act;
(1) “Rural area” means area other than the
(i) local area included in a municipality;
(ii) local area constituted to be a city;
(iii) area declared as an urban area; and
(iv) place declared to be a cantonment under the Cantonments Act,
1994. (Central Act 2 of 1994.)
(m) “Schedule” means a Schedule appended to this Act.
1
[(n) "Sales Tax Law" means any law for the time being in force in
the State of Andhra Pradesh, which provides for the levy of taxes
on the sale or purchase of generally or on any specified goods
expressly mentioned in that behalf and includes value added tax
law and 'general sales tax law', meaning any law for the time
being in force in the State of Andhra Pradesh, which provide for
the levy of tax on the sale or purchase of generally and includes
value added tax law.]
3. Establishment of Board, its constitution, powers and duties:–
(1) The Government may, by notification for exercising powers conferred
on and performing the functions and duties assigned to the Board by or
under this Act establish the Andhra Pradesh Rural Development Board.
(2) The Board established under sub section (1) shall consists of a
Chairman and the following members namely:–
(a) Chief Secretary to the Government shall be the Chairman;
(b) Principal Secretary to Government, Revenue Department, Member.
(c) Secretary to Government, Food and Civil Supplies Department,
Member
(d) Secretary to Government, Finance and Planning Department,
Member.
(e) Secretary to Government, Panchayat Raj and Rural Development
Department, Member.
A.P. Rural Development Cess Act, 1996 871
(f) Secretary to Government, Transport, Roads and Buildings

Department, Member.
(g) Commissioner, Commercial Taxes, Member, and
(h) Director, Civil Supplies, Ex-Officio Member, Convenor.
(3) The Board constituted under sub section (2), shall be a body
corporate having perpetual succession and a common seal with powers,
subject to the provisions of this Act, to acquire and hold property and shall
by the said name sue and be sued.
4. Superintendence of the Board:– The Government shall exercise
superintendence and control over the Board.
5. Power to make regulations:– Subject to the rules made under
this Act, the Board may make regulations for transacting business at its
meeting and for such other matters as may be prescribed.
6. Annual statement of accounts:– (1) The Board shall submit to
the Government an annual statement of accounts showing the income and
expenditure of the Board for the ensuing year duly passed by it for approval
of the Government in such form and in such manner as may be prescribed.
(2) The Government shall approve such statement of accounts and
return to the Board within such period as may be prescribed.
7. Levy and collection of cess:– (1) There shall be levied and
collected by the Government a cess at the rate of five percent on the
advalorem on the quantum of purchase of goods.
(2) The cess levied under sub section (1) shall be collected in such
manner as may be prescribed.
(3) If any dealer fails to pay the amount of the cess levied under
sub section (1), he shall in addition to the amount of cess be liable to
pay interest on the amount of cess due from him at the rate of one rupee
and fifty paise for every one hundred rupees or part thereof; for each month
or part thereof, from the date of default.
(4) The cess levied under sub section (1) or interest payable under
sub section (2) shall be collected by the Commercial Taxes Department
and shall be credit to the Fund constituted under Section 8 of this Act.
(5) If the cess is levied and collected this section at first point of
purchase of the goods no cess shall be levied at subsequent points of sale
or purchases.
7-A. Collection of cess by deduction from the amounts payable

to dealers:– (1) Notwithstanding anything contained in this Act, a Department
of the Central Government or the State Government or an Industrial
Commercial or trading undertaking of the Central Government or the State
Government, or a local authority or a statutory body, or a company
registered under the Companies Act, 1956 or any other person which, the
Government may notify from time to time shall deduct from out of the
amounts payable by them to a dealer in respect of goods purchased by
them, an amount as per the calculation prescribed:
Provided that in the case of Food Corporation of India and Andhra
Pradesh Civil Supplies Corporation, whenever rice is purchased from the
dealers, the Rural Development Cess component on the corresponding paddy
shall be the amount deductable under this sub-section.
(2) The cess deducted under sub-section (1) shall be remitted to
Government in such manner and within such time as may be prescribed.
(3) The authority or person making deduction under sub-section (1)
shall furnish to the dealer from whom such deduction is made, a certificate,
containing such particulars as may be prescribed.
(4) If any such authority or person defaults to deduct the cess specified
under sub-section (1) or defaults to remit the amount so deducted or any
portion thereof as required under sub-section (2), it shall be liable to pay,
in addition to the amount deductable, interest at the rates specified in sub-
section (3) of Section 7 of the Act on the amount with respect to which
the default has taken place from the date of default to the date on which
such amount is remitted.
(5) The mode of deduction under sub-section (2) shall be without
prejudice to any other mode of recovery of cess due under this Act from
the dealer liable to pay Rural Development Cess.]
8. Constitution of Fund:– (1) There shall be constituted a Fund to
be called “The Andhra Pradesh Rural Development Fund” which shall vest
in the Board.
(2) The audit of the Fund shall be done by the Director appointed
under the provisions of the Andhra Pradesh State Audit Act, 1989.
9. Purpose for which the Fund may be applied:– The Fund shall
be applied for the purposes herein specified:–
(i) to provide and accelerate comprehensive rural development
including the construction of rural roads and bridges;
(ii) to augment storage facilities for storing agricultural produce; and

(iii) for maintaining and strengthening of Public Distribution System.
10. Punishments:– Any dealer who contravenes the provisions of
this Act or the rules made thereunder shall be punishable with a fine which
shall not be less than five hundred rupees but which may extend to two
thousand rupees.
11. Board of jurisdiction:– No suit, prosecution or other legal
proceeding shall lie against the Government or any officer of the Government
or Board in respect of anything which is in good faith done or intended
to be done in pursuance of this Act or rules made thereunder or any order
issued thereunder.
12. Power to make rules:– (1) The Government may by notification
make rules to carry out the purposes of this Act.
(2) Without prejudice to the generality of the foregoing power, such
rules may provide for:
(a) the preparation and submission for sanction of an estimate of
annual income and expenditure;
(b) period within which the amount is to be credited to the Fund under
Section 8; and
(c) any other matter which has to be or may be prescribed.
(3) Every rule made under this Act shall be laid before the House
of the State Legislature, if it is in session and if it is not in session, in
the session immediately following for a total period of fourteen days which
may be comprised in one session or in two successive sessions and if, before
the expiry of the session in which it is so laid or the successive session
aforesaid, the House agrees in making any modification in the rule or in
the annulment of the rule, the rule shall, from the date on which the
modification or annulment is notified have effect only in such modified
form or shall stand annulled as the case may be, so however, that any
such modification or annulment shall be without prejudice to the validity
of anything previously done or omitted to be done under that rule.
13. Power to amend Schedule:– (1) The Government may, by
notification alter, add to or cancel any of the schedule.
(2) Where a notification has been issued under sub section (1), there
shall, unless the notification is in the meantime rescind, be introduced in
the Legislative Assembly, as soon as may be, but in any case during the
next session of the Legislative Assembly following the date of the issue
of the notification, a Bill on behalf of the Government, to give effect in

the alteration, addition, or cancellation, as the case may be, of the schedule
specified in the notification, and the notification shall cease to have effect
when such Bill becomes law, whether with or without modification, but
without prejudice to the validity of any thing previously done thereunder:
Provided that if the notification under sub section (1) is issued when
the Legislative Assembly is in session, such a Bill shall be introduced in
the Legislative Assembly during that Session:
not become law within six months from the date of this introduction in
the Legislative Assembly, the notification shall cease to have effect on the
expiration of the said period of six months.
(3) All references made in this Act, to any of the items in the schedule
shall be construed as relating to the items in the schedule as for the time
being amended in exercise of the powers conferred by this section.
14. Power to Assess, re assess, collect and enforce payment
of cess:– (1) Subject to the other provisions of this Act and the rules
made thereunder the authorities for the time being empowered to assess,
re-assess, collect and enforce payment of any tax under the 1[Andhra
Pradesh Value Added Tax Act, 2005 shall, assess, re-assess, collect and
enforce payment of cess including any interest payable by a dealer under
this Act, and for this purpose they may exercise all or any of the powers
they have under 1[the Andhra Pradesh Value Added Tax, 2005, and the
provisions of such law, including provisions relating to returns, provisional
assessments, advance payment of imposition of the tax liability of a person
carrying on business on the transferee of, successor to, such business,
transfer of liability of any firm or Hindu undivided family to pay tax in
the event of dissolution of such firm a partition of such family, recovery
of tax from third parties, appeals, reviews, revision, references (refunds,
rebates, penalties), (charging or payment of interest) compounding of offences
and treatment of documents furnished by a dealer as confidential, shall apply
accordingly.
(2) All the provisions relating to offences and penalities including the
provisions relating to penalities in lieu of prosecution for an offence or in
addition to the penalties or punishment for offence under the 1[(Andhra
Pradesh Value Added Tax Act, 2005], shall with necessary modifications
apply in relation to the assessment, re-assessment, collection and enforcement
of payment of any case required to be collected under this Act or in relation
to any process connected with such assessment, re-assessment, collection
and enforcement of payment as if the case under this Act were a tax
under 1[Andhra Pradesh Value Added Tax Act, 2005].
1. Subs. for "the Andhra Pradesh General Sales Act, 1957", by Act 4 of 2006,
w.e.f. 1-4-2005.
(3) Every dealer shall submit such return or returns in such manner,
within such period and to such authority as may be prescribed.
15. Power to make regulations:– (1) The Board, may, from time
to time, with the previous approval of the Government, make regulations
not inconsistent with this Act, and the rules made thereunder for the purposes
of giving effect to the provisions of the Act.
(2) In particular and without prejudice to the generality of the foregoing
powers, such regulations may provide for transacting business at the meeting
of the Board and for such other matters as may be prescribed.
16. Removal of difficulties:– If any difficulty arises in giving effect
to the provisions of this Act, the Government may, by Order, make such
provisions, including any adaptation or modification of any provision of this
Act as appears to the Government to be necessary or expedient for the
purpose of removing the difficulty.
17. Repeal of Ordinance 16 of 1996:– The Andhra Pradesh Rural
Development Ordinance, 1996 is hereby repealed.
SCHEDULE
[Goods liable to pay cess under Section 7]
Sl.No. Description of Goods
1 2
1. Paddy
1
[2. xxx]
——
1. Entry 2 "Cashewnut" omitted by Act No. 35 of 2006, w.e.f. 1-4-2005.

ANDHRA PRADESH RURAL AND
INFRASTRUCTURE DEVELOPMENT
CESS RULES, 1996
[G.O.Ms.No. 202, Revenue (CT.II) Dept., dt. 24-2-1996]1
In exercise of the powers conferred by sub section (1) Section 12
of the Andhra Pradesh Rural Development Ordinance, 1995 (Ordinance No.
2 of 1995), the Government of Andhra Pradesh hereby makes the following
rules:–
1. These rules may be called the Andhra Pradesh Rural and Infrastructure
Development Cess Rules, 1996.
2. They shall cone into force on the 30th December 1995.
3. In these rules, unless the context otherwise requires
(a) “Act” means the Andhra Pradesh Rural and Infrastructure
Development Cess Act.
(b) “Assessing authority” means the assessing authority under the
Andhra Pradesh General Sales Tax Act, 1957.
(c) “Form” means a form appended to these rules.
(d) “Government” means the Government of Andhra Pradesh.
(e) “Month” means a calendar month.
(f) “Ordinance” means the Andhra Pradesh Rural Development
Ordinance 1995.
(g) “Section” means a section of the Ordinance.
(h) “State” means the State of Andhra Pradesh.
All other words and expressions used but not defined in these rules
or the Ordinance shall have the meaning assigned to them in the Andhra
Pradesh General Sales Tax Act, 1957 or Andhra Pradesh General Sales
Tax Rules, 1957, in so far as they are not inconsistent with the provisions
of the Ordinance and the rules.
4. (1) Every dealer liable to pay cess under the Ordinance shall submit
so as to reach the assessing authority on or before the 15th of every month
a return in Form RD 1 (in duplicate) showing the total quantity of purchases
of goods specified in the Schedule to the Ordinance during the preceding
month. The return shall be accompanied by a receipt from a Government
1. Published in A.P Gazette Part 1, (Ext.), dt. 27-3-1996.
876
A.P. Rural & Infrastructure Devpt. Cess Rules 877
or a crossed demand draft in favour of the assessing authority for the full
amount of cess payable for the month to which the return relates:–
Provided that where a dealer intends to pay the cess through a crossed
cheque, the cheque should be sent so as to reach the assessing authority
on or before the 15th day of the month succeeding the month to which
the cess relates.
(2) The return in Form RD-1 so filed shall subject to the provisions
of sub-rule (3) be provisionally accepted.
(3) Where any dealer fails to submit in respect of any month before
the due date or if the return submitted appears to be incorrect or incomplete,
the assessing authority shall after making such enquiry as he considers
necessary and after giving dealer an opportunity of proving the correctness
and completeness of the return submitted by him and making such enquiry
as he deems necessary, estimate the total quantity of the goods purchases
to the best of his judgment and provisionally assess the cess payable for
the month and shall serve upon the dealer a notice in Form RD II and
the dealer shall pay the sum demanded at the time and in the manner
specified in the notice:
Provided that if for any reason the determination of provisional
assessment of cess payable for any month is not completed on or before
the receipt of the return for the succeeding month the assessing authority
may in his discretion provisionally assess in a single order the cess payable
for all such months as the case may be and serve upon the dealer a notice
in Form RD II and the dealer shall pay the sum demanded within the time
and in the manner specified in the notice.
(4) After the close of the year for which the returns have been
submitted under sub rule (1) or in the course of the year where a dealer
has discontinued business the assessing authority shall if he is satisfied
after such scrutiny of the accounts and after such enquiry as he considers
necessary, that the return or returns filed are correct and complete finally
assess in a single order on the returns the cess payable under the Ordinance.
(5) If on final assessment made under sub rule (4) any cess is found
to be due from the dealer after deducting the cess paid by him towards
the provisional assessment, the assessing authority shall serve on the dealer
notice in Form RD-II and the dealer shall pay the sum demanded in the
notice within such time and in such manner as specified therein. If however,
any refund of cess is found to be due to the dealer, the assessing authority
shall serve on him a notice Form RD-III.
(6) If, for any reason the whole or any part of the quantum of purchase
of goods specified in the Schedule of a dealer has escaped assessment to
cess or has been under assessed in any year, he assessing authority may
after issuing a notice to the dealer and after making such enquiry as the
considers necessary within a period of three years from the date on which
such order was served on he dealer determine to the best of his judgment
the correct quantum of purchase of goods and assess the cess payable on
such quantum of purchase of goods.
(7) An assessing authority may, at any time within three years from
the date of any order passed by him rectify and arithmetical mistake
apparent on the face of the record:
Provided that no such rectification which has the effect of enhancing
the assessment shall be made unless the assessing authority has given a
notice to the dealer of the intention to do so and has allowed him a
reasonable opportunity of being heard.
(8) The powers conferred by sub rules (6) and (7) on the assessing
authority may also be exercised by the appellate or revising authority subject
to the same limitation and conditions as are applicable in the case of
assessing authority.
(9) Notwithstanding anything contained in sub rules (6)(7) and (8)
of Rule 4 where an assessment, re assessment, rectification in revision of,
an assessment, is made in respect of an assessee or any person, in pursuance
or in consequence of or to give effect to any finding or direction contained
in an order passed by an appellate or revisional authority or in any order
of any court in a proceeding otherwise than by way of appeal or revision
under the Ordinance, such assessment, re assessment, rectification in or
revision of an assessment shall be made within three years from the date
of receipt of such order by the assessing or revising authority as the case
may be.
5. Whoever commits any breach of any of these rules shall on
conviction by a Magistrate of the first class be punishable with fine which
may extent to five hundred rupees and when the offence is a continuing
offence, with a daily fine which may extend to fifty rupees for every day
during which the offence continues.
6. The provision contained in the Andhra Pradesh General Sales Tax
Act 1957 relating to the inspection of books, accounts or documents kept
and maintained by the dealer, the entry into any premises at all reasonable
times by the Officers duly empowered for the purposes of search for any
such books, accounts or documents kept or suspected to be kept in such

premises and the seizure of such books, accounts or documents shall so
far as may be apply in relation to those matters under this Ordinance.
FORM RD1
Form of return under Rule 4(1) of the Rural

Development Cess Rules, 1996
To
The Deputy Commercial Tax Officer,
I, ................... Son Daughter Wife ............. on behalf of the dealer
carrying business known as ........... (dealer name firm name) furnish herewith
the statement of the total quantity of purchases of goods during the month
of ....................... and ............... ending on ................. and give the following
connected particulars:–
1. Registration Certificate No. .................. APGST ............... CST
2. Address of the Dealer :
3. Particulars of Payment of Cess
(a) Total cess payable :
(b) Deduct :
Adjustment of refund of cess
(c) Net cess payable :
(d) Total cess paid :
(i) Cheque DD particulars
Number : Date :
Bank : Branch :
(ii) Each (Receipt No.) if paid
Receipt No. Date :
(iii) Challan particulars :
Number : Date :
Name of Treasury :
(iv) Balance Cess payable if any
(c)-(d)
Statement of Commodity Wise Cess and Quantity

of Purchases
Commodity Total Quantum Exempted Net quantum Rate Cess
Description of purchases quantum of of purchases of
of goods purchases of goods cess
if any
1 2 3 4 5 6
Declaration
I/We ........................... Son Daughter Wife of ...................... declare
to the best of my our knowledge and belief, the information furnished in
the above statement is true and complete.
Place Signature
Date: Status and relationship to the dealer.
FORM RD-II
[See Rule 4(4)]

Notice of Provisional Monthly Assessment and Demand
To
(Dealer) Assessment No.
Take notice that you have been provisionally assessed under the Rural
Development Ordinance, 1995 to a cess of Rs ........... (Rupees in words)
................... only for the month of ... and (that month those months) you
have to pay a further sum of Rs. ............. (Rupees in words) ............. only).
This balance of cess shall be paid within thirty days from the date of service
of this notice ........... by cheque, demand draft in favour of the undersigned
or by remittance into the Government Treasury at .............. failing which
the amount will be recovered as if it were an arrear of land revenue and
you will be also be liable to interest as provided in Section 7(3) of the
Rural Development Ordinance, 1995.
Total quantum of purchases as determined by the assessing authority
in respect of;

if any
1 2 3 4 5 6
Place:
Date: Assessing Authority
FORM RD-III
[See Rule 4(5)]

Notice of Annual Assessment and Refund Order
To
(Dealer)
Take notice that you have been finally assessed under the Rural
Development Ordinance Act 1996 to a Cess of Rs. .............. (Rupees) (in
words) .... only) for the year ending ........ the total amount of cess paid
by you already is Rs. ...... (Rupees (in words)...............only that is Rs.
............. in excess of the Cess due.
(2) Out of the above excess a sum of Rs............... will be adjusted
towards Cess due from you for the period.
(3) The claim for the amount of refund due shall be made in Form
RD IV. No such claim made after the lapse of three years from the date
of this notice will be allowed. A refund order for the amount of Rs. .............
is enclosed. You should apply to the Government Treasury at ...................
for the refund of the sum .................... within three months from the date
of issue of this notice failing which the amount will lapse to the Government.
Total quantum of purchase as determined by the assessing authority
in respect of :
if any
1 2 3 4 5 6
VAT–56
Place:
Date: Assessing Authority
FORM RD-IV
[See Rule]
Claim for Refund
1. Name of the dealer:
2. If refund is sought in pursuance of an order or assessment;
(i) No. and date of order of assessment.
(ii) Date of notice of final assessment and refund order.
(iii) Date on which the notice of final assessment and refund order
was served on the dealer.
(iv) Amount of refund order.
3. If refund is sought in pursuance of an order passed in appeal or revision:
(i) No. and date of order of the appellate or revisional authority
(ii) Date of revised notice of final assessment and order of refund
(iii) Date on which the notice of final assessment and order of refund
was served on the dealer.
(iv) Amount of refund due.
Signature of the Authority

Representative if any Signature of Claimant
Verification
I/We ................ the applicants do hereby declare that what is stated
above is true to the best of my our knowledge and belief.
Verified to day the .............. day of ........ 19...
Signature of the Authorised
Representative, if any Signature of the Applicant(s)
——
NOTIFICATIONS
1. Opening of head of account
[G.O.Ms.No. 124 Revenue (CT), dated 31-01-1996]
Andhra Pradesh Ordinance No.21 of 1995, dated 30-12-1995.
Order:
1. The Commissioner of Commercial Taxes, Hyderabad is informed
that Ordinance No. 21 of 1995 was promulgated by Governor of Andhra
Pradesh and published in the Andhra Pradesh Extra-ordinary Gazette Part-
IV-B providing for levy and collection of Cess for the Rural Development
in the State.
2. The Commissioner of Commercial Taxes, Hyderabad has to administer
the levy and collection of Cess on Paddy and Cashewnut at five percent
as per ordinance with effect from 30-12-1995 and it is necessary to create
a new Head of Account to credit the Revenues.
3. The following new Sub-Head of Account for crediting the revenues
received by way of levy and collecting the cess on paddy and Cashewnut
at five percent with effect from 30-12-1995 to the Commercial Tax
Department.
040 Sales Tax
MH 800 Other Receipts
SH(04) Andhra Pradesh Rural Development Cess
4. The Government direct that all the revenues realised by levy and
collection of cess shall be credited to the above Head of Account.
5. This order issues with the concurrence of Finance and Planning
(Finance B.G) Department vide their U.O.No.2264/59/A1/96, dt. 25.1.1996).
Asst. Grain Purchasing Officer (Tahsildar Cadre)/
District Supply Officer
I authorise the Food Corporation of India to make payment of the
Rural Development Cess due on the Above quantities to the Commercial
Tax Officer ......................................... directly to avoid collection of the
amount by me and remitting the same to the Commercial Taxes Department.
Place : Signature :
Name of the Rice Mill :
Date : Seal :
883
To
The District Manager
Copy to the CTO
Copy to the DSO
Statement/Certificate
1. Opening balance of paddy in stock as on 30.12.1995.
2. Copy of the stock register of paddy purchased during the month
under the following heads :
(i) Date of purchase
(ii) Place of purchase
(iii) Quality of purchased
(iv) Price
(v) Quantity of rice delivered to F.C.I.
(vi) Closing balance at the end of the month
3. Verified the stock register and found the above statement correct.
4. Certified that i have verified that State Register of the mill and
certify that the sale of ................................... quantity of rice by the mill
of F.C.I.on (dates) is supported by the entries in the Sales Register.
5. Certified that ......................................... mill did not pay Rural
Development Cess at the time of purchase of paddy though payable by
the Andhra Pradesh Government notification No. ............................. dated
.............................
2. Control of prices of Rice and disbursement of subsidy
[G.O. Ms. No. 734 Revenue (CT-II), dated 06-09-1997]
Read:–
G.O.Ms.No. 25, Food, Civil Supplies & Consumer Affairs (CS-I)
Department, dt. 9-1-1996.
Order :
(1) In the G.O read above the Government have issued orders sanctioning
incentives in the form of subsidy at 5% on the value of paddy purchased
and milled by the millers and the dealers in Andhra Pradesh for sale within
A.P.R.D.C. Act – Notifications 885
the State as well as within the Country against their levy free eligibility
as per the policy of the Government. This was intended to enable the farmers
to get remunerative price for their produce while at the same time to provide
rice to the consumers in the open market at reasonable rates. It is also
ordered that the Commercial Taxes Department would ensure that the
subsidy of 5% will be provided as per that order and would be adjusted
in the books of the accounts of the rice millers and traders concerned every
month.
(2) It has been reported that there are some operational difficulties
in making adjustments in the books of accounts towards subsidy. As a result,
the incentive intended to be given to the farmers and also maintaining of
the prices in the open market is not achieved. After careful consideration
of the matter, the Government consider it necessary to evolve a scheme
for disbursement of subsidy to the millers and the dealers so that the
incentive would reach the persons concerned viz., farmers and consumers.
(3) In partial modification of orders issued in the reference read above,
the Government hereby order that the Commercial Tax Officers in Commercial
Tax department shall disburse the subsidy of 5% of (as provided in G.O.
read above) to the millers and the dealers, on the value of paddy purchased
and utilised by the rice millers and traders for milling and selling rice in
the open market, both within the State as well as within the Country as
per their levy free eligibility. The Commercial Tax Officer shall compute
the amount of subsidy to be given every rice miller or dealer as per G.O.
read above and disburse it accordingly within 15 days. Before sanctioning
the subsidy to the millers and the dealers the Commercial Tax Officer shall
examine the details of paddy purchased which is used for milling rice sold
in open market both within the State and within the Country. He shall also
examine whether Rural Development Cess and Andhra Pradesh General
Sales Tax due thereon has been paid by them or not.
(4) Separate budgetary allocation shall be made to the Commercial
Tax Department to meet the expenditure towards the disbursement of
subsidy and for this purpose a separate Head of Account shall be opened
as detailed below:
“2040 Sales Tax M.H.800. Other expenditure. SH(08) Assistance to
Millers and Traders for sale levy free rice in open market 110 Subsidies”.
This order issues with the concurrence of Finance & Planning (FW
.BG) Department vide their U.O.No.33672/993/A1/97, Dated 01-09-1997.
These orders shall be deemed to have come into effect from 30.12.1995.
3. Date of coming into force of AP Rural Development Cess

(Amendment) Act, 2000
[G.O.Ms.No. 424, Revenue (CT-II) Dept., dated 26-6-2000]
of Andhra Pradesh Rural Development Cess (Amendment) Act, 2000, (Act
No.22 of 2000), the Governor of Andhra Pradesh hereby appoints 4th May
of 2000 as the date from which the provisions of the said Amendment
Act shall come into force.
——
4. Hyderabad Race Club-Conduct of Monsoon and Winter
Races and Intervenue Betting.
[G.O.Ms.No. 409 Revenue (CT), dated 22-3-2005]
Ref:–
1. G.O.Rt.No. 71, Home (Genl.B) Department., dt. 11-03-2003.
4. From Hyderabad Race Clubm Mlakpet, Hyderabad Letter No. Nil
dated 14.10.2004 and 23.10.2004
5. Govt. Memo. No. 30332/Geni B/A2/2004-1, dated. 5-11-2004.
6. From Commissioner of Police, Vijayawada, Letter No.Nil, dt.
11.12.2004.
7. From the Commissioner of Police, Cyberabad Letter No.219/G2/
pet/Cyb/2004, dt. 27-12-2004.
8. From the Commissioner of Police, Hyderabad, Letter No. L&O/
A3/2175/04.
9. From Commissioner of Police, Visakhapatnam Letter No.485/MC/
2004, dt. 16-02-2005
In pursuance of clause (ii) of sub-section (2) of Section 2 of the Andhra
Praesh Gaming Act, 1974 (Act 27 of 1974), the Governor of Andhra Pradesh
hereby accord permission to Hyderabad Race Club, Hyderabad to conduct
Monsoon and Winter Races and Intervenue Betting on Madras,
Ooty,Bangalore, Mysore, Mumbai, Pune and Kolkatta Horse Races for the
year 2005-06 and 2006-07 i.e., 31-03-2007
2. The wagering or betting should be arranged strictily in places set
a part, for this purpose in the Members and First Enclosures and at the
following Racing Centre:
(1) Hyderabad Race Club, Malakpet, Hyderabad.

(2) Off Course Tote Centres, Vikranthi Theatre, Jambagh, Hyderabad.
(3) Off Coruse Tote Centre, M/s.Satty Estates, Musheerabad, Hyderabad.
(4) Off Course Tote Centre, Plot.No.30-53, Uppal, Hyderabad.
(5) Off Course Tote Centre, Ist Floor of P.M.Modi Commercial
Complex, R.P.Road, Sec’bad owned by Mr.Omprakash, P.Modi
(6) Off Coruse Tote Centre, Yelamanchilli Complex, Vijayawada
(7) Off Course Tote Centre, D.No.6-56/1, Industrial Estate, Opp.IDPL,
Balanager, Hyderabad-37.
(8) Off Course Tote Centre Krishna Plaza, Khairtabad, Hyderabad.
(9) Off Course Tote Centre Sri.J.Narasing Rao, Muncipal, No.8-1-329,
Tolichowki, Hyderabad.
(10) R.V.Leela Prasad, DNo.31-32-60, Saraswathi Pictures Palaces,
Saraswathi Park,Visakapatnam.
The presmission accorded to the centres indicated in para-1 above
shall be as detailedhere under and will be subject to the control of the
Stewards of Hyderabad Race Club, in the Following manner:–
(a) With licensed bookmakers only at the Race Club, Malakpet.
(b) By mans of Computeried betting System, for jackpot, Treble Event,
Win, Place, Forecast, Quinella, and Tenaia Pools.
(c) Sales of computerized tickets aby means of computrized betting
system in the first enclosure from 9.00 A.M till completion of the last Race
and members Enclosures Sale of Betting Tickets from one hour before the
First Race till completion of the last Race.
3. Permission is also accorded to Hyderabad Race Club to sell
Computerized Betting tickets from Computerized Betting system at Off-
course Tote Centres at the following Places.
(1) Hyderabad Race Club, Malakpet, Hyderabad
(2) Off Course Tote Centres, Vikranthi Theatre, Jambagh, Hyderabad.
(3) Off Coruse Tote Centre, M/s.Satty Estates, Musheerabad, Hyderabad.
(4) Off Course Tote Centre, Plot.No.30-53, Uppal, Hyderabad.
(5) Off Course Tote Centre, Ist Floor of P.M.Modi Commercial
Complex, R.P. Road, Sec’bad owned by Mr.Omprakash, P.Modi
(6) Off Coruse Tote Centre, Yelamanchilli Complex, Vijayawada

(7) Off Course Tote Centre, D.No.6-56/1, Industrial Estate, Opp.IDPL,
Balanager, Hyderabad-37.
(8) Off Course Tote Centre Krishna Plaza, Khairtabad, Hyderabad.
(9) Off Course Tote Centre Sri.J.Narasing Rao, Muncipal, No.8-1-329,
Tolichowki, Hyderabad.
(10) R.V.Leela Prasad, DNo.31-32-60, Saraswathi Pictures Palaces,
Saraswathi Park,Visakapatnam.
Between 9.00 A.M to completion of the last race on all Hyderabad
Monsoon and Winter Race and on the Intervenue Betting days for the year
2005-06 and 2006-07 i.e., upto 01-03-2007
(By order and in the name of the Governor of Andhra Pradesh).
——
5. Levy of RD Cess on Cashewnut-Cancellation of the Item
‘Cashewnut’ form the Schedule
[G.O.Ms.No. 574 Revenue (CT), dt. 19-05-2006]
Ref:– From the Commissioner of Commercial Taxes, A.P., Hyd.
Letter. A1(4)/498/2005, dt.14.07.2005
Notification
In exercise of the powers conferred under Section 13 of the Andhra
Pradesh Rural Development Cess Act, 1996, the Government of Andhra
Pradesh, having found it necessary to do so in the public Interest hereby
direct to cancel the entry “Cashewnut” at Sl.No 2 of the Schedule appended
to the Act, and also direct accordingly that no RD Cess shall be levied
on ‘Cashewnut’ under Section 7 of the said Act.
——
6. Food & Agriculture Department – Rice Millers Association
[G.O.Ms.No. 290, Revenue (C.T.), date 07-03-2006]
Order :
The Rice Millers Association, Andhra Pradesh in their representation
3rd read above, stated that it was indicated by government from time to
time that the Imports will be exempted from all taxes and levies, they further
state that the exports sales of Rice outside the country are being subjected
to A.P.Rural Development Cess and therefore, requested to give effect to
the assurances made by the Government by removing the levy of R.D.Cess
on paddy corresponding to Exports Sales of Rice.
(2) The Commissioner of Commercial Taxes, in his letter 2nd read

above, has stated that in case of exports of rice, there is no provision in
the Act, exempting from the levy of R.D.Cess, the purchases of paddy,
corresponding to the export sales of rice. While furnishing a report on the
representation of the Palasa Cashew Manufacturers Association, regarding
levy of R.D.Cess, the CCT has recommended to the Government, to issue
a notification exempting from the levy of R.D.Cess, the paddy ,purchased
and utilized by the Rice millers and dealers, in milling and exporting the
resultant rice to outside the country.
(3) As per the existing provisions of the R.D.Cess Act, 1996, Rural
Development Cess is leviable on the purchase value of the Paddy and
Cashew nut @5%. The Government have issued orders in the G.O.1st read
above, to the effect that the R.D.Cess paid on paddy purchased and utilized
for deriving rice, which is sol locally within the sate or within the country,
shall be disbursed to the millers by way of subsidy from the special fund
created for Rural Development. The side Fund has not been created and
the subsidies are also not disbursed so far; Hence, the Commercial Taxes
Department is raising demands in respect of the local sales of Rice, but
not enforcing collection in view of the fact that the subsidy is not being
paddy to the millers. As regards to export sales of rice, the Government
in principle, has agreed in the meeting of the Group of Ministers constituted
to solve the problems face by the Rice Millers Industry held on 02.12.2005
and also earlier to grant subsidy equal to the R.D.Cess paid @5% on paddy
purchased and utilized for milling Rice which was actually exported outside
the country also, which was not so far available.
(4) The Government have decided to grant subsidy equal to the
R.D.Cess payable on the purchase value of Paddy corresponding to the
quantum of Rice milled there-from and exported outside the country, by
the Rice Millers and also not to enforce collection of such demands raised
pending sanction and release of subsidies after due procedure and mechanism
is established. Accordingly, the Government hereby direct that the subsidy
equal to the amount of R.D.Cess payable on paddy purchased corresponding
to the quantity of Rice exported and also that the collection of demands
so raised shall not be enforced till the procedure and mechanism for sanction
and release of subsidy is established.
(5) The Comissioner of Commercial Taxes, A.P., Hyderabad, is therefore
requested to take necessary action, accordingly.
——
7. Cancellation of the Levy of Rural Development Cess on

"Cashewnut" from the Schedule.
Pradesh Rural Development Cess Act, 1996, the Government of Andhra
Pradesh, having found it necessary to do so in the public interest, hereby
direct to cancel the entry ‘Cashewnut’ at Sl.No. 2 of the Schedule appended
to the Act, and also direct accordingly that no Rural Development Cess
shall be levied on ‘Cashewnut’ under Section 7 of the said Act.
*This notification shall come into force with immediate effect.
——
8. Levy of RD Cess on Cashewnut-Cancellation of the Item
‘Cashewnut’ form the Schedule-Orders Issued-
Retrospective effect.
Reference:–
1. G.O.Ms.No. 574, Revenue, dt. 19-5-2006.
2. From the CCT, Hyd., Lr.No.A1(4)/498/2005, dt. 31-5-2006.
Notification
Pradesh Rural Development Cess Act, 1996, and in the partial modification
to the notification issued vide G.O.Ms.No.574, Revenue, dt.19.05.2006, the
government of Andhra Pradesh, hereby directs that the notification issued
in the G.O.Ms.No.574, Revenue, dt.19.05.2006, shall be deemed to have
come into force with effect from 1-4-2005.
——
9. Exemption from levy of RD Cess on the bonus of Rs.40
per quintal for procurement of paddy during Khariff
Marketing Season 2006-07 over and above the MSP,
under Section 13 of the Act
1. From the Commissioner of Civil Supplies & E.D.Secy to Govt.,
D.O.Lr.No.PI(4)/3196/2006, dt. 19-11-2006.
* w.e.f. 1-4-2005, vide G.O.Ms.No. 693 Rev. (CT) Dept., dt. 14-6-2006.
2. From the Commissioner of Commercial Taxes, A.P., Hyderabad,

Letter No.AII(2)/1071/2006, dt. 14-11-2006.
Notification
In exercise of the powers, conferred Section 13 of the Andhra Pradesh
Rural Development Act, 1996, the Government of Andhra Pradesh, hereby
grants exemption from levy of Rural Development Cess on the bonus amount
of Rs.40/- per quintal of paddy to be paid to the farmers by the state
agencies. i.e., Andhra Pradesh State Civil Supplies Corporation Limited/Food
Corporation of India, I.K.P Groups and Rice Millers over and above the
Minimum Support Price fixed by the Government, for procurement of paddy
during Khariff Marketing Season 2006-07, under the said Act.
10. Reconstitution of Andhra Pradesh Rural Development Board
Read:
G.O.Ms.No.1179, Rev. (CT.II) Dep’t., dt.6.9.2007.
Order:
Notification
In exercise of the power conferred by section 3 of the Andhra Pradesh
Rural Development Act, 1996 (A.P. Act No.11 of 1996) and in supersession
of the Orders issued in G.O.Ms.No.1179, Revenue (CT.II) Department,
dated the 6th September, 2007, the Government of Andhra Pradesh hereby
constitute the Andhra Pradesh Rural Development Board with the following
members:
1. Chief Secretary to Government ... Chairman
2. Principal Secretary to Government, ... Member
Revenue Department
3. Secretary to Government Food & ... Member
Civil Supplies Department
4. Secretary to Government Finance ... Member
Department
5. Secretary to Government, ... Member
Panchayat Raj and Rural Development
Department
6. Secretary to Government Transport, Roads ... Member
and Buildings Department
7. Commissioner of Commercial Taxes ... Member
8. Director of Civil Supplies & Ex-Officio ... Member-convenor
2. The Board may make regulations for the purpose of giving effect
to the provisions of the Andhra Pradesh Rural Development Act, 1996 with
the previous approval of the Government as required under section-15 of
the Andhra Pradesh Rural Development Act, 1996.
11. The Andhra Pradesh Rural Development Board

Regulations, 2010.
Notification
In exercise of the powers conferred by Section 5 read with section
15 of the Andhra Pradesh Rural Development Act, 1996 (Act 11 of 1996),
the Andhra Pradesh Rural Development Board after previous approval of
the Government of Andhra Pradesh hereby make the following regulations
for transacting business and other such matters to meet the purposes
envisaged under the provision of section 9 of the said Act.
Regulations
1. Title Commencement:-- (1) These Regulations may be called the
Andhra Pradesh Rural Development Board Regulations, 2010.
(2) These Regulations shall come in to force with immediate effect
from the date of publication in official Gazettee.
2. Definition:-- In these regulations, unless the context other wise
requires words and expressions used shall have the same meaning assigned
to them in the Andhra Pradesh Rural Development Act, 1996 and Andhra
Pradesh Rural and Infrastructure Development Cess Rules, 1996.
3.Conduct of meetings:-- (1) The Board shall conduct meetings of
the members as and when required provided that atleast one meting shall
be held in every quarter of the financial year.
(2) For the purpose of the Quorum for the meeting of the Board the
presence of a minimum of three members shall be required.
(3) The decisions of the Board in its meetings shall be recorded in
the shape of resolutions approved by a majority of the members present.
4. Business of the Board:-- The Board shall ordinarily consider the
following matters namely:-
(a) oversee the collection of cess and interest by the Commercial Taxes
Department and the amount credited to the “Fund”;
(b) allocation of the amount at the disposal of the Board for various
purposes envisaged under section 9 of the Act;
(c) Approval of the specific works or projects to be taken up with the
amounts allocated under clause (b);
(d) Reviewing and monitoring of the progress of works approved by the
Board and utilization of amounts allocated by it, and
(e) Annual statement of accounts showing income and expenditure of
the Board for the ensuing year shall be submitted to the Government;
------
NOTIFICATIONS UNDER CENTRAL SALES TAX
ISSUED BY THE GOVERNMENT OF A.P.
(IN FORCE)
1. Textiles, sugar and tobacco products
1.1 Exemption on inter-State sales of textiles, sugar and tobacco
[G.O.Ms.No. 2328, Revenue, dated 13.12.1957]
In exercise of the powers conferred by sub-section (5) of Section 8 of the
Central Sales Tax Act, 1956 (Central Act 74 of 1956), the Governor of Andhra
Pradesh hereby directs that with effect on and from the 14th December, 1957,
no tax under the said Act shall be payable by any dealer in respect of the sale
by him of the undermentioned goods, provided that such sale is to a dealer
registered under the said Act:–
(1) all varieties of textiles, namely, cotton, woollen or silken including
rayon, art silk or nylon, whether manufactured by handloom, powerloom or
otherwise ;
(2) sugar ; and
(3) tobacco and all its products.
[Pub. in A.P. Gaz., Ext., Pt. II, dt. 14.12.1957]
——
2. Officers competent to exercise the powers under Section 11 of
the Act
2.1 Under sub-section (1) of Section 11 of the Central Sales Tax Act, 1956
(Central Act 74 of 1956), the Governor of Andhra Pradesh hereby directs that
Commercial Tax Officers, within the local limits of whose jurisdiction the offence
has been committed, shall be the officers competent to accord sanction as required
by Section 11 of the said Act.
——
3. Paddy and rice
3.1 Concessional rate of tax on inter-State sales of paddy and rice
Notification I
Pradesh hereby directs that the tax payable by any dealer in paddy or rice or
893
both having his place of business in the State, on sale of paddy, rice or both
to the Government of India during the period from 1st July, 1957, to the 30th
September, 1958, falling under sub-section (2) of Section 8 of the said Act (as
it stood prior to the amendment made by Section 5 of Central Act 31 of 1958)
shall be one per cent of his turnover.
Notification II
Pradesh hereby directs that the tax payable by any dealer in paddy or rice or
both having his place of business in the State on sales of paddy or rice or both
to the Government of India, during the period from the 1st October, 1959, falling
under Clause (b) of sub-section (2) of Section 8 of the Act, shall be one per
cent of his turnover.
——
4. Books
4.1 Rate of tax on inter-State sales of books
[G.O.Ms.No. 205, Revenue (s), dated 28.2.1959]
Pradesh hereby directs that in cases falling under sub-section (2) of Section 8
of the aforesaid Act, the tax payable by a dealer having his place of business
in the State in respect of sales by him from any such place of business of books
in the course of inter-State trade or commerce shall be calculated at the same
rate as that specified under the Andhra Pradesh General Sales Tax Act, 1957.
[Published at page 579, by A.P. Gaz., Pt. I, dt. 12.3.1959]
——
5. Petroleum products
5.1 Exemption of petroleum products other than kerosene and motor spirits
by Caltex Oil Refining (India)
Central Sales Tax Act, 1956 (Central Act 74 of 1956) and in suppression of
Notification No. III published as Revenue Department Notification No. 52 at
page 374 of Part I of the Andhra Pradesh Gazette, dated the 31st January, 1963
the Governor of Andhra Pradesh hereby directs that with effect from the 1st
December, 1965, no tax under the said Act shall be payable in respect of the
sale of petroleum products other than kerosene and motor spirits as defined in
the Andhra Pradesh Sales of Motor Spirits Taxation Act, 1960 (Andhra Pradesh
Notifications under C.S.T. Act by A.P. Govt. 895
Act XVI of 1962) manufactured in the refinery by the Caltex Oil Refining (India)
Limited, and sold by it to the Caltex (India) Limited, and by the Caltex (India)
Limited to the Oil Distributing Companies, namely, Burmah shell oil Storage
and Distributing Co., of India Ltd., ESSO Standard Eastern Inc., Indo-Burmah
Oil Corporation and Indian Oil Corporation.
[Published in A.P. Gazette, Pt. I, dated 3.3.1966]
——
6. Nepal, Bhutan and Sikkim
6.1 Exemption from tax on inter-State sales to dealers in Nepal, Bhutan
and Sikkim
Pradesh hereby directs that in cases falling under sub-section (1) or Clause (b)
of sub-section (2) of Section 8 of the said Act, no dealer having his place of
business in the State shall be liable to pay any tax under the said Act in respect
of sales made by him to the dealers belonging to the countries of Nepal, Bhutan
and Sikkim, in the course of inter-State trade or commerce:
Provided that it is proved by such selling dealer to the satisfaction of the
assessing authority by producing:—
(i) a certificate from the customs authorities of the respective territory,
to the effect that the goods in question have actually entered into the
buyers’ respective territory and that the customs duty or any other
tax or duty which may be payable to the Government of the respective
territory on such entry, has been paid ; and
(ii) a certificate duly filled in and signed by the buyers in the form
annexed below.
Annexure
Form of certificate to be furnished by the buying dealer
I/We ......................... of ............... (address of the buyers) hereby certify
that the goods specified in Invoice/Bill No. ................. dated the ................. have
been purchased by me/us from M/s. ............................ (name of the selling
dealer) of ................. (address of the selling dealer) in the State of Andhra
Pradesh, for consumption in ........................... (name of the territory) and that
the goods were consigned from ............................. (place of purchase) by rail/
road under Invoice/R.R. No. ............... to ................ (name of place) in
.............................. (name of State) and have been taken delivery of by me/us
or by my/our agents M/s. ................................ (name of the agent) of
........................... (address of the agent) at ................... (name of the place) and
thereafter the goods have been taken into .................................... (name of the
territory) through ................ (name of the customs barrier in their territory) of
the Government of .................. (name of the territory).
Date: Signature of the buyer
Verification
I/We declare that to the best of my/our knowledge and belief, the information
furnished in the above certificate is true and complete.
Date : Signature of buyer.
[Pub. in A.P. Gaz., Pt. I, at page 977, dt. 13.7.1967]
——
7. CARE
7.1 Exemption on inter-State sales effected to CARE
Pradesh hereby exempts from the tax payable under the said Act, the sales of
all goods effected to the Co-operative for American Relief Everywhere, subject
to the condition that the dealer in the Andhra Pradesh State produces before the
Assessing Authority a certificate issued by the Administrator of the said Co-
operative for American Relief Everywhere to whom the goods are sold to the
effect that the said goods have been purchased by the Administrator, Co-operative
for American Relief Everywhere.
[Pub. at page 972 in A.P. Gaz., Pt. I, dated 1.8.1974]
——
8. UNICEF
8.1 Exemption on inter-State sales effected to UNICEF
Pradesh hereby directs that no tax shall be payable under the said Act, in respect
of all sales of goods effected to the United Nations International Children’s
Emergency Fund (UNICEF) in the course of inter-State trade or commerce by
the dealer having his place of business in Andhra Pradesh State:
Provided that the dealer who makes sales to the United Nations International
Children’s Emergency Fund will be allowed the exemption only, if such sales
are covered by a certificate obtained from the Administrator of the UNICEF to

the effect that he has purchased such goods for and on behalf of UNICEF.
[Published in A.P. Gaz., Pt. I, dated 27.7.1976, at page 712]
——
9. Scientific equipment to Research Institutions, Universities
9.1 Concessional rate of tax on inter-State sales of scientific equipment to
Research Institutions, Universities etc.
Pradesh hereby directs that in respect of scientific equipment and instruments
(hereinafter referred to as “the said goods”) the tax payable under the said Act
by any dealer having his place of business in the State of Andhra Pradesh in
respect of the sales by him from such place of business of the said goods in
the course of inter-State trade or commerce to educational and research institutions,
universities, Soil Testing Laboratories, Defence Laboratories, C.S.I.R. Laboratories,
Medical Institutions, I.C.A.R. Laboratories, or for use in institutions which carry
on any research work for the promotion of literary, scientific, artistic or educational
objects and which are not run with the motive of making profit, shall be calculated
at the rate applicable to the sale of such goods inside the State of Andhra Pradesh
:
Provided that such sale does not fall within the purview of 1[sub-section
(1) of Section 8] of the said Act :
Provided also that the educational institutions, hospitals, laboratories or
other research institutions, etc., as the case may be, furnish to the dealer from
whom they intend to purchase the said goods, a certificate before the assessing
authority at the time of claiming the concessional rate of tax.
Annexure
I, ................................... the officer in charge of the management of (**)
.................... situated at .............. hereby certify that the scientific equipment/
(place) instruments specified in invoice/bill No. ........... dated ....................... of
M/s. ........................................... have been purchased by the said
............................................
***(i) Educational/research institutions/universities for use in the teaching
of science or research.
1. Subs. for the words “Section 8” by G.O.Ms.No. 286, Rev.(S), dated 16.2.1983.
VAT–57
***(ii)Soil Testing Laboratory, Defence Laboratory, C.S.I.R. Laboratory

or I.C.A.R. Laboratory and medical institution for its use. The institution is not
run with profit motive.
Signature :
Designation :
** Here state the name of institution, hospital or laboratory as the case may
be.
*** Strike out whichever is not required.
[Published in A.P. Gaz., Pt. I, dated 11.10.1979, at page 839]
——
10. Yarn
10.1 Concessional rate of tax on inter-State sales of Polyster Yarn, Viscose

Yarn and Blended Yarn.

Pradesh hereby directs that the tax payable under Clause (b) of sub-section (2)
of Section 8 of the said Act, in respect of sales of Polyster yarn, Viscose yarn
and blended yarn irrespective of whether they are covered by any declaration
in Form-C or not shall be at the rate of two paise in the rupee.
This notification shall come into force w.e.f. the 1st January, 1986.
——
10.2 Rate of tax on the goods sold in the course of Inter-State Trade – Local
rate of tax applicable
[G.O.Ms.No. 78, Revenue (s), dated 14-2-2000]
Notification II

Pradesh hereby directs that the tax leviable under the said Act in respect of
sales in the course of inter-State trade or commerce of computers, all types of
yarn, copra and coconut be at the rate of four paise in the rupee without the
production ‘C’ form in support of such sales.
——
10.3 Concessional rate of 4% tax on inter-state sales on all types of yarn

without ‘C’ Form – Orders issued in G.O.Ms.No.78, Revenue, dt.
14.2.2000 – Date of applicability from 01-01-2000.
[G.O.Ms.No. 339, Revenue (CT.II) Department, dt. 21-4-2004]

Central Sales Tax Act, 1956 (Act 74 of 1956), and in partial modification of
the orders issued in G.O.Ms.No.78, Rev., dt. 14-02-2000, the Governor of Andhra
Pradesh hereby directs that the orders issued in G.O.Ms.No.78, Revenue (CT.II)
Department, dt. 14-02-2000, levying of tax under the said Act in respect of sales
in the course of inter-state trade or commerce of all types of yarn, at the rate
of four paise in the rupee without the production of ‘C’ form in support of such
sales, shall be deemed to have come into force with effect from 1.1.2000.
——
11. Cement
11.1 Concessional rate of tax on inter-State sales of cement

Pradesh hereby directs that the tax leviable under the said Act shall in respect
of the sales of cement in the course of inter-State trade or commerce, be at a
lower rate of two per cent with or without ‘C’ Form with effect from 1.1.1987.
[Published in A.P. Gaz., Ext. No. 56, Pt. I, dated 27.1.1987]
——
12. Electronic goods
12.1 Reduction in the rate of tax on ‘Electronic goods’
[G.O.Ms.No. 105 Revenue (CT.II) Dept., dt. 09.03.2002]
Notification I
In exercise of the powers conferred by sub-section (5) of Section 8 of

the Central Sales Tax Act, 1956 (Central Act 74 of 1956) the Governor of
Andhra Pradesh hereby directs that the rate of tax on the inter-State sales of
electronic goods, mentioned in the Annexure to this order, be at the rate of
two paise in the rupee provided such sales are covered by declarations in Form
‘C’ or ‘D’.
1
[x x x]
This notification shall be deemed to have come into force w.e.f. 28th February
2002.
——
Notification V
Central Sales Tax Act. 1956 (Central Act 74 of 1956) and in supersession of
the notification-I issued in the G.O.Ms.No.78, Revenue, dated 14.02.2000 the
Governor of Andhra Pradesh hereby directs that the tax leviable under the said
Act in respect of sales in the course of inter-State trade or commerce of ‘Electronic
goods’, excluding the goods mentioned in the Annexure to this order, be at the
rate of eight paise in the rupee if such sales are not covered by the declaration
in Form ‘C’ or ‘D’.
This notification shall be deemed to have come into force w.e.f. 28th February
2002.
——
Notification VI
Central Sales Tax Act, 1956 (Central Act 74 of 1956) the Governor of Andhra
Pradesh hereby directs that the words “and electronic goods’ occurring in the
notification issued in G.O.Ms.No. 83, Revenue, dt. 14.02.2000 shall be deleted.
This notification shall be deemed to have come into force w.e.f 28-2-2002.
Annexure
Sl.No. Description of Goods HSN Code

01. Test & Measuring Instruments 9030
02. Medical Electronic Equipment 9018
9021
1. The proviso deleted by G.O.Ms.No. 365, Rev. (CT. II), dt. 22-6-2002, w.e.f. 1.7.2002,
prior to omission it read as below :
"Provided further that if such sales are made to Banks including Co- operative Banks,
Universities, Statutory Bodies, Public Undertakings, Research Institutes, Religious
Institutions and Local Bodies a certificate, signed by an authorised officer of such
purchasing body, shall be treated as equivalent to declaration in Form ‘C’ for the
purpose of allowing the concessional rate of tax ordered above."

9022
9033
03. Analytical Instruments 9027
04. Electronic Milk Analysers 8434
05. Agri Electronic, Mining Electronic, Environmental 9031
Monitoring, Nuclear, Geo scientific, Fish Finders,
Textile Instruments.
06. Process Control Instruments. 9026
9032
07. STD, PCO Monitors 8470
08. Digital Image Recorders 9010
09. Logic Controllers, Sensors, 8531
Indicators, Transducers, 8504
Numerical Controls, 9026
Servo Amplifier, Process Controllers, 9032
Temperature controller, annuciotors, 9030
Converters, Choppers.
10. Electronic Teaching Aids 9023
11. Liquid Crystal Devices & Lasers 9013
12. Navigational, 8517
Signaling & Strategic Electronic equipment. 8525
8526
8527
8530
13. Semiconductor devices including PFDs, LED 8541
Displays, Opto Electronic Displays and Crystals,
Diodes, Transistors Rectifiers, Photo Voltic cells.
14. Integrated Circuits (ICs) Microprocessors 8542
15. Resistors fixed & Variable all types 8533
16. Capacitors (Condensers) fixed and variable all types 8532
17. Head Phones, Loudspeakers without acoustic 8518
enclosures
18. Permanent Magnets & Ferrites 8505
19. Electronic Transformers, chokes, coils, inductors 8504
useful for electronic equipment only.

20. Electromechanical components viz., 8536
Connectors, adapters, Jacks & Plugs, 8535
Relays, switches, terminals & terminal
Block, sockets, heat sinks, bases & holders, fuses
Fuse holders useful for electronic equipment only.
21. Components for TV including tuners, deflection 8529
components and delay lines. 8536
22. Components for tape recorder/VCR/VTR 8522
23. Printed Circuit Boards & Copper clad Laminates 8534
24. Filters, Indicating Lamps & Jewel Lights. 8500
25. Microwave passive components 8526
8529
26. Electron tubes including TV picture tubes 8540
27. Electronic Cash Registers —
28. Electronic point of sale systems. —
29. Electronic Note Counting Machines —
30. Electronic Currency Handling Devices —
31. Computers and all other goods mentioned in —
item 38A in the First Schedule to the Andhra
Pradesh General Sales Tax Act, 1957
32. Electronic X-Ray Baggage Scanning/Inspection —
System Including large sized Scanning System.
[Pub. in A.P. Gaz. Pt. I, ext. No. 112, dt. 14.3.2002]
——
12.2 Inter-State sales of ‘Jelly filled cables, optic fibre cables and jointing
kits’ to the Bharat Sanchar Nigam Limited, Videsh Sanchar Nigam
Limited and Mahanagar Telephone Nigam Limited, at the rate of 4%
without production of Form - ‘C’.
[G.O.Ms.No. 404, Rev. (CT. II) Department, dt. 16.6.2001]
C.S.T. Act, 1956 (74 of 1956), the Governor of A.P. hereby directs that the tax
leviable on the inter-State sales of 1[Jelly filled cables, Optic fibre cables and
1. Subs. for the words "Jelly filled cables, Optic fibre cables and Jointing kits" by
G.O.Ms.No. 10, Rev. (CT-II), dt. 10.1.2002, pub. in A.P. Gaz. Pt. I, ext. No. 25,
dt. 15.1.2002.
Jointing kits, VRLA Batteries and Switch Mode Rectifiers (Battery Chargers)]
to Bharat Sanchar Nigam Limited, Videsh Sanchar Nigam Limited and Mahanagar
Telephone Nigam Limited, shall be at the rate of 4% whether such sales are
covered by the declaration in Form - ‘C’ or not.
Note:– The orders issued in above Noti. shall be deemed to have come
into force w.e.f. 1.10.2002. vide G.O.Ms.No. 50, Revenue (CT-II),
dt. 6.2.2002, pub. in A.P. Gaz. Pt. I, ext. No. 73, dt. 13.2.2002.
——
12.3 Rate of tax on the goods sold in the course of Inter-State Trade – Local
rate of tax applicable.
[G.O. Ms. No. 78, Revenue (CT.II) Department, dated 14.2.2000]
From CCT’s Ref. No. A1 (3)/458/98, dated 20.1.2000.
Notification I
Central Sales Tax Act, 1956 (Act 74 of 1956), the Governor of Andhra Pradesh
hereby directs that the tax leviable under the said Act in respect of sales in the
course of inter-state trade or commerce of electronic goods be at the rate of eight
paise in the rupee without the production of ‘C’ form in support of such sales.
——
13. Public Sector Organisations
13.1 Ineligible Public Sector Organisations for issue of certificate in Form D
[G.O.Ms.No. 882, Revenue (CT-III) Dept., dated 28.12.1988]
It has been brought to the notice of the Government of India that Government
undertakings and Public Sector organisations who are not “Government” and
not eligible to issue “Form D” under the Central Sales Tax (Registration and
Turnover) Rules, 1957 (i.e. Form of Certificate for making Government Purchases)
are taking advantage of the “Form D” and the dealers who are ignorant of the
legal meaning of the term “Government” are put to inconvenience as the assessment
takes place after a lapse of 2 to 3 years when “Form D” is rejected. It is therefore
decided to issue a notification listing out the organisations which are not entitled
to issue “Form D”.
2. Government accordingly notify the list of public sector organisations
who are not eligible to issue Form D for information of the dealers. The
Commissioner of Commercial Taxes is requested to intimate the Government
whenever any organisation is to be included in this list.
3. The Director of Printing is requested to publish the notifications appended
to this order in the next issue of the Andhra Pradesh Gazette.
APPENDIX
Notification
It is notified for information that the following public sector undertakings
and organisations are not eligible for issue of “Form-D” (Form of Certificate
for making Government Purchases) under the Central Sales Tax (Registration
and Turnover) Rules, 1957.
Central Sector Undertakings and Organisations
1. Hindustan Machine Tools Ltd., Machine Tools Division,
Hyderabad-500 854.
2. Hindustan Aeronautics Ltd., HAL Post Office, Hyderabad-500 042.
3. Indian Drugs and Pharmaceuticals Ltd., P.O. Balanagar Town Ship,
Hyderabad-500 037.
4. Hindustan Cables Ltd., P.O. Hindustan Cables, Hyderabad-500 051.
5. Praga Tools Ltd., P.S. 1570, 6.6.18/32, Kavadiguda, Sec’bad-500 003.
6. Bharat Heavy Electricals Ltd., Ramachandrapuram, Hyderabad-500 032.
7. Electronics Corporation of India Ltd., ECIL Post Office, Hyderabad-500
762.
8. Bharat Heavy Plates and Vessels Ltd., Visakhapatnam-530 012.
9. Hindusthan Shipyard Ltd., Visakhapatnam-530 005.
10. Fertilizers Corporation of India Ltd., Ramagundam Division, P.O. Godavari
Khani, Karimnagar-505 209.
11. Hindustan Zinc Ltd., Visakhapatnam-530 015.
12. Bharath Electronics Ltd., Machilipatnam, Krishna District.
13. Bharath Dynamics Ltd., Kanchanbagh, Hyderabad-500 258.
14. Defence Metallurgical Research Laboratory, Chandrayan Gutta, Hyderabad.
15. Defence Electronic and Research Laboratory, Chandrayan Gutta,
Hyderabad.
16. 1[x x x]
17. Modern Bakeries, Uppal Road, Hyderabad.
18. SHAR Project, Srihari Kota, Nellore District.
19. Misra Dhatu Nigam Ltd. (MIDHANI), Chandrayan Gutta, Hyderabad.
1. The Organisation “Nuclear Fuel Complex, Moula-Ali, Hyderabad” omitted by G.O.Ms.No.

630, Rev. (CT-III) Department, dated 2-8-1996.
20. Visakhapatnam Steel Plant, R.T.C. Commercial Complex, Visakhapatnam-

530 020.
21. Wagon Repair Workshop, Vijayawada, Krishna District.
22. Carriage Repair Workship, Tirupati, Chittoor District.
23. Sponge Iron India Ltd., Khanagi, 10.3.311/A, Castle Hills, Masab Tank,
Hyderabad.
State Industries and Organisations
1. A.P. State Road Transport Corporation, Administrative Buildings,
Musheerabad, Hyderabad.
2. Hyderabad Allwyn Metal Works, Sanathnagar, Hyderabad.
3. A.P. Scooters Limited, Patancheru, Hyderabad.
4. A.P. State Agro Industries Corporation, A.C. Guards, Hyderabad.
5. A.P. Textile Corporation, Hyderabad.
6. A.P. Police Housing Corporation, Hyderabad.
7. A.P. Housing Board, Gruhakalpa, Hyderabad.
8. Nizam Sugar Factory, Shakkar Bhavan, Fateh Maidan Road, Hyderabad.
9. Republic Forge, Moula-Ali, Hyderabad.
10. Leather Industries Development Corporation of Andhra Pradesh.
11. A.P. Dairy Development Corporation, Lalapet, Hyderabad.
12. A.P. State Electricity Board, Vidyut Soudha, Somajiguda, Hyderabad.
13. Singareni Collieries, Khammam District.
14. Allwyn Nissan Limited, Sanathnagar, Allwyn Bhavan,
Hyderabad-500 018.
——
14. Milk
14.1 Exemption on inter-State sales of U.H.T. milk by A.P.D.D. Co-operative
Federation
[G.O.Ms.No. 6, Revenue (CT-III), dated 4.1.1989]

Pradesh hereby exempts from the tax leviable under the said Act, the sales of
ultra high temperature milk by the Andhra Pradesh Dairy Development Co-
operative Federation or its member unions in the course of inter-State trade or

commerce with effect from the 9th April, 1986.
[Pub. in A.P. Gaz., Ext. No. 5, Pt.I, dated 5.1.1989]
——
15. Coir Products
15.1 Exemption from Payment of Tax on the Inter State Sales of Coir
Products
[G.O. Ms. No. 428, Rev. (C.T. II), 25th June, 2001]
Central Sales Tax Act, 1956 (Central Act No. 74 of 1956), the Governor of
Andhra Pradesh hereby grants exemption on the inter-State sales of coir products
viz., coir fibre, coir yarn, coir rope, coir matting and other products but excluding
rubberised coir products.
——
16. W.H.O.
16.1 Exemption on inter-State sales to W.H.O.
[G.O.Ms.No. 616, Revenue (CT-II), dated 27.6.1989]
Pradesh hereby directs that no tax shall be payable under the said Act in respect
of all sales of goods effected to the World Health Organisation in the course
of inter-State trade or commerce by the dealer having his place of business in
Andhra Pradesh State.
Provided that the dealer who makes sales to the World Health Organisation
will be allowed the exemption only if such sales are covered by a certificate
obtained from the authorities of the World Health Organisation to the effect that
they have purchased such goods for and on behalf of the World Health
Organisation.
[Published in A.P. Gaz., Ext. No. 263, Pt.I, dated 1.7.1989]
——
17. Pure silk cloth
17.1 Exemption on inter-State sales of pure silk cloth woven on handlooms
[G.O.Ms.No. 853, Revenue (CT-III), dated 18-9-1990]
Pradesh hereby exempts the tax leviable under the said Act in respect of the
sales of pure silk cloth woven on hand-looms.
2. This notification shall be deemed to have come into force on the 1st
September, 1976.
[Published in A.P. Gaz., Ext. No. 299, Pt. II, dt. 20.9.1990]
——
17.2 Exemption from payment of Sales Tax on Inter-State sales of Pure Silk
by Weavers Cooperative Societies, w.e.f. 1.8.1996
[G.O.Ms.No.752 Rev. (CT.II) Dept. Dt. 12.9.1996]
Andhra Pradesh hereby exempts from the tax leviable under the said Act, the
sales of Pure silk by the Weavers, master weavers and Weavers Co-operative
Societies in the course of inter-State trade or commerce with effect from 1.8.1996.
——
17.3 Inter-State sale of handloom pure silk cloth by weavers and their
societies
[G.O.Ms.No. 873 Rev. (CT.II), Dept., dt. 25-10-1996]
Central Sales Tax Act, 1956 (Central Act 74 of 1956) and in supersession of
the orders issued in G.O.Ms.No. 776, Revenue (CT.II), Department, dated 18th
September, 1996, the Governor of Andhra Pradesh hereby exempts the inter-
State sale of handloom pure silk cloth by the weavers, master weavers and
weavers co-operative societies of Andhra Pradesh from the payment of tax under
the said Act.
[Pub. in A.P. Gazette, Ext. No. 475, Part 1, dt. 29.10.1996]
——
18. Vegetable oils
18.1 Set off of tax paid on oil seeds and Non-refined oils from the tax
payable on inter-State sales of refined oil
[G.O.Ms.No. 402, Rev. (CT.II) Dept., dt. 16-8-1995]
Notification III
Pradesh hereby directs that where in respect of sale or purchase inside the State
of all Oil Seeds or non-refined vegatable oil (except rice bran oil) as the case
may be, tax has been levied and collected under Andhra Pradesh General Sales
Tax Act, 1957 (Act VI of 1957) and such oil seeds or non-refined oil are used
in the manufacture of non-refined or refined vegetable oil (except rice bran oil),
the amount of tax paid on such quantity of oil seeds or non-refined vegetable
oil as the case may be, shall be reduced from the tax leviable under the Central
Sales Tax Act in respect of sales in the course of inter-State trade or commerce,
of all vegetable oils (whether refined or non-refined as the case may be) obtained
from the oil seeds or non-refined oil referred to.
——
18.2 Set off of tax paid on oil cakes from the tax payable on de-oiled cakes
[G.O.Ms.No. 402, Rev. (CT.II) Dept., dt. 16-8-1995]
Notification IV
the Central Sales Tax Act, 1956 (Central Act 74 of 1956), the Governor of
Andhra Pradesh hereby directs that where in respect of sale or purchase inside
the State of all Oil cakes on which tax has been levied and collected under the
Andhra Pradesh General Sales Tax Act, 1957 (Act VI of 1957) which are used
in the process of obtaining de-oiled cakes, the amount of tax paid on such quantity
of oil cakes from which the said de-oiled cake has been obtained shall be reduced
from the tax leviable under Central Sales Tax Act in respect of sales in the course
of inter-State trade or commerce of De-oiled cake.
——
18.4 Reduction in rate of tax on de-oiled cakes.
Pradesh hereby that the tax payable under the said Act in respect of sales in
the course of inter-State trade or commerce of (1) de-oiled cakes, shall be
calculated at the reduced rate (2) even without the production of declaration in
form ‘C‘ for the period from 1.4.1993 to 16.8.1995 only.
Note:–
(1) These words “vegetable oils (whether refined or non-refined) except
rice bran oil and” were deleted by G.O.Ms.No.886 Revenue CT.II) Department
Dated on.7.12.2000.
(2) These words “of two (2) paise in the rupee” were deleted by
G.O.Ms.No.84 Revenue (CT.II) Dated on 25-1-2001.
[Pub. in A.P. Gazette, Part-I Extraordinary No. 477, date 02/12/2000]
——
19. Coconut and Copra

19.1 Rate of tax on the Inter-State Sales of Coconut and Copra covered
by Declaration in “C” Form.
[G.O.Ms.No.366, Revenue (CT.II), dated 22.6.2002]
the Central Sales Tax Act, 1956 (Central Act No.74 of 1956), the Governor of
Andhra Pradesh hereby directs that the Inter-State sale of Coconuts and Copra
shall be liable to tax at the rate of 2 paise in the rupee, if the sale is covered
by declaration in form - ‘C’.
This Notification shall come into force with effect from the 1-7-2002.
[Pub. in A.P. Gaz. Pt. I, Ext. No. 289, dt. 26-6-2002]
19.2 Exemption from payment of tax on inter-state sale of "Coconut"

[G.O.Ms.No.576, Revenue (CT.II), dated 4-4-2008]
the Central Sales Tax Act, 1956 (Central Act 74) of 1956), the Government of
Andhra Pradesh hereby direct that no tax under this Act shall be payable by any
dealer, in respect of the sales of the "Coconut" made by him to a registered dealer
in the course of inter State trade or commerce.
This Notification shall come into force on and from the 1st April, 2008.
20. Tapes, Nawars and Laces
20.1 Exemption of Sales Tax on Tapes, Nawars and Laces etc.
[G.O.Ms.No. 420, Revenue (CT-II) Department, dated 15.6.1998]
the Central Sales Tax Act, 1956 (Central Act 74 of 1956), the Governor of
Andhra Pradesh hereby exempts from the tax leviable under the said Act the
interstate sales of Tapes, Nawars and Laces etc., manufactured exclusively by
the members of Chirala Tape Manufacturers Association, Chirala, Prakasam
District, Andhra Pradesh.
The above notification shall come into force with immediate effect.
20.2 Concessional rate of tax on sale of tapes, nawars and laces with
or without declaration in C Form.
[G.O. Ms. No. 775, Revenue (CT-II) Dept., dated 18-09-1996]
In exercise of the powers conferred by sub-sec. (5) of Section 8 of the
Pradesh hereby grant concessional rate of 4% on the inter-State sales of tapes,
nawars and laces weather covered by ‘C’ Form or not.
This notification shall be deemed to have come into force with effect from
1st August, 1996.
——
21. Tapioca
21.1 The Samalkota SAGO Manufacturers Co-op. Socieity Limited –
Retrospective Effect to the Orders Issued in G.O.Ms.No. 517, Revenue,
dt. 29.7.2000 from 1.1.2000.
[G.O.Ms.No. 385, Revenue CT.II) Department, dt. 10-5-2004]
C.S.Tax Act, 1956 (Act 74 of 1956), the Governor of Andhra Pradesh hereby
directs that the orders issued in G.O.Ms.No. 517, Revenue (CT. II) Department,
dated 29-7-2000, shall be deemed to have come into force w.e.f. 1-1-2000.
[Pub in A.P.Gaz. Part I, Ext. No. 197, dt. 18-5-2004]
——
22. Jute
22.1 Inter-State sales of ‘Jute Twine’ and ‘Jute Yarn’ -Reduction of rate
of tax to 1% against Form ‘C’ or ‘D’
Central Sales Tax Act, 1956 (Central Act No.74 of 1956) the Governor of Andhra
Pradesh hereby directs that the rate of tax on the inter-state sales of ‘Jute Twine’
and ‘Jute Yam’ shall be at the rate of one paise in the rupee against Form ‘C’
or ‘D’.
[Pub. in A.P. Gaz. Pt. I ext. No. 113, dt. 14.3.2002]
——
22. M/s. MRF Limited
22.1 Concessional rate of Tax on inter-State sales of tyres made by
M/s. MRF Limited, Medak District.
[G.O.Ms.No.987 Rev. (CT.II) Dept., Dt. 10.12.1998]
In exercise of the powers conferred by Section 8 of Central Sales Tax Act,
1956 (Central Act 74 of 1956), the Governor of Andhra Pradesh hereby directs
that the tax leviable under the said Act in respect of inter-State sale of tyres made
by M/s. MRF Limited, Sadasivapet, Medak District to Road Transport Corporations
situated outside the State shall be at the rate of four paise in the rupee, whether
such sale is covered by the declaration in Form ‘C/D’ or not.
——
23. Atta, Maida, Ravva and Wheat Bran
23.1 Rate of tax on the Inter-State Sales of ‘Atta, Maida, Ravva and Wheat
Bran’ against Form C.
[G.O.Ms.No. 680, Revenue (CT.II) dt. 18.10.2001]
In exercise of the powers conferred by sub-section (5) of section 8 of the

Andhra Pradesh, hereby directs that the tax leviable on inter-State sales of Atta,
Maida, Ravva and Wheat bran shall be at the rate of two paise in the rupee against
Form-C.
——
24. Aluminium
24.1 Inter State sale of Aluminium – Rate of Tax @ 1%.
[G.O.Ms.No. 97, Revenue (CT.II), dt. 25-1-2003]
Central Sales Tax Act, 1956 (74 of 1956), the Governor of A.P. hereby directs
that the tax leviable on the Inter-State sales of Aluminium shall be at the rate
of 1% under the said Act, provided such sales are covered by C/D Form.
[Pub. in A.P. Gaz. Pt. I, ext. No. 40, dt. 27-1-2003]
——
25. Zinc
25.1 Rate of tax on the inter-state sale of Zinc @ 1%
[G.O.Ms.No. 1203, Revenue (CT.II) Department, dt. 25-11-2003]
Central Sales Tax Act, 1956 (Central Act No.74 of 1956), the Governor of
Andhra Pradesh hereby directs that the tax shall be levied and collected on the
inter-state sale of Zinc, at the rate of 1%, provided the inter-state sales of Zinc
are covered by C/D Form, under the said Act.
——
26. Tamarind
26.1 Exemption from payment of tax on inter-State sales of Tamarind,
if Andhra Pradesh General Sales Tax is paid
[G.O.Ms. No. 813, Revenue (CT.II), Dept., dated 14-10-2004]
Pradesh hereby exempts, from the payment of tax under the said Act on the inter-
State sales of Tamarind, covered by "C" form, provided that the tax has been
levied and collected on such goods under the provisions of the Andhra Pradesh
General Sales Tax Act, 1957. The burden of proving the tax has been paid under
the Andhra Pradesh General Sales Tax Act shall lie on the dealer, claiming
exemption.
[Pub. in A.P. Gaz. Part I, Ext. No. 462, dt. 4-11-2004]
——
27. Cotton Seeds
27.1 Exemption from payment of tax on inter-State sales of Cotton
Seeds, if Andhra Pradesh General Sales Tax is paid1
[G.O.Ms. No. 842, Revenue (CT.II), Dept. Dated 23.10.2004]
Pradesh hereby exempts, the inter-State sales of Cotton Seeds, covered by "C"
form, from the payment of tax under the said Act, provided that the tax has been
levied and collected on such goods under the provisions of Andhra Pradesh
General Sales Tax Act, 1957. The burden of proving that tax has been paid
on such goods, under the Andhra Pradesh General Sales Tax Act, shall lie on
the dealer, claiming exemption.
——
28. Scientific Equipment to Research Institutions
28.1 Exemption on sales of DC 312 computer system to certain
institutions
[G.O.Ms. No. 43, Revenue(s) (CT.II) Dept., dated 1-12-1983]
Central Sales Tax Act, 1956 (Central Act, 74 of 1956) the Governor of Andhra
Pradesh hereby directs that the tax payable under sub-section (2)(b) of Section
8 of the said Act, on the sales of Computer system 1. DC.312 made by dealers
in the State in the course of inter-State trade or commerce, to educational and
research institutions, Universities Soil Testing Laboratories, Defence Laboratories,
Council of Scientific and Industrial Research Laboratories, Medical Institutions,
Indian Council of Agricultural Research Laboratories or to the institutions, which
carry on any research work for the promotion of literary, scientific, artistic or
educational object, shall be at the reduced rate of five percent.
——
29. Mica
29.1 Rate of tax on sale of mica
[G.O.Ms. No. 87, Revenue Dept., dated 24-1-1996]

Pradesh hereby directs that the tax payable in respect of Inter-State sales of Mica
shall be at the rate of Four paise in the rupee, whether such sale is covered by
the declaration in Form ‘C’ or not.
30. Handloom pure silk cloth
30.1 Exemption on sales of handloom pure silk cloth by the wholesalers
of Anantapur District.
[G.O.Ms. No. 776, Revenue (CT. II) Dept., dated 18-9-1996]
In exercise of the powers conferred by sub-section(5) of Section 8 of the
Andhra Pradesh hereby exempts the sales of handloom pure silk cloth by the
wholesalers of Anantapur District in the course of inter-State trade or commerce
from payment of tax payable under the said Act.
——
31. Pre Engineered Building System
31.1 Rate of tax on pre-engineered building system
[G.O.Ms. No. 774, Revenue (CT.II) Dept., dated 10-7-1998]
Andhra Pradesh hereby directs that the tax payable under sub-section (1) of
Section 8 of the said Act of the sale in the course of inter-State trade or commerce
of Pre Engineered Building System manufactured by M/s Alghanim Industries,
Mahaboobnagar District be at the rate of one paise in the rupee.
——
32. Light roofing asphaltic corrugated sheets
32.1 Rate of tax on sale of light roofing asphaltic corrugated sheets
without declaration in C Form.
[G.O.Ms. No. 218, Revenue (CT.II) Dept., dated 18-4-2000]
In exercise of the powers conferred by subsection (5) of Section 8 of the
Pradesh hereby directs that the tax payable under the said act by any dealer
having his place of business in the State of Andhra Pradesh in respect of sales
in the course of inter-state trade or commerce of light roofing asphaltic corrugated
sheets be at the rate of eight paise in the rupee without the production of ‘c’
form in support of such sales.
——
VAT–58
33. Civil Supplies

33.1 CST Act, 1956 – Civil Supplies: Implementation of the
Recommendations of Group of Ministers constituted on the revival
of rice milling Industry – Exemption of Furnishing of "C" Form
declarations upto 31.3.2005 and to enforce provisions of Law for
furnishing the C-Form declarations for assessment as well as
collection of tax by the Commercial Taxes from 1.4.2005 onwards.
[G.O. Ms. No. 133 Consumers Affairs, Food & Civil Supplies
(CSI(I) Department, dt. 14-9-2005]
1. G.O. Rt. No. 6640 General Administration (Cabinet) Department
dated 23-11-2004.
2. Minutes of the meeting held on 21-6-2005 in the Chambers of Hon'ble
Minister for Commercial Taxes, Secretariat, Hyderabad.
Order
Government have vide reference first read above, constituted a Group of
Ministers (GoM) with the Ministers for, Civil Supplies, Major Industries and
Commercial Taxes to study all the issues pending with different Departments
and to suggest appropriate measures to the Government for revival and
modernization of Rice Milling Industry in Andhra Pradesh.
2. The Group of Ministers have examined the requests of the rice milling
industry and held discussions with the Senior Officers and with the Office bearers
of Rice Milling Industry. After considering the difficulty of the Rice Millers of
Andhra Pradesh in obtaining 'C' Forms declarations from the traders of
neighbouring States, particularly, when there is no incidence of tax in those
States, and the need to ensure remunerative price for paddy produced by the
farmers by making the Rice Millers of Andhra Pradesh to participate in paddy
purchases and also to make them competitive in sale of rice outside the State,
the Group of Ministers have recommended that the excess demand raised by
the Commercial Taxes Department against the Rice Millers for non-furnishing
of 'C' Form declarations at 8% (those who do not furnish 'C' Form declarations
are liable to be taxed @ 8%), the excess demand raised against the Rice Millers,
may be considered for waiver by the Government for the period ending w.e.f.
1st March, 2005 and the provision of law to be strictly enforced w.e.f. 1st April,
2005 for the purpose of assessment as well as collection of tax by the Commercial
Taxes Department.
3. Government, after careful consideration of the recommendations of the
Group of Ministers hereby order with regard to furnishing "C" Form declarations
that the excess demand raised by the Commercial Taxes Department against the
Rice Millers for non-furnishing of "C" Forms declarations @ 8% be waived to
the extent of 4% excess demand raised over and above the normal rate of 4%
leviable, for not submitting C-form declarations for the period ending 31st
March, 2005 and that the provisions of law be strictly enforced w.e.f. 1st April,
Taxes Department.
4. This order issues with the concurrence of Revenue Department vide their
U.O. Note No. 43095/CT-II/2005, dated 12-9-2005.
[By order and in the Name of the Governor of Andhra Pradesh.]
——
33.2 Civil Supplies: Implementation of Recommendations of Group of
Ministers constituted on the revival of rice milling Industry –
Extension of benefit granted in G.O. Ms. No. 133, dt. 14.9.2005 to
31.1.2006 on furnishing of C-Form declarations – Revised – Orders
– Issued.
[G.O. Ms. No. 41 Consumer Affairs, Food & Civil Supplies (CS) (1)
Department, dt. 2-5-2006]
1. G.O. Rt. No. 6640 General Administration (Cabinet) Department, dated
23.11.2004.
2. G.O. Ms. No. 133, C.A. F&CS Department, dated 14.9.2005.
3. G.O. Rt. No. 8473 General Administration (Cabinet) Department, dated
24.12.2005.
4. Minutes of the meeting held on 14.3.2006 in the Chambers of Hon'ble
Minister for Agriculture, Horticulture, Food and Civil Supplies, Secretariat,
Hyderabad.
Order:
The Government vide 1st and 3rd read above, have constituted a Group
of Ministers to study all the issues pertaining to Rice Milling Industry pending
with different Departments and to suggest appropriate measures to the Government
for revival and modernization of Rice Milling Industry in Andhra Pradesh State.
2. In the 2nd read above, the Government have agreed with regard to
furnishing of "C" form declarations that the excess demand raised by the
Commercial Taxes Department against the Rice Millers for non-furnishing of
"C" Form declarations @ 8% be waived to the extent of 4% excess demand raised
over and above the normal rate of 4% leviable, for not submitting C-form
declarations for the period ending 31st March, 2005 and that the provisions of
law be strictly enforced w.e.f. 1st April, 2005 for the purpose of assessment as
well as collection of tax by the Commercial Taxes Department.
3. The Group of Ministers vide 4th read above have recommended to

extend the benefits granted in G.O. Ms. No. 133, CA, F&CS Department dated
14.9.2005, upto 31.1.2006 and that the provisions of law be strictly enforced
w.e.f. 1st Feb., 2006 for the purpose of assessment as well as collection of tax
by the Commercial Taxes Department.
4. Government, after careful examination of the matter and the
recommendations of the Group of Ministers, hereby, order that the excess demand
raised by the Commercial Taxes Department against the Rice Millers for non-
furnishing of "C" Form declarations @ 8% be waived to the extent of 4% excess
demand raised over the normal rate of 4% leviable, for not submitting C-Form
declarations for the period ending upto 31st January, 2006 and that the provisions
of law be strictly enforced w.e.f. 1st February, 2006 for the purpose of assessment
as well as collection of tax by the Commercial Taxes Department.
5. This order issues with the concurrence of Revenue Department vide their
U.O. No. 9293/CT-II(1)/2006-1 dated 2.5.2006.
[By Order and in the Name of the Governor of Andhra Pradesh.]
——
33.3 Exemption of furnishing of 'C' Forms declaration to the Coconut,
Copra dealers – Extension of benefit granted in G.O. Ms. No.
133, Consumer Affairs, Food and Civil Supplies (CS-I) Dept.,
dated 14.9.2005 upto 31.3.2006.
[G.O. Ms. No. 812 Revenue (CT-II) Department, dt. 4-7-2006]
Order:
The East & West Godavari Coconut and Copra Exporters Association
in their representation second read above, have expressed the difficulty in
obtaining the 'C' Form declarations from the traders of neighbouring States
like Tamilnadu, Pondicherry, Maharashtra and Chattisgarh. Particularly, when
there is no incidence of tax in those States. The Association has therefore
requested to extend the benefit granted to Rice Millers in the G.O. 1st read
above to the Coconut & Copra dealers also by waiving the demand raised
or to be raised in excess of the rate of 2% leviable, by the Commercial Taxes
Department for the years upto 2005-06, on the ground of non-furnishing of
'C' Form declarations.
(2) The Commissioner of Commercial Taxes, has stated that by virtue
of the amendment, given effect to the Finance Act No. 20/2002, the production
of 'C' Forms against the inter-State sales was made compulsory with effect
from 13.5.2002 and the request, made for the relaxation of the condition of
compulsory production of 'C' Forms will therefore amount to violation of the
provisions of the CST Act, 1956 as amended by the Finance Act 20/2002
and hence, such a condition cannot be relaxed as per law. In the case of Rice
Millers, orders were issued waiving the excess demand raised over and above
the normal rate of 4% tax, leviable or levied upto 31.3.2005, vide G.O. Ms.
No. 133, Consumer Affairs, Food and Civil Supplies (CS-I) Department, dated
14.9.2005, later extended upto 31.1.2006, on the basis of the recommendations
of the Group of Ministers.
(3) The Government after careful examination of the matter, and keeping
in view the orders issued in the reference 1st read above, in similar cases relating
to Rice Millers hereby order that the excess demand raised over and above the
tax leviable @ 2% by the Commercial Taxes Department against the dealers in
Coconut & Copra, for non-production of 'C' declaration forms, for the period
from 1.7.2002 to 31.3.2006 be waived and the provisions of Law be strictly
enforced w.e.f. 1.4.2006 for the purpose of assessment as well as collection of
tax by the CT Department.
(4) The Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad
is requested to take necessary action accordingly.
——
34. CDMA Phones
34.1 Tax leviable on the inter State sale of CDMA Phones shall be at
the rate 2% under the said Act
[G.O.Ms.No.546 Revenue (CT-II), dt. 11-5-2006]
Notification
In exercise of the powers conferred by sub-section (5) of section 8 of the
Central Sales Tax Act, 1956 (Central Act No.74 of 1956), the Governor of
Andhra Pradesh hereby directs that the tax leviable on the inter State sale of
CDMA Phones shall be at the rate of 2% under the said Act, provided such sales
are covered by C/D Form.
This notification shall come into force with effect from 1.5.2006.
[Published in the A.P. Gazette Part-I (Ext.) dt. 15-5-2006]
——
34.2 Inter-State sales of CDMA Phones – Further reduction in the rate
of tax on CDMA phones to 1% from 2%.
[G.O. Ms. No. 794 Revenue (CT-II) Department, dt. 29-6-2006]
Notification
Central Sales Tax Act, 1956 (Central Act No. 74 of 1956), and in partial
modification of the Notification issued under the G.O. Ms. No. 546, Revenue,
dated 11.5.2006, the Government of Andhra Pradesh hereby directs that the tax
leviable on the Inter-State sales of CDMA Phones, shall be at the rate of 1%
under the said Act, provided such sales are covered by C/D Forms.
This notification shall be deemed to have come into force with effect from
1.5.2006.
35. Notifications Rescinded

[G.O.Ms.No.1470 Revenue (CT-II) Dept., dt. 7-11-2006]
Notification II
In exercise of the powers conferred by sub-sections (3), (4) and (5) of
Section 13 of the Central Sales Tax Act, 1956 (Central Act No.74 of 1956), the
Governor of Andhra Pradesh hereby rescinds the following notifications issued
under the various G.Os., as mentioned in the table below:–
Sl.No. G.O.No. & Date

This notification shall be deemed to have come into force with effect on
and from 1-2-2006.
——
36. Sales of wheat to Army

[G.O.Ms.No. 1395, Revenue (S), dt. 24-12-1985]
of the Central Sales Tax Act, 1956 (Central Act 74 of 1956) the Governor
of Andhra Pradesh hereby exempts from the liability to pay tax under the
said Act with effect from the 1st July, 1985 the inter-State despatches of
Wheat products by the Army Purchase organisation to the Army Supply Depots
located outside the State of Andhra Pradesh.
37. Polished Granites
37.1 Inter-State sale of polished granites – Reduction of tax paid
on raw material
[G.O.Ms.No. 110, Revenue (CT-II) Department, dt. 20-1-2005]
of the Central Sales Tax Act, 1956 (Central Act 74 of 1956), the Governor
of Andhra Pradesh hereby directs that whereon the purchase of raw material
(rough blocks and semi-finished tiles & slabs), tax has been levied and collected
under the said Act in the State and if such material is used for polished
granites, the amount of tax paid on such raw material shall be reduced from
the tax payable on inter-State sale of polished granites, under the said Act.
38. A.P.M.I. Project
38.1 A.P.M.I. Project
[G.O.Ms.No. 1445, Revenue (CT-II) Department, dt. 14-11-2007]
of the Central Sales Tax Act, 1956 (Central Act 74 of 1956), the Government
hereby exempts the inter-state sales of Fortified Micronutrient Candies, by
M/s. Sampre Nutritions Limited, for free distribution by Government of Bihar
among the Poor beneficiaries of ICDS Scheme, from levy and collection of
tax under the said Act.
2. This notification shall be deemed to have come into force with effect
from 1-4-2007 and shall be valid upto 31-3-2008.
39. C.S.T.
39.1 Reduction of rate of tax to 2% w.e.f. 1-6-2008.
[Noti.No. S.O. 1277 (E), dt. 30-5-2008.]
In exercise of the powers conferred by the proviso to sub-section (1)
of Section 8 of the Central Sales Tax Act, 1956 (74 of 1956), the Central
Government hereby reduces the rate of tax as specified in sub-section (1)
of Section 8 of the said Act from three per cent to two per cent with effect
from 1st June, 2008.
——
1. Pub. in Gaz. of India, Ext. Pt.V, S.3(ii), dt. 30-5-2008.
40. 'C' Forms

40.1 Waiver of excess demands raised for non furnishing of ‘C’ forms
declaration – Waiver of penal interest for the assessment year 1999-
2000 and 2000-2001 under the APGST Act, 1957.
[G.O.Ms.No. 478, Revenue (CT-II), dt. 31-5-2010]
Read the following:
From the Thana Electric Supply Company Limited,
representation dt.Nil.
Order :
M/s.The Thana Electric Supply Company Limited, vide their representation,
dt.Nil, submitted that their unit is a closed firm and production of ‘C’ forms
against interstate Sales is beyond their control as they relate to the past years
, from 1999-2000 to 2001-2002 when the firm was in operation. In a similar
case, i.e., M/s.The Krishna Guntur District Pulses Export Merchants Welfare
Association, Vijayawada, Government issued orders vide G.O.Ms.No.347,
Revenue (CT.II) Department, dt.17.3.2008, waiving the excess demands over
and above 4%, raised for non-filing of ‘C’ forms in respect of Inter-state sales
effected by them. They further represented that huge demands were raised by
completing the assessments on exparte basis by disallowing the exemption
claimed, on the ground that books of accounts are not produced which are
otherwise allowable and not taxable under the law. Therefore, the dealer requested
the Government to take a sympathic view of the exparte demands raised on
account of non-filing of ‘C’ forms and disallowance of exemptions (otherwise
legally allowable) for not producing the books of account so as to waive excess
tax and interest levied thereon.
2. Government, after careful examination of the matter and keeping in
view of the orders issued in G.O.Ms.No.347, Revenue (CT.II) Department,
dt.17.3.2008, hereby order that the demand raised over and above the tax
leviable @ 4% against the Company for non furnishing of ‘C’ declaration forms
in respect of inter-state sales, as prescribed under the CST Act, 1956, for the
period from 1999-2000 to 2001-2002, be waived for the purpose of assessment
as well as for collection of tax by the Commercial Taxes Department.
3. It is also hereby ordered that taxes paid by the Company but not given
credit to their accounts, shall be given credit and excess taxes paid, if any, for
the earlier years 1982-83 to 1996-97 shall also be verified and given credit
against the taxes payable for the later years.
Circulars under C.S.T. issued by A.P. Govt. 921
4. Further, Government also hereby waive the penal interest levied over
and above @ 12% on the taxes dues of M/s.The Thana Electric Supply Company
Limited for the assessment years 1999-2000, 2000-2001 and 2001-2002 and
Interest levied on the taxes payable under the CST Act, where no corresponding
provision has been prescribed under the CST Act.
5. The Commissioner of Commercial Taxes, is requested to issue necessary
instructions to the concerned accordingly.
------
CIRCULARS UNDER C.S.T. ISSUED BY
A.P. GOVERNMENT
1. Rice Millers
Waiver of tax in respect of Rice Millers for the period ending
31-3-2005
CST Act, 1956 – Civil Supplies : Implementation of the
Recommendations of Group of Ministers constituted on the revival
of rice milling industry – Exemption of Furnishing of "C" Form
declarations upto 31-3-2005 and to enforce provisions of Law for
furnishing the C-Form declarations for assessment as well as
collection of tax by the Commercial Taxes from 1-4-2005 onwards
– Orders – Issued.
[G.O.Ms.No. 133 Consumers Affairs, Food & Civil Supplies
(C.S.I)(1) Dept., dt. 14-9-2005]
1. G.O.Rt.No. 6640 General Administration (Cabinet) Department dt.
23.11.2004.
Minister for Commercial Taxes, Secretariat, Hyderabad.
Order :
Government have vide reference first read above, constituted a Group of
Ministers (GoM) with the Ministers for, Civil Supplies, Major Industries and
Commercial Taxes to study all the issues pending with different Departments
and to suggest appropriate measures to the Government for revival and
modernization of Rice Milling Industry in Andhra Pradesh.
2. The Group of Ministers have examined the requests of the rice milling
industry and held discussions with the Senior Officers and with the Office
bearers of Rice Milling Industry. After considering the difficulty of the Rice
Millers of Andhra Pradesh in obtaining 'C' Form declarations from the traders
of neighbouring States, particularly, when there is no incidence of tax in those
States, and the need to ensure remunerative price for paddy produced by the
farmers by making the Rice Millers of Andhra Pradesh to participate in paddy
purchases and also to make them competitive in sale of rice outside the State,
the Group of Ministers have recommended that the excess demand raised by
the Commercial Taxes Department against the Rice Millers for non-furnishing
922
Circulars under C.S.T. issued by A.P. Govt. 923
of 'C' Form declarations @ 8% (those who do not furnish 'C' Form declarations
are liable to be taxed @ 8%), the excess demand raised against the Rice Millers,
may be considered for waiver by the Government for the period ending w.e.f.
1st March, 2005 and the provision of law to be strictly enforced w.e.f. 1st April,
Taxes Department.
3. Government, after careful consideration of the recommendations of the
Group of Ministers hereby order with regard to furnishing "C" Form declarations
that the excess demand raised by the Commercial Taxes Department against the
Rice Millers for non-furnishing of "C" Forms declarations @ 8% be waived to
the extent of 4% excess demand raised over and above the normal rate of 4%
leviable, for not submitting C-form declarations for the period ending 31st March,
2005 and that the provisions of law be strictly enforced w.e.f. 1st April, 2005
for the purpose of assessment as well as collection of tax by the Commercial
Taxes Department.
4. This order issues with the concurrence of Revenue Department vide

their U.O. Note No. 43095/CT-II/2005 dt. 12.9.2005.
——
Extension of the period of Demand upto 31.1.2006.

Civil Supplies: Implementation of Recommendations of Group of
Ministers constituted on the revival of rice milling industry –
Extension of benefit granted in G.O.Ms.No. 133, dt. 14.9.2005 to
31.1.2006 on furnishing of C-Form declarations – Revised – Orders
– Issued.
[G.O.Ms.No. 41 Consumer Affairs, Food and Civil Supplies
(C.S.)(1) Department, dt. 2-5-2006]
23.11.2004.
2. G.O.Ms.No. 133, C.A.F. & CS Department dt. 14.9.2005.
24.12.2005.
Minister of Agriculture, Horticulture, Food and Civil Supplies,
Secretariat, Hyderabad.
Order :
The Government vide 1st and 3rd read above, have constituted a Group
of Ministers to study all the issues pertaining to Rice Milling Industry pending
with different Departments and to suggest appropriate measures to the Government
for revival and modernization of Rice Milling Industry in Andhra Pradesh State.
2. In the 2nd read above, the Government have agreed with regard to
furnishing of "C" form declarations that the excess demand raised by the
Commercial Taxes Department against the Rice Millers for non-furnishing of "C"
Form declarations @ 8% be waived to the extent of 4% excess demand raised
over and above the normal rate of 4% leviable, for not submitting C-form
declarations for the period ending 31st March, 2005 and that the provisions of
law be strictly enforced w.e.f. 1st April, 2005 for the purpose of assessment
as well as collection of tax by the Commercial Taxes Department.
3. The Group of Ministers vide 4th read above have recommended to extend
the benefits granted in G.O.Ms.No. 133, CA, F&CS Department dated 14.9.2005,
upto 31.1.2006 and that the provisions of law be strictly enforced w.e.f. 1st
Feb., 2006 for the purpose of assessment as well as collection of tax by the
4. Government, after careful examination of the matter and the
recommendations of the Group of Ministers, hereby, order that the excess
demand raised by the Commercial Taxes Department against the Rice Millers
for non-furnishing of "C" Form declarations @ 8% be waived to the extent of
4% excess demand raised over the normal rate of 4% leviable, for not submitting
C-Form declarations for the period ending upto 31st January, 2006 and that the
provisions of law be strictly enforced w.e.f. 1st February, 2006 for the purpose
of assessment as well as collection of tax by the Commercial Taxes Department.
5. This order issues with the concurrence of Revenue Department vide
their U.O.No.9293/CT-II(1)/2006-1 dated 2.5.2006.
——
Circulars under C.S.T. issued by A.P. Govt. 924(A)
2. Submission of 'C' Forms

[CCT's Ref.No.AII(2)/722/2005 dated 18-1-2006]
Circular
Sri V. Bhaskar, IAS, Commissioner of Commercial Taxes
Sub:– Instructions regarding issue of Statutory forms – Reg.
Ref:– FAPCCI Ref. No. 1410, dt. 1-12-2005, 1542, dt. 25-12-2005
Reference dt. 3-1-2006 and Ref. No. 032, dt. 6-1-2006

All the Deputy Commissioners (CT) in the State are hereby directed to issue
instructions to all the assessing authorities concerned as follows:
1. Since the amendment to CST (R&T) Act is with prospective effect,
but not with retrospective effect, the transactions that took place prior to 30-
9-2005 will not be covered by the amended provisions. Therefore, a single
statutory form for all the transactions that took place prior to 30.9.2005 can
only be insisted upon.
2. Since the amended provisions will be applicable for the transactions done
after 30.9.2005, quarterly declarations can be insisted upon for such transactions.
It means that the statutory forms, covering the transactions done between
1.10.2005 to 31.12.2005, shall be filed by the dealers before the end of the next
quarter, i.e., on or before 31.3.2006, and so on.
The assessing authorities shall be instructed to follow the above instructions
scrupulously and not to cause any undue hardship to the dealers required to file
the statutory forms under Central Sales Tax Act, by misinterpreting the said
amended provisions of the Central Sales Tax Act.
——
924(B) Commentary on A.P. Value Added Tax
3. Coconut & Copra

Waiver of tax in respect of Coconut & Copra Dealers for the
period from 1-7-2002 to 31-3-2006
CST Act, 1956 – Exemption of furnishing of 'C' Forms declaration
to the Coconut, Copra dealers – Extension of benefit granted in
G.O.Ms.No. 133, Consumer Affairs, Food and Civil Supplies
(CS-I) Dept., dt. 14-9-2005 upto 31-3-2006.
[G.O.Ms.No. 812 Revenue (CT-II) Department dt. 4-7-2006]
Order:
The East & West Godavari Coconut and Copra Exporters Association in
their representation second read above, have expressed the difficulty in obtaining
the 'C' Form declarations from the traders of neighbouring States like Tamilnadu,
Pondicherry, Maharashtra and Chattisghar. Particularly, when there is no incidence
of tax in those States. The Association has therefore requested to extend the
benefit granted to Rice Millers in the G.O. 1st read above to the Coconut &
Copra dealers also by waiving the demand raised or to be raised in excess of
the rate of 2% leviable, by the Commercial Taxes Department for the years upto
2005-06, on the ground of non-furnishing of 'C' Form declarations.
2. The Commissioner of Commercial Taxes, has stated that by virtue of
the amendment, given effect to the Finance Act No. 20/2002, the production
of 'C' Forms against the inter-State sales was made compulsory with effect from
13.5.2002 and the request, made for the relaxation of the condition of compulsory
production of 'C' Forms will therefore amount to violation of the provisions of
the CST Act, 1956 as amended by the Finance Act 20/2002 and hence, such
a condition cannot be relaxed as per law. In the case of Rice Millers, orders
were issued waiving the excess demand raised over and above the normal rate
of 4% tax, leviable or levied upto 31.3.2005, vide G.O.Ms.No. 133, Consumer
Affairs, Food and Civil Supplies (CS-I) Department dt. 14.9.2005, later extended
upto 31.1.2006, on the basis of the recommendations of the Group of Ministers.
3. The Government after careful examination of the matter, and keeping
in view the orders issued in the reference 1st read above, in similar cases relating
to Rice Millers hereby order that the excess demand raised over and above the
tax leviable @ 2% by the Commercial Taxes Department against the dealers in
Coconut & Copra, for non-production of 'C' declaration forms, for the period
from 1.7.2002 to 31.3.2006 be waived and the provisions of Law be strictly
Circulars under C.S.T. issued by A.P. Govt. 924(C)
enforced w.e.f. 1.4.2006 for the purpose of assessment as well as collection

of tax by the CT Department.
4. The Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad
is requested to take necessary action accordingly.
——
4. 'F' Forms
Interstate transactions of Edible Oil dealers without 'F' Forms
[Memo.No. 20223/CT-II (1)/2010-2 dt. 06-07-2010].
Sub: CST Act, 1956 - Interstate transactions of Edible Oil dealers without 'F'
Forms - Demands raised - Disallowing exemption on transactions not
covered by genuine 'F' forms - Waiver - Partly allowed - Orders issued -
Regarding.
Ref: From the CCT, Ref.No.AIII(2)/91/2010, dt.28-4-2010.
-----
The Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad in
the reference cited, furnished a report stating that oil millers/oil refineries, are not
liable to pay tax under the CST Act on the ‘consignment sales’ effected through
consignment agents when such sale are covered by 'F' forms. During investiga-
tion, it was found that in certain cases the ‘F’ forms produced by certain dealers
in vegetables oils, are not genuine. Consequently, such dealers are liable to pay tax
@ 10% on such transaction of consignments not covered by 'F' forms upto
31.3.2007 and @ 4% thereafter.
2. The A.P. Oil Millers Association, vide letter dt.21-1-2010, requested for
levy of tax @4% only on the ground that proper 'F' forms could not be filed due
to some reasons and that rate of tax on vegetable oils in the State of Andhra
Pradesh with effect from 1-4-2007 is @ 4% only.
3. The Commissioner of Commercial Taxes has submitted a proposal for
one time settlement of the amount due by waiving the tax levied in excess of @
6% (ie., waiver of 4%) subject to payment of simple interest @ 12% per annum
from the due date of filing of return.
4. The Government, after careful examination of the issue, hereby order for
waiver tax levied in excess at 6% (ie., 4% out of 10%), subject to the condition
924(D) Commentary on A.P. Value Added Tax
that the said tax is paid by 31-12-2010. Simple interest shall be levied @ 12% per
annum on the tax due from the due date of filing of returns under the CST Act.
Interest, if any, levied over and above 12% shall also stand waived. The One Time
Settlement will be subject to the condition that appeals/WPs/Special Leave Peti-
tions filed, if any, before any legal Forums are withdrawn.
5. The above orders are applicable to all the edible Oil dealers who did not
file, Valid 'F' forms and for the period upto 31-3-2007. After this date such trans-
actions will attract CST @ 4% as per the amended CST Act.
6. The Commissioner of Commercial Taxes is requested to take necessary
action accordingly.
-----
THE CENTRAL SALES TAX (ANDHRA
PRADESH) RULES, 19571
[G.O.Ms.No. 302, Revenue, dt. 23rd February, 1957]
In exercise of the powers conferred by sub-sections (3), (4) and (5)

of Section 13 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956),
the Governor of Andhra Pradesh hereby makes the following rules:–
PART I
Preliminary
1. These rules may be called the Central Sales Tax (Andhra Pradesh)
Rules, 1957.
2. In these rules, unless the context otherwise requires–
(a) ‘The Act’ means the Central Sales Tax Act, 1956.
(b) ‘State’ means the State of Andhra Pradesh.
(c) ‘Appropriate Assessing Authority’ means–
(i) in the case of a dealer who is liable to pay tax under the general
sales tax law of the State, the assessing authority under the said
law ;
(ii) in the case of any other dealer, the assessing authority under the
general sales tax law of the State, who would have jurisdiction
to assess the dealer if he were carrying on the business inside the
State.
(d) ‘Notified Authority’ means the authority specified by the Central
Government under sub-section (1) of Section 7 ;
(e) All other words and expressions used but not defined in these rules
or the Act shall have the meaning assigned to them in the general
sales tax law of the State in so far as they are not inconsistent
with the provisions of the Act and the rules.
PART II
Publication of Lists of Registered Dealers
3. The name of every dealer registered under Section 7 of the Act
shall be entered in a register in Form CST-I in the first instance. The entries
1. Published in A.P. Gazette, Part II, dt. 28-2-1957.
925
926 Commentary on Value Added Tax
contained in this register shall be arranged alphabetically in a register in

Form CST II.
4. (1) if any dealer to whom the provisions of this Act apply–
(a) sells or otherwise disposes of his business or any place of his
business; or
(b) discontinues his business or changes his place of business or opens
a new place of business ; or
(c) changes the name or nature of his business ; or
(d) wants to make any change in the class or classes of goods specified
in his certificate of registration for use in the manufacture of any
goods for sale or in the execution of any contract,
he shall within 1[fourteen days] thereafter, inform the notified authority
accordingly, and if any such dealer dies, his legal representative shall in
like manner inform the said authority.
(2) When any registered dealer makes any report as required by sub-
rule (1) he shall send his registration certificate along with the report to
the notified authority, together with the requisite information. On receipt
of this information, the said authority, may amend, replace or cancel the
registration certificate.
2
[5. (1) The security furnished under sub-section (2-A) or sub-section
(3-A) or sub-section (3-E) of Section 7 shall be in the form of cash or
guarantee by the State Bank of India or the State Bank of Hyderabad or
any corresponding new bank as defined in Clause (d) of Section 2 of the
Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970
(Central Act 5 of 1970).
Provided that the notified authority may in lieu of the cash security,
accept such other security as he may consider sufficient and suitable.
(2)(a) An appeal under sub-section (3-H) of Section 7 shall be in Form
XII and shall be preferred to the 3[Appellate Deputy Commissioner of
Commercial Taxes] of the area concerned.
(b)(i) It shall be in triplicate and shall be accompanied by the order
appealed against in original or by a certified copy thereof, unless the
1. Subs. for "fifteen days" by G.O.Ms.No. 1470 Revenue (CT-II) Dept., dt. 7-11-2006,
w.e.f. 1-4-2005.
2. Inserted by G.O.Ms.No. 651, Rev., dt. 10-7-1974.
3. Subs. by G.O.Ms.No. 991, Rev., dt. 2-7-1983.
The C.S.T. (A.P.) Rules, 1957 927
omission to produce such order or copy is explained to the satisfaction
of the appellate authority.
(ii) It shall be accompanied by a treasury receipt showing that a fee
of 1[rupees fifty] has been paid into the treasury.
(3) The appeal may be sent to the appellate authority by registered
post or be presented to that authority or to such officer as the appellate
authority may appoint in this behalf by the appellant or by any of the persons
specified under 2[Section 66 of the Andhra Pradesh Value Added Tax Act,
2005.]
(4) The procedure specified under the 3[Andhra Pradesh Value Added
Tax Rules] shall apply for the hearing and disposal of the appeals, and
other relative matters under these rules.]
6. 4[x x x]
7. 4[x x x]
8. 4[x x x]
PART III
Maintenance and Use of Declaration Forms
5
[9. Every registered dealer shall apply to the notified authority and
obtain from him adequate number of forms of declaration for use by him
at the time of receipt or purchase of goods as mentioned in sub-section
(1) of Section 6-A or sub-section (4) of Section 8 of the Central Sales
Tax Act, 1956 on payment of the cost as notified by the Commissioner
of Commercial Taxes from time to time.]
6
[9-A. (1) A registered dealer who purchased goods in the course of
inter-State trade or commerce may issue a single declaration form to cover
two or more such purchases provided that:–
(i) all such purchases are made from the same dealer ;
1. Subs. for "rupees twenty five" by G.O.Ms.No. 1470 Rev. (CT. II) Dept., dt.
7-11-2006, w.e.f. 1-4-2005.
2. Subs. for "Section 35 of the Andhra Pradesh General Sales Tax Act, 1957" by Ibid.
3. Subs. for "Andhra Pradesh General Sales Tax Rules" by Ibid.
4. Omitted by G.O.Ms.No. 1834, Rev., dt. 7-9-1960.
5. Subs. by G.O.Ms.No. 932, Rev. (CT. II) Dept., dt. 3-7-2007, pub. in A.P. Gaz. RS
to Pt. I ext. No. 46, dt. 6-7-2007.
6. Inserted by G.O.Ms.No. 1805, Rev., dt. 30-9-1958.
(ii) the turnover of all the purchases so made does not exceed
1
[Rs. 25,000];
(iii) all such purchases relate to the same assessment year.]
2
[(2) Each declaration in Form ‘F’ shall cover transactions referred
to in sub-section (1) of Section 6-A effected during a period of one calender
month.]
10. 3[(1) Every registered dealer and every dealer liable to pay tax
under the Act shall maintain a register in Form 12 4[CST. IV/XIII] showing
a true and correct account of 4[declaration in Form ‘C’/Form ‘F’] received
from the 5[notified authority] 6[x x x]. If any form is lost, destroyed or
stolen he shall report the same to the said authority immediately and shall
make appropriate entries in the remarks column of the register concerned.]
(2) any unused declaration forms remaining in stock with a registered
dealer on the cancellation of his registration certificate shall, within two
working days of the date of cancellation, be surrendered to the 5[notified
authority] from whom the forms have been obtained.
(3) A declaration form in respect of which a report has been received
by the 5[notified authority] under sub-rule (1) shall be declared invalid.
(4) The 7[Commissioner] shall, from time to time, publish in the
Official Gazette the particulars of a declaration form in respect of which
a report is received under sub-rule (1).
(5) The Board of Revenue may by notification declare that declaration
forms of a particular series, design or colour shall be deemed as obsolete
and invalid with effect from such date as may be specified in the notification.
(6) When a notification declaring forms of a particular series, design
or colour as obsolete and invalid is published under sub-rule (5) all
registered dealers shall on or before the date with effect from which the
forms are so declared obsolete and invalid, surrender to the 8[notified
1. Subs. for the expression "Rs. 10,000" by G.O.Ms.No. 1237, Rev., dt. 30-9-1986.
3. The original Rule 10 was renumbered as sub-rule (1) thereof and sub-rules (2) to (7)
were added by G.O.Ms.No. 843, Rev., dt. 9-5-1958.
7. Subs. for "Board of Revenue" by G.O.Ms.No. 1470 Rev. (CT. II) Dept., dt.
7-11-2006, w.e.f. 1-4-2005.
8. Subs. by G.O.Ms.No. 766. Rev., dt. 12-8-1969.
The C.S.T. (A.P.) Rules, 1957 929
authority] all unused forms of that series, design or colour which may be
in their possession and obtain in exchange such new forms as may be
substituted for the forms declared obsolete and invalid.
Provided that new forms shall not be issued to a dealer until he has
rendered account of the old forms lying with him and returned the balance,
if any in his possession to the 1[notified authority].
(7) The notification referred to in sub-rules (4) and (5) may be
furnished to the other State Governments for publication in their State
Gazettes.
2
[10-A. (1) Where a declaration form either blank or duly completed
and signed by the dealer receiving the goods on transfer or the purchasing
dealer, is lost while it is in his custody before despatch or lost in transit
after it has been despatched to the dealer despatching the goods on transfer
to the selling dealer as the case may be, the dealer receiving the goods
on transfer or the purchasing dealer shall, besides taking the action prescribed
under Rule 10, furnish to the authority, from whom the said form was
obtained, a reasonable security by way of an indemnity bond, separately
for each form so lost, against any possible misuse of the said form.
(2) Where a blank or duly completed and signed declaration form
furnished by the dealer receiving the goods on transfer or by the purchasing
dealer, is lost from the custody of the dealer despatching the goods on
transfer or the selling dealer, the latter shall, in the manner specified in
sub-rule (1) furnish a security by way of an indemnity bond in respect
of declaration form to the authority to whom he is required to furnish his
return in Form CST VI.
(3) Where a duly completed and signed declaration Form or the ‘Form
of Certificate’ is lost in transit or from the custody of the dealer despatching
goods on transfer or the selling dealer, he shall obtain a duplicate of the
Form with the following declaration in red ink across the page in all the
three parts and duly signed from the dealer receiving goods on transfer
or the purchasing dealer or department of any State or the Central Government,
as the case may be to whom he despatched on transfer or sold the goods
and in case of his failure so to do his transfer or sale in question shall
not be treated as falling under sub-section (2) of Section 6A or under sub-
section (1) of Section 8 of the Act.
1. Subs. by G.O.Ms.No. 766. Rev., dt. 12-8-1969.

2. Inserted by G.O.Ms.No. 651, Revenue, dt. 10-7-1974.
"I hereby declare that this is the duplicate of the declaration Form
No. ............ signed on ............ and issued to .......... who is a registered
dealer of ......... State and whose registration certificate No. is .......... who
is my agent/principal."]
10B. Every dealer furnishing the declarations in Form ‘C’ or ‘F’ and
certificates in Form EI, EII or H shall submit to the assessing authority
the following statement in triplicate statewise and Formwise, duly attested.
Statement
Sl. Name and Bill No. Nature of Quantity Value Form
No. address of the Challan No. goods No.
dealer who and date
issued the against which
form with his the Form is
CST Rc.No. issued
& date.
1 2 3 4 5 6 7
11. 1[The register in forms 2[CST IV/XIII]] shall be kept in the place
of business of the dealer and shall at all reasonable times be open to
inspection by the 3[notified authority or by any authority] authorised to
inspect the books, accounts and documents of the dealer concerned.
12. 4[(1)] No registered dealer to whom a declaration form is issued
by the 3[notified authority] shall transfer the same to another person except
for the purpose of 5[sub-section (1) of Section 6-A or sub-section (4) of
Section 8] of the Act.
(2) 6[x x x]
(3)(i) In the case of a first sale occasioning the movement of goods
referred to in Section 6(2)(a) or a first sale effected by transfer of documents
of title to the goods referred to in Section 6(2)(b) the registered dealer

4. Rule 12 renumbered as sub-rule (1) of this rule and inserted by G.O.Ms.No. 1805,
Rev., dt. 30-9-1958.
The C.S.T. (A.P.) Rules, 1957 931
selling the goods or any person authorised by him in this behalf may furnish
a certificate in Form E-I duly filled in and signed by him to the purchasing
dealer to enable him to claim exemption from tax on his subsequent sale
of such goods, if any, under sub-section (2) of Section 6 of the Act. The
registered dealer furnishing the Certificate in Form E-I shall retain with
him the counterfoil of the Form.
(ii) For the purpose of claiming exemption from tax on his subsequent
sale under sub-section (2) of Section 6, the purchasing dealer who effects
a subsequent sale to another registered dealer 1[or to the Government not
being a registered dealer] by transfer of documents of title to the goods
during their movement, from one State to another, shall furnish to the
2
[notified authority] (i) the portion marked ‘original’ of the Form EI received
by him from the registered dealer from whom he purchased the goods and
(ii) the original of the declaration in Form ‘C’ received from the registered
dealer, 1[or the original of the declaration in Form ‘D’ received from a
duly authorised officer of the Government] to whom he sold the goods.
3
[Provided that when E-I forms printed under the authority of the State
Government or the Commissioner of Commercial Taxes are not readily
available for use for any reason the E-I Forms containing the signature
and official seal of the assessing authority or registering authority having
jurisdiction over the consignee shall be used in lieu of such printed E-
I Forms.]
(4)(i) In the case of a first or subsequent sale effected by transfer
of documents of title to the goods in a series of sales referred to in Section
6(2)(a) or the second or subsequent sale effected by transfer of documents
of title to the goods in series of sales referred to in Section 6(2)(b) the
registered dealer selling the goods or any person authorised by him in this
behalf may issue a certificate in Form E-II duly filled in and signed by
him to the purchasing dealer to enable such purchasing dealer to claim
exemption from tax on his subsequent sale, if any, under sub-section (2)
of Section 6 of the Act. The registered dealer furnishing the Certificate
in Form E-II, shall retain with him the counterfoil of the form.
3
[Provided that when E-II Forms printed under the authority of the
State Government or the Commissioner of Commercial Taxes are not readily
available for use for any reason the E-II Forms containing the signature
and official seal of the assessing authority or registering authority having
1. Inserted by G.O.Ms.No. 651, Rev., dt. 10-7-1974, w.e.f. 1-4-1973.

3. Added by G.O.Ms.No. 384, Rev., dt. 18-4-1985.
jurisdiction over the consignee shall be used in lieu of such printed E-

II Forms.]
(ii) For the purpose of claiming exemption from tax on his subsequent
sale the purchasing dealer who effects a subsequent sale to another registered
dealer 1[or to the Government not being a registered dealer] by transfer
of documents of title to goods shall furnish to the 2[notified authority] (i)
the portion marked ‘original’ of the Form E-II received by him from the
registered dealer from whom he purchased the goods and (ii) the original
of the declaration in Form ‘C’, received from the registered dealer 1[or
the original of the declaration in Form ‘D’ received from a duly authorised
officer of the Government] to whom he sold the goods.
3
[13. 4[(1) x x x]
5
[(2) Where goods are consigned to a branch office situated in this
State in pursuance of an order placed by the Head Office situated outside
the State, the declaration to be furnished in Form ‘C’ in respect of a sale
in the course of inter-State trade or commerce shall be one obtained in
this State where the delivery of the goods takes place :
Provided that in a case where goods are consigned to a branch office
situated in this State in pursuance of an order placed by the Head Office
situated outside the State and where a branch office is not registered as
a dealer under the Central Sales Tax Act, 1956, a declaration in Form ‘C’
shall be furnished by the Head Office.]
PART IV
Accounts
14. (1) Every dealer registered under the Act shall keep and maintain
a true and correct account showing–
(i) in the case of any sale in the course of inter-State trade or
commerce:–
(a) the name and address of the person to whom the goods are sold;
(b) the description and quantity or weight of the goods sold ;
(c) the amount for which the goods are sold ;
1. Inserted by G.O.Ms.No. 651, Rev., dt. 10-7-1974, w.e.f. 1-4-1973.

3. Subs. by G.O.Ms.No. 1250, Revenue, dated 28-10-1966.
4. Omitted by G.O.Ms.No. 651, Revenue, dated 10-7-1974.
5. Subs. by G.O.Ms.No. 870, Revenue, dated 30-8-1967.
The C.S.T. (A.P.) Rules, 1957 933
(d) the names of the despatching and receiving railway or steamer
stations, or the air booking offices or sea ports ;
(e) the number of the railway receipt or bill of lading or air consignment
note and invoice number with date ;
(f) the names of consignor and consignee ; and
(g) any other information which has a bearing on the liability of the
transaction to tax under the Act ; and
(ii) in the case of any purchase of goods in the course of inter-State
trade or commerce:–
(a) the name and address of the person from whom the goods bought;
(b) the description of and quantity or weight of the goods bought ;
(c) the amount for which the goods are bought ;
(d) the names of the despatching and receiving railway or steamer
stations or the air booking offices or sea-ports ;
(e) the number of the railway receipt or bill of lading or air consignment
note and invoice number with date ;
(f) the names of the consignor and consignee ; and
(g) any other information which has a bearing on the liability of the
transaction to tax under the Act.
1
[(2) Subject to the provisions of sub-rule (1) every dealer registered
under the Act and every dealer liable to pay tax under the Act, shall maintain
his accounts in Form CST X in respect of the declared goods and in Form
CST XI in respect of goods other than declared goods, sold by him in
the course of inter-State trade or commerce.]
2
[(3) Every dealer shall keep and maintain true and correct account
in respect of a transaction referred to in sub-section (1) of Section 6-A
and shall produce the following particulars and documents before any
Officer authorised under the Act, for the purpose of assessment, appeal
or revision or on demand at any time by any officer, authorised to inspect
the place of business:
(a) Name and full address of the agent to whom the goods were
consigned.
1. Added by G.O.Ms.No. 2363, Rev., dt. 13-11-1959.

2. Added by G.O.Ms.No. 651, Revenue, dated 10-7-1974.
(b) Description, quantity and value of goods despatched for sale on

each occasion.
(c) Contract, if any, in writing entered into between the principal and
the agent.
(d) Copies of bills issued by the agents to purchasers in other States;
(e) Copies of patties rendered by the agent to the principal from time
to time showing the gross amount of the bill and deductions such
as commission, incidental charges etc., the net amount remitted
to the principal and the date and mode of remittance.
(f) Attested extract of the ledger maintained by the Agent for each
of the principals ;
(g) Copy of the Railway receipt or Lorry receipt, as the case may
be under which the goods were despatched outside the State ; and
(h) Copy of the authorisation sent to the non-resident agent for the
sale of goods consigned.]
1
[(14-A (1)(a) Every dealer registered under Section 7 of the Act and
every dealer liable to pay tax under the Act shall submit so as to reach
the assessing authority on or before the 2[20th of every month] a return
in Form CST VI 3[in duplicate] showing the total and net turnover of his
transactions including those in the course of inter-State trade or commerce
4
[the total value of the goods transferred outside the State otherwise than
as a result of sale and in the course of export of the goods out of the
territory of India] during the preceding month and the amount or amounts
collected by way of tax. The return shall be accompanied by a receipt from
a Government Treasury or 5[a crossed demand draft] in favour of the
assessing authority for the full amount of the tax payable for the month
to which the return relates.
6
[Provided that where a dealer intends to pay the tax through a crossed
cheque, the cheque should be sent so as to reach the assessing authority
on or before the 15th day of the month succeeding the month to which
the tax relates.
1. Inserted by G.O.Ms.No. 1805, Revenue, dated 30-9-1958.

2. Subs. by G.O.Ms.No. 1470 Rev. (CT. II) Dept., dt. 7-11-2006, w.e.f. 1-4-2005.
4. Subs. by G.O.Ms.No. 651, Revenue, dt. 10-7-1974.
6. Inserted by Ibid.
The C.S.T. (A.P.) Rules, 1957 935
1
[Provided 2[further] that a dealer who is not liable to pay tax under
the Andhra Pradesh General Sales Tax Act, 1957 shall submit return for
each quarter as shown below instead of each month :
Table3
Quarter ending Due date for submission of the return

30th June On or before the 15th July
30th September On or before 15th October.
31st December On or before the 15th January
31st March On or before the 15th April.
(b) Along with the return mentioned in Clause (a) of sub-rule (1) the
dealer shall also, submit to the assessing authority–
(i) the originals of the declarations in Form C, received by him from
the dealers to whom he sold goods ;
(ii) the originals of the certificates in Form D, if any received by him
in the case of sales to Government of India or to the Government
of any State.
(iii) the originals of the certificates in Form E-I or E-II, if any, received
by him from the dealers from whom he purchased the goods, and
4
[x x x]
5
[(iv) The originals of the declarations in Form ‘F’ received by him from
the transferee of the goods to whom he transferred goods otherwise
than as a result of sale.]
6
[(v) an extract of Columns (5) to (13) of the register in Form CST
IV maintained by him.]
(2) If at any time a dealer discontinues or sells or otherwise disposes
of the whole of the business carried on by him during the course of the
year, he shall submit to the assessing authority concerned within 7[15 days]
1. Added by G.O.Ms.No. 1063, Revenue, dt. 20-6-1961.

2. Substituted by G.O.Ms.No. 341, Revenue, dt. 2-4-1985.
3. Added by G.O.Ms.No. 19, Revenue, dated 2-1-1980.
4. The three provisos were omitted by G.O.Ms.No. 651, Rev., dt. 10-7-1974, w.e.f.
1-4-1973.
5. Added by ibid.
6. Added by G.O.Ms.No. 1236, Revenue, dt. 30-9-1986.
7. Subs. for "30 days" by G.O.Ms.No. 1470 Rev. (CT. II) Dept., dt. 7-11-2006, w.e.f.
1-4-2005.
of such discontinuance a return in Form CST VI in the manner prescribed

in sub-rule (1) for the month in which his business was discontinued.
(3) The return in Form CST VI so filed shall subject to the provisions
of sub-rule (4) be provisionally accepted.
1
[(4) If no return is submitted in respect of any month or quarter,
as the case may be, before the due date or if the return submitted appears
to be incorrect or incomplete, the assessing authority shall after making
such enquiry as he considers necessary after giving the dealer an opportunity
of proving the turnover to the best of his judgment, and provisionally assess
the tax or taxes payable for provmine the month or the quarter, as the
case may be, and shall serve upon the dealer a notice in Form CST VII
and the dealer shall pay the sum demanded at the time and in the manner
specified in the notice.
Provided that if for any reason the determination of provisional
assessment of tax or taxes payable for any month or quarter is not completed
on or before the receipt of the return for the succeeding month or quarter,
as the case may be, the assessing authority may in his discretion provisionally
assess in a single order the tax or taxes payable for all such months or
quarters, as the case may be and serve upon the dealer a notice in Form
CST VII and the dealer shall pay the sum demanded within the time and
in the manner specified in the notice.]
2
(4-A) [x x x]
3
[(5) If the return or returns are filed within the prescribed time by
the dealer and such return or returns are found in order, the return or returns
shall be accepted as self-assessment, subject to adjustment of an arithmetical
error, apparent on the face of the said return or returns.
(5A) Every dealer shall be deemed to have been assessed to tax, based
on the returns filed by him, if no assessment is made within a period of
four years from the date of filing of the return.]
(6) If no return or returns have been submitted by the dealer as required
by sub-rules (1) and (2) or if any return or returns submitted by him appear
to the assessing authority to be incorrect or incomplete the assessing

2. Sub-rule (4A) omitted by G.O.Ms.No. 1470, Rev. (CT. II) Dept., dt. 7-11-2006, w.e.f.
1-4-2005. Prior to its omission it read as below :
"The commodity code No. in CST Form VI shall be the same as prescribed in Rule
17(1C) of the A.P. General Sales Tax Rules, 1957.
The C.S.T. (A.P.) Rules, 1957 937
authority shall after making such enquiry as he considers necessary and
after giving the dealer, an opportunity of proving the correctness and
completeness of the return or returns submitted by him determine the
turnover to the best of his judgment and finally assess in a single order
the tax or taxes payable under the Act.
(7) If on final assessment made under sub-rule (5) or (6) any tax is
found to be due from the dealer after deducting the tax or taxes paid by
him towards the provisional assessment, the assessing authority shall serve
on the dealer a notice in Form CST VIII and the dealer shall pay the sum
demanded in the notice within such time and in such manner as specified
therein. If however any refund of tax is found to be due to the dealer,
the assessing authority shall serve on him a notice in Form CST IX.
1
[(8) If, for any reason, the whole or any part of the turnover of
business of a dealer has escaped assessment to tax or has been under
assessed in any year, the assessing authority may after issuing a notice
to the dealer and after making such enquiry as he considers necessary
determine to the best of his judgment the correct turnover, and assess the
tax payable on such turnover–
2
[(a) In cases where an order of assessment or levy had been passed
earlier, within a period of four years from the date on which such
order was served on the dealer ;
(b) within a period of four years from the expiry of the year to which
the turnover relates, in other cases.]
2
[(9) If, for any reason, any tax has been assessed at too low a rate
in any year, the assessing authority may after issuing a notice to the dealer
and after making such enquiry as he considers necessary revise the assessment
within a period of four years from the date on which the order of assessment
to be revised was served upon the dealer.]
(10) An assessing authority may, at any time within four years from
the date of any order passed by him rectify any arithmetical mistake
apparent from the record:
Provided no such rectification which has the effect of enhancing the
assessment shall be made unless the assessing authority has given a notice
to the dealer of the intention to do so and has allowed him a reasonable
opportunity of being heard.
1. Sub-rules (8) and (9) were subs. by G.O.Ms.No. 44, Revenue, dt. 31-1-1967.
1
[(11) The powers conferred by sub-rules 8, 9 and 10 on the assessing
authority may also be exercised by the appellate or revising authority subject
to the same limitation and conditions as are applicable in the case of
assessing authority.]
(12) Where in respect of the turnover referred to in sub-rule (8), or
in respect of the tax referred to in sub-rule (9) or in respect of the assessment
referred to in sub-rule (10) an order has already been passed in an appeal
or revision, the assessing authority shall make a report to the appropriate
appellate or revising authority as the case may be, who shall thereupon,
after giving the dealer concerned a reasonable opportunity of being heard
pass such order as deemed fit.
(13) The order passed under sub-rules (8), (9), (10), (11) and (12)
shall be given effect to by assessing authority who shall collect any
additional tax which is found to be due in the same manner as a tax assessed
by himself.
(14) If any dealer having furnished a return under sub-rule (1) or sub-
rule (2) discovers any omission or other error in the return, he may furnish
a revised return at any time before the assessment is made on the original
return.
Provided that the acceptance of any such revised return shall not be
a bar for taking action against the dealer for having submitted originally
an incorrect return.
2
[(15) Notwithstanding anything contained in sub-rules (8), (9), (10)
and (11) where an assessment, re-assessment, rectification in or revision
of, an assessment, is made in respect of an assessee or any person, in
pursuance or in consequence of or to give effect to any finding or direction
contained in an order passed by an appellate or revisional authority or in
any order of any Court in a proceeding otherwise than by way of appeal
or revision under the Act, such assessment, re-assessment, rectification in
or revision of an assessment shall be made within three years from the
date of receipt of such order by the assessing or revising authority as the
case may be.]
PART V
Miscellaneous
15. Every dealer liable to registration under Section 7 of the Act who
is a member of an undivided Hindu family, an association or a club, society,
The C.S.T. (A.P.) Rules, 1957 939
firm or company or who carries on business as the guardian or trustee
or otherwise on behalf of another person, shall within thirty days from
the date of coming into force of these rules send to the appropriate assessing
authority in whose jurisdiction the dealer has a place of business a declaration
in Form CST V stating the name of the person who shall be deemed to
be the manager of such dealer’s business for the purpose of the Act. All
returns and statements submitted by such manager shall be binding on the
dealer. Such declaration may be revised from time to time.
16. Whoever commits any breach of 1[any of these rules] 2[x x x]
shall on conviction by a Magistrate of the first class be punishable with
fine which may extend to five hundred rupees and when the offence is
a continuing offence, with a daily fine which may extend to fifty rupees
for every day during which the offence continues.
17. The provisions contained in the 3[Andhra Pradesh Value Added
Tax Act, 2005] relating to the inspection of books, accounts or documents
kept and maintained by the dealer, the entry into any premises at all
reasonable times by the officers duly empowered for the purposes of search
for any such books, accounts or documents kept or suspected to be kept
in such premises and the seizure of such books, accounts or documents
shall so far as may be, apply in relation to those matters under the Act.
FORMS PRESCRIBED UNDER THE C.S.T. (ANDHRA
PRADESH) RULES, 1957
FORM CST I
List of Registered Dealers
[See Rule 3] ............. District
Registration
certificate
------------------------------
S.No. Dealer’s name Nature of Head office No. Date Remarks
and address business & branches
if any
1 2 3 4 5 6 7
1. Subs. by G.O.Ms.No. 651, Revenue, dt. 10-7-1974, w.e.f. 1-4-1973.

2. The brackets and figures [4 to 15] shall be omitted vide G.O.Ms.No. 651, Revenue,
dt. 10-7-1974.
FORM CST II
LIST OF REGISTERED DEALERS
[See Rule 3]
............. District
Registration
certificate
------------------------------
S.No. Dealer’s name Nature of Head office No. Date Remarks
and address business & branches
if any
1 2 3 4 5 6 7
1
FORM CST III
[See Rule 8(3)]
——
2
[FORM CST IV
REGISTER OF WRITTEN DECLARATIONS2
[See Rules 10 and 14-A]
RECEIPTS
Date of Authority from Book No. Sl. No.
Receipt whom issued From To
1 2 3 4 5
ISSUES
Date Book Sl. Name and No. & date Description Value Sellers
of No. No. address of of order of goods of cash
issue seller to in respect respect of goods memo
whom of which which challan
issued issued issued No. in ref.
to which
issued
6 7 8 9 10 11 12 13
1. Omitted by G.O.Ms.No. 1834, Revenue, dt. 7-9-1960.

2. Substituted by G.O.Ms.No. 1236, Revenue, dt. 30-9-1986.
The C.S.T. (A.P.) Rules, 1957 941
No. & Date of Railway Surrender Remarks

receipt or other carrier Surrendered to sales
challan for goods tax authority
14 15 16
Note:— Dealers shall maintain the above register commodity-wise and State-wise setting apart
of few pages for purchases made from each State and furnish an extract of Col. (5)
to (13) to the assessing authority as required by sub-rule (1)(b)(v) of Rule 14-A of
the CST (AP) Rules, 1957.
1
FORM CST IV-A
REGISTER OF CERTIFICATE IN FORM E-I
[See Rule 10]
1
FORM CST IV-B
REGISTER OF CERTIFICATE IN FORM E-II
[See Rule 10]
FORM CST V
DECLARATION UNDER RULE 15
I/We ......................................... of ...................................... carrying on the business(es)
known as ................... at ..................................... and other places in the State of Andhra
Pradesh as ......... and liable to pay the tax under the Central Sales Tax Act, 1956, do
hereby declare that I, Sri/Shrimathi ................... (here give address) ......... whose
signature is appended below and who am/is (mention here the status or designation)
.............. of the said concern shall be deemed to be the manager of the said business(es)
.................... all places within the State of Andhra Pradesh for the purpose of the said
Act, and shall, at all times comply with the provisions of the said Act and the rules
made thereunder:—
Place :
Date : Signature
Status
*Enter here one of the following, as may be applicable.
(a) the guardian/trustee or ........................ on behalf of :
(b) an undivided Hindu family known as ........................
(c) an association/club/society known as ..........................
(d) a firm known as .........................................................
(e) a private limited company known as .........................
(f) a public limited company/co-operative society known as ........................
1. The Form earlier inserted by G.O.Ms.No. 1805, Revenue, dt. 30-9-1958 was omitted by
G.O.Ms.No. 1063, Revenue (S) Department, dt. 20-6-1961.
The declaration shall be signed in the case of:—

(i) undivided Hindu Family ........................... by its manager :
(ii) an association or club ......................... by its President or Chairman and
Secretary ;
(iii) a firm ............... by the partners having a total share not less than fifty
percent ;
(iv) a private limited company ............. by all its Directors or where there are no
Directors, by the authorised representative of the company nominated by
the Chairman.
(v) a public limited company or co-operative society of the managing agents,
or where there are no managing agents, by the Managing Directors or the
Chairman of the Board of Directors and the Secretary.
1
[FORM CST VI
FORM OF RETURN UNDER RULE 14 A (1) OF THE
CENTRAL SALES TAX (ANDHRA PRADESH)
RULES, 1957
Return for the period from —————————— to —————————
Registration No (TIN) ———————————————————————
Name of the dealer ————————————————————————
1. Turnover of Inter State Taxable Sales including Cost of freight, delivery or

installation and Central Sales Tax collections Rs…………………
2. Deductions:
Cost of freight, delivery or installation when such cost separately charged as
per Section 2 (h) of the Central Sales Tax Act, 1956 Rs…………………….
(i) CST Collections as per Section 8A of the Central Sales Tax Act, 1956
Rs…………….
(ii) Total Rs. . ……………….
3. Turnover of Inter State sales liable to tax (1-2)
4. Tax rate wise turnovers of inter State sales and tax liability:
(i) Tax rate 1% Turnover Rs.______________ Tax Due Rs. __________
(ii) Tax rate 2% Turnover Rs._______________ Tax Due Rs.___________
(iii) Tax rate 3% Turnover Rs._______________ Tax Due Rs.___________
(iv)Tax rate 4% Turnover Rs._______________ Tax Due Rs.__________
(v) Tax rate 10% Turnover Rs.______________ Tax Due Rs.__________
1. Subs. by G.O.Ms.No. 724, Rev. (CT-II), Dept., dt. 02-08-2010.

The C.S.T. (A.P.) Rules, 1957 943
(vi) Tax rate 12.5% Turnover Rs.____________ Tax Due Rs._________

(vii) Tax rate 14.5% Turnover Rs.____________ Tax Due Rs._________
(viii) Other rate Turnover Rs._______________ Tax Due Rs._________
_____________________________
Total Turnover Rs. Total tax Due Rs.
5. (i) Tax Paid:
Instrument/Challan No. Date Bank Name Amount
(ii) Tax paid by way of Adjustments:

Authority name Order Ref. No. Date Amount
(iii) Total Tax paid : 5 (i)+5(ii) = Rs.
Exempt Inter State Transations:
6. Value of goods dispatched to outside the state otherwise than by way
of Inter State sale.
(as per section 6A of CST Act’56)
(i) Agent/Principal Rs:________________
(ii) Branch/Head Office by way of Stock transfer Rs:________________
Total Rs.________________
7. Sale of goods in the course of Export to outside India
(i) Sales covered by Sec 5 (1) of CST Act’56 Rs:________________
(ii) Sales covered by Sec 5(3) of CST Act’56 Rs:________________
Total Rs.________________
8. Turnover of Inter-State sales exempt Under Section 6 being second or
subsequent sales (E-I/E-II) Rs.________________
I enclose with this return the original copy of each of the declarations and
certificates received by me in respect of sales made to registered dealers, together
with a signed list of such declarations and certificates. I shall submit the declarations
and certificates still due before the time prescribed therefore.
I declare that to the best of my knowledge and belief the information furnished
in the above statement is true and complete.
Place: Signature
Date: Status]
-------
1
FORM CST VII
NOTICE OF PROVISIONAL MONTHLY ASSESSMENT AND
DEMAND
[See Rule 14-A(4)]
Assessment No. ................................................ of ...................................
Registration No. ................................................
To
(Dealer)
Take notice that you have been provisionally assessed under the Central Sales Tax
Act, 1956 to a tax of Rs. ............... (Rupees ........................) (in words) only for the
month/months of 19 ... and that after deducting the month payment(s) already made
by you towards the tax for that month/those months you have to pay a (further) sum
of Rs. ... (Rupees ......................) (in words) only. This balance of tax shall be paid
within twenty one days from the date of service of this notice by money order to
the undersigned or by cheque in favour of the undersigned or by remittance into
the Government treasury at ... or to the Deputy Commercial Tax Officer/Assistant
Commercial Tax Officer, or to the Bill Collector failing which the amount will be
recovered as if it were an arrear of land revenue and you will be liable to fine as
provided in Rule 16 of the Central Sales Tax (Andhra Pradesh) Rules, 1957.
Turnover as determined by the assessing authority in respect of ...............
Nature of goods Rate of tax Turnover

1 2 3
Total
Place :
Date :
Note:— 1. If payment is made by cheque, the cheque shall be crossed and shall be such
as is receivable by the Government treasury and shall be drawn on any
scheduled bank.
2. Where the amount payable exceed Rs. 200 it shall not be paid to the Bill
Collector.
1
FORM CST VIII
NOTICE OF FINAL ANNUAL ASSESSMENT AND DEMAND
[See Rule 14-A(7)]
Assessment No. ................................................ 199 ...................................
Registration No. ................................................

The C.S.T. (A.P.) Rules, 1957 945
To
(Dealer)
Take notice that you have been finally assessed under the Central Sales Tax Act,
1956 to a tax of Rs. ............... (Rupees ........................) (in words) only for ...... the year
ending the 31st March, 19../the period upto and inclusive of the date of discontinuance
of business and that after deducting the total amount of monthly payment(s) already
made by you towards the tax for that year, you have to pay a further sum of Rs.
......... (Rupees .......................) (in words) only. This balance of the tax shall be paid
within twenty one days from the date of service of this notice by money order to
the undersigned or by crossed cheque in favour of the undersigned or to the Deputy
Commercial Tax Officer/Assistant Commercial Tax Officer or to the Bill Collector failing
which the amount will be recovered as if it were an arrear of land revenue and you
will be liable to fine as provided in Rule 16 of the Central Sales Tax
(Andhra Pradesh) Rules, 1957.

1 2 3
Total .................. ...................

Place :
Date :
Note:— 1. Where payment is made by cheque, the cheque shall be crossed and shall be
such as is receivable by the Government treasury and shall be drawn on any
scheduled bank.
2. Where the amount payable exceed Rs. 200 it shall not be paid to the Bill
Collector.
1
FORM CST IX
NOTICE OF FINAL ASSESSMENT AND REFUND ORDER
[See Rule 14-A(7)]
To
(Dealer)
Take notice that you have been finally assessed under the Central Sales Tax
Act, 1956 to a tax of Rs. .... (Rupees .....................) (in words) only for the year ending
the 31st March, 19.... The total amount of tax paid by you already is Rs. ..........
(Rupees .....................) (in words) only that is Rs. ............. in excess of the tax due.
2. Out of the above excess a sum of Rs. .......... will be adjusted towards tax
due from you for the period.
3. A refund order of the amount of Rs. .......... is enclosed. You should apply
to the Government Treasury at ........... for the refund of sum of .......... within 3 months
from the date of issue of this notice failing which the amount will lapse to the
Government.

1 2 3
Total
Place : Assessing Authority
Date :
1
FORM CST X
REGISTER SHOWING THE DETAILS OF SALES OF
DECLARED GOODS IN THE COURSE OF INTER-STATE
TRADE OR COMMERCE
[See Rule 14]
1. Serial No.
2. Name and address and R.C.No. of the Consignor.
3. S.No. of certificate in Form E-I and E-II issued.
4. Name and address and R.C.No. of the Consignee.
5. Name and address and R.C.No. of the purchasing dealer.
6. Serial No. of Form ‘C’ or ‘D’ with the name of the State given by the purchaser.
7. Seller’s invoice number and date.
8. Names of despatching and receiving Railway Stations or air booking offices or
Sea Ports.
9. The No. of R.R. or Bill of Lading or Air Consignment Note.
10. Description and quantity or weight of goods sold.
11. Amount for which goods are sold.
(a) For re-sale by registered purchasing dealer.
(i) If it is first sale, the turnover taxable.
(ii) The amount of sales tax collected.
(iii) If the sale is second or subsequent sale covered by Form E-I or
E-II and Form ‘C’ or ‘D’ and is exempt from tax, the turnover of
such sale.
(b) For other purposes.
(i) The turnover liable to tax.
Note:— Separate folios shall be maintained for goods liable to different rates of tax.

The C.S.T. (A.P.) Rules, 1957 947
1
FORM CST XI
REGISTER SHOWING THE DETAILS OF SALES OF GOODS,
OTHER THAN DECLARED GOODS IN THE COURSE OF
INTER-STATE TRADE OR COMMERCE
[See Rule 14]
1. Serial No.
2. Name and address and R.C.No. of the Consignor.
3. S.No. of Certificate in Form E-I and E-II issued.
4. Name and address and R.C.No. of the Consignee.
5. Name and address and R.C.No. of the purchasing dealer.
6. Serial No. of Form ‘C’ or ‘D’ with the name of the State given by the purchaser.
7. Seller’s invoice number and date.
8. Names of despatching and receiving Railway Stations or air booking offices or
Sea Ports.
9. The No. of R.R. or Bill of Lading or Air Consignment Note.
10. Description and Quantity or Weight of goods sold.
11. Amount for which goods are sold.
(a) Goods sold to registered dealers—
(i) If it is first sale, the turnover liable to tax.
(iii) If the sale is second or subsequent sale covered by Form E-I or
E-II and Form ‘C’ or ‘D’ and is exempt from tax, the turnover of
such sale.
(b) Goods sold to unregistered dealers and others.
(i) The turnover liable to tax.
Note:— Separate folios shall be maintained for goods liable to different rates
of tax.

1
FORM CST XII
FORM OF APPEAL UNDER 2[RULE 5(2)(A)] OF THE
CENTRAL SALES TAX (ANDHRA PRADESH) RULES,
1957 ISSUED UNDER SECTION 13(3) AND (4) OF THE
CENTRAL SALES TAX ACT, 1956 (CENTRAL ACT 74
OF 1956)
To
2
The Deputy Commissioner of Commercial Taxes]
the ............................... day of ........................... 19 ................
1. Name(s) of the appellant(s).
2. Assessment Year.
3. Authority passing the original order in dispute.
4. Date on which the order was communicated.
5. Address to which notice may be sent to the appellant(s).
6. Relief claimed in appeal ........................
(a) Security/Additional Security demanded by the Registering Authority.
(b) Amount disputed.
(c) Additional Security amount, if any, disputed.
(d) Any other relief claimed.
7. Grounds of appeal.
(Signed)
Appellant(s)
Signed
Authorised representative,
if any.
VERIFICATION
I/We ................... the appellant(s) named in the above appeal do hereby declare that
what is stated therein is true to the best of my/our knowledge and belief.
Verified today the ................... day of ............... 19 ................
(Signed)
Appellant(s)
Signed
Authorised representative, if any.
Note:— 1. The appeal shall be in triplicate and shall be accompanied by the order
appealed against in original or by a certified copy thereof unless the
omission to produce such order or copy is explained to the satisfaction
of the appellate authority and by proof of payment of the security
amount, admitted by the appellant(s) to be due.
1. Inserted by G.O.Ms.No. 651, Revenue (S), dt. 10-7-1974.

The C.S.T. (A.P.) Rules, 1957 949
2. The appeal shall be accompanied by a Treasury receipt from a
Government Treasury in support of having paid the fees of Rs. 25.
The fees shall be credited in the Treasury to the following head of
account. 040-Sales Tax (a) Receipts under Central Sales Tax Act (iii)
other receipts.
Cheques, drafts, hundies, or other negotiable instruments will not be
accepted.
3. The appeal shall be written in English and shall setforth concisely
and under distinct heads the grounds of appeal without any argument
or narrative and such grounds shall be numbered consequently.
1
FORM CST XIII
REGISTER OF DECLARATIONS—FORM ‘F’
[See Rule 10(1)]
RECEIPTS
Date of receipt Authority from whom received Book No. Sl. No. ...to...
1 2 3 4
ISSUED
Date of Book No. Sl. No. Folio No. Surrendered Remarks
issue register to Taxation
Officer
5 6 7 8 9 10
1. Inserted by G.O.Ms.No. 651, Revenue(S), dt. 10-7-1974.

CIRCULARS UNDER V.A.T.
1.1 Sensitive Goods
[CCT’s Ref.JC(CT)Enft./D2/723/05, dated 15-6-2005]
Sub:– AP VAT Act, 2005 – Issue of Notification under sub-rule (2)
of Rule 55 of AP VAT Rules, 2005 – Issue of Advance Way
Bill for import of Sensitive goods – Notification issued – Reg.
In exercise of the powers conferred by sub-rule (2) of Rule 55 of
AP VAT Rules, 2005, the Commissioner of Commercial Taxes, Andhra
Pradesh hereby notifies the following goods to be sensitive for the purpose
of said sub-rule.
(1) Marbles, Marble Tiles and Marble Articles.
(2) Sheet Glass, Plate Glass and Mirrors.
(3) Laminated sheets of all kinds, plywood, particles Board, Lamin
Board, MDF Board, Batters board, hard or soft boards, insulating board,
veneered panels i.e., flush doors.
(4) Plastic moulded furniture.
(5) Timber and logs cut into sizes such as beams refters and planks.
(6) Electrical wires, switches, switch boxes, all kinds of bulbs and
lights, washing machines, Transformers and Generators.
(7) Parts & accessories of automobiles and automobiles spare parts
including spare parts of tractors and bulldozers.
(8) Beedi Leaves
(9) Bitumen.
(10) Ceramic Sanitaryware.
(11) Cement sheets and Asbestos sheets.
(12) Aluminium products other than conductors and utensils.
(13) Arecanut, betel nut and betel nut powder
(14) Flour, Atta, Maida, Suji, Besan and Ravva
(15) Paper of all kinds and news print.
(16) All kinds of Foot wear (all kinds of footwear including plastic
footwear, sports shoes, shoe polishes of all kinds, polish brushes and shoe
horns.
951
(17) Vegetable Oils – All kinds of vegetable oils including solvent

oils and coconut oil.
(18)(a) Iron and Steel, that is to say,
(i) Pig Iron, Sponge Iron, and cast iron including ingot moulds, and
bottom plates.
(ii) Steel semis, ingots, slabs, blooms and billets of all qualities, shapes
and sizes.
(iii) Skelp bars, tin bars, sheet bars, hoe-bars and sleeper bars;
(iv) Steel bars, rounds, rods, squares, flats, octagons and hexagons;
plain and ribbed or twisted, in coil from as well as straight length
(v) Steel structurals, angles, joints, channels, tees, sheet piling sections,
Z sections or any other rolled sections
(vi) Sheets, hoops, strips and skelp, both black and galvanized, hot
and cold rolled, plain and corrugated in all qualities, in straight
lengths and in coil form as rolled and in revetted condition.
(vii) Plates, both plain and chequered in all qualities
(viii) Discs, rings, forgings and steel castings;
(ix) Tool, alloy and special steels of any of the above categories
(x) Steel tubes, both welded and seamless, of all diameters and lengths
including tube fittings
(xi) Tin-plates, both hot dipped and electrolytic and tin free plates
(xii) Fish plate bars, bearing plate bars, crossing sleeper bars, fish
plates, bearing plates, crossing sleepers and pressed steel sleepers,
rails – heavy and light crane rails;
(xiii) Wheels, tyres, axies and wheel sets
(xiv) Wire rods and wires rolled, drawn, galvanized, aluminized, tinned
or coated such as by copper
(b) Iron and Steel scrap, that is to say–
(i) Iron scrap, cast-iron scrap, runner scrap and iron skull scrap
(ii) Steel melting scrap in all forms including steel skull, turnings and
borings
(iii) Defectives, rejects, cuttings or end pieces of any of the categories
of item (i) to (xiv) of entry 71.
Circulars under VAT 953
(19) Oil seeds, that is to say.,

(i) Sesamum or Til (orientale)
(ii) Soyabeen (Glycine seja)
(iii) Rape seed and mustard
1. Toria (Brassica campestris vartoria)
2. Rai (Brassica Juncea)
3. Jamba – Taramira (Eruca satiya)
4. Sarcon – yellow and brown (brassica compestris varsarson)
5. Banarasi Rai or True mustard (Brassica nigra)
(iv) Linseed (linum usitatissimum)
(v) Sunflower (Helianthus annus)
(vi) Nigar seed (Guizotia abyssinica)
(vii) Neem, vepa (Azadi rachta indica)
(viii) Mahua, illupai, ippe (Madhuca indica, M. Latifolia), Bassia, Latifolia
and Madhuca Longifolia Syn. M. Longifolia)
(ix) Karanja, Pongam, Honga (Pongamia pinnata syn. P. Glabra)
(x) Kusum (Schleichera Oleosa, syn. S. Trijuga)
(xi) Punna undi (Calophyllum, inophyllum)
(xii) Kokum (Carcinia indica)
(xiii) Sal (Shorea robusta);
(xiv) Tung (Aleurite Jordi and A. Montana)
(xv) Red Palm (elaeis guinenisis)
(xvi) Safflower (corthanus tinctorius)
1
[(xvii)Castor Seed]
(20) All kinds of pulses and dalls.
(21) All kinds of packing material including Hessian cloth and jute
twine but excluding storage tanks made of any materials.
2
[(22) Fire Works & Crackers]
All the dealers who desire to import the above sensitive commodities
from other State or Union Territories shall send in advance a way bill in
duplicate to the consignor. Such way bill in duplicate duly filled in by the
consignor shall accompany the goods and shall be tendered by the person
incharge of the goods vehicle to the officer incharge of the check post
through which the goods vehicle first enters into Andhra Pradesh.
This notification shall come into force with effect from 15-6-2005.
1. Added by Noti. No. CCT's Ref. JC (CT) Enft. D2/723/05, dt. 6-7-2005.
2. Added by Noti. No. CCT's JC (CT) Enft. Ref. No. D2/723/05, dt. 03-08-2010,
w.e.f. 10-8-2010.
1.2 Issue of Notification under sub-rule (2) of Rule 55 of AP VAT

Rules, 2005
[CCT’s Ref. JC(CT)Enft./D2/723/05, dated 6-7-2005]
Sub:– AP VAT Act, 2005 – Issue of Notification under sub-rule (2)
of Rule 55 of AP VAT Rules, 2005 – Issue of Advance Way
Bill for import of Sensitive goods – Notification issued –
Amendment to the Notification issued – Regarding.
Ref:– Noti. issued in CCT’s Enft.Ref.No.D2/723/05, dt. 15-6-2005.
AP VAT Rules, 2005, and in continuation of the Notification issued in the
reference cited, the Commissioner of Commercial Taxes, Andhra Pradesh
hereby notifies CASTOR SEED as SENSITIVE COMMODITY under sub
item xvii of item 19 of the above Notification, for the purpose of said
sub-rule.
1.3 Vanaspathi
[CCT's Ref.JC(CT) Enft.D2/723/05, dt. 12-1-2006]
Sub:– Issue of Notification under sub-rule (2) of Rule 55 of APVAT
Act, 2005 – Issue of Advance Way Bill for import of Sensitive
goods – Notification issued – Amendment to the Notification –
Issued – Regarding.
Ref:– (1) Notification issued in CCT's Enft. Ref. No. D2/723/05, dt.
15.6.2005.
(2) Notification issued in CCT's Enft. Ref. No. D2/723/05, dt.
6.7.2005.
APVAT Rules, 2005 and in continuation of the Notification issued in the
reference cited, the Commissioner of Commercial Taxes, Andhra Pradesh
hereby notifies Vanaspathi as Sensitive Commodity under sub-item (a) of
item 17 of the above Notification, for the purpose of said sub-rule.
2. Edible Oil Millers and Traders – Evasion of tax
[CCT's Ref. No. A.III(2)/106/2004, dated 2-7-2005]
Circular
Sri V. Bhaskar, I.A.S., Commissioner of Commercial Taxes.
Sub:– APVAT Act, 2005 – Evasion of tax by Edible Oil Millers and
Traders – Certain Instructions – Issued.
It is observed that certain edible oil millers and traders are issuing
invoices/Way bills without mentioning the proper description of the Oil,
which is giving scope for adulteration and evasion of taxes.
So all the Deputy Commissioners (CT) are requested not to allow
any invoice/way bills issued by the edible oil millers and traders unless
proper description of oil with H.S.N. Code are mentioned. Please instruct
the traders that if invoice/way bill is not covered by the above description
such transactions can be made ineligible to claim Input Tax Credit.
All the Deputy Commissioners (CT) are therefore requested to issue
necessary instructions to the concerned authorities/traders/millers under
their jurisdiction, to ensure proper recording of sales and payment of tax.
The receipt of the Circular may be acknowledged immediately and
also a copy of the instructions issued in this regard to the subordinate
officers should also be furnished to this Office.
3. Empty Hard Gelating Capsules – Rate of tax
[CCT’s Ref. No.AIII(2)/31/2005, dt.04-07-2005]
Sub:– AP VAT Act, 2005 - Clarification sought by Bio-Pharma
Capsules, Hyd on Empty Hard Gelating Capsules (Packing
material) – Reg.
Ref:– (1) Representation of M/s.Bio-Pharma Capsules, Hyd,
dt.1-6-05.
In the reference cited M/s.Bio-Pharma Capsules, Hyderabad sought
clarification on the rate of Tax applicable to Empty Hard Gelating Capsules
(packing material)
In this regard, they are informed that Empty Hard Gelating Capsules
(Packing material) is taxable @ 4% under AP VAT Act, 2005 as a part
of medicines.
4. Tarpaulin made up of Plastic & Synthetic – Rate of tax
[CCT’s Ref. No.AIII(2)/64/2005, dt. 06-07-2005]
Sub:– A.P. VAT Act, 2005 – Rate of Tax on Tarpaulin made up of
Plastic – Clarification sought by M/s.The A.P. Tarpaulin Dealers
– Association, Secunderabad – Reg.
Ref:– (1) Representation of the A.P. Tarpaulin Dealers Association,
Secunderabad, Dt.8-6-2005. In the reference cited the A.P.
Tarpaulin Dealers Association, Secunderabad, sought

clarification on the rate of tax applicable to plastic and
synthetic Tarpaulin as the said items are not specifically
covered by enry 86 of the Fourth Schedule to APVAT
Act.
In this connection they are informed that the alone said items are
basically meant for packing or otherwise and they are deemed to have been
covered under Entry 86 of Fourth Schedule. Therefore Tarpaulin made up
of Plastic and Synthetic is taxable @ 4%.
5. Clearance Certificate for Contractors
[CCT's Ref. No.A.III(1)/131/2005, dt. 22-07-2005]
Sub:– A.P. Self Employed Engineers Association – Sales Tax not
to insist – Production of clearance certificate and assessment
of tax registration of contractors – Clarification – Requested
– Reg.
Ref:– Commissioner of Tenders, Hyd. Lr.No.COT/E.E.2/DEE 111/
T4/BOCE/2005, dt. 6-7-2005.
I am to invite your attention to the reference cited and to inform as
under :
(1) yes, VAT registration i,.e., TIN (Tax Payer Identification Number)
should be insisted wherever the Value of the contract is above Rs.5 Lakhs
for registration/renewal of contractors with you.
(2) Clearance certificate from the concerned CTO should be insisted
upon :
This should be in the nature of APGST/VAT no dues certificate.
(3) The validity of the clearance certificate will be Twelve months
from date of issue, after which fresh clearance certificate should be called
for.
(4) Model Proforma for clearance certificate is enclosed.
Clearance Certificate
1. Name of the Dealer :
2. Address :
3. Tin :
The above dealer has filed returns up to date (Month & Year) and
has paid Taxes due there in.
The dealer has no pending arrears under APVAT Act, 2005, CST ACT
1956 and APGST ACT, 1957, A.P.Entry Tax Act as on date.
This certificate is valid up to a period of Twelve months from the
date of issue.
Date :
Place : Assessing authority
6. Certain clarification on Paddy and Rice under VAT Act
[Circular No. AIII(2)/201/2005, date 01-08-2005]
Sub:– APVAT Act 2005 – Certain clarification on Paddy and Rice
under VAT Act – issued – Regarding.
Ref:– CCT’s Circular Ref.AI(1)/92/2004, dated 23.11.2004.
The attention of all the Deputy Commissioners (CT) in the State is
invited to the subject and reference cited.
It has been observed that in the course of desk audit of VAT Returns
filed by Rice Millers and comparing with the RD1 Returns(RD Cess returns)
it is noticed that the Rice Millers are not reporting the entire sale turnover
of Rice made to the FCI and it is also found that some of the Rice Millers
are not reporting the amount deducted by the FCI towards RD Cess
payments, in some cases the Rice Millers are also deducting the turnovers
of stitching charges, and AMC paid from the rice sale turnover.
The circular instructions issued vide reference cited, is relevant for
assessment of Rice Millers under the provisions of APGST Act only. The
exemption from levy of Sales tax under APGST Act on the RD Cess
component of the purchase value of the Paddy is under totally different
context in the APGST scenario where tax was levied on the purchase
turnover of Paddy. The said circular is not relevant under the provisions
of the APVAT Act 2005.
With a view to ensuring uniformity in assessments taking due
conginizance of the issues involved as noted below and established case
law, following instructions are issued under AP VAT Act for compliance.
1. Rural Development Cess:
As per G.O.Ms.No.951, Revenue Dept, Dated 10.09.2003 exemption
was granted from levy of sales tax on the R.D.Cess component present
in the sale turnover of Rice. The above notification is valid under APGST
Act 1957 and the sale benefit of exemption cannot be allowed under APVAT
Act 2005. As per the APVAT Act provisions in respect of Rice Millers,
under Section 2(38) and 11(2) read with Rule 19(2), only the VAT paid
or payable alone, is eligible for deduction from the total sale consideration
of rice sale made to the F.C.I. Hence, the R.D.Cess paid by Food Corporation
of India to the Commercial Taxes Department on behalf of the Rice Millers
forms a part of sale turnover of Rice, liable to tax under VAT ACT.
2. Agricultural Market Cess:
The Hon’ble High Court of A.P in the case of State of A.P. Vs. Sri
Lakshmi Traders (7 STJ 265) relying on the decision of the Supreme Court
in Anand Swaroop Mohan Kumar Vs.Commisisoner of Commercial Taxes
(46 STC 477) which was again reiterated in Central Winse Vs. Special
CTO (65 STC 48) held that the Market Cess collected under the statutory
obligation cannot form part of taxable turnover.
3. Stitching Charges:
Stitching charges pre-sale expenses and therefore form part of taxable
turnover. Hence, exemption cannot be allowed on this turnover.
4. Freight Charges:
As per the APVAT Act provisions in respect of Rice Millers, under
Sections 2(38) and 11(2) read with Rule 19(2), only the VAT paid or payable
is eligible for deduction from the total sale consideration of rice sale made
to the F.C.I. In these transaction freight charges becomes part of sale
expenditure only, since the quality check of rice is done at the FCI premises.
Freight is to be added to taxable turnover as the situs of sale is at FCI
premises/godown, after inclusion of transportation charges on supply of rice.
5. Export Sales of Rice under Section 5(3) of CST Act:
For claiming zero rates sales, the transactions under Section 5(3) of
CST Act the following documentary evidence is required
(a) Form H declaration.
(b) Purchase order from the exporter and
(c) Evidence of export in the form of transport documentation as
above.
In the case of direct export, item (b) and (c) must be produced to
establish the claim of zero-rating. In the cases of claims of zero-rating in
the course of export, the dealer/penultimate exporter must produce any of
the above documentary evidence to the concerned assessing authority stating
that the goods purchased are intended for export.
All the Deputy Commissioners (CT) requested to bear in mind the

legal positions as explained above.
Detailed instructions for making provisional assessments in this regard
will be issued shortly.
This instructions issued under the provisions of the Section 77 of the
APVAT Act 2005.
The receipt of the Circular shall be acknowledged.
7. Exemption of Sales Tax/VAT on purchases made through C.S.D.
to the Armed Forces in A.P.
[Circular No. AIII(1)/228/2005, date 16-08-2005]
Sub:– APVAT Act 2005 – Exemption of Sales Tax/VAT on purchases
made through C.S.D to the Armed Forces in A.P. – Reptn,
of Lt.Gen(Retd.,) Lt Governor, Pondicherry – Rejected – Reg.
Ref:– Govt.Endt.No.36564/CT-II(2)/05-1, Rev.(CT-II) Dept., dt.
03.08.2005.
I am to invite attention of the Government to the reference cited and
submit that the request for exemption of VAT on the goods sold out of
Canteen Stores Department (CSD) to Armed Forces cannot be favorably
considered because there is no provision in VAT Act to grant exemption
by notification
8. VAT Form 225 by dealer doing business in Chillies, Cotton, Pulses
and Dhalls.
[CCT's Circular No.A.III(2)/191/2005, dt. 18-08-2005]
Sub:– Filing of VAT Form 225 also by the VAT dealer doing business
in Chillies, Cotton, Pulses and Dhalls.
In exercise of the powers conferred under Section 77 read with Rule
23(8) of the APVAT Act and Rules 2005, the Commissioner of Commercial
Taxes, do hereby notifies that the VAT registered dealers doing business
in Chillies, Cotton, Pulses and Dhalls shall submit a return in VAT Form
225 for each tax period, i.e., for every month in addition to the return
in VAT Form 200.
The notification shall come into force with immediate effect.
9.1 Rate of Tax on Tobacco oil, SIM Cards etc.
[CCT's Circular No.A.III(1)-3, dt. 12-09-2005]
Sub:– APVAT Act, 2005 – Video Conference held with DCs on
5.9.2005 – Certain Clarifications – Issued – Reg.
During the course of video conference on 05-09-2005, the Deputy

Commissioners (CT) have raised certain issues and clarifications were
sought for. The following clarifications are issued.
(1) Rate of Tax on Tobacco Oil : As per Entry 67 of Schedule-IV
to the AP VAT Act, 2005 all kinds of vegetable oils are taxable @ 4%.
Tobacco oil also falls under this entry and hence is taxable @ 4%.
(2) Is Purchase of coal for steam generation eligible for Input tax
credit: The steam from coal can be used for generating power or for other
purposes. In case steam generated from coal is used for power generation,
then input tax credit should be restricted. However, if the steam is used
for purposes other than power generation such coal will be eligible for
input tax credit.
(3) Sale of sim cards and recharge cards : Sale of sim cards and
recharge cards are taxable. The goods actually sold in case of recharge
cards is the air time. "As the goods are "intangible goods" tax should be
levied at the rate of 4%.
(4) What is proforma for seizure and confiscation of goods : As
per Section 45(6) and Rule 56(1) (a) goods can be detained and for this
purpose Form 610 can be used. However, a query has been raised whether
this form can be used for seizure and confiscation of goods under Section
45(7)(b) and Rule 56(2). It is hereby clarified that Form 610 can be used
only for detention of goods. As no form is prescribed for seizure and
confiscation of goods the officers can issue a notice quoting the provisions
of the Act. The same procedure may be followed wherever specific forms
are not prescribed and the enforcement of the Act requires issue of notices.]
9.2 SIM Cards and Telephone handsets
[CCT's Ref.No. LI(2)/7/2004 dt. 25-4-2007]
Circular
Smt. Rajeev R. Acharya, I.A.S., Commissioner of
Commercial Taxes
Sub:– APGST Act & APVAT Act – Levy of tax on SIM Cards and
Telephone handsets – Circular instructions issued – Reg.
It is brought to the notice of the Commissioner of Commercial Taxes
by several Deputy Commissioners in the State that the Assessing Officers,
even after the judgment of the Hon'ble Supreme Court in the case of Bharath
Sanchar Nigam Ltd. and Another vs. Union of India and Others, (145 STC
91), are still uncertain on the question as to what constitutes "goods" in
Telecommunication services viz. cellular phone connections and fixed land
line telephone connections and whether "SIM Cards" in cellular phone

connections are "goods" and if they are "goods" what is the turnover for
the purpose of levying tax on SIM cards.
In this regard all the assessing and revisional authorities in the State
are requested to note that the Hon'ble Supreme Court after tracing the history
of case law on "goods" exhaustively, adopted the following view of "goods"
for the purposes of sales tax:–
"A "goods" may be a tangible property or an intangible one. It would
become goods provided it has the attributes thereof having regard to (a)
its utility (b) capable of being bought and sold (c) capable of being
transmitted, transferred, stored and possessed."
All the Assessing and Revisional Authorities are requested to follow
this view of the Hon’ble Supreme Court while examining the taxability
of SIM cards because the Hon'ble Supreme Court in their judgment have
left the issue of SIM cards for determination by the Assessing Officers.
While doing so, however, the Hon'ble Supreme Court also observed what
SIM Card represents is ultimately a question of fact as has been correctly
submitted by the States. In determining the issue, however, the Assessing
Authorities will have to keep in mind the following principles. If the SIM
card is not sold by the assessee to the subscribers but is merely part of
the services rendered by the service providers then a SIM card cannot be
charged separately to sales tax. It would depend ultimately upon the
intention of the parties. If the parties intended that the SIM card would
be a separate object of sale, it would be open to the sales tax authorities
to levy sales tax thereon." The Hon'ble Supreme Court further observed
that no one denies the legislative competence of the States to levy sales
tax on sales provided that the necessary concomitants of a sale are present
in the transaction and the sale is distinctly discenible in the transaction
and while the States are not allowed to entrench upon the Union List and
tax services by including the cost of such services in the value of the goods,
the Centre also cannot include the value of SIM cards if they are found
ultimately to be goods, in the cost of service.
The aforesaid observations of the Hon'ble Supreme Court makes it
clear that an enquiry has to be made to establish that SIM cards are goods
and that there is sale of SIM cards to the customers by the cellular phone
companies. All the Deputy Commissioners in the State are therefore requested
to conduct such enqiry and assess the SIM cards to tax if on enquiry it
is found that SIM cards are goods and they are sold to customers for
valuable consideration. While conducting the enquiry the officers may keep
in mind the view of the Supreme Court on "goods" quoted in the earlier
VAT–61
paragraphs of this circular and also the judgments of the Hon'ble Supreme
Court in cases of Associated Cement Companies Ltd. vs. Commissioner of
Customs (4 SCC 593) where in it was held that technical knowhow
transferred in the form of drawings is goods and Tata Consultancy Services
vs. State of A.P. (39 APSTJ Page 205) wherein it was held that intellectual
property, software in that case, incorporated on a media such as a CD is
"goods" and when transferred for valuable consideration is a sale exigible
to tax. In case the Assessing Officers in the course of enquiry establish
that a SIM card in its physical form of a plastic card with software for
accessing the cellular net work embedded in it is "goods" for the purposes
of sales tax, they may proceed to determine the value for which the SIM
cards are transferred to the customers either as an outright sale or in the
course of transfer of right to use those SIM cards to the customers and
levy tax accordingly.
With regard to the handsets provided by the service providers in land
line telephone connections and also cellular phone connections in certain
cases, the Hon'ble Supreme Court clearly held that the handsets provided
by the service providers are goods and by giving a telephone connection
there may be a transfer of right to use those handsets. This finding of the
Hon'ble Supreme Court clearly paves the way for levy of tax on the lease
rentals received by the telephone and cell phone companies from the
customers on the transfer of right to use the handsets. The Assessing and
Revisional authorities are therefore requested to take steps on this point
immediately and assess the amounts realized by the cellular and telephone
companies on lease rentals of handsets.
In the cases of both SIM cards and handsets, the Assessing Officers
should determine the taxable turnovers after verifying the agreements, bills
etc. They are also required to examine the trade channels through which
the SIM cards and handsets reach the consumers to fix up liability at each
stage of channel in accordance with law.
All the Assessing Officers and Revisional Authorities are therefore
requested to verify all the cases of cellular phone companies, their distributors
and retailers and also the companies engaged in the business of providing
fixed telephone services and take appropriate action as discussed in this
circular instructions and report compliance.
10. Rate of tax on “Aluminium and Copper Cables excluding single
core wires up to 6 Sq.mm.”
[CCT’s Circular No. A.III(1)-1, dt. 22-9-2005]
Sub:– Amendment to AP VAT Act, 2005 – Re-notification of HSN
Codes – Industrial Cables – Clarification – Issued – Reg.
The Government recently amended the Schedules to the AP VAT Act,

2005 and among other things, the HSN codes included in the Schedule
-IV for IT Products have been deleted. A notification for HSN Codes was
issued separately vide G.O.Ms.No.1615, Revenue (CT-II) Department, Dt.31-
8-2005. In the light of the above changes, the queries have been raised
by members of the Electrical Trade regarding electric cables meant for
domestic use, as they are not taxable @ 12.5%, whereas industrial cables
are taxable at 4%. The issue has been examined and it is hereby clarified
that “Aluminium and Copper Cables excluding single core wires up to 6
Sq.mm” will be treated as industrial cables. That means all single core
cables up to 6 Sq.mm will be taxable @ 12.5%. This change is effective
from 01-09-2005.
All the Deputy Commissioners are requested to communicate this
circular to their subordinates under their jurisdiction and to important Trade
Associations and dealers of these products.
11. Residential Apartments, House Buildings and Commercial
Complexes
[CCT’s Circular No.A.III(1)/-2 dt. 22-9-2005]
Sri V. Bhaskar, I.A.S., Commissioner of Commercial Taxes
Sub:– Amendment Rule 17(4) of APVAT Rules, 2005 – Instructions
– Reg.
All the Deputy Commissioners (CT) are hereby informed that Rule
17(4) of APVAT Rules has been amended with effect from 01-09-2005.
A new clause namely (I) has been inserted in Rule 17(4). All VAT dealers
engaged in construction and selling of residential apartments , house buildings
and commercial complexes who opt for composition shall pay 1% of the
total consideration received or receivable or market value fixed for purpose
of stamp duty which is higher . In the new clause (1) to Rule 17(4) provision
for tax collection at source is now made at the time of registration and
this payment shall be made by way of demand draft in favour of Commercial
Tax Officer/Assistant Commissioner concerned and the instrument has to
be presented at the time of registration of the property to the Sub-Registrar
who is registering the property, duty furnishing TIN and full postal address
of the Commercial Tax Officer/Assistant Commissioner on the reverse of
the demand draft. The Sub-Registrar shall then send the same to the
Commercial Tax Officer/Assistant Commissioner concerned every week.
The deputy Commissioners (CT) are requested to see that the above
amendment is complied with . They are also requested to direct the assessing
authorities to coordinate with the Sub-Registrars concerned of Registration
Department and ensure that the amounts are collected and remitted properly
from time to time.
The receipt of the above circular may be acknowledged.
12. Sale of price determination in "Ready Mix Concrete".
[CCT's Ref. No.AIII(1)-4, dt. 26-9-2005]
Sub:– APVAT Act, 2005 – Levy of VAT on Sales of Ready Mix
Concrete Manufactured and sold – Certain – Instructions –
Issued – Reg.
The attention of Deputy Commissioners (CT) in the State is invited
to the subject cited. It is observed that the correct output value is not being
declared by dealers and a portion of sale consideration is converted into
other expenses. One such instance was noticed in Abids division, wherein
a manufacturer "Ready Mix Concrete" claimed exemption on amount charged
and collected by him towards freight and unloading charges from his
customers on the sale or "Ready Mix Concrete". It is clearly known that
ready mix concrete cannot be accepted by customers unless it is prepared
at the site of customer in proper condition. "Sale Price" includes all the
amounts charged in the bill and it shall include any other sum charged
in the bill and it shall include any other sum charged for anything done
in respect of goods sold at the time of or before the delivery of goods.
That means even transportation, freight, loading/unloading charges collected
in the bill form part of "Sale Price" liable for VAT.
Therefore all the Deputy Commissioners (CT) are requested to verify
similar cases in their divisions, and take immediate action for collection
of VAT and penalty/or interest as applicable and report compliance.
The receipt of this circular shall be acknowledged.
13. Guidelines for finalisation of assessments under Rule 6(3)(i) of
APGST Rules
[CCT’s Circular Ref. No.AII(1)/407/2005, dated 4-10-2005]
Sub:– Guidelines for finalisation of assessments under Rule 6(3)(i)
of the APGST Rules, 1957 – Reg.
In supersession of all the earlier guidelines and instructions, issued
with regard to the finalisation of the assessments under Rule 6(3)(i) of
the APGST Rules, 1957, the following guidelines are issued:-
(1) Rule 6(3)(i) reads as follows:–
“In cases where the execution of a works contract extends over a

period of more than one year, the total turnover for the purpose of sub-
rule (2) for that year shall be deemed to be the value of goods, purchased
for being supplied or used in the execution of such contract in that year”
(2) In the case of Gannon Dunkerly & Co. and others v. State of
Andhra Pradesh (23 APSTJ 195), the Hon’ble High Court of Andhra
Pradesh held as follows:
“In W.P. No.17415/1995, the validity of sub-rules (3) and (4) questioned.
As sub-rule (4) has already been omitted by G.O.Ms.No.788, Rev. (CT-
II), September 21st, 1996, the challenge has to be confined to Rule 6(3).
It was submitted that the first portion of the sub-rule imposes a tax on
the value of the goods purchased for being supplied, where the contract
extends more than a year, even though it may not be ultimately used in
the contract. There appears to be some force in this contention. The Supreme
Court has held in the case of State of Madras v. T. Narayana Swamy Naidu
that the stock in hand may or may not be sold or consumed and could
even be destroyed, and therefore, unless the taxable event has occurred,
it can not be taxed. Perhaps, the intention of this sub-rule was only that,
but it is not happily worded. If the words "for being" is substituted by
the word “and”, it would be clear that only the value of the goods purchased
and supplied or used in the execution of such contracts in that year would
be liable to be taxed. It must be remembered that in respect of goods used
in the execution of contracts, there is no sale price as such, and therefore,
the turnover pertaining to the goods involved in the execution of the
contracts refers only to the purchase turnover. The purchases so made will
not be liable to tax unless actually supplied or used in the execution of
such contracts. Accordingly, the turnover must be limited only to such
supply or use, and cannot, extend to the stock in hand at the end of the
assessment year as held by the Supreme Court. Instead of declaring the
rule to be invalid, we are of the opinion that it would be appropriate to
read the rule to mean only that and no more.”
It may be observed from the above that while making a general
observation that there is no sale price as such in respect of the goods used
in the execution of the contracts, the Hon’ble Court observed that the
turnover in the case of works contract is only the purchase turnover. These
observations are not with reference to Rule 6(3)(i), but with reference to
the concept of taxation of works contracts as such. The Hon’ble Court has
however not referred to the measure of tax in this context, as the simple
question for decision was whether the value of goods purchased and used
alone is to be taxed. Hence, the essence of the above decision is that the
turnover should be limited only to such supply or use and could not be
extended to the stock in hand at the end of the assessment year. The court
read the rule to mean only that and no more. Therefore, it cannot but be
said that the value of the goods purchased and supplied or used in the
execution of a contract is nothing but the value of the goods at the time
of incorporation, since the measure for imposition of tax was left untouched
by the above said decision of the Hon’ble A.P. High Court.
(4) This interpretation of the said decision of the Hon’ble High Court
gains strength from the decision of the Hon’ble Supreme Court in the case
of Gannon Dunkerly & Others v. State of Rajasthan & Others (88 STC
204), wherein it is held as follows:-
“Though the tax is imposed on the transfer of property in goods
involved in the execution of a works contract, the measure for levy of such
imposition is the value of the goods involved in the execution of a works
contract. We are however, unable to agree with the contention urged on
behalf of the contractors that the value of such goods for levying the tax
can be assessed only on the basis of the cost of the acquisition of goods
contractor. Since the taxable event is the transfer of property in goods
involved in the execution of a works contract and the said transfer of
property in such goods takes place when the goods are incorporated in
the works, the value of the goods which can constitute the measure for
the levy of tax has to be the value of the goods at the time of incorporation
of the goods in the works and not the cost of acquisition of the goods
by the contractor.”
(5) It is categorically held in the said decision that the measure for
the levy of tax has to be the value of the goods at the time of incorporation
and not the cost of acquisition of the goods by the contractor. Hence, the
turnover, on a harmonious interpretation of both the above decisions, is
neither the purchase value nor the sale value but the value of the goods
at the time of incorporation.
(6) The words, "purchase turnover" in the above said decision have
been used by the Hon’ble High Court of A.P. only in the above context
and only to draw a contrast between the sale turnover and the turnover
involving the value of the goods at the time of incorporation. It is not
said therein that tax shall not be levied on incorporation value. In view
of the decision of the Supreme Court, mentioned above, it is only the value
of the goods at the time of incorporation that has to be considered for
the purpose of levy of tax under Rule 6(3)(i).
(7) The next question would be whether Rule 6(3)(i) granted any
concession to adopt lesser value for the purpose of that rule. The rule simply
says that in the given circumstances the total turnover for the purpose of
sub-rule (2) for that year shall be deemed to be the value of the goods
purchased and used and thus simply says what should be the total turnover
for the purpose of Rule 6(2) and nothing more than that. Rule 6(2) speaks
that tax shall be levied under Section 5(F) of the Act and the procedure
for arriving at the turnover. It is settled law that under Section 5-F, tax
has to be levied only on the value of the goods at the time of incorporation.
(8) In the above mentioned decision, the Hon’ble High Court held
that “Section 5-F was a conscious effort to increase the revenue by levying
separate tax on goods involved in works contract.” Such being the case,
there is no intention made known through Rule 6(3)(i) that tax would be
levied on a lesser turnover, resulting in decrease in the revenue.
(9) Further in Rule 6(3)(i), the word, “value” in the expression “value
of the goods, purchased and supplied or used” should be interpreted in
the light of the provision in Section 5-F of the Act, as interpreted by Hon’ble
Supreme Court of India in the case of Gannon Dunkerly & Others v. State
of Rajasthan & others (88 STC 204), since the Rule is silent on the question
whether the value is “purchase value” or “value at the time of incorporation.”
(10) In the above background, particularly in the absence of any
specific observation by the High Court against the adoption of the value
of the goods at the time of incorporation, the charge created by Sec.5-
F, is necessarily on the measure for the levy of tax, as determined by the
Hon’ble Supreme Court in Gannon Dunkerly’s case. The Rule 6(2) & 6(3)
were also inserted immediately after the said decision of the Hon’ble
Supreme Court. The contents of the Rule 6(2) are extracted word by word
from the said decision of the Apex Court. In view of the said binding
decision of the Supreme Court and High Court on the interpretation of
measure for the levy of tax, for the purpose of Rule 6(3)(i) also, the value
of the goods at the time of incorporation has to be considered.
(11) All the authorities, concerned, may keep in mind the above legal
position. They are requested to examine all the cases of assessments,
finalised or to be finalised, in the light of the above discussion and take
appropriate action by exercising their independent judgment with respect
to the individual circumstances of each case.
14. Religious Institutions are not "dealers".
[Memo No.75655/CT-II(2)/2005-1, dated 27-10-2005]
Sub:– APVAT Act, 2005 – TTD, Tirupathi – Exemption of Religious
Institutions from VAT Act, 2005 – Clarification – Issued –
Regarding.
Ref:– From the CCT, Lr. Ref.No.AIII(1)/01/2005, dt.07-06-2005.
The Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad,

in his letter has informed that the Executive Officer, TTD, Tirupathi has
requested for exclusion of religious institutions from the definition of
"Dealer" by making suitable amendment to Section 2(10) of APVAT Act,
2005. He has requested the Government to issue clarification under Section
76 of APVAT Act, 2005, to exclude Religious Institutions from the preview
APVAT Act, 2005. Further, in the Group of Ministers meeting held on
28-4-2005, a decision was already taken to exclude religious institutions
from the purview of "Dealer".
2. It is therefore, informed that the definition of "Dealer" under sub-
section (10) of Section 2 of the AP VAT Act, 2005, covers all sales and
deemed sales made in the course of trade or business but does not specifically
covers the sales made by Religious Institutions in furtherance of or for
the propagation of the religious teachings and practices. Hence, a clarification
is hereby issued under Section 76 (2) of AP VAT Act, 2005 to the effect
that the Religious Institutions does not come under the definition of the
'dealer' in respect of purchases and sales made by them for the purpose
of propagation of religious teachings and practices as per the aims and
objects of such institutions.
3. The Commissioner of Commercial Taxes is therefore, requested to
issue necessary orders to all the assessing authorities of Commercial Taxes
Department under intimation to Government.
15. New Registrations – Precautions to be taken – Instructions issued
[CCT's Ref. No. A.III(1)-6/2005, dated 27-10-2005]
Circular
Sri V. Bhaskar, I.A.S., Commissioner of Commercial Taxes.
Sub:– APVAT Act, 2005 – New Registrations – Precautions to be
taken – Instructions issued – Regarding.
It has come to the notice of the Commissioner (CT) that VAT
registrations are being issued in the Circles without following the due
procedures and without taking minimum precautions. In certain cases TIN's
were issued after 1.4.2005 and investigations have revealed that they are
bogus. Such situations can be avoided to a large extent if minimum care
is taken at the time of issue of R.C. The procedures to be followed are
already mentioned in the Registration Manual supplied to all the officers.
In addition, it is advised that the following procedures be adhered to by
the field officers.
(1) Whenever VAT-100 application is received, certain minimum checks

need to be carried out. The Processing Officers/Registering Authorities
should verify the date of first taxable sale declared. If such date is beyond
45 days of date of application, the application may be rejected and the
dealer may be advised to apply within the eligible time frame i.e., 15 days
prior to the date of first taxable sale and not prior to 45 days of first taxable
sale. For e.g., The application is received on 1.6.05, and the date of first
taxable sale is shown as 1.8.05, i.e., the gap between the date of application
and date of first taxable sale is more than 45 days. In this case TIN can
be rejected (except for start-up business).
(2) In case the dealer has not started his business and if the declared
taxable turnover in a year is less than Rs. 40 lakhs, the dealer may be
persuaded (wherever possible) to apply for registration after commencing
the business. In some cases, even though there is no 'sale' in the hands
of the applicant, applications for TIN's are being received. The dealers may
be counselled in such cases.
(3) Pre registration visits may be carried out wherever the Processing
Authority/Registering Authority is doubtful about the particulars given in
the VAT-100 application. Special care needs to be taken in case of sensitive
commodities.
(4) Whenever a pre registration visit/advisory visit is to be conducted
by an officer other than the Registering Authority, the Registering Authority
shall give a written authorization to the officer designated for conducting
the visit.
(5) In case advisory visit is conducted after issue of registration, the
file needs to be updated with the latest particulars collected during the visit
and should also be fed into the VATIS program in the computer. The visiting
officer should give a clear report in writing as to what his findings are.
(6) If the dealer has not given any details of bank account in the
VAT-100 application, the bank account should be insisted atleast at the time
of advisory visit to the dealer. If the dealer fails to give particulars of his
bank account within a fixed time frame, then the Registering Authority
may proceed to cancel the R.C. on such grounds after giving an opportunity
to the dealer.
(7) The first VAT return filed by the dealer should be compared with
the estimated turnover declared on form VAT-100. If the turnover appears
to be less, the reasons may be ascertained. If the second VAT return filed
by the dealer is 'NIL' i.e., there is no taxable sale even at the end of 60
days, then the R.C. may be cancelled after giving notice to the dealer.
(8) Whenever a new dealer applies for statutory forms, the CTO/AC
may exercise caution in issuing the same. As far as possible an advisory
visit may be carried out before issue of any statutory forms. If the dealer
applies for statutory forms subsequently, the utilization details of the forms
issued earlier may be compulsorily obtained and compared with the returns
filed, if any.
(9) The Registering Authorities are advised to exercise due care at
the time of issue of R.C., by following various methods like examining
available records, pre registration/advisory visits, counselling/advising the
dealer.
(10) Instead of issuing R.Cs indiscriminately and cancelling some of
them at a later date, it is preferable that R.Cs are issued with due caution.
(11) It is suggested that the Deputy Commissioners (CT) should review
the status of new registrations issued in their divisions every month, whether
the first return has been filed and whether any statutory forms were obtained
in the new cases.
(12) Disciplinary proceedings will be initiated against those Officers
who do not exercise due care and diligence in adhering to the procedure
discussed above.
16.1 Interpretation on “made ups” in entry 52 of Schedule IV
[CCT’s Circular No.A.III(1)/7/2005-06, dt. 28-10-2005]
By G.O.Ms.No.1564, Revenue (CT-I) Department, dt. 17th August,
2005 published in A.P. Gazette Dt.18th August, 2005, some changes have
been made to the entries in the Schedules to AP VAT Act, 2005. One of
the important changes made is with regard to the Entry 52 dealing with
Ready-made Garments. The following words “bed sheets, pillow covers,
towels, blankets, travelling rugs, curtains, crochet laces, zari, embroidery
articles and all other made ups” have been added to the Entry 52.
It is noticed that many dealers are not paying taxes on the items
mentioned above though they were hitherto falling under the residuary entry
in ‘Schedule-V to the AP VAT Act, 2005. To reduce the tax burden on
these items and also to avoid confusion, specific items were added by an
amendment to the Entry 52 of Schedule-IV. There is substantial revenue
potential in these items because the dealers were earlier camouflaging the
sales of these items as sales of cloth attracting AED. It is, therefore, felt
necessary to clarify that any processing done to textiles subsequent to
production through power looms will categorize them into “made ups” and
no AED is attracted subsequent to the production of cloth from the power
looms. All the officers working at the field level are requested to identify
the dealers dealing in such items, scrutinize their VAT returns carefully
and also to verify the transactions during the course of VAT audits and
ensure that the tax @ 4% on sales of these items is collected.
While implementing these instructions, the officers should also take
into account the entry 21 in Schedule-I to the Act dealing with the “goods
produced from handlooms” and the circular issued earlier in this regard.
The products coming out of handlooms are to be treated as exempted under
the provisions of AP VAT Act, 2005. At the same time any cloth produced
from power looms and processed at a subsequent stage, for example, a
sari coming out of a power loom processed further by some zari work or
hand work etc., shall be liable to tax @ 4%.
The Deputy Commissioners (CT) of the divisions are requested to see
that the instructions are fully complied with and the taxes involved are
collected at the earliest.
16.2 Levy on Textile made-ups confined to dealers with Rs. 1 Crore
Turnover
[Circular No. AIII(1)/2006 dt. 30-6-2006]
Sub:– APVAT Act, 2005 – Tax on Sales of Textile made-ups – Certain
instructions to field officers – Issued – Reg.
Ref:–Govt. Memo No. 41307/CT-II(2)/2006-1, Rev (CT-II) Dept., dt. 14-
6-2006.
All the Deputy Commissioners (CT) in the State are informed that
nearly 227 dealers are identified in all the divisions in textile trade having
a turnover of more than Rs. 1 Crore per annum. All these dealers with
Rs. 1 Crore Turnover per annum shall be covered for the present to collect
the tax on sales of textile made-ups. For that purpose, the following
instructions are to be issued to field officers.
(1) Only Textile Traders with sales of textile made ups having Gross
Turnover (including cloth) higher than Rs. 1 Crore per annum will be
covered.
(2) Textile made ups on handloom cloth and Khadi Cloth are not
taxable. Small consignments of less than Rs. 50,000/- should not be detained
or held up to collect taxes on textile made-ups while the goods are in transit.
(3) Any attempt by big dealers to disintegrate business into two or
more separate registrations must be carefully watched and proposals of new
VAT registrations in the category of textiles should be scrutinised carefully
before registration.
(4) Textile traders not having sales of textile made-ups and small
traders having sale of textile made-ups will not be covered for the purpose
of levy of tax.
(5) Self help groups and Dwacra will not be covered for the purpose
of levy of tax on textile made-ups.
Further, vide reference cited it is clarified by the Government, that
as per item (entry) 49 and 21 of 1st Schedule of APVAT Act, 2005, and
also under Entry 52 of IV Schedule of APVAT Act, 2005.
All the Deputy Commissioners are requested to acknowledge the
receipt of this letter by return of post.
T. Yugandhar Reddy
For Commissioner of Commercial Taxes
17. Finalisation of tenders against speen No. PFc/CETT-03/2005-Rates
of Value Added Tax
[CCT’s Ref:AIII(1)/383/05, dated 08-11-2005]
Sub:– APVAT Act, 2005 – Finalisation of tenders against speen No.
PFC/CETT-03/2005-Rates of Value Added Tax – Requested
– Informed – Ref.
Ref:– C.E. Telecom & I.T. , A.P. Trans Co., Hyd. Lr.No.CETC2/
1/PFC/CETT-03/05/D.No.217/05, dated 19-10-2005.
With reference to your Lr. Cited, I am to inform that the following
goods are taxable at 12.5% under APVAT Act, 2005
(1) 48-V-VRLA Battery sets (150 AH & 250 AH)
(2) 48V Floot cum boost chargers (35A & 50A)
Further the goods are liable to entry tax @ 12.5% when imported
from outside the State for purposes other than for resale in the State.
18.1 Levy of tax on lifts under Entry 82 of the First Schedule
[Memo. No. 24643/CT-II(1)/2005-1, dated 17.11.2005]
Sub:– APGST Act, 1957 – Levy of tax on lifts under Entry 82 of
the First Schedule – Certain instructions issued to all the DC's
– Certain Clarification issued – Regarding.
Ref:– From the CCT Lr. No. AI(1)/316/2005, dated 17.5.2005.
With reference to the letter cited, and keeping in view of the judgment
of the Hon'ble Supreme Court in the case of State of Andhra Pradesh vs.
M/s. Kone Elevators (India) Ltd., (140 STC page 22), it is hereby clarified
that the tax shall be levied on the supply of elevators and lifts, with
prospective effect only.
(2) The Commissioner of Commercial Taxes Andhra Pradesh, Hyderabad
should take necessary action accordingly.
18.2 Levy of tax on lifts under Entry 82 of the First Schedule
[CCT's Ref. No. A1(I) 316/2005, dated 8-12-2005]
Circular
Sri V. Bhaskar, IAS., Commissioner of Commercial Taxes
Sub:– APGST Act, 1957 – Levy of tax on lifts under Entry 82 of
the First Schedule – Certain instructions issued to all the DC's
– Certain Clarification issued by Govt. – Communicated –
Regarding.
Ref:– (1) CCT's Ref. No. AI(1)/316/2005, dated 30.4.2005.
(2) Govt. Memo No. 24643/CT-II(1)/2005-1, Revenue (CT-
II) Dept.
A copy of the Government memo 2nd cited is sent herewith to all
the Deputy Commissioners (CT) in the State. They are requested to
communicate the same to their subordinate officers and local chamber of
commerce.
19. Implementation of Ordinance 24 of 2005
[CCT’s Ref. No. AIII(1)/184/2005-8, dated 9-12-2005]
Sub:– APVAT Act, 2005 – Ordinance further to amend the Andhra
Pradesh Value Added Tax Act, 2005 – Issued – Amendment
to sub-section (9) of Sec. 4 of the Act – Instructions issued
– Reg.
Ref:– (1) Andhra Pradesh Ordinance 24 of 2005, dated 24-11-2005.
An Ordinance to amend the APVAT Act was promulgated vide reference
cited, wherein existing sub-section (9) of Section 4 of the Act was substituted
as under:
“(9) Notwithstanding anything contained in the Act, every dealer
running any restaurant, eating house, catering establishment, hotel, coffee
shop, sweet shop or any establishment by whatever name called and any
club, who supplies by way of or as part of any services or in any other
manner whatsoever of goods, being food or any other article for human
consumption or drink shall pay tax at the rate of twelve and half percent
(12.5%) on sixty percent (60%) of the taxable turnover, if the taxable
turnover in a period of preceding twelve months exceeds Rs. 5,00,000/-
(Rupees five lakhs) or in the preceding three months exceeds Rs. 1,25,000
(Rupees one lakh twenty five thousand).”
It is clarified that all the dealers covered under revised Section 4 (9)
are liable to be registered compulsorily for VAT. They are also eligible
to claim input tax credit based upon valid VAT invoices.
Consequent to this amendment, certain action has to be initiated by
the department to identify all these dealers, ensure that they are registered,
file monthly return & pay taxes regularly. The following instructions should
be scrupulously adhered to.
1. The provisions of the sub-section (9) of Section 4 of APVAT Act
are applicable to every dealer running any restaurant, eating house, catering
establishment, hotal, cofee shop, sweet shop, or any establishment (Bar &
restaurants, canteens, messes etc.) by whatever name called and any club.
2. The CTO has to identify such dealers mentioned in point 1 above
whose taxable turnover in last 12 months in more than Rs. 5,00,000/- or
more than Rs. 1,25,000 during the last 3 months period.
Such dealers can be identified by verifying the Turnover Tax returns
filed by them for last two quarters and/or by verifying the AA9 returns
filed by them for the year 2004-2005. In addition for persons who have
not filed returns earlier, the CTO concerned should obtain the particulars
of expenditure incurred on purchase of gas (commercial use), purchases
of cool drinks, ice creams, milk, electricity consumption and expenditure
on establishment of the dealer including rent to estimate his sales turnover
and determine his eligibility for registration under VAT.
3. All such dealers should be issued VAT registration with EDR from
1-12-2005.
4. Such dealer will have to pay tax @ 12.5% on 60% of the taxable
turnover which amounts to 7.5% on taxable turnover, and are eligible to
claim input Tax Credit on eligible inputs.
These dealers shall collect tax @ 12.5% on 60% of the bill amount.
Alternately these dealers can collect tax @ 7.5% on total value of the bill
from the customer.
Rupees
For Ex: If the Total value of the bill is 100.00
60% of the value 60.00
Tax @ 12.5% on Rs.60* 12.5% 7.50
Total Value (bill value Rs. 100+tax Rs.7.50) 107.50
Alternate method:
Total value of the bill 100.00
Tax @ 7.5 on Rs. 100* 7.5% 7.50
----------
Total value 107.50
----------
Since 7.5% is not a VAT rate following the former method where
a tax of 12.5% is shown is desirable.
In case, the amount collected is inclusive of VAT, then the dealer
should bifurcate his turnover for the purpose of calculation of output tax
assuming that the total value of the bill is inclusive of tax @ 7.5%. The
tax element by applying tax fraction i.e. X*7.5/107.50, where X is the total
bill value.
Since the dealer has to pay @ 12.5% on 60% value he has to take
the total value of the bill less element and take out 60% of the remaining
turnover and arrive at output tax @ 12.5%.
For example :
Rupees
A. The total value of the bill including tax 100.00
B. Tax fraction 100x7.5/107.5 7.00
C. Value of the food items (A-B) 93.00
D. 60% of C is (93 x 60%) 56.00
E. Tax @ 12.5% on 60% value i.e. Rs. 56 7.00
F. Output tax in this case is 7.00
The provisions of the amended section are now applicable to bar and
restaurants also. However to arrive at taxable turnover, for the purpose of
calculating output tax, the turnovers relating to sale of liquor served in
bar restaurants shall be excluded. The remaining turnover should be treated
as taxable turnover and subjected to calculation as mentioned above to arrive
at output tax.
5. Hitherto the dealers with taxable turnover exceeding Rs. 5 lakhs

but below Rs. 40 lakhs were paying tax @ 1% on their taxable turnover.
All these dealers are now liable to pay at the revised rate due to increase
in tax rate. For example: A Hotel with Rs. 10,00,000/- food sales for a
period was liable to pay Rs. 10,000/- only as tax prior to the amendment
whereas the same hotel has to pay now Rs. 75, 000/- towards tax due on
same turnover less input tax credit eligible.
It may be noted that consequent to the amendment, there are only
two categories of hotels, eating establishments
(a) Those with turnover below Rs. 5 lakhs per annum which are totally
exempted.
(b) Those above Rs. 5 lakhs per annum which will pay 12.5% on
60% of the turnover and avail input tax credit. There is no
composition scheme for restaurants, eating houses, hotels, clubs
etc.
6. Effective steps should be taken by all assessing authorities to register
all dealers to arrest evasion and to ensure proper filing of returns and prompt
payment of taxes.
The Deputy Commissioners should issue suitable instructions to the
subordinate officers and shall monitor the progress of implementation of
the instructions periodically and report compliance.
The receipt of these instructions should be acknowledged by return
Mail.
20.1 Works Contracts – TCS/TDS – Procedure for Streamlining the
accounting of TCS and TDS
[CCTs Ref. A.III (1)/441/2005-10, dt.15-12-2005]
Sub:– AP VAT Act 2005 – Works Contracts – TCS/TDS – Procedure
for Streamlining the accounting of TCS and TDS at the
Division/Circle Offices – Issued – Regarding.
It is observed that the procedure of collection and accounting for of
IDS is not uniform in all the divisions and it is resulting in wrong reporting
of revenue collections. There are instances of reporting revenue in the
circles, where the dealers are not actually registered with that circle, on
the plea that the deducting authority is located in the jurisdiction of the
circle and TDS amounts. To avoid this confusion and eliminate double
reporting of revenue, it is proposed to streamline the procedure relating
to the TCS and TDS as under.
I. Provisions relating to TCS :

As per Section 22 (3) of AP VAT Act 2005, read with Rule 17(2)(h),
the Government Department has to collect the tax (TCS - Tax Collection
at Source) @ 4% on total value of contract and remit the tax amount within
15 days from the date of payment to the contractor. As per Rule 17 (2)
(d) the contractor has to obtain Form 501 filled in all respects and duly
signed by the contractee (the Government Department) and submit it along
with the return on Form VAT 200 on or before the 20th of the following
month to the month in which tax collection at source was made. Box 10
of the Form 501 should contain remittance particulars of TCS.
It may be noted that where the contractee fails to remit such tax
collected/deducted at source within fifteen days of the payment to the
contractor, the authority concerned shall be liable to pay penalty and interest
for the delayed payment. (Rule 17 (2) (h) in case of Government Department
or local authority and Rule 17 (3) (i) in case of other contractees).
Note:– Remittance of such tax collected may be by way of book
adjustments or challan or by drawing the instrument (Demand Draft, banker’s
cheque, cheque, etc.,) on the name of the AC (LTU)/CTO concerned, with
whom the contractor is registered/and on the name of authority in whose
jurisdiction the contractee is located in cases of contractors not registered
with the tax department.
II. Provisions relating to TDS :
As per Section 22 (4) of APVAT Act, 2005 read with Rule 17 (3)
(i) and Rule 18, contractee (other than Government/local bodies) has to
deduct the tax 4% of the amount paid or payable to the contractor at the
time of each payment and remit such tax amount within 15 days of payment
to the contractor. As per Rule 18 (1) (b) the contractor has to obtain Form
501-A from the contractee and submit it along with the proof of payment
to the authority prescribed along with the return on or before 20th of next
month.
Note:– Remittance of such tax deducted may be by way of book
adjustments or challan or by drawing the instrument (Demand Draft, banker’s
cheque, cheque etc.) on the names of the AC (LTU)/CTO concerned, with
whom the contractor is registered/or on the name of authority in whose
jurisdiction the contractee is located in cases of unregistered contractors.
The following procedure is to be followed by the contractees, the
contractors and the commercial taxes department for the smooth functioning
of the system.
VAT–62
I. Procedure to be followed by the Contractees :

(1) For the sake of convenience, the tax collecting/deducting authority
may remit all such taxes collected/deducted during the month by way of
single instrument, within 15 days after the end of the month. Appropriate
amendments are being made in the rules. However the contractee (tax
collecting/deducting authority) can remit or issue an instrument separately
for each contractor wherever convenient or desired by the contractor.
(2) In the case of contractee Government Department or local authority
concerned shall make out Form 501/on the name of the VAT contractor
at the time of tax collection/deduction itself, in duplicate and supply a copy
of such Form to the contractor and furnish the other copy to the person
authorised from tax department to collect the TCS particulars from his
office.
(3) In the case of contractees other than Government Department or
local authority, the contractee shall complete Form 501-A indicating the
TIN, the amount of tax deducted and details of the related contractee. The
contractee shall supply a copy of such Form to the contractor at the time
of deduction itself and furnish another copy along with the draft/challan
to the authorised person in the CT department.
II. Procedure to be followed by the contractor :
(1) VAT Registered Contractor : The contractor shall submit the Form
501/Form 501-A certified by the contractee together with Form VAT 200
by the 20th of the month following the month in which payment was
received.
(2) In case of TDS the contractor shall pay any balance of tax payable
after adjusting the amount of TDS on Form 501 A in Box 22 (a) of VAT
Return to the tax due.
III. Procedures to be followed by the department : In case of TCS/
TDS :
(1) The Deputy Commissioner of the division shall appoint an office/
a person to collect the particulars of TCS/TDS from the office of the
contractees and to collect Demand Drafts (DDs) from the offices of all
contract/awarding authorities (state, central, banks, local authorities etc.)
including 'Sub-Registrar (Registration) located in their jurisdiction'.
(2) The office/person so appointed shall visit the office of TCS/TDS
authorities on or before 15th of every month and collect the instruments,
Forms 501/501-A, if any, along with the list of contractors (summary of
all payments issued in 501/501-A) from whom TCS/TDS is made and
remitted.
(3) The office/person so appointed shall maintain a Register in the

prescribed proforma, which is enclosed. (Annexure-I)
(4) After obtaining the book adjustment Ref. No/challan/demand draft/
banker’s cheque or cheque, the particulars of the instrument so obtained
shall be entered into VATIS through the payment window “TCS/TDS/
Miscellaneous payment” only even though TIN is available, in the office/
person collecting the particulars.
Path – Payments – TCS/TDS/Miscellaneous payments – Name of the
contractee
(a) Entering payments through this window avoids double credit to
the registered contractor. If the payments are entered against TIN
of the registered contractor, it results in double credit as the
amounts in Form 501-501-A are also taken as adjustments against
payments.
(b) Further it will be convenient to get the reports relating to the TCS/
TDS revenue.
(c) This will also facilitate to correlate the remittance particulars with
the Box 10 of Form 501/501-A. Hence this mode is adopted to
enter TCS/TDS payments.
(5) Where the contractor himself collects the instrument in case of
TCS/TDS, he will deposit it along with Form 501/501-A at the time of
filing of return to\the concerned AC LTU/CTO. In this case challan should
be generated by entering payments through window mentioned in point 4
mentioned above.
(6) Where a registered contractee (For e.g., HEL, MRF etc.) made
TDS from payments made to the contractors and submits those particulars
along with his own return to the AC LTU/CTO concerned, the remittance
particulars so supplied shall be entered in the service in which it is received
through the payment window “TCS/TDS/Miscellaneous payment” only (as
detailed in point 4 above) but not against the TIN of the contractee. Please
take care that such deducted amounts shall not be credited to the deducting
registered contractee. The particulars of deductions shall be sent to the
office/person authorised in the division.
(7) Such registered contractee shall submit list of contractors from
whom TDS is made along with a copy of Form 501-A (for each registered
contractor). The officer who received Form VAT 501-A in this case shall
send it to the Circle Office concerned, where the contractor is registered.
In case of Builder contractors :

(1) In case of collection of Demand Drafts (DDs) from the sub-
registrar’s office, the officer/person so appointed shall visit the sub-registrar’s
office in their jurisdiction on every Saturday and collect the DDs.
(2) The officer/person so appointed shall maintain a Register in the
prescribed proforma, which is enclosed? (Annexure - II)
(3) After obtaining the DDs, the DDs relating to registered builder
contractors shall be sent to the concerned authority, and the DDs relating
to unregistered contractors shall be entered in to VATIS through window
“TCS/TDS/Miscellaneous payment”.
Path – Payments – TCS/TDS/Miscellaneous payments – Name of the
contractee.
(4) The DDs relating to registered contractors shall be entered into
VATIS through window “Record payment details” in the concerned offices.
Path – Payments – record payment details – TIN – DD
Revenue Reporting
As it is considered that the amounts in Form 501-501-A are treated
as tax paid by the contractor against his liability, the officer collecting TCS/
TDS has to deduct the amounts relating to registered contractors from the
total amount and the remaining amount relating to unregistered contractors
may be retained by him. He can report the collections relating to unregistered
contractors as his circle/divisions revenue. The amounts referred to in Form
501/501-A will be the revenue of the circle where contractor is registered.
Action Plan
(1) The procedure prescribed shall be implemented from 01-01-2006.
(2) There should not be any reporting of TCS/TDS by the statistics
wing in the office of Commissioner of Commercial Taxes. The revenue
reporting of TCS/TDS will now onwards be done by the divisions only.
(3) The instructions issued shall be followed scrupulously by all the
Deputy Commissioners in the State.
(4) The name and designation of the officer/person appointed for the
purpose of collecting the particulars, as well as the institutions/contractees
from where such payments are to be collected, should be sent to this office
by 30-12-2005.
(5) The Deputy Commissioners concerned shall obtain the list of TCS/
TDS authorities/Sub-registrars offices located in their jurisdiction and send
a copy to this office.
(6) The collection office should ensure that there should not be
reporting of revenue relating to registered contractors whose revenue will
be credited to the circle where they are registered. In case of any deviation,
as this amount to double reporting of revenue, suitable action will be
initiated on the person responsible.
(7) It should be ensured that the Registers prescribed are maintained
properly.
(8) This work shall be reviewed periodically by the Deputy
Commissioner concerned.
20.2 Works Contracts
[G.O.Ms.No.1, W & P Dept., dated 24-01-2006]
Ref : (1) G.O.Ms.No.11, Finance (Works & Projects F.8) Dept.,
dt.29.07.2005
(2) From the Commissioner of Commercial Taxes, D.O. On
CCT’s Ref.No.A.III(1)/78/2005, dt. 02.01.2006
Order :
In the circumstances stated by the Commissioner of Commercial Taxes,
in the letter second read above, the following amendment is issued to the
G.O. first read above.
Amendment
In place of point(11) of instructions, the following shall be substituted:
“In respect of all works costing more than Rs.5 lakhs each, no work
should be awarded without the successful tenderer submitting copy of his
VAT registration certificate incorporating Tax Identification Number(TIN).
A copy of such registration shall be annexed to the agreement.”
20.3 Levy of tax on goods imported from outside the State and used
in the execution of Works contracts
[CCT's Ref. No. AI(3)/911/2005-1 dated 23-1-2006]
Sri V. Bhaskar, IAS, Commissioner of Commercial Taxes
Sub:– APGST Act and APVAT Act – Levy of tax on the goods
imported from outside the State and used in the execution of works contracts
– Certain instructions – Issued – Reg.
The question whether tax under Local Sales Tax Act (APGST/APVAT
Acts) can be levied on the goods, imported from outside the State and
used by the Works contractors in the execution of works contracts in the

State of A.P. has been coming up repeatedly.
In the case of works contracts, when it is said that there is no tax
on goods, imported in the course of inter-State trade and commerce, it is
imperative to verify as to which contract has occasioned the movement
of such goods from outside the State. It is claimed by the some Works
Contractors that the contract for execution of Works entered into by them
with the contractee, has occasioned the movement of the goods. The
contention is being accepted by the assessing authorities/revision authorities
and no local tax is levied. However, there is a need to verify such claim
with reference to the nature as well as the terms and conditions of the
contract. In order to establish that the contract between the works contractor
and the contractee has occasioned the movement of the goods from outside
the State, or alternately there should be no choice for the contractor but
to import such goods from outside the State or alternately there should
be no choice for the contractor but to import goods from outside the State.
If the works contractor is not under such a contractual obligation or is
not forced to import the goods from outside the State, movement of such
goods cannot be said to have been occasioned by such a contract. In such
a case, the contract that occasions the movement of goods from outside
the State is an explicit or implicit contract, entered into by the Contractor
within the State with the selling dealer outside the State and such a contract
is independent of Contract, entered into by the contractor with the contractee.
It is so, because the purchase of goods from outside the State by the
Contractor is not in pursuance of the discharge of the contractual obligations
and the event of incorporation of goods in the execution of works is not
in continuity with the inter-State movement of the goods from outside the
State. Therefore, unless, it is established that the purchase of goods from
outside the State is in pursuance of the discharge of the contractual
obligations, either explicitly or implicitly cast on the Contractor by virtue
of the Contract between him and the contractee, all the goods imported
from outside the State and used in the execution of works contract are
liable to tax under the Local Sales Tax (APGST/APVAT Act).
In case the works contractor is not liable to pay tax on the goods,
imported from outside the State, by virtue of the reason that such import
is as a result of his contractual obligation under the Contract between him
and the Contractee, the liability to pay the entry tax wherever applicable
is on the Contractee, who is the "importer", according to the definition
of the term in the A.P. Tax on Entry of Goods into Local Areas Act. The
definition of the "importer", is as follows:
Sec. 2(h): "Importer means a person who brings or causes to be

brought any goods whether on his own account or an account of a principal
or any other person, into a local area, from any place outside the State
for consumption, use or sale therein or who owns the goods at the time
of entry into a local area.
In the circumstances, mentioned above, the Contractee is the "importer",
since he causes to be brought the goods into local area by virtue of the
terms and conditions of the Contract between him and the contractor.
Therefore all the assessing authorities and revision authorities are
directed to examine the terms and conditions of the contracts, entered into
by the works contractors with the Contractees, and assess to tax the goods
imported from outside the State and used in the execution of the works,
if the contractors are found to be under no contractual obligations under
the contract between them to necessarily import the goods from outside
the State and incorporate the same at the time of execution of the works.
If that is the case, wherever applicable the Contractees should be assessed
to tax on the value of such goods, imported, under the A.P. Tax on Entry
of Goods into Local Areas Act.
20.4 Works Contracts – One transfer of property in goods
[CCT's Ref.No.AIII(3)/233/2006 dt. 31.08.2006]
Sri T.S. Appa Rao, I.A.S., Commissioner of Commercial Taxes,
A.P., Hyderabad.
Sub:– A.P. VAT Act, 2005 – Certain clarification sought on works
contracts – Request – Orders issued – Reg.
Ref:– Repn. from M/s. CEC International Corporation (India) Pvt.Ltd.
With reference to the representation cited you are informed that there
is only one transfer of property in goods to unit in Special Economics Zone
and it is zero rated. It is immaterial whether contractor or his agent (sub
contractor) is executing works contract. Hence the transaction is free from
levy of tax subject to condition that both the main contractor and the sub-
contractor should be registered with special economic zone so as to claim
Input Tax Credit on purchases from local VAT dealers.
21. VAT Audit
[CCT's Ref. No. BII(2)/122/2006, dated 19-6-2006]
Circular
Sri T.S. Appa Rao, I.A.S., Commissioner of Commercial Taxes.
Sub:– APVAT Act, 2005 – VAT Audit – Instructions issued –

Procedure for conducting Audit – Target of audit for the year
2006-2007 – Communicated – Regarding.
Ref:– CCT's Circular No. PMT/P&L/2005-06, dated 11-8-2005.
You are aware that audit is one of the four pillars of VAT administration
and that the system of inspection and assessment as separate functions under
A.P.G.S.T. Act, 1957 is replaced by the system of audit under VAT regime.
VAT being a self assessment, the audit functionally is significant in bridging
the gap between the tax legally due and tax declared by the assessee.
It is expected that Deputy Commissioners being controlling and
supervisor officers of the divisions have to ensure that powers under Section
43 read with Section 21 of the APVAT Act, 2005 are exercised by field
officers effectively to serve dual purposes of improving voluntary compliance
and acting as deference for evasion. It is, therefore, necessary that adequate
and qualitative audits are taken up to unearth evasion and to increase the
revenue collection.
In order to achieve tangible results, various issues pertaining to the
audits were discussed elaborately during the conference of the Deputy
Commissioners held on 8.6.2006 and 9.6.2006. Pursuant to the discussions,
decision was taken to adopt the following strategy for future audits and
to fix norms for audits in 2006-2007. The following instructions are issued
for compliance:
1. Strategy for general audits:
(a) The selection and authorization of audits shall be done only through
VATIS System.
(b) All cases in LTU of the divisions should be audited atleast once
in 2006-2007.
(c) All top 50/100VAT registered dealers falling into the categories
of manufacturers, companies, sensitive commodities, seasonal agricultural
commodities, wholesalers, dealers having complex transactions such as
exports, consignment sales, branch transfers, contractors etc., audited once
in one year/once in two years. A List of top dealers to be audited in 2006-
2007 and 2007-2008 shall be prepared and communicated.
(d) All credit return dealers whose excess ITC is more than Rs. 50,000
as on date should be audited before March, 2007. A list of credit dealers
shall be prepared Circle/Division-wise with excess input credit tax in
descending order and sent to Headquarters.
(e) All other dealers may be grouped into the category of audit once
in three years or four years cycle. Depending on the revenue potential risks
cases can be selected by the Deputy Commissioner concerned.
The following target of general audits for 2006-2007 are fixed:
(a) Deputy Commissioners should fix the target of audits to each
officer under their control.
(b) The Deputy Commissioners are also permitted to take up specific/
special VAT audit of a specific dealer/(s) outside the VATIS system if so
required. However the data has to be entered into the VATIS system.
(c) 5-7 audits in a month per officer is the bench mark prescribes/
established.
(d) A target of 8 to 10 audits are fixed to each officer for a month
in every circle.
The Division-wise target of audits are enclosed as Annexure-I.
(e) Beside the C.T.Os and D.C.T.Os, the Assistant Commissioners,
Commercial Tax Officer (Intelligence) and Commercial Tax Officer (Audit)
in the division shall also be entrusted with the function of VAT audits.
The office-wrise details may be sent to Central Computer Wing O/o The
Commissioner (CT) for generation of User Ids and passwords, if any officer
had no user Id/access to VATIS as of now.
(f) Overall target for the year 2006-2007 is 50,000 audits, with a
strength of 700 auditing officers.
The following steps for conducting general audits shall be followed
sequentially/strictly:
(i) The CTO/AC shall select the cases fit for audit based on sound,
rational lines, and shall furnish notification of list of VAT dealers selected
for audit in VAT Form ADM – I A to the Deputy Commissioner (CT)
concerned, who shall maintain a record at divisional level. Any difficulty
to generate the list of dealers selected for audit through VATIS, shall be
promptly notify to Central Computer Wing through CCW
helpdesk@apcommercialtaxes.gov.in by emails.
(ii) The Deputy Commissioners/Assistant Commissioners concerned
shall issue Audit Visits authorization in Form ADM-I B.
(iii) Thereafter Notification of advisory/Audit Visit to these VAT
dealers shall be issued in VAT 304. Wherever 304 can not be served in
advance, it should be generated through VATIS and retained by Officer
conducting audit. This should be produced if asked by dealer at the time

of audit. This ensures avoidance of multiple audits by different officers
for the same dealer and also prevents unauthorized audits unless VAT 304
is generated through VATIS, then any VAT-305 demand raised, cannot be
entered/processed through VATIS. The Deputy Commissioners are authorized
to issue specific audit orders without issuing form 304 for purpose of
effectiveness. However before issue of 305-A notice, in all such cases form
304 has to be generated.
(iv) In case if the audit as authorized in Form 304 cannot be completed
for valid reasons the authorization for non-completion of audit in Form
ADM-I C is required to be issued.
(v) The notice of assessment of Value Added Tax in Form 305A shall
be issued wherever necessary.
(vi) Then the assessment of Value Added Tax shall be done in VAT
305.
(vii) The show cause notice and assessment orders (305A and 305)
must be speaking order with findings in detail.
(viii) Penalty proceedings may have to be issued separately.
(ix) In the event of finding of under-declaration of Value Added Tax
or over declaration of value added tax, the Notice in VAT 307 and VAT
308 respectively shall be issued.
(x) All Deputy Commissioners are requested to send audits conducted
in each fortnight in the proforma of Annexure-II. The Deputy Commissioners
are requested to send detailed compliance/action taken through special
reports besides in the Annexure-II. Performance and progress of audits will
be reviewed monthly by the Commissioner of Commercial taxes.
22. Uniformity in Rice Mill assessments
[CCT's Ref. No. A(1)/449/2006, dated 5-7-2006]
Circular
Sub:– APGST/CST Acts – Uniformity in Rice Mill assessments –
Review of Case Law – Guidelines issued – Regarding.
Ref:– (1) CCT's ref. A11(2)/18/2003, dated 24.2.2003 addressed to
all Deputy Commissioners (CT).
(2) CCT's ref. A11(2)/18/2003, dated 12.12.2003, addressed
to all Deputy Commissioners (CT).
(3) CCT's ref. A11(2)/18/2003, dated 27.7.2004, addressed to

all Deputy Commissioners (CT).
(4) SLP No. 27102-27129/2004, dated 2.9.2005 of Supreme
Court of India.
invited to the references cited. They are informed that in view of the facts
that the S.L.P., filed against the decision of the A.P. High Court in the
case of West Godavari Rice Millers Association vs. State of A.P., (38 APSTJ
320) was withdrawn and such withdrawal was accepted by the Hon'ble
Supreme Court of India in reference 4th cited, the decision of the A.P.
High Court in the above case may be followed in all cases, where assessments
and revisions were made on the basis of the decision of the APSTAT in
the case of M/s. Satyanarayana Raw and Boiled Rice Mills vs. State of
Andhra Pradesh, (34 APSTJ 153) dated 21.7.2000.
Therefore, all the Deputy Commissioners (CT) in the State are hereby
directed to issue suitable instructions to all the assessing authorities to give
effect to the decision of the Hon'ble A.P. High Court in the case of West
Godavari Rice Millers Association vs. State of A.P., (38 APSTJ 320) by
passing appropriate orders in respect of all relevant assessments and revisions.
23. Ready Mix Concrete Plate
[Memo. No. 24437/CT-II(1)/2006-1, dated 18-7-2006]
Sub:– APGST Act, 1957 – Ready Mix Concrete Plate – Request for
waive Exemption of pumping charges and acceptance of "G"
form to claim concessional Rate of Tax under Section 5-B
– Clarification – Orders – Issued.
Ref:– (1) Representation of M/s. Grasim Industries, Hyderabad, dated
28-4-2006.
(2) CCT's Ref. No. AI(1)/334/2006, dated 29-5-2006.
In the G.O. Ms. No. 496, Revenue (CT.II) Dept., dated 17.7.2001,
a notification was issued notifying non-eligible items for claiming concessional
rate of tax U/S. 5-B of the APGST Act, 1957, and cement was one of
the items.
(2) The Commissioner of Commercial Taxes vide his letter 2nd cited
has requested the Government to clarify whether "Ready Mix Concrete"
comes under the entry 'Cement' mentioned at Sl.No.10, in the list of
ineligible goods notified under the above G.O.
(3) The Government after careful examination of the matter has come
to a conclusion that the "Ready Mix Concrete" is different commodity from
the 'cement' as per the classifications made under Taxation Laws including
the Clarification made under the Central Excise Act. The Government
therefore hereby clarifies that the entry 'cement' mentioned at the Sl.No.10,
in the list of ineligible goods notified under G.O. Ms. No. 496, Revenue
(CT.II) Dept., dated 17.7.2001, does not include "Ready Mix Concrete".
(4) The Commissioner of Commercial Taxes, Andhra Pradesh,
Hyderabad is therefore requested to take necessary action.
24. Ready Mix Concrete Plate
[CCT's Ref. No. AI(1)/334/2006, dated 2-8-2006]
Circular
Sub:– APGST Act, 1957 – Ready Mix Concrete Plate – Request for
waive Exemption of pumping charges and acceptance of "G" form to claim
concessional Rate of Tax under Section 5-B – Clarification – Orders –
Issued – Regarding.
Ref:– (1) Representation of M/s. Grasim Industries, Hyderabad, dated
28.4.2006.
(2) CCT's Ref. No. AI(1)/334/2006, dated 29.5.2006.
(3) Govt. Memo No. 24437/CT.II(1)/2006-1, dated 18.7.2006.
A copy of the Government Memo issued in the reference 3rd cited
is herewith communicated to all the Deputy Commissioners (CT) and
Appellate Deputy Commissioners (CT) in the State for information and
necessary action in the matter.
25. Provisional attachment of the property of the dealer under Section
27(2) of the APVAT Act, 2005 – Certain Instructions
[CCT's Ref. No. L.II(4)/1195/2006, dated 30-8-2006]
Circular
Sub:– APVAT Act, 2005 – Provisional attachment of the property
of the dealer under Section 27(2) of the APVAT Act, 2005
– Certain Instructions – Issued.
Ref:– Orders of the Hon'ble High Court of A.P. dated 20.7.2006 in

WPMP No. 17691/2006 in W.P. No. 14207/2006.
It is noticed that some of the assessing authorities are resorting to
issue of proceedings of provisional attachment under Section 27(2) of the
APVAT Act, 2005 without obtaining the previous approval of the
Commissioner of Commercial Taxes as required thereunder. Such proceedings
would, no doubt, run the risk of being suspended by the judicial forums
on the grounds of non-compliance with the vital condition imposed under
the said section.
Therefore, all the Assessing Authorities in the State are directed not
to resort to the issue of proceedings of provisional attachment under Section
27(2) of the APVAT Act, 2005 without obtaining previous approval of the
Commissioner of Commercial Taxes. Any deviation in this regard will be
treated as gross negligence on the part of the authorities, concerned.
26. Levy of purchase tax under Section 6-A on the purchase of Milk
from farmers classifying them as unregistered dealers
[CCT's Ref. No. A1(1)/195/2006, dated 28-11-2006]
Circular
Sub:– APGST Act, 1957 – Levy of purchase tax under Section 6-
A on the purchase of Milk from farmers classifying them as
unregistered dealers – Further Orders – Issued – Regarding.
Ref:– (1) CCT's Ref. No. AI(1)128/2005, dated 11-4-2005.
(2) CCT's Ref. No. L.IV(4)/21/2005, dated 23-3-2006.
(3) Representations from M/s. Dodla Dairy Ltd., Nellore,
dated 16.8.2006 & 17.8.2006 and M/s. Dairy Industry
Association, Hyderabad dated 17.8.2006.
(4) CCT's Ref. No. AI(1)/195/2006, dated 20-9-2006.
(5) Govt. Memo No. 37158/CT.II(1)/2006-2, dated 17-11-2006.
invited to the references cited above.
In reference 2nd cited, a Circular was issued with directions to levy
tax on the purchase of milk by the Dairies under Section 6-A of the APGST
Act, when such milk is purchased from unregistered dealers and utilized
in the manufacture and sale of its by products.
In the reference 5th cited, the Government issued clarification, stating

that the orders issued in G.O. Ms. No. 1091, Revenue, dated 10.6.1957
does not authorize levy of tax under Section 6-A of the APGST Act, 1957
on the milk purchased from unregistered dealers and utilized for obtaining
ghee & butter which are not specifically mentioned in the G.O. In the said
reference, the Government also directed the Commissioner (CT) to rescind
the circular instructions issued in the reference 2nd cited. The Government
further ordered that the demands, if any, raised or proposed to be raised
on the basis of the said circular either after or before the issue of the said
circular shall be deemed to have been waived. A copy of the Govt. Memo.,
issued in the reference 5th cited is enclosed herewith.
In view of the above clarification, issued by the Government, the
circular issued earlier in the reference 2nd cited is hereby rescinded.
Further all the Deputy Commissioners (CT) are also informed that
in accordance with the clarification, issued by the Government in the
reference 5th cited, the purchase of milk, made from unregistered dealers
by the Dairies and utilized the same for manufacture and sale of its by
products are not liable to tax under Section 6A of the APGST Act and
the demands, raised, if any, on the basis of the circular, issued in the
reference 2nd cited, shall be waived.
Therefore, all the Deputy Commissioners (CT) are hereby requested
to issue necessary instructions to the officers under their control to follow
the directions of the Government, contained in the reference 5th cited.
27. Levy of tax on seeds – Exemption on certified and truthfully
labelled seeds
[Memo. No. 49132/CT-II(1)/2006-1, dated 7-12-2006]
Sub:– APGST Act, 1957 – Levy of tax on seeds – Exemption on
certified and truthfully labelled seeds – Conflicts in
interpretations between Vig. & Enft. Department and C.T.
Department – Clarification – Orders – Issued.
Ref:– (1) G.O. Ms. No. 604, Revenue, dated 9.4.1981.
(2) G.O. Ms. No. 129, Revenue, dated 14.2.1989.
(3) Repn. received from Seedsmen Association, No. SNA/ct/
2006-07, dated 2-9-2006.
(4) From the CCT, Lr. No. AI(1)/834/2006, dated 20.10.2006.
In the G.O. first read above, exemption was granted from levy of
tax on the sales or purchases of all varieties of certified and truthfully
labelled seeds for agricultural purposes under the APGST Act, 1957 and
the CST Act, 1956, respectively. Subsequently, vide Memo No. 13630/CT-
II(2)/1989-90, dated 26.4.1999, it was clarified that both certified seeds and/
or truthfully labelled seeds are entitled for exemption in terms of the said
G.O. Further, the CCT after obtaining clarification from Commissioner of
Agriculture, Andhra Pradesh, Hyderabad, issued circular instructions in Ref.
No. AI(1)/2816/2002, dated 27.1.2003, duly mentioning that if the evidence
as recommended by the Commissioner of Agriculture, Andhra Pradesh,
Hyderabad, produced by the dealers in seeds, would amount to self
certification and is accordingly covered by exemption granted by the
Government in the said Government orders.
(2) In their representation third cited, the Seedsmen Association,
Hyderabad have represented that the instructions issued by the Commissioner
of Commercial Taxes were not followed by the Commercial Taxes Authorities
and that they are issuing show cause notices. They have therefore, requested
to issue suitable instructions in the matter, so that, the dealers are not put
to further financial difficulties in the matter.
(3) The Commissioner of Commercial Taxes in his letter fourth cited,
while offering his remarks on the representation of Seedsmen Association,
has requested the Government to issue clarification as to whether the
circular instructions issued in reference No. AI(1)/2816/2002, dated 27.1.2003
are to be followed or the tax has to be levied, as per the alert note of
the Vig. & Enft. Department. He informed that in the alert notes of the
Vig. & Enft., it was mentioned that the judgment of the A.P. High Court
in the case of M/s. Shakthi Seeds Pvt. Ltd. v. DC (CT), Abids, the unprocessed
paddy purchased by the seed companies from the farmers is exigible to
purchase tax. The Commissioner of Commercial Taxes had opined that the
above circular dated 27.1.2003, was issued only after considering all the
above facts and judgments and hence, requested the Government to issue
suitable clarification in the matter.
(4) The Government after careful consideration of the matter, hereby
clarify that the instructions in Commissioner of Commercial Taxes Clr. No.
AI(1)/2816/2002, dated 27.1.2003 were issued in consultation with the
Commissioner of Agriculture and since there is no procedure of certification
and that the basic or seed processing register and the stock register of
processed seed have to be maintained in the prescribed format as prescribed
by the Commissioner of Agriculture to identify the authorized source of
production and quality maintenance, which are only the basis to ascertain
whether the paddy or other Agricultural produce purchased is of seeds.
The exemption granted earlier by the Government in G.O's 1st and 2nd
read above, in respect of certified or truthfully labelled seeds is to ensure
supply of seeds at reasonable prices to the farmers and hence the intention
of Government is not to withdraw the exemption on some technical grounds.
(5) The Government, after careful examination of the issue, hereby
direct the Commissioner of Commercial Taxes to follow the circular issued
by him, vide No. AI(1)/2816/2002, dated 27.1.2003 in this regard; and to
take necessary action accordingly.
28. Railway Wagons – Inspection of
[CCT's Ref. No. LII(1)/400/2006-1, dt. 6-3-2006]
Sub:– AP VAT Act, 2005 – Inspection of goods carriers office by the
officials of the CT Department – Certain Instructions – Issued.
Ref:–Judgment of the Hon'ble High Court dt. 6.2.2006 in W.P.No.
271/06.
The attention of all the officers of the department is invited to the
provisions of Section 46 of the AP VAT Act, 2005. This provision empowers
the officers of the department not below the rank of the Deputy Commercial
Tax Officer to inspect the offices of the carrier or bailee to whom goods
are delivered for transmission and who keeps the said goods in any office,
shop, godown, vessel, receptacle, vehicle or any other place before delivery
is taken from him. Any officer not below the rank of Deputy Commercial
Tax Officer shall have power to enter into and search such office, shop,
godown, vessel, receptacle or other place of business or building or place,
and to examine the goods and inspect all records relating to such goods.
The carrier or bailee or the person in-charge of the goods and records shall
give all facilities for such examination or inspection and shall if so required
produce the bill of sale or delivery note or such other document as may
be prescribed regarding the goods and give his name and address and the
name and address of the consignee.
Railway freight transport system is one of the major means of
transporting goods from one place to another in the country apart from
carrying the passengers and many dealers use railways in the course of
their business for transporting the goods. Instances have come to the notice
that some of the unscrupulous dealers are consigning their goods through
railway freight transport system without properly accounting for the goods
in the documents accompanying the consignment and sometimes no document
at all accompanying the goods. In other cases, no correct and complete
addresses of the consignor or consignee with registration Nos., are furnished
relating to the goods thereby evading tax legitimately due to the State.
Recently, the Railway parcel offices at Vijayawada were inspected by
the officials of this department for verification of the documents relating
to goods as to whether they were properly accounted for in the documents.

However, the Railway parcel officers and other authorities were reluctant
to extend co-operation to the department officials in discharging their duties
under the AP VAT Act, 2005. This constrained the department officers to
file the W.P. before the Hon'ble High Court of A.P., Hyderabad.
The Hon'ble High Court of A.P., by its order in the reference cited
directed the Railway authorities of the South Central Railway to provide
all the necessary assistance and co-operation to the department in the
implementation of the provisions of the APVAT Act, 2005. Copy of the
above judgment is enclosed to this Circular for ready reference.
In view of the above, all the officers of the department not below
the rank of the Deputy Commercial Tax Officer shall periodically inspect
the Railway parcel Offices – Railway goods shed located in their jurisdiction
with a view to ensure that the goods available for transshipment or delivery
are covered by proper documents with complete and correct address of the
consignor and consignee with their TIN Nos., nature and value of the goods,
etc. If any irregularities are found, action envisaged under Section 46 of
the AP VAT Act, 2005, should be initiated. The inspection should cover
both outgoing and incoming goods.
The receipt of this Circular shall be acknowledged by the officers
noted in the margin by return of post.
V. Bhaskar
29. Plastic Manufacturers
[Memo. No. 12514/CT. II(1)/2006-1, dt. 23-3-2006]
Sub:– APVAT Act, 2005 – Refund of excess tax paid to Exporters,
Manufacturers like Plastic manufacturers etc. – Clarification on
the orders issued vide G.O.Ms.No. 1248, dt. 23-6-2005.
Ref:– (1) G.O.Ms.No. 1248, Revenue, dt. 23-6-2005.
(2) From the Commissioner of Commercial Taxes, A.P., Hyderabad
D.O.Letter No. Refunds/2005, dt. 22-2-2006.
The attention of the CCT is invited to the reference first cited in which
Government have issued orders permitting him to provide for monthly
refund of excess input tax, wherever the manufacturers like plastic
manufacturers pay tax @ 12.5% on the purchase of inputs while they have
to pay output tax only @ 4%.
VAT–63
2. The Commissioner of Commercial Taxes in his letter second cited,

has reported that the above order has been issued keeping in view the
differential tax component of 8.5% paid by them on inputs and got blocked
as they are not in position to adjust this portion of tax against output tax
which is only 4% either under the APVAT Act or under the CST Act.
The said G.O. has not taken into account the manufacturers who pay tax
@ 12.5% on the purchase of inputs and pay CST tax @ 4% when they
effect inter-State sales and also pay VAT @ 12.5% on local sales. Further,
added that certain industrial units, who are availing industrial incentives
are not able to avail tax deferrals as their output tax is less than input
tax regarding the excess paid input tax credit to be refunded. He has
therefore, stated that in such cases, their working capital is blocked thereby
cost of borrowing finance increases and requested to amend the said Govt.
Order, to clarify that all manufacturing units/industries, who pay tax @
12.5% on purchase of inputs while they have to pay output tax either @
4% under APVAT Act will be eligible for monthly refund if there is not
excess credit.
3. After careful examination, the Government hereby clarify that the
orders issued in G.O.Ms.No. 1248, Revenue (CT.II) Department, dt.
23.06.2005 are not limited to plastic manufacturers alone but the case of
plastic manufacturers was used for anology. Hence, the Government hereby
order by way of clarification that the orders issued in G.O.Ms.No. 1248,
Revenue, dt. 23.06.2005 shall apply to all cases where output tax paid is
4% either under AP VAT Act, 2005 or CST Act, 1958 while the input
tax paid has been @ 12.5%. The Commissioner of Commercial Taxes,
Andhra Pradesh, Hyderabad is therefore requested to take necessary action
accordingly.
30. Credit of Taxes paid at Check Posts
[Circular No. AIII(1)/06/2006, dated 4-4-2006]
Sub:– APVAT Act, 2005 – VATIS Package – Challan posting in
VATIS package to give credit to the dealers who have paid
taxes on Vehicular Check or at Check Posts – Procedure –
Certain instructions – Issued – Reg.
Ref:– CTO, Tirupathi-II, Circle Rc.No.1/05-06, dt. 23-12-2005.
Of late requests are being made by the field officers that the taxes
paid by the dealers at check posts/mobile checks are kept pending for want
of specific provision in VATIS programmed and requested for clarification
on the issue.
After examining the issue in detail, the following procedure is prescribed

in case of collection of taxes (including tax, penalty, interest and compounding
fee) from the registered dealers of other circles.
(1) In case, dealers pay by way of challans – the particulars of the
same should be posted into VATIS application against his TIN / GRN. The
collecting officer is responsible for posting the particulars into VATIS within
(5) days of such collection.
(2) In case, dealers pay by way of cash/cheque/Demand Drafts, challan
should be prepared MANUALLY and sent to the bank for realisation. After
receipt of realisation particulars, the details of amount realised, challan
number, challan date etc., should be posted into VATIS application against
the TIN/GRN as if payment is made by the way of challan by the dealer.
The collecting officer is responsible to post the particulars into VATIS
within (5) days of challan date.
(3) In case of ICPs/BCP/since VATIS application is not available at
present, the administrative officer should send the realisation particulars
(Challan Particulars) on every Monday for the realizations related to the
previous week in the following proforma to the circle officer where check
post is located. ACTO I of the circle office is responsible for posting of
the same into VATIS within (5) days of receipt of the same from check
post.
Sl. TIN Firm Period Amount Challan Challan Treasury Remarks
No. or Name No. Date
GRN
1.
2.
(Note:– Under "Remarks" column mention VAT/CST/TOT/Interest/

Penalty/Compounding fee)
(4) The tax collecting officer should clearly record the details such
as TIN/GRN, period for which it was collected and whether it is VAT/
CST/TOT/Interest/Penalty/Compounding Fee, at the time of collecting the
same so as to enter them into VATIS subsequently.
(5) In view of the above instructions it is directed that the payments
on the basis of cash receipts filed along with the returns by the registered
dealer should not be entered into VATIS to avoid double credit.
(6) Further certain dealers are filing Form 503 along with their monthly
returns to claim as adjustment for the amounts paid at check post/mobile
check (excluding entry tax). In view of the above instructions the DCs are
request to instruct their circle officers to intimate to the dealers not to use
Form 503 to adjust the taxes paid at check post/mobile check and such
adjustments should not be accepted.
(7) Further the following are reiterated.
(a) Tax collection, in case of registered dealers of other circles will
not add to their circle's revenue. That revenue goes to the circle
where the dealer is registered.
(b) The officers are not expected to collect advance tax from register
dealers and wherever further verification is required, the documents
should be passed onto the circle where the dealer is registered.
(c) The actual realization of tax only is considered to be the revenue
of the circle. Hence it is requested to see that the realization
particulars are posted into VATIS promptly.
(8) In case of collection, related to the unregistered dealers, the
amounts so collected shall be entered into VATIS by using the link TCS/
TDS/Miscellaneous payments in payment module, against miscellaneous
payments (unregistered dealer), which will form part of the revenue of the
circle where the tax has been collected.
(9) DCs are requested to instruct their subordinate officers on the
above lines and this item should be included in the agenda of monthly
review meetings held by them.
31. Monthly Returns – E-Return
[CCT's Ref.No.A.III(1)/2006 dt. 4-9-2006]
Circular – 16
Sub:– APVAT Act and CST Act – Monthly Returns – Facility For
e-Return.
As per provisions of APVAT Act and CST Act dealers are requested
to file their return by particular date of the succeeding month in the office
of CTO concerned. The dealers of twin cities of Hyderabad and Secunderabad
and Rangareddy District also have option to submit the returns in e-seva
centres.
In order to provide one more channel for submission of monthly
returns by the VAT/CST dealer from the comforts of their office premises,
the facility of e-return is going to be launched soon. The important features
of e-return service are as follows:
1. Extension of service: This service will be made available to dealers
in two phases.
Phase 1: Dealers of all the 7 (seven) divisions of Twin cities and

Ranga Reddy District.
Phase 2: Dealers of all other divisions.
2. Eligibility to file e-returns:
1. Nil returns and Credit returns can be filed by all the dealers
whenever that facility is extended to them phase-wise as indicated above.
2. Dealers can file either VAT-Return (Form 200) or VAT & CST
returns (combined), but not CST return alone.
3. Returns requiring payment of tax. Presently those dealers who have
ICICI internet banking can avail this facility. In phased manner other banks
will also be added for the convenience of dealers.
3. Steps in e-filing:
(i) The dealer will log in to CTD web site and register themselves
in e-return application. For registration to be successful, dealer
should have e-mail address in his registration data base. The
dealers who have not reported e-mail address to CTO concerned,
they should get it entered in the Registration data base. System
has been designed to send registration password through e-mail.
Hence availability of e-mail address is must for completing e-
return registration process.
(ii) Dealer will enter in e-return application the details of purchase
and sales. System will calculate the tax liability. If it is nil or
credit return, the returns can be submitted without any further
steps.
(iii) In case tax is payable, the dealer will be taken to the ICICI internet
banking account. After payment is successful from internet account,
system will take the dealer back to the CTD web site along with
payment I.D. The dealer can print the return for his own record.
In case dealer has made payment part or full amount by adjustment,
the dealer must send adjustment orders in original to the CTO
concerned by post by end of the month in which e-return is filed.
The CTO have to monitor as to receipt of adjustment claim forms
vis-a-vis amounts entered through e-return.
(iv) System will also send e-mail to CTO concerned confirming filing
of e-return. CTO can also take print of the return filed by the
dealer for office file.
The proposals for e-filing of return are under consideration of

Government and orders are expected shortly from the Government.
Meanwhile, all the Deputy Commissioners are requested to arrange for a
convenient meeting by the CTOs concerned with the dealers to explain
the process (e-return format enclosed) and to collect e-mail address wherever
not available in registration data base andenter e-mail address in Registration
database.
Sd/-
T.S. Appa Rao
Commissioner of Commercial Taxes.
Encl: Format of e-return.
Monthly Return for VAT – CST VAT 200 and CST VI
Name Return Date
TIN Enterprise(s)
Division Tax Circle
A. Return Type VAT – CST VAT
B. Return Month-Year
C. If no purchases and no sales, select this box
D. Carried forward balance from previous month (OB)
E. Purchases in the month (input) Value excluding ITC claimed
VAT (A) in Rs. (B) in Rs.
1. Exempt or non-creditable Purchases
2. 1% Rate Purchases
3. 4% Rate Purchases
4. 12.5% Rate Purchases
5. Special Rate Purchases
F. Sales 20% Special Rate
I. Within State Sales Value excluding Tax Liability
1. Exempt Sales
2. Purchase Tax (Purchase liable for purchase tax)
3. 1% Rate Sales
4. 4% Rate Sales
5. 12.5% Rate Sales
6. Special Rate Sales 20% Special Rate
II. Inter-State Transactions

i. Exports
1. Direct Exports
2. In course of Export
ii. Exempt Transactions Value excluding Tax Liability
1. Transactions Exempt (Sale of Exempt goods)
2. Transactions Agent (Consignment Sales)
3. Transactions – BT (Branch Transfer)
iii. Taxable Transactions Value excluding Tax Liability
CST (A) in Rs. (B) in Rs.
1. Transaction
G. Adjustment Details
1. Type Authority Adjustment Details
Amount
Adjustment Details ....... Contract Order/Adjustment reference details
J. Payment Details
1. Payment towards VAT 2. Payment towards CST
3. Refunds 4. Credit Carried forward
5. Total amount payable 6. Total Amount paid
7. Transaction No. 8. Paid Date
Declaration by Dealer
I hereby declare that this Return is filed as per the requirements of
AP VAT Rules, 2005 and CST Rules, 1957 and further declare that
information furnished here is strictly in accordance with the AP VAT Rules,
2005 and CST Rules, 1957 and the records maintained there on.
32. Audio Cassettes – Rate of Sales Tax
[CCT's Ref.No.AI(1)/61/2007, dt. 24-4-2007]
Circular
Smt. Ranjeev R. Acharya, I.A.S., Commissioner of
Commercial Taxes
Sub:–APGST Act, 1957 – Request of Indian Music Industry on the rate
of Sales Tax on Audio Cassettes – Certain clarification issued
– Communicated – Regarding.
Ref:– (1) Representation received from the Indian Music Industry No.
NIL, dt. 22.11.2006.
(2) Govt. D.O. Lr. No. 58677/CT-II(1)/2006-1, dt. 20.12.2006.
(3) From the CCT, Ref. No. AI(1)/61/2007, dt. 2.2.2007.
(4) Govt. Memo. No. 58677/CT-II(1)/2006-3, dt. 13.4.2007.
invited to the reference 4th cited (copy enclosed), wherein the Government
have clarified that the audio cassettes shall be treated as electronic goods
and liable to tax @ 4% for the period from 1.1.2000 to 31.3.2005.
In view of the above, all the Deputy Commissioners (CT) in the State
are requested to communicate the same to their subordinate officers for
taking necessary action in the matter.
D. Venkateswara Rao
For Commissioner of Commercial Taxes.
33. Certain manufacturers of Iron and Steel ineligible to use the
gate pass-cum-Invoice as Way Bill
[CCT’s Ref.No. AIII(1)/318/06, dt. 29-11-2006]
Sri T.S. Appa Rao, I.A.S., Commissioner of Commercial Taxes
Circular
Sub:– AP VAT Act, 2005 – Issue of Notification under sub-rule
(4) of Rule 55 of AP VAT Act, 2005 – Manufacturers of
Iron and Steel excepting the cases including in LTUs –
Ineligible to use the gate pass cum Invoices as Way Bills.
AP VAT Rules, 2005, the Commissioner of Commercial Taxes, Andhra
Pradesh hereby notifies that the following categories of dealers are ineligible
to use the gate pass cum Invoices as way bill and therefore they shall
make out way bills on Form 600.
(1) Manufacturers of Iron & Steel except those on the rolls of Large
Tax Payers Units (LTU).
This notification shall come into force with effect from 1-12-2006.
34. Sugar Cane Seed
[Memo. No.22074/CT-II(l)/2010-l, Rev. (CT-II). Dept., dt. 27-5-2010.]
Sub:- APVAT Act, 2005 - Sugar Cane Seed - Classification Clarification -
Orders - Issued.
Ref:- From the CCT, Ref.No.AIII(l)/100/2010, dt.10-5-2010.
The Commissioner of commercial taxes vide reference cited, stated that
M/s. Sree Rayalaseema Sugar & Energy Private Limited have represented
that the “Sugar Cane Seeds” are being treated as goods falling under Schedule-
V of the APVAT Act, 2005 and subjected to tax @ 12.5% for the years 2005-
2006 & 2006-2007. They further contended that said category of goods are
liable for exemption under Entry 44 of the Schedule-I of the APVAT Act, 2005
and requested the Government to issue suitable clarification, treating ‘Sugar
Cane Seed’ as ‘Seed (Sets)’, to that effect.
2. Government after careful examination of the matter, hereby clarify
that ‘sugar cane seed’ popularly known as ‘sugar cane sets’ would squarely
fall under Entry 17 of 1st Schedule to the APVAT Act, 2005 and is exempt
from VAT.
3. The Commissioner of Commercial Taxes is therefore requested to take
necessary action in the matter.
-----
35. Rule 55 – Movement of Goods in Goods Vehicles

[CCT’s Enft. Ref. No.D2/160/2010, dt. 24-08-2010]
Suresh Chanda, I.A.S., Commissioner of Commercial Taxes
Circular
Sub: APVAT Act, 2005-Rule 55 (Movement of Goods in Goods
Vehicles) - Issuing of certain instructions - Reg.
Ref: CCT’s Enft.Ref.No.D2/1173/07, dt. 20-04-2010.
It is to inform you that officers while conducting check of vehicular
traffic are noticing that several goods vehicles are entering the State without
touching en-route Check Posts.
In this regard, officers are instructed to make a thorough scrutiny of all
the documents and goods carried in such vehicles and also the reason for
taking such route. If any attempt to evade payment of tax is sensed by taking
route other than through Check Post “deterrent action is to be initiated by
collecting tax, penalty and confiscation of goods as per the provisions of Act
as instructed in the earlier Circular vide reference cited.
This deterrent action of levying penalties and confiscation of goods
against such action will alone discourage the transporters from avoiding the
check posts.
Hence, all the officers conducting check of vehicular traffic should be
more cautious while checking the vehicles which have not passed through
the Check Posts.
36. Service of notices and orders.
[CCT’s Ref.No.LV(1)/53/2010, dt. 27-08-2010]
Circular
Sub: APGST/APVAT Acts-Service of notices and orders-Instructions
issued earlier-Service by un-authorized persons-Complaints received-
Instructions issued - Regarding.
Ref: 1. CCT’s Ref.No.LV(l)/53/2010, Dated:15.02.2010.
2. CCT’s Ref.No.LV(l)/53/2010, Dated: 23.02.2010.
The Commissioner of Commercial Taxes have been issuing instructions
from time to time regarding disposal of appeals by Appellate Deputy
Commissioners, review of those orders by the regular Deputy Commissioners
and also the modes of service of notices and orders on the dealers. In the
4th cited reference it was directed that the officers should serve the final
orders by registered post only whereas notices such as show cause notices
and hearing notices may be served by ordinary post or by personal service
through official process servers. But it is noticed that in certain circles the
Commercial Tax Officers are sending the notices for service through
unauthorized persons. A complaint to this effect was received by the
Commissioner of Commercial Taxes by e-mail from one of the dealers. It is
stated in the complaint that the notices are sent for service through unauthorized
persons who are demanding money from the dealers after serving the notices.
This is serious matter of concern which should be curbed immediately.
All the officers in the State are therefore requested to desist from using
any unauthorized persons for service of notices to the dealers. They should
deploy only official process servers /attenders for service of notices in person.
As far as the service of final orders are concerned the earlier instructions
of service by Registered Post should be strictly followed. If any officer is
found flouting these instructions, disciplinary proceedings will be initiated
against such officer.
37. New Image and Meaning to the functions of Check Posts
[CCT’s. Enft. D2/172/2010, dated: 01-11-2010.]
Circular
Sub : Check Posts - New Image and Meaning to the functions of Check
Posts - Change management - Pilot implementation at 3 CPs -
Guidelines Issued-Regarding.
Ref: Arising
In view of several representations received from FAPCI, Trade bodies
and individual complaints, it is proposed to stream line and give new image
and meaning to the functions of Check Posts. It is well known that the
primary objective behind establishing of Check posts is to:
1. Ensure that Goods with valid documents enter or exit the State
boundary so as to ensure due tax are paid by trade.
2. To record details of entry and exist of Goods so as to ensure same
are accounted for by the Trade and
3. To collect, tax, penalty and compounding fee if there is violation of
tax laws
Hence in nutshell, the primary function of Check Post is to ensure tax
compliance by the Trade. The purpose behind collection of Tax and Penalty
is to create a deterant mechanism against tax evaders. But over a period of
time, Check Posts, instead of creating environment for improvement in tax
compliance, becoming mechanisms of raising revenue through collection of
tax and penalty, perhaps on the presumption that levy and collection of tax
and penalty will force trade to follow tax laws. But experience has been quite
different.
It is a fact that all over the country, Check Posts shows Tax departments
in a very bad light. Complaints like harassment on filmsy ground and incidence
of corrupt practices are quite common all over the country.
In this back ground, it is proposed to give new image and meaning to
functions of Check Posts to address such issues. It is proposed to shift focus
from tax and penalty collection to improvement in tax compliance by trade.
To make Check Posts functioning trade friendly but at the same time ensure
tax compliance by the trade.
Issue was discussed at length with senior officers the department and
after thorough brain storming session and discussion following guidelines are
issued for checking of the vehicles by Check Posts. As a pilot implementation
initially these guidelines will be made applicable to three CPs namely (1)
Bhoraj (Adilabad Division) (2) Naraharipet (Chittoor Division) (3) Saloora
(Nizamabad Division).
Primary Objectives of Check Posts:
1. To ensure tax compliance by trade by ensuring that Goods enter or
exit with valid and proper documents
2. To record details of Goods entering or leaving the State and make
available such information to Tax authorities for ensuring tax
compliance by the trade and
3. Trade friendly by firm administrative environment
Functions of Check Post:
To achieve above objectives, Check Post shall take following steps to
discharge its functions:
1. All the staff posted at Check Post shall bear name badge at all
times of duty
2. Put display boards in multiple languages indicating clearly functions
of Check Post, List of valid documents that will facilitate entry or
exit of Goods, Penalty provisions in case Goods carrying vehicle
fails to provide valid documents but still desires entry or exit,
Telephone Numbers, email Id of DC, CTO and CCT office
3. Train its staff for trade friendly but firm behavior
4. Check the documents for completeness and correctness
5. Allow the vehicle to pass check post if documents are in order
6. If documents are not in order, issue detention order listing out
clearly the defects in the documents and serve it on the person
incharge of the goods vehicle. It should also be stated in the detention

order that if the defects pointed out in the detention order are
rectified, the goods vehicle will be permitted to proceed to its
destination and in case the defects are not rectified the dealer of
person incharge of the goods vehicle should approach the Commercial
Tax Officer concerned for assessment of tax, penalty and
compounding fee to be paid.
7. CTO or DCTO concerned as authorized by DC, shall verify the
documents and levy tax, penalty and compounding fee as per Rules
and Regulations. On receipt of tax, penalty and compounding fee
amount, CTO/DCTO as the case may be, will issue order to Check
Post to allow the vehicle to pass through the Check Post.
8. On receipt of order of CTO/DCTO, allow vehicle to pass through
Check Post.
9. Check Post shall not pass any assessment order for payment of
Tax and Penalty etc.
List of Valid Documents for entry of Goods:
1. Invoice or Delivery Challan or Stock transfer Memo or Central
Excise Gate document of Seller/Consignor.
2. CST Way Bill issued by the Buyer/Consignee if commodity being
carried is sensitive commodity.
List of Valid Documents for exit of Goods:
Excise Gate document of Seller/Consignor.
2. CST Way Bill of the Seller/Consignor.
3. Any other Certificate prescribed by Government from time to time.
In order to ensure that Trade is following Tax laws properly, DC
concerned shall arrange for random and surprise checks of vehicles on all
routes now and then. If any vehicle is found carrying Goods without valid
documents or order of CTO/DCTO, the assessing authority shall take a very
serious view of such violations and assess the Goods accordingly for Tax,
Penalty and Compounding fee including confiscation of Goods not supported
by valid documents.
Senior Officers from O/o CCT and DC office will be deputed for a day
or more for conducting hand holding demonstration to the staff at these
Check Posts for smooth change over to new concept.
These new guidelines will come into force with effect from December
1,2010 at the Check Posts indicated above and shall remain in force till
further orders.
Check List (Incoming Vehicles)

1. Invoice/Delivery Challan/Stock transfer Memo/Central Excise Gate
document (of Seller/Consignor) not produced
2. Advance way bill issued by Buyer/Consignee not produced for
sensitive goods
3. TIN Number of the consignor and consignee not mentioned on
documents
4. Date not mentioned in the documents indicated at Sl.No. l
5. Other Certificate not produced wherever necessary
6. Variation in quantities mentioned in the documents indicated at SI.
No.1 and actual quantities in the vehicle.
Sd/-________
Check List (Outgoing Vehicles)
1. Invoice/Delivery Challan/Stock transfer Memo/Central Excise Gate
document (of the Seller/Consignor) not produced.
2. CST way bill issued by Seller/Consignor not produced.
3. TIN Number of the consignor and consignee not mentioned on
documents.
4. Date not mentioned in the documents indicated at Sl.No. 1.
5. Declaration of Non Dealers of AP not produced.
6. Other Certificate not produced wherever necessary.
7. Variation in quantities mentioned in the documents indicated at Sl.
No.1 and actual quantities in the vehicles.
Sd/-_________
Display Boards at Check Posts
Functions of Check Posts
1. Allow the movement of goods vehicles with proper and valid
documents.
2. Record the transactions to ensure proper accounting by the Trade.
3. In case valid and proper documents are not produced, provide
single opportunity for rectification of defects and if defects are not
rectified, refer the matter to CTO/DCTO concerned for assessment
for Tax, Penalty and Compounding Fee.
List of Valid Documents for entry of Goods:

Excise Gate document issued by the seller/consignor.
2. CST Way Bill issued by Buyer/Consignee if commodity being carried
is sensitive commodity.
List of Valid Documents for exit of Goods:
Excise Gate document issued by Seller/Consignor.
2. CST Way Bill issued by Seller/Consignor.
3. Other Certificate.
Address of CTO:
Telephone No. and email Ids:
CTO:
DC:
CCT Office:
38. Issue of Way Bills

[CCT’s Enft.B3/296/2010, dt.12-11-2010]
Circular
Sub:- Issue of Way Bills - Certain guidelines for prevention of misuse -
Further instructions issued - Reg.
Ref:- 1) CCT’s Enft. B3/197/2008, Dated: 28-11-2008.
2) The Federation of Andhra Pradesh Chambers of Commerce &
Industry (FAPCI) Hyderabad, Lr.No.T&C Com/877/2010-11,
dt. 08-11-2010.
The attention of the Deputy Commissioners is invited to the reference
st
1 cited. It is decided to withdraw the guidelines issued earlier relating to
validity period of Waybills as they are causing hardship to Traders since they
have to approach the officers whenever the re-validation is required for the
already issued Way Bills.
Hence, all the Deputy Commissioners and Assessing Authorities should
dispense with Affixing Validation stamps on Waybills while issuing Way
Bills. However, proper care should be taken to monitor the Trade which is
evasion prone to prevent any misuse of Way Bills.
——
38A. VAT on Sale of Textiles and Sugar

[Memo.No 20355/CT.II(1)/2011-2, dated 16-7-2011]
Sub:– APVAT Act, 2005 – Levy of VAT on sale of Textiles and
Sugar – Amendment to Schedules - I & IV – Certain
clarification – Issued – Regarding.
Ref:– 1. Finance Act No. 8 of 2011, w.e.f. 1.4.2011.
2. G.O.Ms. No. 932, Rev. (CT.II) Deptt., dated 8.7.2011,
(w.e.f. 11.7.2011)
The Government of India vide reference 1st cited, have amended the
1st Schedule to the Additional Duties of Excise (Goods of Special Importance)
Act, 1957 by omitting the commodities, Textiles and Sugar from the purview
of levy of AED with effect from 1.4.2011.
2. The Government of Andhra Pradesh, vide reference 2nd cited,
issued notification deleting Textiles and Sugar from entries 45 and 46 of
the 1st Schedule to the APVAT Act, and inserted Entries 127 and 128
in the IVth Schedule of the APVAT Act, 2005 respectively thereby levying
VAT @ 4% with effect from 11.7.2011.
3. Since there has been ambiguity about the applicability of VAT on
Textiles and Sugar with effect from 1.4.2011 till the date of coming into
force of the said notification i.e., 11.7.201, the VAT levy on the two items
(Textiles and Sugar) except in cases where VAT on these commodities
has been collected from the customers/buyers, by the Dealers shall be
waived, VAT, if any collected, from the customers from 1.4.2011 to 10.7.2011
shall however be remitted to the Government Account.
------
38.1 Levy of VAT on Textiles and Sugar.

[CCT’s Ref. AIII(1)/114/2011, Dated: 12-7-2011]
Circular
Sub:– AP VAT Act, 2005 – Levy of VAT on Textiles and Sugar
– Certain Instructions – Issued – Regarding.
Ref:– G.O. Ms. No. 932, Revenue (CT-II) Department, Dated
08.07.2011.
invited to the reference cited, whereby the Textiles and Sugar become liable
to tax @ 4% w.e.f. 11.7.2011.
In this regard, all the Deputy Commissioners (CT) in the State are
directed to conduct interactive sessions immediately with the Textile and
Sugar trades separately and educate the dealers on the procedures to be
adopted for getting themselves registered and for filing the returns periodically.
They are directed to play a proactive and positive role in sorting out the
teething problems in the initial period of transition.
They are also directed to ensure meticulously that there is no scope
for any sort of complaints of harassment in the process of registration under
the APVAT Act, 2005. Any complaint, received in this regard, will be viewed
very seriously.
The receipt of this Circular may be acknowledged immediately.
------
38.2 Levy of VAT on Sugar and Textiles
[CCT’s Ref. AIII (1)/114/2011 dt. 22-10-2011]
CIRCULAR
Sub: APVAT Act, 2005 – Levy of VAT on Sugar and Textiles –
Certain instructions – Issued – Reg.
-----
The Government of Andhra Pradesh, vide G.O.Ms.No.932, Revenue
(CT) Department, Dated 8.7.2011, notified Textiles and Sugar under Schedule
IV. Accordingly they become liable to tax @ 4% along with the other goods,
enumerated in the Schedule IV of the Act. As per the said G.O., the tax
liability on Textiles and Sugar arises with effect from 11.7.2011. The
Government vide its Memo dated 16/7/2011 has also informed that no tax
will be levied on Textiles and Sugar during the period from 8.4.2011 (i.e.,
the date of the Notification by the Government of India) to 11.7.2011 (i.e.,
the date from which, the G.O.Ms.No.932, Dt. 8.7.2011 came into effect).
Further, the rate of tax of 4% has been increased to 5% w.e.f 14.9.2011
vide G.O.Ms.No.1718, Revenue (CT-II) Department, Dt.13/9/2011. As such,
the tax liability under APVAT Act on Sugar and Textiles is as follows:
Sl.No Period Rate of Tax applicable
1 08-04-2011 to 10-7-2011 Exempted
2 11-7-2011 to 13-9-2011 4%
3 With effect from 14-9-2011 5%
Further, it is informed that the textiles and sugar are exempted from
tax under Central Sales Tax Act vide G.O.Ms.No.2328, Revenue, Dt.
13.9.1957, which is still in force. Therefore, there will be no tax liability
on the interstate sales of Sugar and Textiles under CST Act, if such
transactions are covered by “C’ Form.
In case purchasing dealer in other state is not able to obtain C Form
other state due to the reason that that state is not issuing C Form for
Textile and sugar or dealer in other state is not required to be registered
under relevant Act and accordingly selling dealer is not able to produce
C Form to the authorities in Selling State, the following alternative modes
of evidence will be accepted in lieu of “C” Forms:
1. In case of transport by Rail: For the Sugar and Textiles, transported
by Rail, a copy of the CST way bill along with the Railway Receipt (RR)
has to be produced as an evidence to show that the goods have been
sold or consigned in the course of interstate trade and commerce.
2. In case of transport by Road: For the Sugar and Textiles,
transported by Road, a copy of the CST way bill, Lorry Receipt and the
proof of payment of consideration by the dealer outside the State shall be
produced in proof of the transaction with the dealer outside the State.
------
39. Calculation of Eligible Input Tax Credit
[CCT’s Ref. No. A.III (1)/209/05, dated 1-08-2005]
Office of the Commissioner of Commercial Taxes, A.P., Hyderabad.
Sub:– A.P. VAT Act, 2005 & A.P. VAT Rules, 2005 – Calculation
of eligible input tax credit – Instructions issued – Reg.
The attention of all the Deputy Commissioners is drawn to the
provisions of calculation of eligible input tax credit under A.P. VAT Act
& A.P. VAT Rules.
As per sub-section (5) of Section 13 to A.P. VAT Act, 2005, no input
tax credit shall be allowed on the following:
(a) Works contracts where the VAT dealer pays tax under the provisions
of clauses (b), (c) and (d) of sub-section (7) of Section 4;
(b) Transfer of a business as a whole;
(c) Sale of exempted goods except when such goods are sold in the
course of export or exported outside the territory of India;
(d) Exempt sale;
VAT–64
(e) Transfer of exempted goods on consignment basis or to branches

of the VAT dealer outside the State otherwise than by way of sale;
(f) Supply of goods by the VAT dealer as mentioned in sub-section (9)
of Section 4.
Further, the procedure for availing input tax credit is given in Rule
20 to A.P. VAT Rules, 2005. If a particular VAT dealer is having more
than one division or more than one production unit, the VAT dealer is eligible
for input tax credit for all his taxable activities. Further the VAT dealer
can follow sub-rule (6) of Rule 20 of A.P. VAT Rules and can claim input
tax credit separately for each division for each tax period. He can also
claim input tax credit separately for distinctly identifiable products if these
products do not share common inputs. Accordingly, it is clarified that the
dealer is eligible to apply formula to restrict his input tax credit for each
and every division separately. When common inputs relating to all divisions
are used, the input tax credit related to such common inputs should be
subjected to formula taking into consideration the total taxable turnover and
total exempt turnovers of all the divisions. For this purpose, the taxable
turnover and total turnover shall be the amounts that have arisen using
those common inputs. The examples for common inputs for all divisions
could be items used in office or for sales.
As per sub-rule (6) of Rule 20 of A.P. VAT Rules where any VAT
dealer is able to establish that specific inputs are meant for specific outputs,
the input tax credit can be claimed separately for taxable goods. In the
instant case, in a particular division when such inputs are used in that division
only and the output is taxable and exempted, the restriction of input tax
credit relating to formula can be applied in a particular month with reference
to turnovers of that division. This automatically implies applying formula
separately for each division for each tax period and the consolidated figures
relating to specific inputs shown in Form VAT 200A which is to be enclosed
along with Form VAT 200. The VAT dealer is required to follow this
procedure continuously from April to March tax periods and the adjustments
in respect of March tax period are to be made on the same lines and
the adjustments should be furnished in Form VAT 200B to be enclosed
along with Form VAT 200A and Form VAT 200 for the month of March.
The Deputy Commissioners may also refer to the advance ruling given by
the Committee in the case of M/s. Dhanalaksmi Cotton & Rice Mills
(P) Limited, Guntur in CCT’s Ref. No. PMT/P&L/A.R.Com/167/2005,
dated 9.7.2005 (enclosed herewith).
In the light of the above, it is clarified as under:
(i) While applying the formula A x B / C for calculating input tax credit
eligible, the values of B and C may be taken as representing the
following:
B = Taxable turnover arisen as a result of usage of common inputs.

C = Total turnover arisen as a result of usage of common inputs.
(ii) The dealer can apply the formula A x B / C for all the units separately
and consolidated figures can be shown on Form VAT 200A. The
VAT dealer can enclose the attachments showing the details of
calculation done.
(iii) ‘Division’ for this purpose shall include those locations where multiple
products are produced provided that every product line has distinct
inputs not shared with other products.
Wherever there is sharing of inputs, original formula will apply.
All the Deputy Commissioners shall acknowledge the receipt of the
circular by return of post.
-------
40. Recovery of Arrears under the APGST & APVAT Acts
[CCT’s Ref. No. DMU/3/500/2004, dated 17-02-2009]
Sub:– APGST & APVAT Acts – Recovery of arrears – Provisions
relating to first charge, transfer to defraud revenue and
recovery of tax from transferee of business – Effective
implementation of – Instructions issued – Regarding.
It is noticed by the Commissioner of Commercial Taxes during the
course of review of collection of arrears that in several cases the Assessing
Officers and the Officers entrusted with the work of collection of arrears
are not utilizing all the provisions, especially those that deal with first charge,
liability of the transferee and transfer of assets to defraud revenue etc.,
available under the APGST and APVAT Acts effectively.
As per the provisions of Section 16C of the APGST Act and Section
26 of the APVAT Act, the taxes payable under those Acts shall be the
first charge on the property of the dealer. The said sections which are
identical, are reproduced hereunder.
“Notwithstanding anything to the contrary contained in any law for
the time being in force, any amount of tax, Government loan extended to
the dealer due to treating deferred tax as deemed to have been paid, penalty,
interest and any other sum if any payable by a dealer or any other person
under this Act, shall be the first charge on the property of the dealer, or
such person.”
The Hon’ble Supreme Court and several High Courts while upholding
the concept of "first charge" have clearly held that the tax dues of the
State will have priority over other debts including the debts to a bank as
a mortgagee. The cases in which the Hon'ble Supreme Court and other
High Courts upheld the first charge are listed below.
1. State Bank of Bikaner and Jaipur v. National Iron and Steel Re-
rolling Corporation, (96 STC 1612 SC).
2. Delhi Auto General Finance Limited v. Tax Recovery Officer, (114
STC 273 SC)
3. Dena Bank v. Bhiknabhaia Prabhudas Parekh & Co., (120 STC
610 SC)
4. State of Madhya Pradesh v. State Bank of lndore, (126 STC 1
SC)
5. The Federal Bank Limited v. DCTO, (126 STC 225 TNTST)
6. State Bank of Travancore v. District Collector, Malappuram, (142
STC 266 Kerala)
Even though the judgements of the Hon'ble Supreme Court and other
High Courts have unequivocally upheld the first charge, the recovery officers
cannot take advantage of these decisions unless they initiate action at the
right time and before the respective Banks or the State Finance Corporation
attach and auction the property of the dealer to recover their debts. In
several cases it is noticed that the officers of the Department failed to
initiate action early and have issued notices to the Banks and State Finance
Corporation to pay up the sales tax arrears from out of sale proceeds,
long after the sale is completed by the Bank or the State Finance Corporation.
In such cases the reply they generally receive from the Banks or the
Corporation is that they are unaware of the sales tax arrears and because
the property of the debtor had already been sold and sale proceeds were
appropriated to their debts, no amount is left to adjust to the sales tax
arrears. Therefore, all the Officers in the Department are requested to note
that timely action is very vital to realize the arrears.
In cases where the Banks or the State Finance Corporation have
already sold the assets of business of the dealer, they can still collect the
arrears by treating the purchaser of the business assets as a transferee
of the business of the transferor dealer from whom the arrears are due.
In such cases the officers can invoke the provisions of Section 18 of the
APGST Act and Section 30 of the APVAT Act and realize the arrears
from the purchaser. These sections which are identical are reproduced
hereunder.
“Where ownership of the business of the dealer liable to pay tax is
transferred any tax or other amount payable under this Act in respect of
such business and remaining unpaid at the time of the transfer, may without
prejudice to any action that may be taken for its recovery from the transferor,
be recoverable from the transferee as if he were the dealer liable to pay
such tax or other amount.”
In cases where the Banks or State Finance Corporation sell the
property of the dealer, the sale would generally be the sale of entire business.
The sale by the State Finance Corporation, especially by virtue of Sub-
Section (2) of Section 29 of State Financial Corporation Act, is as though
the dealer himself has transferred the property in favour of the transferee
by sale. In such cases both the selling dealer and the purchasing dealer
are jointly and severally liable to pay arrears, as held by Karnataka High
Court in the case of Karnataka State Industrial Investment and
Development Corporation Ltd. v. Asst. Commissioner of Commercial
Taxes, (121 STC 520 Karnataka).
It should also be noted that even though the sale agreement between
the State Finance Corporation and the purchaser says that the sale is free
from all encumbrances, it does not absolve the purchaser of the liability
to clear the defaulters dues. Therefore the transferee of the business
purchased in auction by State Finance Corporation is liable to clear dues
of the transferor as held by Rajasthan Tax Tribunal in the case of Electronic
Trade and Technology Development Corporation Limited v. State of
Rajasthan, (115 STC 545 Rajasthan Tax Tribunal). The Hon'ble A.P. High
Court also in the case of Sri Kanaka Durga Paper Mills Pvt. Ltd. v.
Andhra Pradesh State Finance Corporation, (89 STC 88 AP) while
upholding the liability to pay tax arrears by the transferee of the business
sold by State Finance Corporation, directed the Commercial Taxes Department
to grant instalments to the transferee to clear the arrears. The liability of
transferee was upheld by the A.P. High Court in another case also in Ambica
Oil Mill v. Commercial Tax Officer, (92 STC 474 AP).
All the Assessing and Recovery Officers in the State are therefore
requested to effectively utilize the aforesaid cases in promptly initiating action
by invoking the provisions relating to first charge and also the liability of
the transferee.
It is also noticed by the Commissioner of Commercial Taxes that in
several cases the banks have initiated action for recovery of dues by
referring the dues to the Debts Recovery Tribunal and the Tribunal by
appointing a Tax Recovery Officer initiated action by attaching properties
of the defaulters. In such cases our officers are filing claims before the
Debt Recovery Tribunal for payment of sales tax arrears from out of the
sale proceeds of properties of the dealer. But it should be noted that Debt
Recovery Tribunal has not been conferred with the power to decide as
whether the State has a statutory charge on the mortgaged property.
“If there is genuine dispute between the defaulter and the State
Government or between the State Government and the Bank, those are
disputes not to be resolved by me Debts Recovery Tribunal. The recovery
officers of the Debt Recovery Tribunal once being informed of the State
Governments statutory charge over the mortgaged properties shall not
proceed with those property till the State Government's statutory charge
gets exhausted. The recovery officer has no jurisdiction to proceed with
the properties over which the State has got jurisdiction. The Financial
Institutions or Banks cannot raise any claim before the Debts Recovery
Tribunal over those properties on which the State has got charge.” These
findings on the priority of State Government’s statutory charge over Banks
and Financial Institutions are in the judgment of Kerala High Court in the
case of State of Kerala v. Raj Mohan Cashew Pvt. Ltd., (142 STC 283
Kerala). The officers of the Department are therefore requested to
take advantage of this judgement of Kerala High Court and proceed
with the attachment of the properties of the defaulter even if the
Recovery Officer of the Debt Recovery Tribunal has initiated any
action against those properties. They may inform the Recovery Officer
of the first charge of the State and also the findings of the Kerala High
Court. In case the Recovery Officers decide to proceed in spite of our
informing them about first charge, the officers concerned may file a Writ
Petition before the A.P. High Court in consultation with Special Standing
Counsel.
The other important provision that should be invoked by the officers
in collection of arrears is the provision relating to transfer of properties
by the defaulting dealers to defraud revenue. Such transfers are held
to be void under Section 17 A of the APGST Act and Section 27(1) of
APVAT Act.
Section 17A of the APGST Act reads:
“Where during the pendency of any proceedings under this Act or
after the completion thereof any dealer creates a charge on, or parts with
the possession by way of sale, mortgage, gift, exchange, or any other mode
of transfer whatsoever of any of his assets in favour of any other person,
with the intention to defraud the revenue, such charge or transfer shall
be void as against any claim in respect of any tax or any other sum payable
by the dealer as a result of the completion of the said proceedings or
otherwise:
Provided that, such charge or transfer shall not be void if it is made.
(i) for adequate consideration and without notice of the pendency of
such proceedings under this Act or as the case may be without notice
of such tax or other sum payable by the dealer or
(ii) With the previous permission of the Assessing Authority.

Explanation:– In this Section “Assets” means Land, Building, Machinery,
Plant, Shares, Security, and fixed assets in Banks to the extent to
which any of the assets aforesaid do not form part of the stock
in trade of the business of the dealer”.
Section 27 (1) of APVAT Act says,
“Where during the pendency of any proceedings under the Act or
after completion thereof, any VAT dealer or TOT dealer or any other dealer
creates a charge on, or parts with the possession by way of sale, mortgage,
gift, exchange or any other mode of transfer whatsoever of any of his
assets in favour of any other person, such charge or transfer shall be void
unless he proves that such charge or transfer was not with the intention
to defraud any tax or any other sum payable.”
Both Section 17A of the APGST Act and Section 27(1) of APVAT
Act makes transfers of properties of any dealer to defraud revenue void.
The only difference between the two sections is that under Section 17A
of the APGST Act the burden of proving that the transfer is made to defraud
the revenue is on the Department, but under Section 27(1) of APVAT Act,
the burden is cast on the dealer. Moreover, as per the proviso under Section
17A of the APGST Act the transfer shall not be void if it is made
for adequate consideration and without notice to the transferee of
the pendency of any proceeding or tax under the Act. This proviso
was incorporated keeping in view of the protection granted to the transferee
under Section 100 of Transfer of Property Act which lays down that no
charge shall be enforced against any property in the hands of the
transferee without notice of the charge. The necessity of notice of
charge is also emphasized by the Hon'ble A.P. High Court in the case
of V. Adinarayana v. Andhra Bank (142 STC 469 AP) and by Madras
High Court in the case of D. Sentil Kumar v. Commercial Tax Officer,
Erode, (148 STC 204 Madras). But in the case of State of Tamilnadu
v. M. Cauvery Ammal (124 STC 562 Madras) it was held that statutory
charge created over properties of the transferor for sales tax dues before
the transfer of property can be enforced against the transferee also. The
Hon'ble Madras High Court observed in that case that the tax which has
been assessed or has become payable will have priority over all other claims
against the property and this being so, prima facie, any alienation of the
property made on and after the assessment of sales tax would not be valid
until and unless the sales tax amount due and payable is cleared. Therefore
any contention of the purchaser that he was a bona fide purchaser for
value without notice was not acceptable. Therefore the Hon'ble Madras
High Court held that the purchaser need not be put to notice to
hold the transfer void. In a similar case the Madras High Court in the
case of B. Suresh Chand v. State of Tamilnadu, 148 STC 477 Madras,
held that sale of property by a dealer who is in arrears of sales tax is
void and the purchaser who fails to enquire about the sales tax dues of
the seller should be taken to have constructive notice of the charge.
From the above cases of A.P. High Court and the Madras High Court
it can be deduced that though the purchaser is not put to notice specifically
before holding the transfer void, the fact of completion of assessment and
raising demand and serving it on the dealer should be taken as a constructive
notice of charge to any prospective buyer of the property of the defaulting
dealer. As already stated in the preceding paragraph that under Section
27(1) of APVAT Act the proviso relating to notice of pendency of proceeding
or tax and adequate consideration is removed and the burden to prove that
the transfer is not made with an intention to defraud revenue is placed
on the dealer himself. Therefore all the officers are requested to note
that under the existing provisions of APVAT once the demand is
raised and served on the dealer, any subsequent transfer of property,
without clearing the dues shall be held as void and officers can
proceed to attach the property sold and recover the arrears. It is
also brought to the notice of all the officers that the Hon'ble A.P. High
Court in the case of Ganji Venkateshwara Rao v. Deputy Commercial
Tax officer and Kommu Venkateshwara Rao v. Deputy Commercial Tax
Officer, (124 STC 705 AP) held that Deputy Commercial Tax Officer or
any other recovery officer is competent to declare any transfer of assets
during pendency of any proceeding under the APGST Act or after completion
thereof as void without referring the issue to any Civil Court.
All the officers are therefore requested to utilize the provisions of
APGST and APVAT Acts relating to first charge, collection of dues from
the transferee and declaring transfer of property to avoid payment of tax
as void, by following the provisions as well all the judgments effectively
on those provisions, for realization of arrears from defaulting dealers.
In this regard all the officers are also requested to note that it is
always desirable to initiate early action for collection of arrears instead of
entering into legal wrangles with Andhra Pradesh State Finance Corporation,
Banks, and transferees of businesses. Towards this end it is necessary
that all the particulars of the properties, both movable and immovable,
of the dealers, their bank accounts and a list of secured creditors
especially in the cases of dealers having industrial units should be
obtained by issuing notices to the dealers and keep them on record to
initiate effective action against the defaulters soon after completion of the
assessment and service of demand notices. It is also suggested that
whenever officers conduct audits they may obtain the latest list of
sundry debtors in cases where they anticipate good demands and
keep the list on record for issue of garnishee notices for recovering
the demands raised on assessment in such cases. The officers are also
requested to keep a close watch on the sale notices of the Banks or
the State Finance Corporation published in the newspapers regarding
sale of assets of the defaulting dealers so that action can be initiated
immediately by invoking all the aforementioned provisions under APGST
& APVAT Acts.
In this connection it is brought to the notice of the officers that the
Hon’ble A.P. High Court in its interim orders dated 11.11.1999 in W.P.M.P.
No. 27393 of 1999 in W.P. No. 21865 of 1999 filed by the Andhra Pradesh
State Finance Corporation questioning the vires of the Section 16(c) of the
APGST Act vis a vis Section 29(1) of State Financial Corporation Act had
given the following directions:
“Pending further orders the petitioner (Andhra Pradesh State Finance
Corporation) can proceed to sell the properties offered as security for the
repayment of the loan due to the petitioner. Out of the sale proceeds realized
by the petitioner Corporation an amount equivalent to the sales tax due
in respect of which the Sales Tax Department has issued notice shall be
kept in an interest yielding deposit and a separate account shall be maintained
for the amount so deposited. Depending on the result of the writ petition
the deposited amount with interest shall be disbursed or dealt with.”
From the above interim order of the A.P. High Court it is clear that
the Andhra Pradesh State Finance Corporation is bound to keep the sales
tax arrears in a separate interest yielding deposit if a notice is issued by
the department to the Andhra Pradesh State Finance Corporation informing
them of the sales tax dues from the debtors. Therefore, all the Assessing
and Recovery Officers of the Department are requested to note that
whenever a demand is raised in the case of a manufacturing unit,
they should not only initiate action for its recovery by attaching the
bank accounts etc. but also inform the Andhra Pradesh State Finance
Corporation about the demand. This information about the sales tax
demands may be sent to the Andhra Pradesh Finance Corporation in all
the cases of manufacturing units as a protective measure whether or not
the unit has taken a loan from Andhra Pradesh State Finance Corporation.
All the Deputy Commissioners in the State are also requested to depute
a responsible officer to the branch office of the Andhra Pradesh State
Finance Corporation in their jurisdiction for obtaining information regarding
the sale of assets of manufacturing dealers by the branch, the
amounts realized thereon and the amounts of sales tax dues deposited
by the Corporation in interest yielding deposit as per the directions

of the A.P. High Court. The Deputy Commissioners (CT) may also
prepare a list of cases in which our officers have issued notices to the
Andhra Pradesh State Finance Corporation for recovery of the arrears of
the dealers in their respective jurisdiction and whether the Andhra Pradesh
State Finance Corporation had responded to those notices and the stage
of action in all such cases and submit detailed report to the Commissioner
(CT) for taking further action.
---------
41. Builders under the Act Unregistered
[CCT's D.O. No.AIII(l)/35/2009, dated 9-02-2009]
Sub:– APVAT Act, 2005 - Certain Builders unregistered under VAT
Act, 2005 - Certain information furnished - Requested to issue
instructions - Regarding.
Ref:– Lr. Ref. No.A6/36/2009, dated 31.01.2009 received from
Deputy Commissioner (CT), Saroornagar Division.
I am to invite your attention to the subject cited and to inform that
as per Section 4(7) of APVAT Act, any dealer engaged in construction
and selling of residential apartments, houses, building or commercial complexes
at his option, is liable to pay tax @ 1% of the consideration received or
the market value fixed for the purpose of stamp duty, whichever is higher.
As per Rule 17(4)(i) of the AP VAT Act 2005, the VAT dealer/contractor
has to pay this amount by way of a demand draft obtained in favour of
the Commercial Tax Officer or Assistant Commissioner concerned and the
instrument is to be presented at the time of registration of the property
to the Sub-Registrar, who is registering the property, duly furnishing his TIN
(Tax payer Identification Number) and the full postal address of the
Commercial Tax Officer/Assistant Commissioner concerned on the reverse
of the D.D. The Sub- Registrar, shall then send the D.D. to the Commercial
Tax Officer/Asst. Commissioner concerned every week.
However, it is observed that the buyers of the houses/flats at the time
of registration of the property are tendering the DD equivalent to 1% of
the consideration before the Sub-Registrar. But, such demand drafts obtained
by the buyer do not contain any details of the seller of the property. These
DDs also do not contain TIN or addresses of the seller/contractor/builder,
and the CTO/Asst. Commissioner concerned of the C.T. Department.
Further, it is noticed that most of the Sub-Registrars are not sending the
DDs to the Commercial Tax Officer/Assistant Commissioner concerned,
but the CTO/ACs are obtaining DDs from the Sub-Registrars located in
their jurisdiction on periodical basis.
Therefore, due to the above practice, some of the builders are getting
away without having registration under VAT Act under the plea that VAT
@ 1% has been paid through DDs at the time of registration to the Sub-
Registrar concerned. In all such cases there is a possibility of huge loss
of revenue, because many of the builders are purchasing sand and bricks
etc. from unregistered dealers on which they evade tax during the sale
of the flats. When they escape registration with C.T. Department, we are
not in a position to assess them and levy and collect the differential tax.
Similarly, they may be doing lot of other works contracts also which go
totally unaccounted and therefore lead to substantial tax evasion.
Therefore, in view of the above, I request you to issue instructions
to all the Sub-Registrars in the State that they must insist for Tax Index
Number (TIN) of the contractor at the time of registration of the property
when they receive Demand Drafts in favour of the CTO/AC concerned
with full address of the CTO/AC concerned. They must also send these
DDs to the CTOs/ACs of C.T. Department every week. Any delay in
sending these D.Ds would mean delay in realizing the taxes at the right
time, which as per the VAT Act can result in levy of penalty and interest
on the dealer because the credit of this amount of tax paid would not be
given in his account and this also causes unnecessary loss of time to the
Government in not realizing the revenues at the right time.
Therefore, urgent instructions may be issued in this regard and a copy
of the instructions issued to all the Sub-Registrars in the State in this regard
may be furnished to this office for taking necessary action of coordination
at this end.
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42. Tax Liability under the APGST and APVAT Acts to be the
First Charge on the Property of the Dealer
[CCT's Ref.No.LV(l)/284/2009-III Dated: 15-05-2009]
Sub:– APGST & APVAT Acts Section 16C of the APGST Act
and Section 26 of APVAT Act Tax liability under the two
Acts to be the first charge on the property of the dealer
- Judgment of the Hon'ble Supreme Court in the case of
Central Bank of India v. State of Kerala and Others –
Circular instructions - Issued - Regarding.
Ref:– 1. Judgment of the Hon’ble Supreme Court of India in the
case of Central Bank of India v. State of Kerala and
Others reported in 21 VST Page 505.
The attention of the all Deputy Commissioners, Appellate Deputy

Commissioners and S.Rs before STAT Hyderabad and Visakhapatnam is
invited to the judgment of the Hon'ble Supreme Court, in the case of Central
Bank of India v. State of Kerala and Others in which the Hon’ble Apex
Court examined the question whether Section 38C of the Bombay Sales
Tax Act, 1939, and Section 26B of the Kerala General Sales Tax Act,
1963 and similar provisions contained in other State legislations by which
first charge has been created on the property of the dealer or such other
person, who is liable to pay sales tax are inconsistent with the provisions
contained in the Recovery of Debts Due to Banks and Financial Institutions
Act, 1993 (in short the “DRT Act”) for recovery of “debts” and the
Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (in short “Securitization Act”) for enforcement
of “security interest” and whether by virtue of non obstante clauses
contained in Section 34(1) of DRT Act and Section 35 of Securitization
Act, the two Central legislations will have primacy over State legislations
and held that neither the DRT Act nor the Securitization Act create first
charge in favour of Banks, Financial Institutions and Other secured creditors
and the provisions relating to first charge under the State Sales Tax Acts
are not inconsistent with the provisions of DRT Act and Securitization Act.
In the absence of any such inconsistency, the non-obstante clauses in the
provisions relating to first charge under the Sales Tax Act not only create
the first charge on the property of the dealer liable to pay Sales Tax but
also give them overriding effect over other laws.
The Hon'ble Supreme Court further held that the Parliament while
enacting the DRT Act and Securitization Act was aware of the law laid
down by the Supreme Court wherein the priority of the State dues was
recognized and if Parliament intended to create a first charge in favour
of Banks, Financial Institutions or other secured creditors on the property
of the borrower, then it would have incorporated a provision like Section
529A of the Companies Act, 1956 and ensure that the dues of Banks,
Financial Institutions and other secured creditors should have priority over
the States statutory first charge in the matter of the recovery of Sales
Tax dues. In the absence of any specific provision to that effect, the first
charge created under the State Legislation will operate.
The Hon’ble Supreme Court also stated that (1) Section 14A of the
Workmen’s Compensation Act, 1923, (2) Section 11 of Employees Provident
Funds and Miscellaneous Provisions Act, 1952, (3) Section 74(1) of Estate
Duty Act, 1953, (4) Section 25(2) of the Mines and Minerals (Development
and Regulation) Act, 1957, (5) Section 30 of the Gift Tax Act, 1958 and
(6) Section 529A of the Companies Act are some of the Central Legislations
by which statutory first charge has been created in favour of the State
or workers.
It is to be noted that under Section 529A of the Companies Act, when

a company is in the process of winding up, the workmen’s dues and debts
due to secured creditors to the extent such debts rank under clause (c)
of the proviso to sub-section (1) of Section 529 pari passu with workmen’s
dues shall be paid in priority to all other debts. Therefore, this section protects
the workmen's dues either directly or when the secured creditor instead
of relinquishing his security and proving his debts, opts to realize his security,
the workmen's dues are to be given priority even in the security interest
of the secured creditors.
Except the workmen’s dues either directly or in the security of the
secured creditors, no other debts are given priority over the taxes due by
the company to the Central or State Governments. Section 530(1) of the
Companies Act clearly states that in winding up of a company all revenues,
taxes, cesses and rates due from the company to the Central or a State
Government or a local authority shall have priority over all other debts.
Therefore, even in the case of winding up of company the State taxes
will have priority over other debts excepting, workmen’s dues. This is
because “charge” is a wider term than any “security interest” in the form
of mortgage etc. created in favour of secured creditors. It is needless
to say that in case of companies who are not in the process of winding
up the first charge under Sales Tax Act would prevail over all other debts.
However, the first charge under State Sales Tax Act is subject to the first
charge created by other Central Acts listed out by the Hon’ble Supreme
Court in its judgment.
All the officers of the Department are therefore requested to go
through the judgment of the Hon'ble Supreme Court carefully and make
use of the findings in that judgment while proceeding to recover the dues
from the companies and other dealers.
----------
43. Instructions issued for Collection of Taxes by way of
Cheques/D.Ds under the Act
[Circular No AIII(1)/2007, dt. 12-01-2007]
Sub:– AP VAT Act – Collection of taxes by way of Cheques/DDs
– Instructions issued – Reg.
The Commercial Taxes Department Officers in some cases are hitherto
collecting VAT, CST and other taxes by way of issue of Government printed
cash receipts. This procedure shall be dispensed with effect from 01.02.2007.
Hence no officer of C.T Department shall collect any tax by way of issue
of cash receipt. The tax payments should be made by the dealers by
instruments like demand drafts, account payee cheques, or by payment
through challans in the Banks. The dealers coming for paying in cash during
January 2007 may be advised personally and through Notice Board.
However, at the time of vehicular traffic checking and also at check
posts, tax collection by way of issue of Government printed cash receipts
is permitted.
All the Deputy Commissioners are requested to bring these instructions
to the notice of all C.T. Officials for compliance and any deviation of the
instructions will be viewed seriously.
---------
44. Compulsory e-filing of returns by all the dealers in the State
Sub: Andhra Pradesh Value Added Tax Rules, 2005 - Notification under
Rule 23(12) -Compulsory e-filing of returns by all the dealers in
the State -Notification issued - Reg.
Ref: 1. G.O.Ms.No.1292, Revenue (CT-II) Dept., Dt.14/10/10.
2. CCT's Ref.AIIICD/29/2010, Dt.26/10/2010.
---
Order
In the reference 2nd cited, notification has been issued to the effect
that all the dealers in the registere in the C.T. Division of Abids, Begumpet,
Charminar, Hyderabad (Rural), Punjagutta, Saroor Nagar and Secunderabad,
shall file e-Return either directly or through their authorized representatives
with effect from the Tax period of October 2010 onwards.
Now it is decided to make the e-filing of monthly VAT and CST
Returns compulsory for all the dealers in the State in addition to the C.T.
Divisions, already notified under Rule 23(12) of the APVAT Rules, 2005.
Accordingly, in exercise of the powers conferred by sub-Rule 12 of
the Rule 23 of the APVAT Rules, 2005, it is hereby notified that all the
dealers, registered in the State under VAT and CST Acts shall compulsorily
file the monthly VAT and CST Returns online through the Commercial Taxes
Department (CTD) website www.apcommercialtaxes.gov.in. However, the
dealers can also file the monthly e-Returns online through their authorized
representatives or by submitting them at any of the e-Seva Centres in the
State by paying the transaction charges, prescribed by the Information
Technology & Communication (IT&C) Department from time to time.
This notification comes into force with effect from 01-06-2011.
-----
45. Inspection of Business Premises such as Manufacturing Units,

Godowns, Branches etc. – Powers of Inspection under the Act
[CCT’s Ref. AIII (1)/129/2011, dated 05-08-2011]
Sri Suresh Chanda, I.A.S., Commissioner of Commercial Taxes,
A.P., Hyderabad.
Sub:– APVAT Act, 2005 – Inspection of business premises such
as manufacturing units, godowns, branches etc. – Powers of
inspection – Clarification issued – Regd.
Ref:– 1. E-mail from the DC (CT), Nellore, dated 01.08.2011.
Several Deputy Commissioners (CT) in the State have been seeking
clarifications on the question, whether they can authorize the Officers of
their Division to inspect the business premises, such as Godowns, Branches
etc., which are located in their areas, but dealer is registered in other division.
It is clarified that in terms of Section 43 of the APVAT Act read
with Section 3-A of the APVAT Act and Rule 59 of the APVAT Rules,
the Deputy Commissioner (CT) can authorize the Officers of their Division
to inspect any business premises located within their territorial jurisdiction.
However, he cannot authorize any of his Officers to take up the assessment
of such dealers, if they are registered in other divisions. In such cases,
the Inspecting Officer may send the incriminating material, if any, to the
Deputy Commissioner (CT) of the Division concerned, in which such dealer
is registered, for further necessary action.
The receipt of the circular may be acknowledged at the earliest.
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46. Revised Instructions issued for Clarification on Lease Deed
and Rental Deeds Registrations under the Act
[CCT’s Ref. CAU /BI(2)/43/2007, dated 06-02-2010]
Sub:– APVAT Act, 2005 – Registrations under APVAT Act, 2005
– Certain Clarification on Lease Deed and Rental Deeds
Registrations – Revised instructions – Issued – Reg.
Ref:– (1) Govt. U.O Note No. 322391/Regn/I(2)/2005, dated
20.07.2005.
(2) Govt. Memo No. 24597/Vog.I(1)/2007-1, dated 02.06.2007.
(3) CCT’s letter addressed to all the DCs for implementation
of the U.O Note dated 10.07.2007.
(4) D.I.G-I of Registration and Stamps Lr.No.73/1765/05,

dated 09.09.2009.
(5) From the Registration Authority, Central Registration Unit,
Hyderabad Rc.No. CRU/1/2009, dated 30.09.2009 and
01.10.2009 addressed to the Deputy Commissioner (CT)
(CRU).
(6) CCT’s Ref. CAU/BI (2) /43/2007, dated 05.11.2009.
(7) From the Rajahmundry Chamber of Commerce
representation dated 06.12.2009.
(8) From the Twin City’s Tax Practitioners Association,
Hyderabad representation dated 22.01.2010.
(9) From the Commissioner and Inspector General of
Registration and Stamps, Andhra Pradesh, Hyderabad
Letter No.S1/9/2010, dated 21.01.2010 addressed to the
CCT.
invited to the reference cited.
In the reference 6th cited, all the Deputy Commissioners (CT) in the
State were directed to strictly follow the instructions issued vide references
1st to 3rd cited and to insist on the registered Lease Deeds on Rental
Deeds, while issuing Registration Certificates (RC’s) to the business
entrepreneurs.
However, the Commissioner and Inspector General of Registration &
Stamps Department vide reference 9th cited (copy enclosed) has informed
that their Department has no objection, if the Commercial Taxes Department
accepts unregistered rental deeds for issue of licensed (RC’s) under APVAT
Act, 2005, if the applicants pay the required stamp duty payable.
He further informed that the officer, who issues orders of license
(RC’s) should collect the stamp duty as per Article 31 of Schedule-A of
Stamp Act and cited an example to arrive the Stamp Duty leviable and
also informed the Head of Account, in which it has to be remitted in the
reference 9th cited (copy enclosed).
He finally informed that as soon as the Stamp Duty is paid license
(RC’s) may be issued and the issue of license (RC’s) may not be deferred
till the certificate is issued by the District Registrar. If the District Registrar
finds that the Stamp Duty, paid, is not adequate, the deficit amount has
to be collected from the concerned, by the Licensing Officer.
Therefore, all the Registering Authorities in the State including CRU,
Hyderabad are instructed to follow the procedural aspects communicated
by the Commissioner and Inspector General of Registration & Stamps

Department vide reference 9th cited (copy enclosed). Accordingly, they are
instructed to accept the unregistered rental deeds for issue of licenses (RC’s)
under, APVAT Act, if the applicants pay the required Stamp Duty payable
as per Article 31 of Schedule I-A to the Indian Stamp Act, 1899 by remitting
it to the following Head of Account:
Major Head : 0030 Stamps Non judicial
Minor Head : 103 Duty on impressing of Stamps
Sub Head : 01 Duty on impressing of Documents.
Encl: as above.
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47. Misinterpretation of Section 4(9)(b) of the APVAT Act
[CCT’s Ref.AIII (1)/234/2010 dated 18-12-2010]
Sub:– APVAT Act, 2005 – Misinterpretation of Section 4(9)(b) of
the APVAT Act – Certain clarification – Issued – Reg.
Ref:– From the Andhra Pradesh Hotels Association Lr., dated
08.11.2010.
invited to the reference cited, wherein the Andhra Pradesh Hotels Association
has requested for clarification with regard to the implementation of Section
4(9) of the APVAT Act, 2005.
In this regard, the Scheme of taxation with regard to the Hotels &
Restaurants as per Section 4(9) of the APVAT Act, 2005 is as under:
Sl.No. Description Rate of Tax Remarks
1. Star Hotels – 14.5% Hotels of the level of
3 Star and Three Stars and above
above are liable to tax
@ 14.5% irrespective
of the fact whether the
turnover is more or less
than Rs. 1.50 Crores.
2. Star Hotels – 4% Hotels of the level below
1 and 2 Stars Three Star are liable to
tax @ 4% irrespective
of the fact whether the
turnover is more or less
than Rs. 1.50 Crores.
VAT–65
Sl.No. Description Rate of Tax Remarks

3. Non Star Hotel 14.5% The Hotels (without
lodging facilities) having
turnover of Rs. 1.50
Crores and above are
liable to tax @ 14.5%
4. Non Star Hotels: 4% The Hotels (without
Turnover below lodging facilities) having
1.5 Crores and turnover of Rs. 1.50
above Rs. 5 Lakhs Crores and are liable
to tax @ 4%
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48. Increase in the Rate of Tax on Goods from 4% to 5%
[CCT’s Ref. AIII (1)/68/2011, dated 17-09-2011]
A.P., Hyderabad
Sub:– APVAT Act, 2005 – Increase in the rate of tax on goods
notified under Schedule IV from 4% to 5% – Eligibility for
input tax credit – Certain clarification – Issued – Reg.
Ref:– G.O.Ms.No.1718, Revenue (CT.II) Department, dated
13.9.2011.
Vide reference cited, the rate of tax for the goods, notified under
Schedule-IV of the APVAT Act was increased from 4% to 5% w.e.f.
14.9.2011. Several representations are received, seeking clarification on the
eligibility of input tax credit, available against the goods in stock as on
13.9.2011.
In this regard, it is clarified that the tax, paid @ 4% on the inputs,
purchased and held in stock as on 13.9.2011, is eligible for input tax credit
at 4% only against the output tax, payable @ 5% w.e.f. 14.9.2011.
This is for information and necessary further action.
--------
49. Waiver of Demands under CST Act for the Period from
1.4.2007 to 31-12-2010
[CCT’s Ref. AIII(1)/02/2011, dated 13-7-2011]
A.P., Hyderabad.
Sub:– Revenue Department – Implementation of the recommendations
of Group of Ministers held on 9.5.2011 in the Chambers of
Hon’ble Minister for Food and Civil Supplies – Communicated
– Waiver of demands under the CST Act for the period from
1.4.2007 to 31.12.2010 – Orders – Issued – Regarding.
Ref:– 1. G..O.Rt. No. 6040, GA (Cabinet) Dept., dated 23.11.2004.
2. G.O.Rt. No. 8473, GA (Cabinet) Dept., dated 24.12.2005.
3. Minutes of the meeting of GOM held on 9.5.2011 received
from Commr. of Civil Supplies & Ex-Officio
Secy. to Govt., CA, F&CS Deptt.,
Ref. No. PCC/7062/2010, dated 18.5.2011.
4. Govt. Memo No. 20354/CT.II(1)/2011-1, dated 08.06.2011.
invited to the reference 4th cited (Annexure I) and they are requested to
take necessary action accordingly. Instructions regarding Lorry Receipt are
also enclosed (Annexure II).
Encl: as above
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ANNEXURE–I
Waiver of Demands under the CST Act for the period from
1.4.2007 to 31.12.2010
[Memo. No. 20354/CT.II(1)/2011-1, dated 8-6-2011]
Sub:– Revenue Department – Implementation of the recommendations
of Group of Ministers held on 9.5.2011 in the Chambers of
Hon’ble Minister for Food and Civil Supplies – Communicated
– Waiver of demands under the CST Act for the period from
1.4.2007 to 31.12.2010 – Orders – Issued – Regarding.
Ref:– 1. G.O.Rt. No. 6040, GA (Cabinet) Dept., dated 23.11.2004.
2. G.O.Rt. No. 8473, GA (Cabinet) Dept., dated 24.12.2005.
3. Minutes of the meeting of GOM held on 9.5.2011 received
from Commr. of Civil Supplies & Ex-Officio
Secy. to Govt., CA, F&S Deptt., Ref. No. PCC/7062/2010,

dated 18.5.2011.
The Government vide references 1st and 2nd read above, have
constituted a Group of Ministers to study all the issues pertaining to Rice
Milling Industry pending with different Departments and to suggest appropriate
measures to the Government for taking further necessary action.
2. The Commissioner of Civil Supplies and Ex-officio Secretary to
Government, vide reference 3rd cited, have communicated the minutes of
Meeting of Group of Ministers held on 9.5.2011 which are as follows:
(1) That inter-State sales of rice, which are supported by Railway receipts
would be considered as an alternative to ‘C’ form.
(2) However, inter-State sales with effect from 1.1.2011 would have to
be compulsorily supported by ‘C’ form declaration for claiming 2%
CST.
(3) That the request made by the Rice Millers Association to accept
lorry receipts supported by valid documents and supporting proof like
stamps etc., on the permits/Release certificates may be examined
for taking a decision.
3. Government after careful examination of the matter, hereby, decide
that the recommendations of the Group of Ministers be accepted in toto.
Government accordingly order that the demand raised / to be raised by
the Commercial Taxes Department against the Rice Millers @ 4% on inter-
State sale of rice not supported by ‘C’ declaration forms, be waived to
the extent of 1% (i.e., excess demand raised over and above 3%) for the
period from 1.4.2007 to 31.5.2008 and 2% (i.e., excess demands raised
over and above 2%) for the period from 1.6.2008 to 31.12.2010. The orders
of waiver will be subject to the production of valid Railway Receipts. In
respect of Lorry receipts the Commissioner of Commercial Taxes is requested
to issue suitable instructions regarding the supporting documents/evidence
which shall authenticate such inter-State sale of rice.
4. The rice millers shall however have to mandatory furnish ‘C’
declaration forms for inter-State sale of rice from 1.1.2011 onwards and
the provisions of the CST Act be strictly enforced with effect from 1.1.2011.
5. The Commissioner of Commercial Taxes, A.P., Hyderabad is
requested to take necessary action accordingly.
--------
ANNEXURE–II
Guidelines to be followed to extend concession rate of tax under
CST Act in the absence of production of “C” Forms in case of the
inter-State transactions of rice, transported other than by way of
Railways
1. The dealer should produce the triplicate copies of the way bills
and the duplicate copy, left with the millers after checking of the same
by the check post authorities and the same has to be verified by the Authority
concerned.
2. The dealer should produce the data of the names of the Check
Posts, through which the goods have been transported to other States. The
Authority, concerned, should cross verify such data with the data, recorded
in the Check Posts, concerned.
3. The relevant entries in the “B” Registers, statutorily maintained
by the millers, should be verified as an evidence to show whether or not
the rice was transported against an inter-State permit of sales, issued by
the Civil Supplies Department.
The waiver has to be implemented only after verification, as mentioned
above.
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50. Filing of Trading and Profit and Loss Account, Balance Sheet
and Annual Reports under Rule 25(10) of the APVAT Rules
[CCT’s Ref. No. LV(1)/53/2009, dated 18.12.2010 and 29-12-2010]
Sub:– Filing of Trading & Profit and Loss account, Balance Sheet
and Annual Reports under Rule 25(10) of the APVAT Rules
– Regarding.
All the Deputy Commissioners, Assistant Commissioners, Commercial
Tax Officers, Deputy Commercial Tax Officers and other Officers in the
department are requested to note that as per the recently inserted sub-
Rule (10) of Rule 25 of the APVAT Rules, every VAT dealer shall furnish
for every financial year to the prescribed authority the statements of
manufacturing/ Trading Account/ Profit & Loss Account, Balance sheet and
Annual Report duly certified by a Chartered Accountant on or before 31st
December of every year. In this regard enquiries are received by the office
of the Commissioner of Commercial Taxes as to contents and the format
of the Annual Report mentioned in the said sub-rule.
The term “Annual Report” usually refers to the statements of final

accounts (Balance Sheet, Profit and Loss Account etc., together with the
Schedules thereunder), Directors report and Auditors report bunched together
in a book form. The Annual Reports are generally prepared by the companies
incorporated under Companies Act which prescribes the formats for all these
statements under Sections 209 to 217 of the Companies Act. Therefore
filing of Annul Report under Rule 25(10) of APVAT Rules is necessary
only for those dealers who are incorporated companies. For other dealers
(proprietary concerns, partnership firms, etc.,) it is enough if they file
Manufacturing/Trading Account, Profit and Loss Account and Balance Sheet
separately and not in the form of a book “Annual Report”. All the Deputy
Commissioners in the State are requested to bring this clarification to the
notice of all the dealers and STPs in their respective Jurisdictions”.
51. Levy of Tax on Sim Cards/Recharge Coupons
[CCT’s Ref. No. AIII (3)/ 328/2008, dt. 19-02-2009]
Sub:– APVAT Act, 2005 – Levy of tax on SIM Cards, Recharge
Coupons etc. – Certain ambiguities in assessment of the
dealers – Instructions issued – Regarding.
Ref:- 1. Representation of the Federation of A.P. Consumer Products
Associations dated 21.11.2008.
It is observed that the Assessing Authorities are assessing the Distributors
of the SIM cards, recharge coupons etc. @12.5% on the sale of the said
products. The Federation of A.P Consumer Products Associations has
represented that they are being put to hardship due to the levy of tax
@12.5% on their entire turnover due to the fact that the first sellers did
not pay tax and not issued the tax invoices, required.
In this regard it is informed that the first sellers of the SIM cards,
recharge coupons etc. were assessed to tax and the cases are pending
before the different appellate fora. The levy on the entire turnover at the
hands of the Distributors would amount to double taxation due to the nature
of the chain of transactions. Further Government is being addressed to take
a view on these transactions, which are liable to tax strictly in accordance
with the provisions of the APVAT Act, but leading to double taxation.
Therefore, it is hereby directed that the Deputy Commissioners in the
State may not proceed with the assessment of the SIM cards, recharge
coupons etc. to tax in the case of second and subsequent sellers till further
orders. It is further directed that coercive steps for the collection of demands,
raised in such cases, may not be initiated.
All the Deputy Commissioners are requested to bring the above
instructions to the notice of the Assessing Authorities for compliance.
--------
52. Submission of Certain Annual Statement of Accounts like Annual

Report, Profit & Loss Account Etc. under Rule 25(10) of APVAT
Rules.
[CCT/Peshi/2010, dated 24-12-2010]
Sri Suresh Chanda, IAS, Commissioner of Commercial Taxes
Sub:– AP VAT Act, 2005 – Rule 25(10) of the APVAT Rules –
Submission of certain annual statement of accounts like Annual
report, Profit & Loss Account etc. – Extension of time for
submission of Data.
As per Rule 25 (10) of AP VAT Rules 2005, all VAT dealers shall
furnish the statements of Trading Account, Profit & Loss Account, Balance
Sheet and Annual Report, duly certified by Chartered Accountant for every
financial year. These accounts have to be submitted for financial year 2009-
10 by 31st December 2010. In this connection, representations have been
received from the dealers and the Trade Representatives that this being
the first year for submission of such accounts by the dealers, the time
period for submission of these accounts may be extended by one month.
Keeping in view that this new Rule has been added in the month
of October 2010, the request is considered and for the financial year 2009-
10 these accounts can be submitted by the VAT dealers by 31.01,2011.
Requests also have been received from some quarters that they do not
have enough original copies certified by Chartered Accountants for submission
to the Commercial Taxes Department. Hence they requested for acceptance
of photocopies of the accounts duly certified by Chartered Accountants.
Keeping in view that this new Rule was added to the AP VAT Rules
in the month of October 2010, for this financial year 2009-10, the dealers
can submit photocopies of the accounts which are already certified by
Chartered Accountants provided that these accounts are again self-certified
by the dealer or by the Sales Tax Practitioner approved by the Commercial
Taxes Department.
--------
53. Payment of VAT/CST
[CCT’s Ref. No. Peshi/2011, dated 21-9-2011]
Circular
Sub:– Commercial Taxes Department – Payment of VAT/CST etc.
– Certain instructions –Reg.
All the field officers and staff may be aware that the dealers are
supposed to pay VAT and CST through e-payment mode or RTGS / NEFT
mode or Treasury challan. It has been brought to the notice that some
of the dealers are facing problem in getting challan from the circle office/
treasuries due to ongoing strike by staff in Telangana area.
In this regard, the Deputy Commissioners (CT) are requested to bring
it to the notice of all the dealers to make VAT / CST payments preferably
through e-payment or RTGS systems. In case they find any difficulty in
paying through e-payment or RTGS system they can download challan from
the website link available on CTD portal. With this challan they can approach
any SBH branch which is dealing in Government account to make payment
against that challan and submit challan copy in the CTO office concerned.
In Twin Cities, the dealers can also make payment through challan
system in Axis Bank Branches and SBH Branches of Sultan Bazar, R.P.
Road, Gunfoundry, Gruhakalpa and Sanathnagar.
All the Deputy Commissioners are requested to give vide publicity
of this facility so that dealers can make tax payments without any problems.
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54. Sale Of DEPB Licenses – Eligibility For Input Tax Credit
[CCT’s Ref. AIII(2)/91/2011, dt. 08-6-2011]
A.P., Hyderabad
Sub:– APVAT Act – Sale of DEPB Licenses – Eligibility for
Input Tax Credit – Clarification issued – Reg.
It is observed that some of the assessing authorities have not been
allowing input tax credits at the time of second and subsequent sales of
Duty Entitlement Pass Book (DEPB) licenses, supported by the tax invoices.
It is informed, in this regard, that the DEPB Licenses are treated
as goods for the purpose of levy of tax under APVAT Act and they are
eligible for benefits like input tax credit, admissible for other categories of
goods, subject to other conditions and restrictions.
Therefore, all the Deputy Commissioners (CT) in the State are directed
to instruct all the assessing authorities under their control to allow input
tax credit against all the second and subsequent sales of DEPB licenses
within the State subject to the production of tax invoices.
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55. Check Posts Surrender of Transit Passes at Exit Check Posts

[CCT’s Ref. Enft/D2/ 172/2010, dt. 24-5-2011]
Sub:– Check Posts – Surrender of Transit Passes at Exit Check Posts
– Generation of Receipt of Acknowledgment by VATIS module – Instructions
– Regarding.
It has come to notice that, the data entry of the Transit Passes
surrendered by the Driver/Owner of the goods vehicles at the Exit Check
Posts is not being done in the VATIS GIS module regularly. Consequently
these vehicles are unnecessarily black listed in VATIS/GIS and the area
CTOs are required to initiate assessment proceedings against the Transporters.
To ensure prompt data entry, a provision is made in the Check Post GIS/
Module, such that the receipt of acknowledgment is generated after entering
the details of surrendered transit pass at the Exit Border Check Post as
follows.
1. In GIS module enter TP No and Click “Save” button.
2. TP Surrender Receipt Screen will be displayed
3. Click “Print” button and take a print out of the Receipt.
4. The Authorized officer at CP will sign on the Receipt and hand it
over to Vehicle owner/Driver in addition to handing over stamped
TP to vehicle incharge.
A board has to be displayed (English/Hindi/Telugu) at all the counters,
that “Driver/Owner of the Vehicle shall insist on the Receipt of
Acknowledgment while surrendering the Transit Pass in the respective
counters”.
The Check Post authorities shall follow these instructions with immediate
effect without fail.
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56. Office Management District Office Manual Tottenham
System of Office Procedure
[CCT’s Ref. No.LV(l)/53/2010, dated 09-02-2011]
Sub:– Commercial Taxes Department - Office Management District
Office Manual Tottenham System of office procedure – To
be followed – Instructions issued – Regarding.
It is brought to the notice of all the Deputy Commissioners, CTOs
and other officers in the State that the Hon'ble Andhra Pradesh High Court
in one of the recent cases passed adverse remarks on the maintenance
of records and files in the offices of the Commercial Taxes Department.
The Hon’ble High Court observed that it has become a habit for the officers
to deal with the files and correspondence in a very casual manner creating
adverse effect on the democratic norm of accountability and transparency
in public administration.
The Hon’ble High Court would not have made these comments, had
the officers in that case strictly followed the Tottenham System of office
procedure as prescribed in the District Office Manual. In this regard it
may be noted that Dr. M.C.R. HRD Institute had brought out a small booklet
on office management. The portion relating to the office system as per
the District Office Manual in that booklet is enclosed to this circular as
Annexure for use by all the officers. All the officers are requested to strictly
follow the procedure to bring about transparency and accountability in the
offices.
The Hon’ble High Court also requested the Commissioner of Commercial
Taxes to evolve a foolproof workable system of receiving appropriate forms,
declarations and certificates filed by the assessee for claiming concessional
rate of tax and/or the exemption on any of the sales / purchase turnovers
under VAT Act.
In this regard all the officers are requested to note that if the system
of receiving the forms or other documents from the dealers is to be foolproof,
the first prerequisite is to maintain Inward Register, Distribution Register
and note file for all the assessment files in which receiving of all the returns,
forms etc., from the dealer and also issue of the forms, way bills, notices
etc., to the dealer are recorded promptly and accurately. The officers were
already requested earlier to record the hearings and appearances by the
dealers or their Authorised Representatives for assessments, revisions etc.,
in the note file in addition to maintaining a hearing register. As far as
receiving the forms, declarations etc., from the dealers is concerned, the
officers should request the dealers to file the forms with an index showing
the details such as numbers and dates of the forms, the dealers from whom
they were received, the invoices numbers with dates in the declarations
etc. In case the dealers file the forms and declarations without index, the
concerned assistant who maintains the assessment file should prepare the
index and keep it in the assessment file along with the forms. The index
details should also be entered in the note file and the signature of the
Commercial Tax Officer should be obtained in the note file.
All the officers and staff are requested to follow these circular
instructions strictly not only to promote transparency and accountability but
also to avoid the allegations, misconduct and the consequent disciplinary
action.
Encl: Annexure.
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ANNEXURE
(1) [Circular No: Memo No. 47340/CT-II(l)/2006
Dated: February 9, 2007]
Sub:– APGST Act, 1957 – Levy of Tax on the activities of Photo
Colour Labs under the said Act – Certain instructions – Issued
– Regarding.
Ref:– 1. From Photographic Assn., A.P., Hyd., Lr. No. dt. NIL.
2. Govt D.O.No.47340/CT.II(1)2006-l, dated 19.10.2006
3. From the Commissioner of Commercial Taxes, A.P., Hyd.,
Lr. No. AI(1)/921/2006, dt. 22.10.2006
The Photographic Association, Andhra Pradesh, Hyderabad in their
representation while ventilating their grievances on taxation of their transactions
such as taking photographs, development of negatives and printing of
photographs in the colour labs as transactions of works contract under the
APGST Act, 1957, based on the observations made by the Hon’ble Supreme
Court on 02.03.2006, in case of M/s. BSNL v. Union of India, (145 STC
91), by the Commercial Taxes Departmental authorities making revisions
retrospectively to levy and collect tax against the studios and colour labs
though they have not collected any tax, has requested for issuing instructions
to the concerned authorities to levy taxes prospectively i.e., w.e.f. 01.10.2006
with a view not to cause hardship to dealers and in public interest.
2. The Commissioner of Commercial Taxes vide his letter 3rd cited,
has reported that in view of the conflicting judicial decisions with regard
to the taxability of the transactions of printing and development of photographic
films, the request of the Photographic Association can be considered.
3. After careful examination of the above matter, the Government
hereby directs that levy of the tax on the transactions of printing and
development of Photographic films treating them as transactions of works
contract shall be made prospectively i.e., from 01.03.2006 onwards only,
as they have not collected the tax earlier. The Commissioner of Commercial
Taxes, Andhra Pradesh, Hyderabad is therefore requested to issue necessary
instructions to all the assessing authorities accordingly.
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57. Demand Raised for Payment of VAT on Lease of Taxi

Cabs/Buses under the Act
[Memo.No. 42596/CT-II(1)/2011-l, dt. 11-11-2011]
Sub:– CT Department – Demand raised for payment of VAT on
lease of taxi cabs/buses under AP VAT Act, 2005 – Certain
representation filed for waiver of tax - Orders Issued - Reg.
Ref:– 1 Govt. Memo. No. 28812/CT.II(1)/2008-l, Revenue (CT-II),
Department, dt. 12-6-2008.
2. Representation from Greater Hyderabad Cabs and Bus
Operators Association, Hyderabad received through CMP
No. 1845/CMP - SM/2011, dt 11.10.2011 along
with letter of Hon'ble Minister for Labour Employment.
3. Representation from Greater Hyderabad Cabs and Bus
Operators Association, Hyderabad received through CMP
No. 1893/CMP-SM/2011, dt. 17-10-2011 along with letter
of Hon'ble Minister for Labour Employment.
4. Representation Sri NK. Sultania, President, Greater
Hyderabad Cabs & Bus Operators Association, Hyderabad
received through Prl. Secretary to CM CMP No. 974/
CMP-OV/2011, dt 27.10.2011.
1. The Greater Hyderabad Cabs and Bus Operators Association, vide
representation 2nd to 4th cited, have requested the Government not to levy
VAT on the Taxi Cabs/Buses rented out by the members of the Associations
to IT/ITES/other organizations/institutions who usually hire the vehicles on
monthly/yearly basis.
2. The Association has also stated that the Government, in the meeting
held on 6.6.2008, had given the following assurances.
(1) VAT will not be levied/applied with retrospective effect.
(2) No coercive action will be taken against demands already raised.
(3) A Committee will be formed to look into the applicability of VAT
on the business transactions and come out with clear cut guidelines.
If VAT is found applicable by the Committee, it will be effective
with prospective date to be notified.
3. It has been further represented by the Association that their business
transactions have been assessed to service tax by the Union Government
from the date of inception of Service Tax and the proposed levy of VAT
@ 4% under the scheme of composition, vide Section 8(B) of the APVAT
Act, brought in through Ordinance No. 7 of 2011 with retrospective effect.
from 1.4.2005, is not in line with the assurance given by the Government
in June 2008. They have also cited some Court judgments in their favour
viz., Delhi High Court Order in S.T. Appeal No. 10/2009 in Commissioner,
VAT, Trade and Taxes Department v. International Travel House Limited.
They have stated that it would not be possible for them to pay Tax with
retrospective effect as they did not collect the same from their customers.
Finally, they have requested the Government to consider levy of VAT with
effect from 1.4.2012.
4. Government have carefully considered the above representation.
In 2008 M/s. Piyush Sultania, Jubilee Hills, a member of the above mentioned
Association, filed an application seeking an Advance Ruling on the taxability
of Taxi/Bus hiring. The Advance Ruling Committee, in its proceeding No.
AR.Com/22/21/2008, dt. 1.1.2009, under the powers vested by Section 67
of the APVAT Act, clarified that the transactions of Taxi Cab hiring/Bus
hiring are taxable to VAT in cases where there is transfer of ‘right to
use the goods’ and the said aspect has to be determined on a case to
case basis having regard to the terms of the relevant contract.
5. Government have also noted the recent Judicial findings on the
issue in the case of M/s. G.S. Lamba & Sons v. State of Andhra Pradesh
decided by the Hon’ble High Court of Andhra Pradesh on 28th January,
2011 which has held the levy of VAT on a transaction involving the transfer
of right to use vehicles through a contract, as valid.
6. Government has however noted that an element of doubts existed
among the taxi cab/bus owners about the taxability of the transaction
involving transfer of right to use the vehicles in view of differing Court
decisions on the issue. Hence keeping in view all the attendant circumstances
and legal position on the issue Government have decided, as a special case,
to waive the VAT demand on transactions involving transfer of right to
use taxi cabs/buses upto 7th November, 2011 provided the vehicle owner
has paid Service Tax to the Union Government and has not collected VAT
from the customer (lessee/hirer of the vehicle). However VAT should be
levied and collected on all such transactions with prospective effect from
08.11.2011. Cases in which VAT dues have been already paid shall not
however be reopened nor the taxes refunded.
7. The Commissioner, Commercial Tax Department is requested to
take necessary action accordingly.
------
58. Amendment to Rule 24 – Payment of Tax Online.

[CCT's Ref. CS(1)/483/06, Dated 29-04-2011]
Circular
Sub:– APVAT Rules 2005 – Amendment to Rule 24 – Payment
of Tax online – Certain instructions issued – Reg.
Ref:– 1) Govt. Memo No 11701/CT.II(1)/2010-3 Dated 15.06.2010
2) G.O.Ms.No.1292 Rev (CT.II) Dept., Dated 14.10.2010
3) DTA, Hyderabad Letter No Ml/17563/06 Dated 09.11.10
It is to inform that the VAT/CST dealers have been provided, since
November 2010 facility to pay tax VAT/CST online after filing monthly return
through “eReturn” module on the CTD website: www.apcommercialtaxes.gov
.in. At present the dealers having Internet Banking Account with any one
of the Banks viz. SBI, SBH, IDBI, Union Bank of India, Andhra Bank
and Corporation Bank can file the e-Returns and then make online payment
through e-Return application. The online application is routed through Treasury
department website where the eChallan number is generated and after
successful payment is made by the Bank gate way and acknowledged by
the Treasury dept. website, the confirmed ePayment receipt is generated
on CTD Portal.
In this system, the dealers are required to pay the entire tax due in
one transaction and there is no option to make part payment or multiple
payments for the same return. Further the dealer cannot make payment
before filing return through eReturn mode. In this connection, certain dealers
represented that they are facing practical difficulties to pay return tax in
one transaction and also to pay tax in advance.
In view of this, in addition to the existing eReturn mode, a new mode
of online payment is provided for the convenience of all the dealers with
name “ePayment” on the CTD Portal. All the dealers having Internet
Banking Account with any one of the Banks viz., SBI, SBH, IDBI, Union
Bank of India, Andhra Bank and Corporation Bank or Banks to be added
in future, can avail this facility and make online payment of tax due related
to monthly return before or after filing the return through e-Payment module.
The VAT/CST dealer can make full payment or part payment of Return
tax and the Dealer can also make multiple part payments for the same
tax period.
Therefore, all the Deputy Commissioners and Commercial Tax Officers

are hereby instructed to inform the same to all the dealers in the State
that they can make payment of VAT/CST Return tax through the eReturn
mode or ePayment mode.
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59. Levy of Tax on Hospital Beds, Beside Racks, Lockers etc.
[Ref: CCT’s Addl. CCT/Enft/DCTO-I/60/2010, Dated 16-11-2010]
Circular
Sub:– AP VAT Act, 2005 – Levy of tax on Hospital Beds, Bedside
racks, lockers etc. – Clarification issued – Regarding.
It is noticed that Hospital Beds, Bedside racks, Lockers etc. are being
assessed to tax @ 4%, treating them as falling under Entry 111 of the
IV Schedule to the AP VAT Act, 2005.
It may be noted that the Entry 111 of the IV Schedule to the AP
VAT Act, 2005 reads as “Medical Equipments/Devices and Implants”.
But the goods, actually sold, are hospital beds, bedside racks, lockers
etc., which do not qualify for classification as Medical Equipment. The
reasons, adduced generally to classify the said goods as falling under Entry
111 of Schedule IV of the AP VAT Act, 2005 are reported to be the
following:
1. The goods are sold only to hospitals.
2. They are being assessed to tax @ 4% only.
3. All the dealers are paying tax only @ 4%.
4. All the dealers are being assessed by the Department @ 4% only,
treating the goods as falling under Hospital/Medical Equipment.
The above reasons attempt to prove that the Hospital Equipment falls
under the category of Medical Equipments. Here, it should be noted that
the Medical Equipments is a sub-set of Hospital Equipments. All Hospital
Equipments do not qualify as Medical Equipments.
Therefore, Hospital Equipment cannot be equated with Medical
Equipment. The Hospital Beds, Racks, Lockers, etc. will fall under Hospital
Equipment, but not under Medical Equipment. The Medical Equipment is
an instrumentality, used with skill in diagnosis or cure of diseases and all
the hospital equipments need not be useful in the diagnosis or cure of the
diseases. In the Entry 111 of the Schedule IV, the expression, “medical
equipment” has to be read together with the words, “medical devices and
medical implants”. So, going by the principle of “noscitur a sociis” (The

word is known by the company it keeps), medical equipment is akin to
medical devices of implants, used in the diagnosis or cure of diseases. The
other equipments or furniture, used in the hospital, are not qualified to be
treated as medical equipment. Hence, hospital equipments like beds, racks,
lockers and other items of furniture, used in hospitals, do not fall under
Entry 111 of the IV Schedule to AP VAT Act, 2005 and are liable to tax
@ 12.5% up to 15.01.2010 and 14.5% thereafter.
All the assessing authorities in the State are, therefore, examine the
issue carefully and take appropriate action to levy tax on the goods like
beds, racks, lockers and other items of furniture, which are used in Hospitals
but do not fall under Entry 111 of the Schedule IV of the AP VAT Act,
at the rate, applicable under V Schedule of the AP VAT Act, 2005. Wherever
assessments are finalized in similar cases, Deputy Commissioners (CT) are
directed to initiate revision of the same, if necessary.
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60. C.T. Check Posts Modification of Circular issued earlier.
[CCT’s Ref. No. BV (3)/90/2010, dated: 19-11-2010]
Circular
Sub:– C.T. Check Posts Modification of circular issued earlier -
Regarding.
Ref:– 1. CCT's Enforcement No: D2/611/2007, dated 7-8-2007
In the reference cited supra, it is ordered that the check post authorities
should send the lorries with full load of goods, along with the relevant
documents, to the CTOs having jurisdiction over such check posts for the
disposal of the cases at their end, if they notice any irregularities. But,
it is noticed that some of the CTOs have no sufficient storage, loading
and unloading facilities. It is also noticed that ICPs and BCPs are better
placed when compared to the offices of their CTOs. Hence it will be better
if Goods vehicle is detained or Goods are unloaded at ICPs/BCPs and only
documents are sent to CTO for necessary action.
Hence, it is ordered that the ICPs and BCPs are excluded from the
operation of the above referred circular to this extent, with immediate effect.
Check Posts can detain the goods with them under the orders and transfer
the relevant documents, along with their observations, to their CTOs to take
further action in those cases.
------
61. Detention of Vehicles by Check Posts Authorities

[CCT’s Ref. No. D2/164/2010, Dated: 19-11-2010]
Circular
Sub:– Check posts – Detention of Vehicles by Check Posts Authorities
– Issuing – Certain Instructions – Regarding.
It is observed that on several occasions Check Post Authorities are
detaining the goods being transported from other States by persons which
are brought for personal use. Henceforth such goods should not be detained
if they are brought for personal use by individuals (other than Traders)
provided that they are covered by the address proof of the purchasers.
The address proof may be in the form of Driving License/Ration card Voter
ID Card/Bank A/c. etc., and Check Post Authorities may request/insist for
a letter stating that goods under transportation are meant for personal use
but not for sale.
Similarly, it is also noticed that materials purchased by Religious
Charitable Trusts which are brought from other States for construction of
Temples/Mosque/Church etc., are also detained at Check Posts. If such
goods are covered by plan copy and covering letter from the Trusts or
Committees, they should not be detained.
In respect of Works Contractors who are transporting the Earth moving
equipments/Poclainers/JCBs etc., relating to major Work Contractors at
times are being detained at Check Posts for want of invoices etc., though
they are not for sale. Generally, works contractors will be undertaking works
in several States and will be sending their own equipment for executing
works in other States. In such cases the TIN Number of Works Contractor
and a letter stating that these goods are for own use but not for sale is
sufficient proof. Such consignments should not be detained if they are
covered by the relevant proof. If required the TIN mentioned therein may
be verified with TINXSYS at Check Posts.
However, the Check Post Authorities may obtain Xerox copies from
the above mentioned individuals and Contractors for cross verifying the same
with concerned Assessing Authorities.
The instructions shall be scrupulously followed with immediate effect.
--------
VAT–66
62. Submission of certain annual statement of accounts like

Annual Report, Profit & Loss Account etc.
[CCT’s Ref. AIII(2)/232/2010, Dt. 24-11-2010]
Circular
Sub:– APVAT Act, 2005 – Rule 25(10) of the APVAT Rules –
Submission of certain annual statement of accounts like Annual
Report, Profit & Loss Account etc. – Certain Clarification
– Issued – Regarding.
Ref:– G.O.Ms.No.1292 Rev. (CT - II) Department dated 14.10.2010.
In the reference cited, a new Rule 25(10) is incorporated in the AP
VAT Rules, according to which every VAT dealer shall furnish for every
financial year the Statements of Trading Account, Profit & Loss Account,
Balance Sheet and Annual Report, duly certified by Chartered Accountant.
Several representations have been received on behalf of the VAT dealers,
whose turnover is less than Rs.40 lakhs and who are not liable for statutory
audit under the provisions of the Income Tax Act. It has been requested
in such representations that such small VAT dealers may have to get the
said Statements prepared and certified by the Chartered Accountants only
for the purpose of APVAT Act and it would increase their cost of
compliance.
Therefore, pending appropriate amendment to Rule 25(10), those VAT
dealers, whose turnover in a financial year is less than Rs.40 lakhs and
who are not liable for statutory audit under the provisions of the Income
Tax Act can file such documents as required under Rule 25(10) either
certified by Chartered Accountant or by Sales Tax Practitioners or Self
certified.
Accordingly, all the Deputy Commissioners (CT) in the State are
directed to issue necessary instructions to all the Authorities concerned to
accept the Statements from such VAT dealers if these statements are either
certified by the Chartered Accountant or certified by the Sales Tax
Practitioners or certified by the dealer himself.
The above instructions come into force with immediate effect.
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63. Issuing of Way Bills to dealers outside the State doing job works
in A.P.
[CCT’s Enft. Ref. No. B3/440/2011, Dated: 22-03-2011]
Circular
Sub:– AP VAT Act, 2005 – Issuing of Way Bills to dealers outside
the State doing job works in A.P. – Regarding.
It is to inform you that certain manufacturers located in other States
are sending goods (raw material) to work sites in Andhra Pradesh on job
work basis. After job work the goods will be taken back to their units
in other States. The movement of goods in such cases is not covered by
Way Bills since job working units do not have VAT Registration in Andhra
Pradesh. To facilitate the movement of goods in such cases the following
guidelines are issued:
1) The job work units located in A.P. bringing goods for doing job works
in Andhra Pradesh will approach the concerned Deputy Commissioner
(in the Division in which the job work unit is located).
2) The DC concerned after verifying the genuineness of the applicant
will permit the job working unit to bring raw material from other
States and to send back the finished goods to the manufacturing units
located in other States. The DC will specify the goods to be brought
and send duly covered by a prescribed stock transfer permit (in
triplicate). Check Post authorities will be instructed to permit the job
work units to transport the goods basing the stock transfer permits.
3) DCs should ensure that such permits are not misused by keeping
a watch on the job work units.
4) Check Post authorities should collect copies of stock transfer permits
and send the same to DC concerned for cross verification with the
job work units.
5) Job work unit will file monthly returns by 20th of next month indicating
quantity and value of goods brought in and goods sent out.
6) The above arrangement will help the dealers in transporting goods
(without Way Bills) and avoid problems at the Check Posts since
such goods are not covered by Way Bills.
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64. Certain Clarification on Paddy and Rice

[CCT’s Ref. AIII (1)/57/2010 Dt. 11-7-2011]
A.P., Hyderabad
***
Circular
Sub: APVAT Act, 2005 – Certain clarification on Paddy and Rice
under APVAT Act, 2005 – Issued – Regarding.
Ref: 1. CCT’s Circular Ref.AI(1)/92/2004, Dt.23/11/2004.
2. CCT’s Circular Ref.AIII(2)/201/2005, Dt.01/08/2005.
-----
invited to the references cited.
In the reference 2nd cited, it was informed that for claiming zero
rates sales, the transactions under Sec.5(3) of the CST Act, the following
documentary evidence is required:
a. Form H Declaration.
b. Purchase Order from the exporter and
c. Evidence of export in the form of transport documentation as above.
It was further mentioned that in the case of export, items (b) and
(c) must be produced to establish the claim of zero rating. In the case
of claims of zero rating in the course of export, the dealer / penultimate
exporter must produce any of the above documentary evidence to the
concerned assessing authority stating that the goods purchased are intended
for export.
However, it came to the notice of this Office that by misinterpreting
the above instructions, certain dealers are enjoying the benefit of exemption
on the sales falling under sub Section (3) of section 5 of CST Act' 56
even after a gap of one year by offering to file any of the required
documents, stated above. Though the dealers are under the obligation to
file all the requisite documents, they are taking the shelter of the circular
instructions issued vide reference 2nd cited and requesting to allow exemption
by accepting any one of the document filed by them.
Further, allowing exemption under the Act on the strength of any one
of the documents as instructed in the circular 2nd cited, vitiating the
assessment procedure and giving scope to raise objections by the Accountant
General.
Therefore, in supersession of the instructions, issued in the reference

2nd cited with regard to Export sales of Rice under Sec.5(3) of the CST
Act, it is clarified that all the following documentary evidence must be
produced in order to claim zero rate on the sales, falling under Sec. 5(3)
of the CST Act:
a. Form H Declaration.
b. Purchase Order from the exporter and
c. Evidence of export in the form of transport documentation as above.
All the Deputy Commissioners (CT) in the State are directed to follow
the above instructions scrupulously and acknowledge the receipt of the
circular, immediately.
------
65. Collection of Works Contract Tax/TDS
[CCT’s Ref.AIII(1)/100/2011 Dt. 30-06-2011]
Sri Suresh Chanda, I.A.S., Commissioner of Commercial
Taxes, A.P.
***
Sub: Collection of Works Contract Tax / TDS – Reg.
Ref: 1. CCT’s Ref. AIII (1)/184/2010, Dt.16/9/2010 and on 04/01/2011.
2. Meeting held in the chambers of the Principal Secretary
(Industries & Commerce) on 10.02.2011.
3. From the Asst. Development Commissioner, VSEZ F.No.
9/MISC/ SEZ/ HYD/2011, Dt.01/06/2011.
4. From the Development Commissioner, VSEZ D.O.No.9/
MISC/SEZ/HYD/2011, Dt.06/04/2011.
***
invited to the references 3rd and 4th cited, wherein the Development
Commissioner, Visakhapatnam Special Economic Zone has been requesting
for exemption of the Units, located in the processing Zones of SEZ, from
the provisions of the tax deduction at source, since the Contractors or
Subcontractors, executing the works for Units, located in the processing
Zone of the SEZ, are exempted in terms of Section 7A of the APVAT
Act read with Entry 59&59A of Schedule I of the APVAT Act.
Considering the fact that the Contractors, executing the work for SEZ
Units, are exempted and any TDS results in refund of huge amounts in
these cases, all the Deputy Commissioners (CT) in the State are hereby
directed to issue necessary instructions to all the authorities, concerned, to

invoke the provisions in Rule 18(1)(a) of the APVAT Rules, 2005 on
receiving applications from the works contractors, executing works for the
SEZs, Developers, Co-developers etc., and issue certificate thereunder to
the effect that there is no need for the SEZ Units, Developers, Co-
developers etc. to deduct tax at source in respect of such works. The
Authorities, concerned, may also be directed to examine the Contracts,
entered into by the Contractors with SEZ Units, Developers, Co-developers
etc., to ascertain that the works are going to be executed for the above
Contractees.
The circular instructions may be acknowledged at the earliest.
------
66. E-way Bills
[CCT’s Ref. No.D2/172/2010 Dated: 07-6-2011]
Circular
Sub: APVAT Act’05 – E-way bills -Acceptance of Faxed copy and
Print from Scanned image of e- waybills –Instructions issued –
Reg.
***
Complaints are received from the dealers stating that the Departmental
officials are stopping the vehicles that are carrying the faxed copy of e-
waybills by treating the said transaction as not covered by original e-waybill.
1. All the field officers and Officer of the Check Posts in the State
are hereby informed that the faxed copy and print from scanned
image of e-waybill are also valid eWaybills.
2. For utilization of e-waybills all the details of origin, destination,
consignor details, consignee details are to be entered into the e-
waybill for utilizing the waybill. These details are generally entered
in a computer located in the Head office. After filling the details
and obtaining the printed copy of e-waybill, it may not be practically
possible to send the physical copy of e-waybill particularly if the
branches or godowns are located at far off places from the head
office. Hence it is necessary to permit dealers to Fax eWaybill
to such palces. Same way it is also necessary to permit dealers
to send eWaybill through email by enclosing scanned image of
eWaybill.
3. Similarly will be the situation in respect of advance CST eWaybill

to be sent to other dealer in respect of sensitive commodities to
be brought into the State of Andhra Pradesh. The consignor may
be located in a far off State and sending of physical copy of
e-waybill may not be practically possible as it may takes days
for eWaybill to reach its destination and goods transporter may
not wait for such a number of days for moving the goods.
Hence keeping in view the practical requirements, it is hereby instructed
to all the field officers to accept the faxed copies and print from scanned
image of the e-waybills also.
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67. C.T. Check Posts
[CCT’s Ref. No.D2/172/2010 Dated:16-8-2011]
Office of the Commissioner of Commercial Taxes Enforcement Wing
A.P. Hyderabad.
Circular
Sub: C.T. Check Posts- Transit Passes – Surrender of TP at Exit Check
Post – Not done – Certain instructions issued- Reg.
***
1) It has been brought to the notice of under signed by the transporters
that although they have surrendered TP at Exit Check Post long
back but still CT department is issuing notices to them. They further
informed that some of the cases pertain to 3 – 4 years old and
at this stage they are unable to locate third copy of TP. Hence
to resolve this issue, following instructions are issued to the CTOs/
Administrative Officers/ACTOs/ Staff at Check Posts and there are
instructed to accept the following documents as proof of exiting the
A.P. border.
These instructions are valid only for TPs issued prior to 01.01.2011.
Any TP issued on or after 01-01-2011, transporter must submit third
copy of TP duly signed and stamped by Exit CP staff as proof
of exiting from AP Border. Failing which Tax shall be collected from
Transporter as per provisions of AP VAT Act and Rules.
Documents that can be accepted as proof of Exiting of Vehicle from
AP Borders:
a) Third copy of the Transit Pass signed and stamped by the Exit
Check Post Authorities or
b) Declaration on Rs.10/- Stamp Paper from consignee (buyer or

recipient of Goods) that goods are received by consignee giving
details of Consignor, Invoice No., Invoice Date, Value of Goods
and Date of receipt of the goods. It will apply only to those
consignees who are Government departments/Govt. organizations/
Centre and State Public Sector Units.
c) In case of other Consignees, Declaration on Rs. 10/- Stamp Paper
giving information mentioned under Sl. No. (b) above and details
of payment made by the consignees to consignors and or
transporters.
CT department reserves the right to check at random cases under
Sl. No. (b) and (c) above at any time for their correctness and if
found wrong during verification, the declarant as well as transporter will
be liable for criminal action under appropriate laws.
2) Further CP staff are instructed to see that, as soon as TP is received
at Exit CP, it should be entered into the computer system and the
acknowledgement receipt generated from computer system is handed over
to person in charge of the vehicle along with third copy of TP duly signed
and stamped by the CP staff on duty.
------
68. Inspection of business premises such as manufacturing units,
godowns, branches, etc.
[CCT’s Ref. AIII (1)/129/2011 Dt. 05-08-2011]
Sri Suresh Chanda, I.A.S., Commissioner of Commercial Taxes, A.P.,
Hyderabad
-----
Circular
Sub:– APVAT Act, 2005 – Inspection of business premises such as
manufacturing units, godowns, branches etc.–Powers of inspection
- Clarification issued - Reg.
Ref:– 1. e-Mail from the DC (CT), Nellore Dt.01/08/2011.
----
Several Deputy Commissioners (CT) in the State have been seeking
clarifications on the question, whether they can authorize the Officers of
their Division to inspect the business premises, such as Godowns, Branches
etc., which are located in their areas, but dealer is registered in other division.
It is clarified that in terms of Section 43 of the APVAT Act read

with Section 3-A of the APVAT Act and Rule 59 of the APVAT Rules,
the Deputy Commissioner (CT) can authorize the Officers of their Division
to inspect any business premises located within their territorial jurisdiction.
However, he cannot authorize any of his Officers to take up the assessment
of such dealers, if they are registered in other divisions. In such cases,
the inspecting officer may send the incriminating material, if any, to the
Deputy Commissioner (CT) of the Division concerned, in which such dealer
is registered, for further necessary action.
The receipt of the circular may be acknowledged at the earliest.
------
69. Levy and collection of Profession Tax by the Commercial
Taxes Departmental Officers
[CCT’s Ref. No. AI (4)/94/2010, Dated: 02-08-2011].
Sub: – The A.P Tax on Professions, Trades, Callings and Employments
Act, 1987 – Levy and collection of Profession Tax by the
Commercial Taxes Departmental Officers – Interpretation of Entry
21 of the First Schedule with reference to Entry 9 of the said
Act – Instructions issued – Regarding.
Ref:– e-mail received from Sri. Nitin K. Parekh, Chairman, Trade and
Commerce Committee (FAPCCI) Hyderabad, dt: 29-07-2011.
-----
The Andhra Pradesh Tax on Professions, Trades, Callings and
Employments Act, 1987 envisages under Sec.4, for levy of Tax as per item
number 9 of the of the 1st Schedule for the dealers registered or liable
to be registered under the A.P. Value Added Tax, 2005 other than those
mentioned in item (19) which reads as under:
Dealers registered or liable to be registered under Andhra Pradesh
Value Added Tax 2005 (Act 5 of 2005) (other than those mentioned in
item (19) whose total turnover in year ranges.
(a) Up to Rs.5,00,000/- Nil
(b) from Rs.5,00,001/- to Rs.10,00,000/- 800/- PA
(c) from Rs.10,00,001/- to Rs.25,00,000/- 1,200/- PA
(d) from Rs.25,00,001/- to Rs.50,00,000/- 1,500/- PA
(e) above Rs.50,00,000/- 2,500/- PA
As per item No.19 of the 1st Schedule of the said Act “ All companies
registered under the Companies Act, 1956 and engaged in a Profession,
Trade or Calling shall pay Profession Tax @ 2500/- per annum.
As regards Entry 21 which reads that, “Persons other than those
mentioned in any of the preceding entries, who are engaged in any
profession, trade or callings or employments”, are liable to pay Profession
Tax at the rate of Rs. 750/- per annum.
However, it has been brought to the notice that, CTD officials are
collecting Rs 750/- per annum from dealers who are not liable for Registration
under VAT Act with turnover less than Rs. 5,00,000 per annum under the
Entry 21 of the First Schedule, i.e., “Persons other than those mentioned
in any of the preceding entries, who are engaged in any profession, trade
or callings or employments” of the said Act.
It is observed that, such collection of profession tax under Entry (21)
defeats the very purpose of Entry 9(a) of the said Act, wherein the rate
of tax for the dealers registered or liable to be registered under Andhra
Pradesh Value Added Tax Act, 2005 (Act 5 of 2005) other than those
mentioned in item (19) whose total turnover in any year ranges up to Rs.
5,00,000, the Profession Tax payable is Nil.
In view of this, proposal is being sent to Government for appropriate
amendment to Entry No. 9 of the schedule.
Therefore, all the Deputy Commissioners (CT) in the State are requested
to give suitable directions to the Profession Tax Officers in their jurisdiction
not to enforce such collection till further orders.
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70. Levy of tax on interstate Sales of Textiles and Sugar
[CCT’s Ref. AIII (1)/114 /2011 dated 23-7-2011]
A.P., Hyderabad
----
Circular
Sub:– CST Act, 1956 – Levy of tax on interstate sales of Textiles and
Sugar – Clarification – Issued – Reg.
Ref:– G.O.Ms.No.932, Revenue (CT-II) Department, Dt.08/07/2011.
----
Several representations have been received from the Trade and Industry,
stating that their share in the market outside the State will be adversely
affected due to introduction of VAT on Textiles and Sugar in Andhra Pradesh
in view of the fact that a large number of States continue to exempt them
and as such they will not be able to produce “C” Form.
In this regard, it is clarified that the interstate sales of Sugar and
all varieties of Textiles are exempted in terms of G.O. Ms. No. 2328
Revenue dated 13-12-1957 and hence no tax is payable under CST Act
on the interstate sales of the said goods.
However, the dealers are required to produce C-Form to claim exemption
on such interstate sales of Sugar and Textiles. In this regard, it is contemplated
to provide for an alternative mode of evidence in lieu of C-Forms for the
purpose of discharging the proof that the goods are sold to dealers outside
the State where such goods are exempt and such buying dealers in those
States are not able to obtain “C” Form from the respective Tax Departments.
Therefore, on the strength of evidence, alternative to the C-Form, the
interstate sales of Sugar and Textiles will be treated as exempted, in case
such sales are made from Andhra Pradesh to States, where the said goods
are exempted under their local VAT Acts and such buying dealers are not
able to produce “C” Forms form their respective tax Department.
------
71. Non-filing and late filing of returns and late payment of tax
declared in the returns.
[CCT’s Ref. No.BV(2)/75/2010, dt. 10-11-2011]
Sri Suresh Chandra, IAS, Commissioner of Commercial Taxes,
A.P. Hyderabad.
Sub:- APVAT Act, 2005 & CST Act, 1956 -Non-filing and late filing
of returns and late payment of tax declared in the returns assessing
authorities not taking prompt penal action to enforce compliance
– Instructions under Section-77 of the APVAT Act, 2005 issued
– Reg.
***
It is noticed from VATIS data and on review of statistics submitted
by the Deputy Commissioners (CT) in the state, that there is large non-
compliance, by both VAT and TOT dealers, in filing the periodical returns
under APVAT Act, 2005/ and also under the CST Act, 1956. Sometimes
returns are filed beyond the due date prescribed in this regard. It is also
noticed in many a case, the tax declared and admitted as payable by the
registered dealers is paid beyond due dates prescribed under the provisions
of the APVAT Act, 2005, which provisions will apply for the delay in filing
returns/ payment of taxes under the CST Act, as per Section-9 of the CST
Act, 1956. Several instructions are issued under the provisions of APVAT
Act, 2005 besides the detailed instructions in this regard as prescribed in
General Procedures (Training Manual-II) issued under the APVAT Act, 2005
under the authority of the Commissioner (CT).
But it is distressing to note that the Assessing Authorities (i.e., Asst.
Commissioners (CT) LTUs, Circle Commercial Tax Officers, and the Deputy
Commercial Tax Officers entrusted with TOT administration) are not taking
the required action to enforce return filing by the dealers and to take penal
action for delay in filing returns/payment of declared and admitted taxes
as per turns as prescribed under the APVAT Act, 2005. Therefore the
following Instructions are issued for strict compliance by all the officers
concerned:-
A. NON FILING/LATE FILING OF RETURNS/ LATE
PAYMENT OF DECLARED TAXES BEYOND DUE DATES
BY DEALERS REGISTERED UNDER VAT/ CST:
1. If the VAT dealers (including under CST) did not file monthly
returns (VAT 200 and/ or CST-VI as the case may be) by the
20th day of the following month, the concerned authority shall
generate non-filers list by the 25th of the month the return was
due, then prepare Form-VAT 201 in duplicate, and a copy is to
be got served on the defaulter.
2. If the VAT dealer files return (along with payment of admitted
tax if any) then issue Form VAT 205 to demand payment of interest
due.
3. If the VAT dealer fails to file the return by the end of the month,
a unilateral assessment in Form VAT 204 should be issued to the
dealer as per Section-21(1) read with Rule-25(1) of the APGST
Act, 2005.
4. If the VAT dealer files the required return (along with payment
of admitted tax if any), then issue Form VAT 205 to demand
payment of interest due.
5. Form VAT 203A proposing to levy penalty for failure to file return
and/or to pay taxes in time is to be issued, and after considering
the objections filed if any, issue Form VAT 203 on the penalty
levied. (Sections-50, 51 and 52 of APVAT Act, 2005).
6. If a VAT dealer files a return before the end of the month, but
fails to pay the admitted tax along with the return, and there is
delay in payment of taxes beyond the end of the month, then
issue Form VAT 202 demand for payment of short paid/unpaid
taxes, and after payment of tax demand to issue notice for payment
of interest in VAT 205, in addition to issue of VAT 203A (later
VAT 203) for levy of penalty.
7. If the VAT dealer fails to file the return, and fails to pay the
unilateral assessment demand/penalty, then the file should be referred
for collection of unpaid demands.
B . NON FILING/LATE FILING OF RETURNS/ LATE
PAYMENT OF DECLARED TAXES BEYOND DUE DATES
BY DEALERS REGISTERED UNDER TOT:
1. If the TOT dealers did not file quarterly return in Form TOT
007, then on the first day of the month following the month in
which the return was due (July, October, January, and April) (i.e.,
on 1st of August and so on as the case may be) the defaulters
list is to be generated, and a notice in Form TOT 008 is to be
issued to the defaulter dealer by the DCTO entrusted with TOT
administration in the circles.
2. If the TOT dealer files the return and pays the tax due if any,
then issue Form TOT 011 to demand payment of interest due.
3. If the TOT dealer fails to file the return by the end of the month,
a unilateral assessment in Form 010 should be served on the dealer
by the 15th day of the next month (Keep a gap of at least 10
to 15 days time after issue of Form TOT 008) as per Section-
21(1) read with Rule-25(3) of APVAT Act, 2005.
4. If the TOT dealer files the return (along with payment of admitted
tax if any), then issue Form TOT Oil to demand payment of interest
due. (Then the unilateral tax demand and the penalty as per TOT
010 shall be withdrawn).
5. Form TOT 009 A proposing to levy penalty for failure to file return
and/or to pay taxes in time is to be issued, and after considering
the objections filed if any, issue Form TOT 009 on the penalty
levied. (Sections-50, 51 and 52 of APVAT Act, 2005).
6. If a TOT dealer files a return before the end of the month after
the quarter to which it relate, but fails to pay the admitted tax
along with the return, and there is delay in payment of taxes beyond
the due date, then issue Form 012 demand for payment of short
paid/unpaid taxes, and after payment of tax demand to issue notice
for payment of interest in TOT 011, in addition to issue of TOT
009 A (later TOT 009) for levy of penalty.
7. If the VAT dealer fails to file the return, and fails to pay the
unilateral assessment demand/penalty, then the file should be referred
for collection of unpaid demands.
The above instructions are issued with a view to enforce prompt filing
of returns which in turn augment the revenues of the State, besides
inculcating discipline in dealers and the administration. Therefore all the
assessing authorities in the State are instructed to follow the above instructions
in letter and spirit. Any laxity in this regard will be taken note for appropriate
action. The Deputy Commissioners (CT) are requested to ensure reviewing
this work frequently. It will also be reviewed along with statistics periodically
by this office.
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72. Filing of e-Return at any e-Seva centre
[CCT’s Ref. CS(1)/171/06, Dt. 16-04-2011]
O/o Commissioner of Commercial Taxes,
Central Computer Wing, A.P. Hyderabad.
Circular
Sub:– APVAT Rules, 2005 – Amendment to Rule 23(12) – Filing
of e-Return at any e-Seva centre – certain instructions issued
– Reg.
Ref:- 1) G.O.Ms.No. 1292 Rev (IT.II) Department, Dt. 14-10-2010.
2) Dy. Director, e-seva mail Dt: 07-04-2011.
In the reference 1st cited Government have issued orders regarding
filing of Returns through electronic filing system.
In the reference 2nd cited the Deputy Director, e-Seva informed that
e-Seva is ready to accept returns and Application is installed in all districts
and tested.
Therefore, all the Deputy Commissioners and Commercial Tax Officers
are hereby instructed to inform the same to all the dealers in the State
that they can file e-Return at any e-Seva centre through out the State.
Dealer will pay e-Seva transaction charges as fixed by the IT & C
Department from time to time.
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73. Certain instructions issued to improve the quality of ‘Audits’
[CCT’s Ref.No. B-V(3)/37/2010, dt. 5-9-2011]
Circular
Present:
Sri Suresh Chanda, IAS, Commissioner of Commercial Taxes
Sub:- APVAT Act, 2005 – Certain instructions issued to improve the
quality of 'Audits' and to maximize revenue by proper selection
of cases for Audits-need to incorporate all issues observed in the
audit in the assessment order as and when made and to take
up post audit check of some cases where audit has been completed-
reg.
Ref: 1. CCT's Ref. No. B II (2)/122/2006, dt. 29.5.2006.
2. CCT's Ref. No. B II (2)/122/2006, dt. 19.6.2006.
3. CCT's Ref. No. B II (2)/122/2006, dt. 8.9.2006.
4. CCT's Ref. No. B II (2)122/2006, dt. 16.9.2006.
5. CCT's Ref. No. B II (2)122/2006-1, dt. 4.10.2006.
6. CCT's Ref. No. BV I (3)/120/2007, dt. 31.5.2007.
7. CCT's Ref. No. BV I (3)/120/2007, dt. 13.6.2007.
8. CCT's Ref. No. BV I (3)/120/2007, dt. 22.9.2007.
9. CCT's Ref. No. BV I (3)/120/2007, dt. 5.10.2007.
10. CCT's Ref. No. BV 1 (3)/120/2007, dt. 25.10.2007.
11. CCT's Ref. No. BV 1 (3)/120/2008, dt. 16.4.2008.
12. CCT's Ref. No. BV I (3)/120/2007, dt. 30.10.2008.
13. CCT's Ref. No. BV (3)/60/2009, dt. 11.5.2009.
14. CCT's Ref. No. BV (3)/37/2010, dt. 29.3.2010.
-----
Several instructions were issued, through the various references
cited, besides at the time of review of audit reports, and also at the time
of review of performance of divisions in the conferences of Deputy

Commissioners (CT) by the Commissioner (CT) and by the Principal
Secretary to the Government, Revenue Department as to conducting of
quality audits with a view to unearth revenue leakages and 'Audit exercise'
should act as a deterrent for others. It is observed that from the selection
of cases to take up audit to the quality of assessment orders made, there
is need for improvement.
Review of reports on 'Audits' furnished by the Deputy Commissioners
(CT) further revealed that necessary exercise of verification of all the
available data before taking up the cases for audit is not being done as
expected, but the cases appear to have been picked up casually. The details
to be verified for selecting the cases for audits are reiterated in the ref.
13th and 14th cited. In several cases, there is no match between the taxes
collected and the penalty (ies) levied/leviable. Though it was prescribed (ref.
13th cited) that each and every audit officer has to fill up the ‘check memo’
at the time of audit, it came to light that there are no check memos in
the audit files as was observed by the Audit of some files by the teams
of Accountant General. Further the assessment orders by the audit officers
do not throw any light on the points verified by them at the time of/
subsequent to audit, but mention only the items that are proposed for levy
of tax, thereby making the said assessment orders lacking in the required
details on the totality of the dealers’ activities for the period covered by
audit. The ‘Model Assessment Order’ communicated by this office recently
has not been taken in to cognizance by the audit officers/ controlling officers
while assessing the dealers.
In order to stream line the quality of audit and accountability on the
part of Audit Officers', the following instructions are issued-
1. The Deputy Commissioners (CT) shall gather/cause to gather
relevant data relating to any dealer from various sources available,
including check post data, way bills utilization, other third party
information, information obtained from statutory bodies, banks etc;
the reports of variation available from VATIS, and then prioritize
the cases for taking up audit, and such important cases alone shall
be authorized for audit. This does not mean that the DCs (CT)
cannot take up cases for audit at random, but shall not pick the
cases for audit in a routine manner.
2. The 'Audit Officers' shall invariably fill up the 'check memos'
assessee wise (copies enclosed-7) on completion of audit, sign
them and keep a copy in the Audit/Assessment file for record

and verification. If such check memos are not available in any
file where audit was done, then the lapse on the part of the audit
officer will be taken a serious view, besides taking up suitable
disciplinary action.
3. After the audit is completed, and if it is decided that 'assessment'
is need, then invariably the said officer authorized to do the
assessment shall discuss all the aspects observed as per check
memo in the said pre-assessment show cause notice, and give
remarks/ conclusions on each issue in the assessment order, along
with the totality of the business transactions of the dealer during
the period covered by the audit. If the said details are missing
in any assessment order, it will be construed that the said audit
officer has not applied his/ her mind to the facts, and discharged
the duties in a casual/ negligent manner.
4. The Deputy Commissioners (CT) being the controlling officers
responsible for proper conduct of audits, shall identify some cases
for re-check of the correctness/ authenticity of the audits; identify
an officer other than the officer who conducted the audit to super-
check such records if necessary by going to the dealers' place.
It is made clear that this is not further audit of the dealers'
transactions. It is desirable to make this very clear to the dealer
and also to the officer entrusted with the super-check. At least
in one or two cases such exercise may be taken up by the Deputy
Commissioner concerned. If any variations are noticed by such
super-check, then it will be construed that the ‘audit officer’ who
conducted audit did not act diligently while conducting audit and
suitable action may follow. Further on the variations, if any, if
assessment is needed the DCs (CT) may initiate revision of such
assessments.
5. In the review meetings of the Deputy Commissioners (CT) with
the Commissioner (CT), these super-checked audit cases shall be
presented and analyzed by the DCs, starting from the basis for
selection of the cases to the findings/conclusion.
VAT–67
6. The Commissioner (CT) may also identify cases, based on the

audit reports, and entrust to any senior officers in the O/o.
Commissioner (CT) to have a relook at the assessments as to
the legality and propriety of such assessment orders, if necessary
to visit divisions/ circles to examine the connected files.
The Deputy Commissioners (CT) are requested to bring these instructions
to notice of all the assessing/audit officers for strict compliance, and shall
acknowledge receipt by return of post.
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74. State Government of A.P. filed SLP (Civil) No.(s). 8053-8077/
2008 before Hon’ble Supreme Court of India
[CCT’s Ref.No. B-V(3)/380/2011, dt. 2-1-2012]
Sri Suresh Chanda, Commissioner of Commercial Taxes
Circular
Sub:– A.P.Tax on Entry of Goods into Local Areas Act, 2001 – Set
aside by the Hon’ble High Court of AP in W.P.No.615/2002 and
its batch cases, dated 30.12.2007 – State Government of A.P. filed
SLP (Civil) No.(s). 8053-8077/2008 before Hon’ble Supreme Court
of India against the orders of Hon’ble High Court of A.P. – Interim
Orders issued on 09-05-2008 for Stay of refund – Circular
instructions – Issuance – Regarding.
Ref:– 1. Hon’ble High Court of AP in W.P.No.615/2002 and its batch
cases, dated 30.12.2007.
2. Interim orders of Hon’ble Supreme Court of India in SLP (Civil)
No.(s)8053-8077/2008, dated 09-05-2008.
3. CCT’s Ref.No.L1(3)/2008, dated 12-05-2008 and 14-05-2008.
-----
The attention of all the Deputy Commissioners (CT) and all the
Assessing Authorities in the State is invited to the subject and references
cited. They are informed that in the reference 1st cited the Hon’ble High
Court of Andhra Pradesh in its orders dated 30-12-2007 in WPNos.615/
2002 and batch cases in M/s Sri Rayalaseema Alkalies and Chemicals and
others struck down the charging Section 3 of A.P. Tax on Entry of Goods
in Local Areas Tax Act, 2001 as ‘unconstitutional’.
NOTIFICATIONS UNDER V.A.T.
1. Plastic Manufacturers – Refund of Excess Paid Tax To Exporters
[G.O.Ms.No. 1248 Revenue (CT-II) Department, dt.23-6-2005]
Order:
The Government of Andhra Pradesh introduced Value Added Tax
system of taxation w.e.f. 01-04-2005 as per the provisions of Andhra
Pradesh Value Added Tax Act, 2005. The State of Andhra Pradesh did
not include the items of Raw materials and industrial inputs in Schedule-
IV of the AP VAT Act taxable at 4% as was done by some of the States.
In order to ensure that the un-organised industries would come into the
VAT fold. Resultantly the industrial inputs and raw material purchased by
manufacturers are taxable under Schedule V @ 12.5% tax. In case of the
manufacturers, whose final product is liable to tax @ 4% under Schedule
IV with specific reference to plastic industry comprising of PVC pipes,
HDPE sacks, plastic containers etc. are subjected to disadvantageous position,
as the differential tax element of 8.5% paid by them on inputs get blocked
as they cannot adjust this portion of tax against the tax payable by them
on the sales of their final product.
(2) In view of the above, the Group of Ministers in their meeting
held on 28-4-2005, considered the request of the plastic manufacturers
industry and approved the proposal of the Commissioner of Commercial
Taxes, to grant monthly refunds, so as to avoid the burden of 8.5% tax
of such manufacturers being locked up with the Government, since the
refund of tax to the VAT dealers other than exporters are available in March,
2007. The Commissioner of Commercial Taxes, A.P., Hyderabad has
submitted proposal in the letter, read above, to accord permission for
arranging to refund the differential tax of 8.5% paid by such manufacturers
remaining un-adjusted from out of the output tax payable @ 4%. The
Commissioner of Commercial Taxes, A.P., Hyderabad has also sent proposal
to permit him to follow the same process to arrange refund of tax paid
by the exporters, on monthly basis, as per the provisions of AP VAT Act,
2005.
(3) The Government have carefully examined the matter in view of
the decision taken by the Group of Ministers at its meeting held on
25.4.2005 and decided to accord permission to grant monthly refunds for
the excess input tax available in respect of plastic manufacturers and also
for approving the mechanism of monthly refunds to the exporters under
Section 38 (1)(a) of AP VAT Act, 2005. The Commissioner of Commercial
Taxes, A.P., Hyderabad has also submitted a proposal with a process of
1059
mechanism for regulating the grant of refunds for approval of the Government.
The Commissioner of Commercial Taxes is himself competent to issue
directions and instructions to his subordinate officers, prescribing the
procedure under Section 77 of the AP VAT Act, 2005. The Government,
have therefore decided to permit the Commissioner of Commercial Taxes
to issue instructions prescribing the procedures to be followed for regulating
the refunds.
(4) Accordingly, the Government hereby permit the Commissioner of
Commercial Taxes (i) to provide for monthly refunds of excess input tax,
wherever the manufacturers like plastic manufacturers pay tax @ 12.5%
on the purchase of inputs while they have to pay out put tax only @ 4%.
(ii) to adopt suitable mechanism for refund of tax to the eligible exporters
under Section 38 (1)(a) of APVAT Act, 2005 on monthly basis. The
Government also permits the Commissioner of Commercial Taxes to issue
instructions under Section 77 of APVAT Act, 2005 to all his subordinate
officers prescribing the procedure regulating the refunds to be granted as
per the orders issued herein and to send a copy to the Government for
record.
2. Amendment to Schedule VI of the Andhra Pradesh Value Added
Tax Act, 2005
[G.O.Ms.No. 1453, Revenue (CT. II), dated 26-7-2005]
In exercise of the powers conferred by Section 79(1) of the Andhra
Pradesh Value Added Tax Act, 2005 (Act No. 5 of 2005), the Governor
of Andhra Pradesh hereby directs that the notification issued in G.O.Ms.No.
1229, Revenue (CT. II) Department, dated 20-6-2005, in so far as it relates
to entry (1) of the Schedule VI shall be deemed to have come into force
w.e.f. 1-4-2005, in respect of the stocks of liquor costing more than Rs.
700 per case held by M/s. Andhra Pradesh Beverages Corporation Limited,
as on 1-4-2005, and sold thereafter with old MRP stickers and at the old
billing rates as per the orders issued by the Government in G.O.Rt.No.
399, Revenue (Excise II) Department, dated 31-3-2005.
3. Works Contracts – Finance (Works & Projects F-8) Department
[G.O.Ms.No.11, W & P Dept., dated. 29-7-2005]
(1) Deputy Financial Advisor & Ex-Officio Dy.Secretary to Government
Fin.(W&P) Department D.O.Lr.No.629/F8(1)/05-02,
dt. 09-05-2005 along with minutes of the Meeting held on
27-04-2004.
(2) CCT’s Ref.No.AIII(1)/78/05, dt.14-07-2005.
Notifications under VAT 1061
Order :
In exercise of the powers conferred under Sec.76(2) of AP VAT
Act, 2005, the Government of Andhra Pradesh hereby issues the following
instructions on executing works contracts under APVAT Act, 2005.
(1) Tax collection at source at 4% towards VAT shall be made in
all payment made in all Engineering Departments of all works irrespective
of value of work and irrespective of category of registration of the contractor/
firm.
(2) Necessary provision in the works estimate has to be made at 4%
of the cost of the work towards VAT where value of material component
in the work is more than 10% of the value of the total work
(3) In respect of works in which overall material component involved
is less than 10% of the value of work, no provision towards VAT be made
in the estimates and no recovery also need be made in respect of such
works payments.
(4) The component of 4% for payment against VAT shall be included
in the estimates prepared in this connection.
(5) For implementation of VAT and effecting TCS, date of payment
of the respective bill only is the criterion. As and when bills are paid,
4% should be collected, wherever applicable.
6. Calculation of VAT to be deducted is as follows:
Amount of bill X 4/104
7. In respect of ongoing works, the recovery as per already existing
provision will be made and in addition, the difference between 4% of work
value and earlier provision already available will also be made. This is
to ensure that all payments from 1-4-2005 are regulated according to VAT
provision. This additional amount can be provided in the works estimates
and if necessary the relevant estimate sanctioning authorities can sanction
revised estimates for this purposed.
8. Sales Tax recovered in the bills will be credited by the PAOs direct
to the Major head 0040 Sales Tax -Sub Major Head 040-Minor Head 102
Receipts under State Sales Tax Accounts-Sub Head 05 Tax Collection -
and a Schedule of Sales Tax (TIN-Wise) is to be given by the PAO to
the DDO (With copy to Commercial Tax authorities)
9. A copy of the Schedule of TCS shall be given to the nearest CTO
by the PAO.
10. From 501(certificate of Tax Collection at Source) is to be finished

to the contractor by the Drawing and Disbursing Officer at the time of
delivery of cheque at the instance of each payment, A copy from 501
is attached.
1
[11. In respect of all works costing more than Rs.5 lakhs each, no
work should be awarded without the successful tenderer submitting copy
of his VAT registration certificate incorporating Tax Identification
Number(TIN). A copy of such registration shall be annexed to the agreement.]
4. Input Tax Credit – Food Corporation of India and Andhra
Pradesh Civil Supplies Corporation made ineligible
[G.O.Ms.No. 1676 Revenue (CT-II) Dept., dt. 23-9-2005]
(1) CCT's Ref. No. A.III(1)/244/05, dt. 30-08-2005.
(2) G.O.Ms.No. 1675, Revenue (CT-II), Dept., dated 23-09-2005.
Order :
In the reference 1st read above the Commissioner of Commercial Taxes
has reported that the Food Corporation of India purchases Rice from farmers
and farmers' clubs who are not the registered dealers under A.P. VAT Act,
2005, that the farmers and farmers' clubs could be treated as Casual Traders
under Section 2(7) of A.P.VAT Act, 2005 not required to get themselves
registered, but would be liable to pay VAT on their sales to Food Corporation
of India, that the Food Corporation of India may be responsible for deduction
of tax payable by the farmers and farmers' clubs on their sales of Rice
to FCI from out of the amounts payable by the FCI to the farmers and
farmers' clubs and that the FCI shall account for such purchases from
farmers and farmers' clubs as non-creditable purchases in FCI's Returns
without claiming input tax credit, and requested the Government to issue
appropriate orders in this regard.
(2) In the reference 2nd read above the Government issued orders
under Section 78 of A.P.VAT Act, 2005 amending the A.P.VAT Rules, 2005
as per which the FCI is not eligible for input tax credit under Clause (1)
of sub-rule (2) of Rule 20. Similarly as per Clause (m) of sub-rule (2)
of Rule 20 of A.P.VAT Rules, the A.P.Civil Supplies Corporation is also
not eligible to claim input tax credit.
(3) The Government after careful examination of the matter, and in
view of the amendments issued to A.P.VAT Rules, 2005 as stated under
Para (2) above, hereby issues the following clarifications in exercise of
the powers vested under Section 76 (2) of A.P.VAT Act, 2005 :
1. Subs. by G.O.Ms.No. 1, W&P, Dept., dt. 24-1-2006.
(i) The Government vide G.O.Ms.No.1675, Dated 23-09-2005 have

made amendment to clause (1) of Rule 20(2) of Andhra Pradesh Value
Added Tax Rules, 2005 and also inserted a new clause (m) in Rule 20(2).
As a result of this, Rice purchased by Food Corporation of India from
VAT dealers and farmers/farmers' clubs/associations of farmers within the
State and rice purchased by Andhra Pradesh State Civil Supplies Corporation
from the Depots of Food Corporation of India, in Andhra Pradesh or from
any other VAT dealer in the State will not be eligible for input tax credit.
As input tax credit is not available on the purchase of Rice as mentioned
above, their corresponding sales will not be liable to any tax. Accordingly
the Food Corporation of India and Andhra Pradesh State Civil Supplies
Corporation Limited will be liable to pay tax only if their sales are first
sales in the State. Both Food Corporation of India and Andhra Pradesh
State Civil Supplies Corporation Limited will not be eligible for transitional
relief in respect of Rice purchased from registered dealers in Andhra
Pradesh and held in stock as on 01.04.2005.
(ii) In respect of the Rice purchased by the FCI from farmers/farmers'
clubs/associations of farmers who are treated as Casual Traders not required
to be registered under VAT Act. The FCI shall deduct the Tax payable
by the farmers or farmer's clubs, association of farmers on their sales or
Rice to FCI from out of the amounts payable to them and remit the VAT
so deducted to the Commercial Tax Officer concerned.
(iii) Fair Price Shops are acting as agents on behalf of the State
Government i.e., resident principals. As such Fair Price Shops do not have
any liability to register under Andhra Pradesh Value Added Tax Act, 2005
and to pay any tax on the items like Rice, Wheat, Salt, Kerosene etc.,
supplied on behalf of Government as part of Public Distribution System.
However, if the Fair Price Shops are dealing in any other goods not supplied
through public distribution system they shall be liable to register under Andhra
Pradesh Value Added Tax Act, 2005 depending on the turnover of such
goods in their hands and they will have to pay tax accordingly.
(4) The Commissioner of Commercial Taxes is requested to communicate
the above orders to the concerned and take necessary action accordingly.
5. Input Tax Credit – Refund of excess Input Tax Credit under
Section 38(8) of Andhra Pradesh Value Added Tax Act, 2005
Notification
In exercise of the powers conferred by sub-section (8) of Section
38 of Andhra Pradesh Value Added Tax Act, 2005, the Government of
Andhra Pradesh having found it necessary to do so in the public interest
hereby direct that all registered Value Added Tax dealers falling under
clause (b) of sub section (1) of Section 38 shall be eligible for refund if
the input tax credit exceeds the amount of tax payable as on 30.09.2006
subject to the following conditions namely,-
II. (a) that the dealer has filed all VAT 200 & CST VI returns
upto date.
(b) that there are no outstanding arrears of tax payable under Andhra
Pradesh General Sales Tax, Andhra Pradesh Value Added Tax and Central
Sales Tax Acts.
(c) that the dealer should have reported taxable sale turnovers in the
last 6 months.
III. (a) that the refund shall be given on or before 31.10.2006 for
all Credit Carry forward cases of Rs.10,000/- without pre-Value Added Tax
Audit.
(b) Refund shall be given on or before 31.12.2006 for all credit carry
forward cases of Rs.10,000/- and above but below Rs.50,000/- without Value
Added Tax Audit, but subject to submission of Indemnity Bond/Bank
guarantee for the refund amount.
(c) Refund shall be given on or before 31-12-2006 for all credit carry
forward cases of Rs.50,000/- and above but below Rs.10 Lakhs subject
to conducting the audit.
(d) Refunds of all credit carry forward cases of Rs. Ten lakhs and
above shall be refunded as per provision of Section 38(1) of the Andhra
Pradesh Value Added Tax Act, 2005.
Accordingly, the Government permit the Commissioner of Commercial
Taxes to issue instruction under Section 77 of the Andhra Pradesh Value
Added Tax Act, 2005 to all his subordinate officers prescribing the procedure
for regulating the refunds to be granted in pursuance of this notification.
6. Additional Bench of STAT – Commercial Taxes Department –
Constituting Additional Bench of STAT to be located at
Visakhapatnam – Notification – Issued.
[G.O. Ms. No. 1707 Revenue (CT-III) Dept., dated 1-10-2005]
(1) G.O. Ms. No. 634, Fin (SMPC) Dept., dt. 16.8.2004
(2) G.O. Ms. No. 844, Rev. (CT-III) Dept., dt. 25.11.2004
(3) From the CCT, Lr.No.C2/821/2004, dt. 13.7.2005
Order:
the AP VAT Act, 2005 the Government hereby constitute an Additional
Bench of the Sales Tax Appellate Tribunal at Visakhapatnam in
Visakhapatnam District consisting of the Chairman and 2 member as mentioned
below:
Chairman – A District Judge Grade-I
Member – An Officer in the rank of an Additional Commissioner (CT)
Member – An Officer not below the rank of an Additional Commissioner
2. The Government also hereby define the territorial jurisdiction of the
Sales Tax Appellate Tribunal at Hyderabad and the Additional Bench of the
Sales Tax Appellate Tribunal at Visakhapatnam as shown in the table below:–
Sl. Location of the Bench Territorial Jurisdiction
No. of the STAT
1. Appellate Tribunal at All appeals preferred by the dealers,
Hyderabad registered and assessed in the circles,
located in the following districts:
1) Adilabad 2) Nizamabad
3) Karimnagar 4) Warangal
5) Khammam 6) Ranga Reddy
7) Medak 8) Hyderabad
9) Kurnool 10) Ananthapur
11) Cuddapah 12) Chittoor
13) Nalgonda and 14) Mahaboobnagar
2. Additional Bench of the All appeals preferred by the dealers,
Appellate Tribunal at registered and assessed in the circles,
Visakhapatnam located in the following districts:
1) Srikakulam 2) Vizianagaram
3) Visakhapatnam 4) East Godavari
5) West Godavari 6) Krishna
7) Guntur 8) Prakasam and
9) Nellore
3. In accordance with the sub-section (2) of the Section 80 of the AP
VAT Act, 2005 the Additional Bench to the Appellate Tribunal at
Visakhapatnam shall hear and dispose of all the appeals, preferred under
APGST Act, 1957 by the dealers in the respective jurisdiction, as defined
above.
4. The Commissioner of Commercial Taxes, Hyderabad shall take
necessary action accordingly.
[By Order and in the Name of the Governor of Andhra Pradesh.]
7. *Refund of Tax paid on ATF by the Airlines operating Aircraft

of less than (50) Seater capacity from Hyderabad through Kadapa
Airport
[G.O.Ms.No.1041, Revenue (CT.II), 3rd August, 2006]
15 of Andhra Pradesh Value Added Tax Act, 2005, the Government of
Andhra Pradesh, having found it necessary to do so in the public interest,
hereby direct that the tax paid on Aviation Turbine Fuel purchased by the
Airlines in Andhra Pradesh and utilized for operating Aircrafts of less than
(50) seater capacity, from Hyderabad through Kadapa Air Port, Shall be
refunded to the Airlines. The refund shall be made by the Commissioner
of Commercial Taxes as per the procedure laid down in Section 38 of
the APVAT Act, 2005.
8. Delegation of Powers to the Commissioner of Commercial Taxes
to exercise under the said Act
[G.O.Ms.No. 1163, Revenue (CT.II), dt. 14th August, 2006]
In exercise of the powers conferred by under Section 3A of the
Andhra Pradesh Value Added Tax Act, 2005(Act No.5 of 2005), the
Government of Andhra Pradesh hereby empowers the Commissioner of
Commercial Taxes to empower any officer working under his control to
exercise any powers under the said Act within such area or areas or the
whole of the State of Andhra Pradesh.
Provided that where any officer in exercise of the power delegated
to him by the Commissioner of Commercial Taxes, in pursuance of the
above orders undertakes the assessment of any dealer, the assessing authority
of the area having jurisdiction to assess such dealer shall not exercise such
jurisdiction for the relevant period.
It shall be deemed to have come into force with effect from 01.04.2005.
9. Amendments made to the Entry at Sl.No. 24, to the Schedule
1 of the said Act – Orders for retrospective effect.
[G.O.Ms.No.1694, Revenue (CT.II) dt. 17th November, 2006]
In exercise of powers, conferred by sub-section (1) of Section 79
of the Andhra Pradesh Value Added Tax Act, 2005 (Act No.5 of 2005),
the Government of Andhra Pradesh hereby order that the amendment made
in the notification issued under G.O.Ms.No.795, Revenue (CT.II) Department
*This G.O.Ms.No.1041 is rescinded by G.O.Ms.No.612, dt. 24-4-2008. printed infra.
dt. 29.06.2006, to the Entry at Sl.No.24, under Schedule I appended to

the Andhra Pradesh Value Added Tax Act, 2005, shall be deemed to have
come into force on and with effect from 01-04-2005.
10. HSN Codes – Scope of applicability of certain items included
under Schedule-I and Schedule-IV of the Act
[G.O.Ms.No. 398 Revenue (CT-II) Dept., dt. 15.4.2005]
The Government have notified the commencement of the provisions

of Andhra Pradesh Value Added Act, 2005, under the G.O. 1st read above,
with effect from 01.04.2005. There are (6) Schedules appended to the Act,
listing out the items taxable at different rates. The CCT, Hyderabad has
sent a proposal in the 2nd read above. For issuing a clarificatory orders
to remove difficulties about the scope and application of (13) entries under
Schedule I, and 54 entries under Schedule IV of the Act, with a view to
eliminate discretionary and varied interpretation and application of the
entries by the assessing authorities of the CT Department. He has therefore,
proposed to specify the scope and the applicability of (13) entries under
Schedule I and 54 entries under Schedule IV with reference to the HSN
Codes followed by the Central Excise Department.
2. The Government after careful consideration, hereby order by way

of clarification that in respect of the (13) items under Schedule I and 54
entries under Schedule IV as mentioned in the Annexure appended to this
order shall have the scope and applicability of the respective HSN Codes
furnished under Col. 4 of the Annexure enclosed to this order.
3. The Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad

is therefore requested to intimate the trade and the officers of the Commercial
Taxes Department to act accordingly with effect from 1-4-2005.
11. Scope of applicability of certain items included under Schedule-

I and Schedule-IV of the Act
[G.O.Ms.No. 490, Revenue (CT.II) Dept., dt. 15.04.2005]
76 of the Andhra Pradesh Value Added Tax Act, 2005, the Governor of
Andhra Pradesh hereby orders that the HSN in respect of 2 items in
Schedule-I and 22 items in Schedule-IV shall be as furnished in the
Annexure-IA and IIA appended to this notification, and that the HSN Codes
already notified in G.O.Ms.No. 398, Revenue (CT.II) Department, dated
31.03.2005 in respect of (2) items in Schedule-I and in respect of (9) items

in Schedule-IV shall be substituted as furnished in Annexure-IB and IIB
appended to this notification and further orders that the HSN Codes shall
be read and understood as mentioned in the note below.
Note:
(1) Whenever a 4-digit code is allotted in an entry, it is to be understood
that all the 6-digit and 8-digit codes starting with those 4 digits are included
in that entry.
(2) Whenever a 6-digit code is allotted, all the 8-digit codes starting
with those 6-digit are included in that entry.
(3) Whenever an 8-digit code is allotted, the entry is restricted to that
particular code.
12. Treating the Returns as deemed assessments in respect of the
Assessments to be submitted under the repealed A.P.G.S.T.
Act, 1957 under Section 76(1) read with Section 80 of the
Andhra Pradesh Value Added Tax Act, 2005.
[G.O.Ms.No. 564, Revenue (CT.II), dt. 30-4-2007]
76 of the Andhra Pradesh Value Added Tax Act, 2005, (Andhra Pradesh
Act No. 5 of 2005) the Government of Andhra Pradesh hereby orders
that the assessment of all dealers in respect of any year upto the year
ending 31st March, 2005 which has not been completed under the APGST
Act, 1957, shall be deemed to have been made on the basis of return/
returns submitted by the dealer concerned in accordance with Section 14
of the Andhra Pradesh General Sales Tax Act, 1957, without requiring the
presence of the dealer or production of books of account by the dealer
excluding the cases falling under the following categories:–
(1) Works contracts and lease transactions.
(2) Industrial incentives.
(3) Cases involving incriminating material.
(4) Cases to be assessed under Central Sales Tax Act.
(5) Cases in which information in AR-II was not filed and in which
AR-II was filed but additional liability was indicated therein.
(6) Cases of all oil companies.
(7) The cases in which the tax assessed during the immediately
preceeding year or any year with in four years preceeding to the year
which is covered by this notification, the amount of tax finally assessed

was more than the tax payable by him as declared in the return filed, by
more than twenty five thousand rupees under the provisions of the Andhra
Pradesh General Sales Tax Act, 1957.
[Pub. in the A.P. Gaz., Pt. I, Ext., No. 269, dt. 4-5-2007]
13. Gems and Jewellery
Refund of excess Credit in case of re-exports of Gems and Jewellery
who have taken goods under customs bond for re-export after manufacturing
or otherwise.
In exercise of the powers, vested under sub-section (8) of Section
38 of Andhra Pradesh Value Added Tax Act, 2005, the Government hereby
directs that the claims of the dealers, who take gold under customs bond
for re-export after manufacturing or otherwise, for refund of input tax credit,
arising due to zero – rating, shall be processed and refunds, as admissible,
shall be given on monthly basis, even though the value of the exports by
them is below Rs.10 lakhs in the particular month. However, such refunds
are admissible only in cases where the re-export is made within 90 days
from the date of purchase of gold under custom bond.
[Pub. in the A.P. Gaz., Pt. I, Ext., No. 242, dt. 30-4-2008.]
14. Dealers in Automobiles – Certain issues regarding levy of
penalty and interest on undisclosed turnovers and levy of tax,
interest and penalty on transactions treated as taxable.
Read the following:-
1. From the Andhra Pradesh Motor Vehicle Dealers Association,
Secunderabad, Repn. Dt. Nil received on 24.7.2006.
2. From the Andhra Pradesh Motor Vehicle Dealers Association,
Secunderabad, Repn. Dt. 13.07.2006.
3. From the Commissioner of Commercial Taxes, Andhra
Pradesh, Hyderabad Lr. No. AC - (ADMN) - 57 - 1/06,
Dt.20.09.2006.
4. From the Commissioner of Commercial Taxes, Andhra
Pradesh, Hyderabad Lr. No. AC - (ADMN) - 57 - 1/06,
Dt.29.08.2007.
****
Order
In the reference 1st read above, the AP Motor Vehicle Dealers
Association, Secunderabad have represented to the Government that they
have been contributing substantial revenue to the State Government by
marketing vehicles through various schemes, that some of the dealers in
Automobiles have not correctly reported the turnovers due to various
reasons, but later paid the taxes due on such undisclosed turnovers that
the department is levying 3 to 5 times penalty and interest on such taxes
paid later, which will result in closure of their business and unemployment
to hundreds of workers and hence, they have requested to waived the
penalty and interest. They have also represented that the Department which
has been accepting the turnovers declared and taxes paid by the Automobile
dealers in respect of the spare parts and oils supplied during the course
of servicing as sales of spare parts and oils for many years (past 50 years)
have revised the assessments already made treating servicing transactions
as works contracts following the decision of Andhra Pradesh Sales Tax
Appellate Tribunal retrospectively for the last four years which would badly
affect their business and therefore requested the Government to apply the
orders of the STAT prospectively on the ground that they have not collected
taxes from their customers and as the Department also finalised the
assessments treating the transactions as sale of spare parts and oils. They
further represented that the replacement of spare parts made during the
warranty period of the vehicles sold was not subjected to tax and the
assessing authorities of the CT Department allowed exemption but the
Department changed their view based on the Judgement of Supreme Court
in Ekram Khan and Sons v. Commissioner of Trade Tax, UP (136 STC
515 Dt.21/7/2004) and revised the assessments for four years applying the
above Judgement retrospectively in respect of all dealers even though they
have not collected tax which will cause hardship to them and requested
to levy tax prospectively applying the above judgement of the Supreme
Court. They have also represented that the assessing authorities of CT
Department have raised heavy demands levying tax on the life tax collected
as per the directions of the Transport Department and also on the Insurance
Premium paid on behalf of the customers which will not form part of their
sales turnover and requested to issue clarificatory orders to the effect that
the life tax and insurance premium collected and paid on behalf of customers
are not exigible to tax. They have quoted the precedents where the
Government considered such request earlier directing to levy one time
penalty and to levy tax prospectively when an new interpretation of law
arose.
2) The Government examined the matter in detail and also held detailed
discussions with the CCT, Officers of the Department and the representatives
of the Automobile Dealers Association. The Government observed the
provisions of the repealed APGST Act, 1957 and the provisions of the
APVAT Act, 2005, introduced from 01.04.2005. The Government adopted
more pragmatic approach in framing the penal provisions under APVAT
Act, 2005, prescribing penalties ranging from 10% to 100% of the tax
involved and the highest penalty (of 100%) equal to the tax is leviable in
cases where tax is under declared (under Section 53(3) of the APVAT
Act, 2005). Government have further observed that in cases where tax
was sought to be levied in pursuance of new interpretation of Law made
either by Officers of the Department vested with the powers of revision
or by various Appellate Courts, clarificatory orders were issued to levy
tax prospectively taking into account the fact of non collection of tax by
the dealers form their customers.
3) Accordingly, the Government after careful consideration of the
matter direct the Commissioner of Commercial Taxes, to implement the
following, so as to ensure realisation of the arrears of taxes due and also
ensure better compliance from the dealers in Automobile Trade.
1) In respect of the Automobile dealers who have under declared their
turnovers and evaded tax due thereon but paid the total tax due after
the tax under declared was detected by the Officers of the Department,
penalty equal to tax shall be levied as a special case and collected
besides interest to be levied @ 12% for delay in payment of taxes
due, subject to condition that the penalty and interest herein ordered
to be paid are paid before 31st March, 2008.
2) In respect of the Automobile dealers who have under declared their
turnovers and evaded tax due thereon but paid the total tax due
voluntarily before it was detected by the Officers of the Department,
penalty equal to 50% of the tax due shall be levied as a special case
and collected besides interest to be levied @ 12% for delay in payment
of taxes due, subject to condition that the penalty and interest herein
ordered to be paid are paid before 31st March, 2008.
3) In respect of the transactions relating to supply of spare parts and
oils during the course of servicing of the vehicles, tax should be levied
treating them as works contacts prospectively following the judgement
of APSTAT in TA No.560/99, Dt.17.05.2006 in M/s Durga Auto
Service, Cuddapah Vs State of AP (2006).
4) In respect of the transactions relating to supply of spare parts during

warranty period tax should be levied treating those transactions as sale
prospectively following the judgement of Supreme Court in Ekram
Khan and Sons v. Commissioner of Trade Tax, U.P (136 STC 515,
Dt.21/7/2004).
5) In respect of the transactions relating to collection of Insurance
Premium and Life Tax collected and paid to Insurance Companies
and to Transport Department as per the directions of the Commissioner,
Transport Department, Government of Andhra Pradesh on behalf of
the purchasers, the amount of Insurance Premium and Life Tax actually
paid by the Automobile Dealers to the account of Insurance Companies
and Transport Department shall be excluded from their turnover for
levying tax under APVAT Act, 2005, provided the dealers did not
collect Tax on these amounts and any amount collected in excess of
Life Tax and Insurance Premium on any count as a presale expense
shall be liable to tax.
15. Aviation Turbine Fuel
15 of the Andhra Pradesh Value Added Tax Act, 2005 read with Section
15 of the Andhra Pradesh General Clauses Act, 1891, the Government
of Andhra Pradesh hereby rescind the Notification issued vide
G.O.Ms.No.1041, Revenue (CT-II) Department, dt. 3-8-2006, directing that
the tax paid on Aviation Turbine Fuel purchased by the Airlines in Andhra
Pradesh and utilized for operating the Aircraft of less than 50 (Fifty) seater
capacity from Hyderabad to Kadapa Airport shall be refunded to the
Airlines, consequent on the notification issued under Section 79(1) of the
said Act, 2005 reducing the rate of Tax on Aviation Turbine Fuel from
33% to 4% by suitably amending the Schedule-VI of the said Act vide
G.O.Ms.No.143, Revenue, dt.11.2.2008 with effect from 15.2.2008.
----
16. Procedure of collection of Service Charge and user charges

by e-Seva by Commercial Taxes Department and filing of
Returns and payment of user charges by dealers at e-Seva
centers – Reduced price at e-Seva Centers
[G.O.Ms.No. 399, Revenue (CT-II) Dept. dt. 07-5-2010.]
Read the following:
1. G.O.Ms.No.696, Rev. (CT.II) Dep’t., dt:24.5.2007.
2. From the CCT, Ref.No.CS(1)/36/99, dt.9.3.2010.
Order:
Government vide reference first read above, accorded permission to
collect Rs.50/- from the dealers who submit their returns at e-Seva. Out
of Rs.50/- the e-Seva Center shall retain Rs.10/- and Rs.10/- will be parked
with APTSL and the remaining Rs.30/- shall be remitted to the Head of
Account under VAT user charges of Commercial Taxes Department.
2. The Commissioner of Commercial Taxes vide reference 2nd read
above, have stated that the dealers are not interested to file returns at
e-Seva centers due to the collection of Rs.50/- from the dealer. During
the period from 19.1.2009 to 30.1.2010 only 12 returns were filed by the
dealers in the e-Seva centers and for encouraging the dealers to file the
returns at e-Seva centers, the user charge of Rs.50/- per return may be
reduced and requested the Government to accord permission to collect
Rs.10/- from the dealers who file returns at e-Seva centers and the same
will be retained by the e-Seva centre at source as per e-Seva contract
between e-Seva service provider and Information, Technology and
Communication Department.
3. In view of the circumstances reported by the Commissioner of
Commercial Taxes, in supersession of the orders issued in the G.O. 1st read
above, Government hereby permit the Commissioner of Commercial Taxes
to collect Rs.10/- from the dealers who file returns at e-Seva centers and the
same will be retained by the e-Seva centre at source as per e-Seva contract
between e-Seva service provider and Information, Technology and
Communication Department. Thus the transaction charge for filing Commercial
Taxes Return will henceforth be Rs.10/- per Return.
4. The Commissioner of Commercial Taxes, AP, Hyderabad is requested
to take necessary action in the matter.
VAT–68
17. Proceedings of the Commissioner of Commercial Taxes Andhra

Pradesh, Hyderabad.
Present: Sri Suresh Chanda, I.A.S., Commissioner of Commercial Taxes
[CCT’s Ref. AIII(1)/36/2009, dt. 25-10-2010]
Sub: Andhra Pradesh Value Added Tax Rules, 2005 - Amendment to
Rule 59 - Notification issued - Reg.
Ref: G.O.Ms.No.1308, Revenue (CT.II) Department, Dt.22/10/2010.
Order:
In exercise of the powers conferred by Rule 59 of the APVAT Rules,
2005 read with the reference cited, the Assistant Commercial Tax Officers
are authorised to exercise the powers of the Registering Authority under
Sec. 17(10), Sec.17(11), Sec.l8(l)(a) and Sec.l9(2) of the APVAT Act, 2005
read with Rules 4 to 14 of the APVAT Rules, 2005 for the purpose of
registration, amendment and cancellation of the VAT Registrations. Provided
that the Deputy Commissioner of Commercial Taxes of the division concerned
may, by order, authorize any one Assistant Commercial Tax Officer to exercise
the above powers in their respective jurisdictions.
18. Proceedings of the Commissioner of Commercial Taxes, Andhra
Pradesh, Hyderabad.
Notification
[CCT’s Ref. AIII(1)/29/2010, dt. 26-10-2010.]
Sub: Andhra Pradesh Value Added Tax Rules, 2005 - Amendment to
Rule 23(12) - Consequential Notification issued - Reg.
Ref: G.O.Ms.No.1292, Revenue (CT-II) Department, dt.14/10/10.
Order
In exercise of the powers conferred by sub-rule (12) of the Rule 23 of
the APVAT Rules, 2005, it is hereby notified that all the dealers, registered
in the C.T. Divisions of Abids, Begumpet, Charminar, Hyderabad (Rural),
Punjagutta, Saroor Nagar and Secunderabad, shall file e-Return either directly
or through their authorized representatives with effect from the Tax period
of October 2010 onwards through Commercial Taxes Department (CTD)

website www.apcommercialtaxes.gov.in or at any of the eSeva Centre in
Twin cities.
The Dealers, using the services of eSeva Centres shall pay eSeva
transaction charges, applicable from time to time (presently Rs.10/- per Return).
This notification comes into force with immediate effect.
-------
INSTITUTIONAL EXEMPTIONS
1. Refund of Tax to M/s. Hyderabad International Airport Limited,
Hyderabad under Andhra Pradesh Value Added Tax Act, 2005.
[G.O.Ms.No. 1254, Revenue (CT.II) dated 24-6-2005]
I. In exercise of the powers conferred by sub-section (1) of Section
hereby directs that the tax paid;
(a) By M/s. Hyderabad International Airport Limited, Hyderabad on
its purchase of goods to the sellers and,
(b) By the contractors and the sub-contractors if any engaged by or
for Hyderabad International Airport Limited, on their purchases of goods
to the sellers under the provisions of the said Act shall be refunded to
the respective purchasers, subject to the following conditions:
Conditions
(1) The goods purchased by M/s. Hyderabad International Airport
Limited or its contractors or sub-contractors must be for use or consumption
in the execution of the project work of Hyderabad International Airport,
in Andhra Pradesh;
(2) M/s. Hyderabad International Airport Limited shall furnish a separate
declaration duly signed by the Managing Director or a Senior Officer
authorized by him in this regard to the effect that the goods purchased
by it are for use or consumption in the execution of project work of
Hyderabad International Airport, for each tax invoice or invoice, in respect
of which refund of tax paid is claimed;
(3) Where the said contractors or sub-contractors make claim for
refund of the said tax paid, in addition to the tax invoices or invoices received
by them from their sellers, they shall furnish the said declaration in respect
of each such invoice, duly signed by the said person on behalf of Hyderabad
International Airport Limited.
This Notification shall be deemed to have come into force with effect
from the first day of April, 2005 and 1[shall be in force till 31st December,
2009]
II. In exercise of the powers conferred by sub-section (1) of Section
1. Subs. by G.O.Ms.No. 13, Rev. (CT-II) Dept., dt. 3-1-2009.
1076
hereby directs that the tax paid under sub-section (7) of Section 4 of the
said Act, by M/s. Hyderabad International Airport Limited, Hyderabad and
the contractors engaged by M/s. Hyderabad International Airport Limited
for execution of works contract relating to the project work of Hyderabad
International Airport in Andhra Pradesh, shall be refunded as follows:-
(a) the said tax paid by M/s. Hyderabad International Airport Limited
to the contractors shall be refunded to M/s. Hyderabad International Airport
Limited on production of proof of remittance of tax deducted at source
in accordance with sub-section (4) of Section 22 of the said Act, along
with the invoices issued by the contractors.
(b) the said tax paid by the contractors to the sub-contractors if any
shall be refunded to the contractors on production of proof of remittance
of tax deducted at source in accordance with sub-section (4) of Section
22 of the said Act, along with the invoices issued by the sub-contractors.
This order shall be subject to the condition that the said contractors
and sub-contractors, if any, shall opt for payment of tax by way of
composition, under clause (c) of sub-sec. (7) of Section 4 of the said Act.
This Notification shall be deemed to have come into force with effect
from the first day of April, 2005 and 1[shall be in force till 31st December,
2009] or completion of the said project, whichever is earlier.
1.1 M/s.GMR Hyderabad International Airport Limited - claiming the
refund and clarification on the words “Valid” to “inforce”
[G.O.Ms.No. 264, Revenue (CT-II), dated 31-3-2010]
Read:
1. G.O.Ms.No.1254, Rev. (CT.II) Dep’t., dt.24.6.2005.
4. From M/s.GMR Hyderabad International Airport Limited,
Representation dt.1.2.2010 and 25.2.2010.
5. From the CCT, Ref.No.BVI(1)/65/2006, dt.5.3.2010.
Order
Government vide reference 1st read above, issued a Notification for
refund of tax on all purchases made by M/s.GMR HIAL for construction
of Rajiv Gandhi International Airport, which shall be deemed to have come
into force with effect from first day of April, 2005 and shall be in force
till 31st December, 2009 or completion of the said Project whichever is
earlier.
1. Subs. by G.O.Ms.No. 13, Rev. (CT-II) Dept., dt. 3-1-2009.
2. Government vide reference 2nd read above, issued a notification,

amending the last para of the notification issued in reference 1st cited as
indicated below:-
for the words “valid till 31st December, 2009 or completion of the
project which ever is earlier” the words “valid till 31st December, 2008
shall be substituted”.
3. Government vide reference 3rd read above, again issued an
amendment to G.O.Ms.No.589, dt.10.4.2008 as below:
for the words “valid till 31st December, 2008” the words “valid till
31st December, 2009” shall be substituted.
4. M/s.GMR HIAL vide reference 4th read above, represented that
the Commercial Taxes department have rejected the claim of refund of
tax paid by them on purchase goods for the months of November, 2009
and December, 2009, on the ground of variation in the phrases between
two amendments i.e., G.O.Ms.No.589, Revenue (CT.II) Department,
dt.10.4.2008 and G.O.Ms.No.13, Revenue (CT.II) Department, dt.3.1.2009.
Therefore, they have requested the Government to suitably address the
variation in the original G.O.and the amendments .
5. The Commissioner of Commercial Taxes, vide reference 5th read
above, requested the Government to issue an errata to G.O.Ms.No.589,
Rev. (CT.II) Dep’t., dt.10.4.2008 and G.O.Ms.No.13, Revenue (CT.II)
Department, dt.3.1.2009.
6. Government have carefully examined the matter and hereby observe
that the variation in using the words “valid till” and “shall be in force”
is inadvertent and the error is clerical in nature. The intention of the
Government in the Gos is clearly to refund tax under APVAT payable
upto 31.12.2009.
7. Hence, it is hereby ordered to rescind the orders issued in the
references 2nd and 3rd read above and clarify that the orders issued in
the reference 1st read above, will holds good.
1.2 M/s.GMR Hyderabad International Airport Limited - Claiming the
VAT refund for the bills prior to December, 2009.
Read:
Representation dt.29.4.2010.
Order :
The Government issued orders in the G.O. 1st read above, for refund
of Value Added Tax paid on purchases to M/s.GMR Hyderabad International
Airport Limited, Hyderabad. This was later amended vide orders issued in
the G.Os. 2nd and 3rd read above limiting the validity of the notification till
31st December, 2009.
2. In the Letter 4th cited, M/s.GMR Hyderabad International Airport
Limited, Hyderabad has represented to afford opportunity to claim refund of
tax on purchases made upto 31st December, 2009 even beyond a period of
six months.
3. The Government after careful consideration of the matter, hereby
order to permit M/s.GMR HIAL for submission of tax refund claims, subject
to the condition that the purchases are made upto 31st December, 2009 and
are covered by purchases invoices in original.
4. Accordingly, the following Notification shall be published in an Extra-
ordinary Issue of the A.P. Gazette.
Notification
15 of the Andhra Pradesh Value Added Tax Act, 2005 (AP Act No.5 of
2005), the Government of Andhra Pradesh hereby permit M/s.GMR Hyderabad
International Airport Limited, Hyderabad to make an application for refund
of tax paid for the purchases made upto 31st December, 2009 and which are
covered by purchase invoices in original.
[Pub. in A.P. Gaz. Part I, Ext. No. 304, dated 28-6-2010.]
1.3 M/s. GMR Hyderabad International Airport Limited – Exemption of
VAT during the period of Project Construction – Extension of time
limit granted in G.O.Ms.No.1254, Revenue (CT.II) Department,
dt.24.6.2005 from 1.1.2010 to 31.12.2010.
Read:
1. G.O.Ms.No.1254, Rev. (CT.II) Dept., dt.24.6.2005.
Lr.No.GHIAL/Revenue, dt.13.10.2009.
Order :
Government have issued orders in G.O. 1st read above for refund of
Value Added Tax paid on purchases made by M/s.GMR Hyderabad
International Airport Limited, Hyderabad and its Contractors/sub-contractors.

Orders were issued in the references 3rd read above, limiting the validity of
the notification relating to the above facility till 31st December, 2009.
2. In the Letter 5th read above, M/s.GMR Hyderabad International
Airport Limited, Hyderabad has represented that several works viz., execution
of administrative office, modification to the existing floor space at Airport
Village, shifting of glide path setting, modifications in existing cargo terminal,
conversion of taxiway into runway, enhancement of baggage screening
capacity are in progress and may be completed by 31st December, 2010.
Accordingly they have requested the Government to further extend the validity
of the Government orders in the reference 1st read above upto 31.12.2010.
3. The Government, after careful consideration of the matter, hereby
order that the validity of the G.O.Ms.No.1254, Rev. (CT.II) Dept., dt. 24.6.2005
be further extended upto 31st December, 2010 and accordingly permit
M/s.GMR HIAL to submit its tax refund claims subject to the condition that
all purchases made from 1.1.2010 to 31.12.2010 are covered by purchase
invoices in original.
2. Refund of tax to Sri Satya Sai Central Trust and its Organisations
under the A.P. VAT Act, 2005
[G.O.Ms.No. 1282, Revenue (CT.II), dated 30-6-2005]
hereby directs that the tax paid;
(1) By Sri Satya Sai Central Trust, Prasanthi Nilayam, Anantapur
District, Andhra Pradesh on purchase of goods required for the construction
activity and civil works connected with the trust including the works of
Sri Satya Sai Water Projects for providing safe drinking water to upland
habitations in East and West Godavari Districts,
1
[(2) By Sri Satya Sai Institute of Higher Medical Sciences, Prasanthi
Gram, Sri Satya Sai Medical Trust, Prasanthi Nilayam on the purchase of
drugs and medicines and all machinery for support services, spares for diesel
generating sets, boilers and air conditioning equipment, medical gases and
dietary items for patients, all furniture items used in hospitals maintained
by the trust, under the provisions of the said Act shall be refunded to the
respective purchasers, subject to the following conditions:]
1. Subs. by G.O.Ms.No. 95, Rev. (CT. II) Dept., dt. 28-1-2006.

Conditions:
(1) The purchases made by Sri Satya Sai Central Trust, Prasanthi
Nilayam, Sri Satya Sai Institute of Higher Medical Sciences, Prasanthi Gram,
Sri Satya Sai Medical Trust, Prasanthi Nilayam should have been made
for utilization in the execution of works relating to the trust or for use
in the institutions maintained by the trust;
(2) Sri Satya Sai Central Trust, Prasanthi Nilayam should furnish a
declaration duly signed by the Secretary or the person authorized by him
in this regard to the effect that the goods purchased are for utilization in
the execution of works relating to the trust or for use in the institutions
maintained by the trust for each tax invoice or invoice in respect of which
refund of tax paid is claimed.
This notification is deemed to have come into force with effect from
01-04-2005.
[Pub. in A.P. Gaz. Part I, Ext. No. 484, dated 7-7-2005]
2.1 Amendment to Sri Satya Sai Central Trust, and its Organization
for refund of tax under A.P. VAT Act, 2005
[G.O.Ms.No. 95, Revenue(CT.II), dated. 28-01-2006]
In exercise of the powers conferred by Sub-Section(1) of Section 15
of the Andhra Pradesh Value Added Tax Act, 2005, and in partial modifications
of the orders issued in G.O.Ms.No.1282, Revenue(CT.II) Department,
Dated 30-06-2005, the Government of Andhra Pradesh hereby directs that
the following shall be substituted instead of the existing para(2) of the
Notification issued vide G.O.Ms.No.1282, Revenue (CT.II) Department.
(2) By Sri Sathya Sai Institute of Higher Medical Sciences,
Prashanthigram/Sri Sathya Sai Medical Trust, Prashanthi Nilayam on the
purchase of Drugs and medicines and all surgical consumables, all medical
equipment and machinery for support services, spares for diesel generating
sets, boilers and air conditioning equipment,medical gases and dietary items
for the patients, all furniture items used in hospitals maintained by the trust
under the provisions of the said Act shall be refunded to the respective
purchasers subject to the following.
2.2 Sri Satya Sai Central Trust and its Organisations – Refund of Tax
[G.O.Ms.No. 492, Revenue (CT-II), dated 19-4-2007]
Andhra Pradesh having found it necessary to do so in the public interest,
hereby directs that the tax paid under sub-section (7) of Section 4 of the
said Act by Sri Satya Sai Central Trust, Prashantinilayam, Anantapur the
contractors or sub-contractors engaged for the construction works of Sri
Satya Sai Water Project for providing safe drinking water to upland
habitation in East and West Godavari District, shall be refunded subject
to the following conditions.
2. This notification shall be deemed to have come into force on
1.4.2005 and shall be in force till the completion of the above Project.
(a) The said tax paid by Sri Satya Sai Central Trust or its Contractors
or sub-contractors shall be refunded to Sri Satya Sai Central Trust
or its Contractors or sub-contractors as the case may be on
production of proof of remittance of tax deducted at source in
accordance with sub-section (4) of Section 22 of the said Act,
along with the invoices issued by the contractors.
(b) The said tax paid by the Contractors to the sub-contractors if
any, shall be refunded to the contractors on production of proof
of remittance of tax deducted at source in accordance with
invoices issued by the sub-contractors in accordance with sub-
section (4) of Section 22 of the said Act, along with the invoices
issued by the Sub-Contractors.
3. Sanction of Refund of Tax for Sri Swamy Ramananda Tirtha Rural
Institute, Bhoodan Pochampally
[G.O.Ms. No, 1394, Revenue (CT. II), dt. 16-7-2005]
In exercise of the powers conferred by sub-sec. (1) of Section 15
of the A.P.V.A.T. Act, 2005 (5 of 2005), the Governor of A.P., having
found it necessary to do so in the public interest, hereby directs that the
tax paid;
(1) By Sri Swamy Ramananda Tirtha Rural Institute, Bhoodan
Pochampally, Nalgonda District, Andhra Pradesh on purchase of sophisticated
equipment required for training programmes organised in their institute, shall
be refunded to them subject to the following conditions :
Conditions :
(1) The purchases made by Sri Swamy Ramananda Tirtha Rural
Institute, Bhoodan Pochampally, Nalgonda District, Andhra Pradesh should
have been made for utilization in the Training Programmes established in
the institute;
(2) Sri Swamy Ramananda Tirtha Rural Institute, Bhoodan Pochampally,
should furnish declaration duly signed by the Secretary or the person
authorized by him in this regard to the effect that the goods purchased
were for utilization in the Training Programmes established by the institute
for each tax invoice or invoice in respect of which refund of tax paid is
claimed.
4. Indian Red Cross Society-Refund of tax on the Purchase of Blood

Bags and other necessities for use of Red Cross Blood Bank &
Other Institutions working under Indian Red Cross Society, A.P.
Branch.
[G.O.Ms.No.327, Revenue (CT-II), dt. 16-03-2006]
15 of the Andhra Pradesh Value Added Tax Act, 2005, the Government
of Andhra Pradesh, having found it necessary to do so in the public interest,
hereby directs that the tax paid by the Indian Red Cross Society, A.P.,
Hyderabad on purchase of Blood Bags and other necessities for use of
Red Cross Blood Bank and other institutions working under Indian Red
Cross Society., A.P. State Branch, shall be refunded, under the provisions
of the said Act. The refund shall be made by the Commissioner of
Commercial Taxes as per the procedure laid down in Section 38 of the
AP VAT Act, 2005.
This notification is deemed to have come into effect with effect from
01-04-2005.
[Pub. in A.P. Gaz. Pt. I, Ext. No. 153-B, dt. 23-3-2006]
5. Refund of tax paid on purchase in connection with construction
of Krishnapatnam Port (Andhra Pradesh)
[G.O.Ms.No. 609 Rev. (CT-II) Dept., dt. 29-5-2006]
I. In exercise of the powers conferred by sub-section (1) of Section
15 of the Andhra Pradesh Value Added Tax Act, 2005, the Government
of Andhra Pradesh, having found it necessary to do so in the public interest,
hereby directs that the tax paid:
(a) By M/s. Krishnapatnam Port Company Ltd., to their sellers on
the purchase of all inputs for construction of Krishnapatnam Port.
(b) By the contractors and the sub-contractors, if any, engaged by
or for Krishnapatnam Port Ltd., on their purchases of all inputs
used for construction of Krishnapatnam Port, under the provisions
of the said Act; shall be refunded to the respective purchasers,
subject to the following conditions:
Conditions
(1) The goods purchased by M/s. Krishnapatnam Port Company Ltd.,
or its contractors or sub-contractors must be for use or consumption in
the execution of the project work of Krishnapatnam Port;
(2) M/s. Krishnapatnam Port Company Ltd., shall furnish a separate
declaration duly signed by the competent authority to the effect that the
goods purchased by it are for use or consumption in the examination of

project work of Krishnapatnam Port Ltd., for each tax invoice, in respect
of which refund of tax paid is claimed.
(3) Where the said contractors or sub-contractors make claim for
refund to the said tax paid, in addition to the tax invoices or invoices received
by them from their sellers, they shall furnish the said declaration in respect
of each such invoice, duly signed by the said person on behalf of
Krishnapatnam Port Company Limited.
The Notification shall be deemed to have come into force with effect
from the month of March, 2006, and shall be in force till April, 2010 or
the completion of the said project, whichever is earlier. The refund of taxes
paid by M/s. Krishnapatnam Port Company Ltd., or its contractors or sub-
contractors shall be made within (30) days from the date of the submission
of the claims.
6. Exemption from Payment of VAT to the Career Consular Officers
of United States Consulate at Hyderabad.
[G.O.Ms.No.454, Revenue (CT-IV) dt. 24-3-2009.]
15 of the Andhra Pradesh value Added Tax Act, 2005, the Government
of Andhra Pradesh hereby directs that the tax paid on purchases made
by the eligible career consular officers of the United States consulate,
Hyderabad shall be refunded, subject to condition that the claims shall be
endorsed by the Ministry of External Affairs, Government of India,
Hyderabad Branch before presenting the claims by them to the Commissioner
of Commercial Taxes as required under sub-rule(12) of rule 35 of the
Andhra Pradesh Value Added Tax Rules, 2005.
7. Clarification Regarding Ayurvedic Products
[Memo.No.10247/CT.II (1)/2009-1, dt. 29-4-2009].
Sub:- APVAT Act 2005 –CHMR Division – Manufacturers of Ayurvedic
Products Entry 88 & 117 in Schedule – IV of the Act amended
w.e.f.1.7.2008 – Certain ambiguity noticed – Clarification – Issued.
Ref:- 1. From the Chairman, FAPCCI, Ref.T&C/Rep/226/2009,
dt.27.2.2009.
2. From the CCT, Ref.No.AIII (3)/47/09, dt.2.03.2009.
——
As per the Entry 88 of the Schedule-IV of APVAT Act, 2005 the
drugs and medicines are liable to tax @4%. This entry specifically excluded
medicated goods and products capable of being used as cosmetic and toilet
preparations, including tooth pastes, tooth powders, Cosmetic, Toilet Articles
and soaps. Later the Government vide Notification in G.O.Ms.No.1625,

Revenue (CT.II) Department, dt.6.11.2006 added new entry 117 to the
Schedule-IV of APVAT Act, 2005 by bringing Ayurvedic products and
Homeopathic Products liable to tax @4% subject to condition that AYUSH
(GOI) should certify such products as 100% Ayurvedic or Homeopathic
Products, irrespective of their use. The Entry 117 was again substituted
as follows in the Notification issued vide G.O.Ms.No.818, Revenue (CT.II)
Department, dt.30.6.2008.
“117 Ayurvedic and Homeopathic products manufactured under license
issued by the Licensing authorities concerned under Drugs and Cosmetics
Act, 1940.”
2. In view of the above amendment, the condition of producing
certificate by AYUSH THAT THE PRODUCTS ARE 100% Ayurvedic
or Homeopathic has been dispensed with and new condition of possessing
the license issued by the concerned authority under Drugs and Cosmetics
Act, 1940 has been prescribed.
3. The Commissioner of Commercial Taxes in the letter 2nd cited,
has stated that in view of the aforesaid changes there is no unanimity among
the Assessing Authorities on the rates of taxes, applicable to different
commodities of Ayurvedic and Homeopathic Medicines/ Products and that
the related issues are pending before different appellate forums and requested
the Government for clarification on rates of taxes, applicable to different
commodities under Entry 117 and Entry 88 of Schedule – IV of the APVAT
Act, 2005 with specific reference to the following 8 (eight) commodities.
1. Boroplus Antiseptic Cream (Ayurvedic medicine)
2. Boroplus Prickly Heat Powder (Ayurvedic medicine)
3. Sonachandi Chavanprash (Ayurvedic medicine)
4. Menthoplus Pain Balm (Ayurvedic medicine)
5. Fast Relief (Ayurvedic medicine)
6. Sona Chandi Healthy & Fair Ayurvedic Baby Message Oil (Ayurvedic
product)
7. Boroplus Lotion (Ayurvedic medicine)
8. Navaratan Oil (Ayurvedic product)
4. The Government after careful examination of the matter with
reference to the provisions of the APVAT Act, 2005 and various judicial
precedents connected with the relevant entries and in exercise of powers
vested under Section 76 of the APVAT Act, 2005 hereby clarify that:
(1) the following six commodities come under the category of the
Ayurvedic medicine and therefore are taxable @4% under Entry 88 of
the Schedule-IV of the APVAT Act, 2005 from 1.4.2005 onwards.
i. Boroplus Antiseptic Cream (Ayurvedic medicine)
ii. Boroplus Prickly Heat Powder (Ayurvedic medicine)
iii. Sonachandi Chavanprash (Ayurvedic medicine)
iv. Menthoplus Pain Balm (Ayurvedic medicine)
v. Fast Relief (Ayurvedic medicine)
vi. Boroplus Lotion (Ayurvedic medicine)
(2) the following two commodities come under the category of Ayurvedic
Products taxable @4% under entry 117 of the Schedule – IV of the APVAT
Act, 2005 from the date of incorporation of Entry 117 in Schedule-IV of
the Act i.e., from 1.09.2006 and therefore they are liable for tax @12.5%
from 1.4.2005 to 31.08.2006 under Schedule –V of the APVAT Act, 2005.
(i) Sona Chandi Healthy & Fair Ayurvedic Baby Massage Oil
(Ayurvedic Product)
(ii) Navaratan Oil (Ayurvedic Product)
(3) the Ayurvedic Products taxable under entry 117 of the Schedule
–IV of the APVAT Act, 2005 shall be liable for VAT @4% from 1.9.2006
without the requirement of the certificate of AYUSH to the effect that
the products are 100% Ayurvedic or Homeopathic, in pursuance of the
amendment made to the Entry 117 by Notification in G.O.Ms. No.818,
Revenue (CT.II) Dept., dt.30.06.2008.
——
8. Errata to the Act No. 4 of 2009 Regarding dates of commencement
of various sections
[Memo.No.17661/CT.II(1)/2009-1, dt. 06/05/2009]
Sub: Act No.4 of 2009 – Andhra Pradesh Value Added Tax (Amendment)
Act, 2009 – Error in dates of commencement –
Clarification – Issued.
Ref : 1. G.O.Ms.No.1100, Rev.(CT.II) Dep’t., dt.11.9.2008.
2. G.O.Ms.No.1264, Rev.(CT.II) Dep’t., dt. 1.11.2008.
5. G.O.Ms.No. 15, Rev.(CT.II) Dep’t., dt. 05.1.2009.
6. G.O.Ms.No. 17, Rev.(CT.II) Dep’t., dt. 05.1.2009.
7. Act No.4 of 2009, dt.3.3.2009 (Andhra Pradesh
Value Added Tax (Amendment) Act, 2009)
——
In the references 1-6 cited, Government have issued notifications

making changes in the entries of Schedules- I, IV and VI of the APVAT
Act, 2005. These changes came into effect from the dates mentioned in
the notifications as shown in the Column No.4 of the table below:
2. As required under section 79(2) of the APVAT Act, 2005, a bill
was introduced and passed by both the Houses of State Legislature. After
the introduction of Bill in the Assembly an official Amendment was moved
to insert a new clause 3 and it was passed by the Legislature by inserting
a new section renumbering the existing clauses 3,4,5,6,7 and 8 as 4,5,6,7,8,
and 9, but the consequential change of renumbering the clauses in
commencement clause were not carried out. Hence an error occurred in
the dates of commencement notified in the clause 1(3) (b) to (h) of
amendment Act No.4 of 2009, with reference to the commencement date
already notified in the respective GOs cited (1-6), as shown in column 5
of the table below:
Sl. No. & Date of Entry/Schedule Effective Erroneous
No. G.O. where amended dates as per date notified
notification GOs in Act No.4
issued of 2006
(1) (2) (3) (4) (5)
1. G.O.Ms.No.1100, 26/Schedule-I 1.09.2008 1.7.2006
dt.11.9.2008. (Organic
Manure
excluding
deoiled cakes)
2. G.O.Ms.No.1264, 121/Schedule–IV
dt.1.11.2008. (Battery
Charges) 1.11.2008 1.10.2008
3. G.O.Ms.No.1276, 102/Schedule-IV
dt.4.11.2008. (Machinery) 1.7.2006 1.10.2008
(read with
G.O.Ms.No.59,
dt.20.01.2009)
4. G.O.Ms.No.1276, 1/Schedule-VI
dt.4.11.2008. (All Liquors) 1.10.2008 —
5. G.O.Ms.No.1276, Schedule-VI
dt.4.11.2008. (Explanation–IV
Oil companies) 1.10.2008 —
6. G.O.Ms.No.1351, Schedule-VI
dt.24.11.2008. (Explanation–IV
Oil companies) 1.11.2008 —
(1) (2) (3) (4) (5)
7. G.O.Ms.No.15, 44/Schedule-I
dt.5.1.2009. (Seeds)(NAFED) 1.7.2008 1.11.2008
8. G.O.Ms.No.17, 122/Schedule-IV
dt.5.1.2009. (Oats) 1.1.2009 1.11.2008
3. The Government after careful examination of the matter have
observed that the dates of commencement for the changes made in the
entries of schedules of the APVAT Act, 2005 which ought to have been
as mentioned column (4) of the above table have been erroneously notified
in the amendment Act 4 2009 as shown in Column (5) of the above table,
even though the Government have no intention to change the dates of
commencement.
4. The Government therefore hereby clarify that the dates of
commencement of the changes made to the entries in Schedule of the
APVAT Act, 2005 shall be as shown in column 4 of the above table,
till the clause 1(3) of the amendment Act No.4 of 2009 is suitably amended.
5. The Commissioner of Commercial Taxes is therefore requested to
issue necessary institutions to the concerned authorities, accordingly.
-----
9. DPR (DPR) for Strengthening of I.T infrastructure and provision of
citizen centric services by the Commercial Taxes Department
Government of Andhra Pradesh – Permission accorded - Orders --
Issued.
[G.O.Ms.No. 267 Revenue (CT-II) Dept. dt. 03-04-2010.]
Read:
1. From the GOI, F.No.S.31012/2/2009-SO(ST), dt.23.11.2009.
2. From the CCT, Ref.No.CS(1)/204/2005, dt.2.2.2010.
Order
The Government of India, vide letter first read above, while furnishing
the framework for preparing DPRs for funding under the Mission Mode
Project (CT), requested to furnish the revised DPRs as per the framework-
envisaged.
2. The Commissioner of Commercial Taxes vide letter 2nd read above,
informed that as per the guidelines of Government of India, a revised DPR
was prepared and submitted to Government of India. In the revised DPR
the State’s commitment and action plan was furnished. As per the guidelines
of the Government of India, the State Government has to meet 31% of
the total cost of the Project, the total cost of the project being Rs.72,05,66,458/
-. Out of this Government of India is likely to provide funds to an extent

of Rs.50,20,96,594/- and the Government of Andhra Pradesh has to meet
the balance cost of Rs.21,84,69,864/-, in the next two to three years. The
details of the component-wise funding breakup, year-wise State and Central
Share and non-recurring expenditure incurred of Rs.5,51,49,999/- from 1-
4-2007 by Government of Andhra Pradesh have been furnished in the
revised DPR.
3. Government, after careful examination of the matter, hereby accepts
in principle and permit the Commissioner of Commercial Taxes, AP,
Hyderabad, to meet the 2009-2010 balance State contribution of Rs.2.68
crores from “user Charges” budget of Commissioner of Commercial Taxes.
Proportionate State’s share will also be released based on release of funds
by Government of India.
4. This order issues with the concurrence of the Finance (Exp.Rev.)
Department vide their U.O.No.4587/060/A2/Exp.Rev/2010, dt.18.3.2010.
------
10. Refund of Tax on the purchase of goods listed under Entry 58
of Schedule-I of the said Act.
[G.O.Ms.No. 142 Revenue (CT-II) Dept., dt. 17-2-2010.]
Notification
15 of the Andhra Pradesh Value Added Tax Act, 2005 (Andhra Pradesh
Act No.5 of 2005), the Government of Andhra Pradesh hereby direct that
the tax paid under the said Act on or after the date of this notification,
by the Canteen Stores Department or the Indian Naval Canteen Services,
either directly or through their unit-run canteens, on the purchase of goods
listed under Entry 58 of Schedule-I (appended to the said Act), shall be
refunded subject to the condition that the declaration in respect of each
invoice in original, duly signed by the authorized person, is submitted to
the Commercial Tax Officer concerned within a period of six months from
the date of purchase.
------
11. Andhra Pradesh State Housing Corporation Limited -- Refund of
VAT of Rs.3,54,31,000/-
[G.O.Ms.No. 492 Revenue (CT-II) Dept., dt. 10-6-2010.]
Notification
of the APVAT Act, 2005, the Government of Andhra Pradesh, having found
it necessary to do so in the public interest hereby direct that the Tax paid by
VAT–69
the Andhra Pradesh State Housing Corporation Limited, Hyderabad amounting

to Rs.3,54,31,000/- (Rupees Three Crores fifty four lakhs thirty one thousand
only) for the period from November, 2008 to February 2010, under the
provisions of the said Act, shall be refunded, subject to verification of
remittance of Rs.3,54,31,000/- to the Commercial Taxes Department’s Head
of Account.
[Pub. in A.P. Gaz. Part I, Ext. No. 283, dated 16-6-2010.]
12. Industrial Incentives – repayment deferred Tax collection
under Rule 67 of APVAT Rules, 2005 – Easy Repayment
Scheme granted to M/s.Sree Rayalaseema Alkalies and Allied
Chemicals Limited.
[G.O.Ms.No. 605, Rev. (CT-II) Dept., dated: 29-6-2010.]
Read the following:
1. From the CM’s Office, CMP No.839/Genl/10, dt.19.1.2010 along
with the representation of Sri T.G.Venkatesh, CMD, M/s.Sree
Rayalaseema Alkalies and Allied Chemicals Limited
dt.19.1.2010.
2. From the CCT, Ref.No.AIII(3)/67/10, dt.18.3.2010.
ORDER:
The Chairman and Managing Director, M/s.Sree Rayalaseema Alkalies
and Allied Chemicals Limited vide reference 1st read above, stated that
consequent to the amendment to Rule 67 of APVAT Rules, 2005 vide
G.O.Ms.No.503, Revenue (CT.II) Department, dt.8.5.2009, Industrial Units,
in whose cases the sales tax holiday incentive was earlier converted into
Sales Tax/VAT deferment, were required to pay the deferred tax amount
availed immediately after the end of the period of availment instead of a gap
period of 14 years earlier available. This would cause hardship to such units.
2. The Commissioner of Commercial Taxes, has furnished his report in
the matter vide reference 2nd cited.
3. Government have carefully considered the request and decide to
offer an Easy Repayment Scheme (ERS) to facilitate repayment of the tax
deferred amount by such industrial units. As per the ERS:
(i) The tax deferred amount shall be paid in two equal annual installments
for each year of availment.
(ii) The repayment period would commence in the month following the
expiry of the deferment period or 1.5.2009, whichever is later, provided
that in the case of industrial units affected by the severe floods of
October, 2009 the repayment period would commence in the month
following the expiry of the deferment period or 1.5.2011, whichever

is later.
(iii) The industrial unit claiming the benefit specified in (i) above as ‘flood
affected unit’ shall obtain a certificate to that effect from the General
Manager, District Industries Centre of the concerned District. The
General Manager, District Industries Centre shall issue the certificate
after satisfying himself about the loss of production/closure of the unit
due to flood. Necessary guidelines in this regard shall be issued by
the Commissioner of Industries.
(iv) The application for the ERS (Easy Repayment Scheme) shall be
submitted in the format annexed to this order.
4. The Commissioner of Commercial Taxes, AP, Hyderabad is
requested to take necessary action in the matter.
13. Exemption from levy of VAT on incentives bonus of Rs.50/- per quintal
of paddy
[Memo No. 31382/CT-III(1) 2010-2, dt. 27-9-2010]
Sub: APVAT Act, 2005 - Exemption from levy of VAT on incentive
bonus of Rs.50/- per quintal of paddy paid by the Rice Millers -
Certain clarification sought for - Regarding.
Ref: 1. From the CCT, Ref.No. AIII(l)/98/2010, dt.23-6-2010.
2. From the Commr., of Civil Supplies & Ex-officio Secy, to
Govt. Ref.No.PI(l)/6466/2009/dt.12-7-2010.
3. From the Commr., of Civil Supplies & Ex-Officio Secy, to
Govt., Ref.No.PI(l)/6466/2009, dt.25-8-2010.
The attention of the Commissioner of Commercial Taxes Andhra Pradesh,
Hyderabad is invited to the reference third cited wherein while furnishing the
information he reported that the amount of Rs.50/-, which may or may not
be a part of the price of Paddy, purchased by the Rice Millers for the
purpose of their own business (i.e., not for the purpose of fulfilling the levy
of Rice to be supplied to the FCI), is not eligible for deduction from the
taxable turnover of the Rice Millers. The clarification issued by the Government
in Memo. No.58282/CT.II(l)/2007-3, dt.15-4-2008 stipulates that only the
turnover relating to any incentive, offered to the agricultural farmers by the
Government of India would not be taxable. Hence, there is no merit in the
representation of the A.P. Rice Millers Association to the Commissioner of
Civil Supplies and requested the Government to clarify suitably to the
Commissioner of Civil Supplies.
2. The Government, after careful examination of the matter, hereby
clarify that on the levy portion of paddy the incentive bonus of Rs.50/- is not
being subjected to tax so that the consumer or PDS rice is not burdened with
the corresponding tax component. No such social objective is sought to be
achieved in respect of levy free paddy/rice which is sold by the millers in the
open market. The miller is supposed to pass on the tax component on Rs.50/
- price element of levy free paddy to the consumer. Therefore, the request
of the A.P. Rice Millers Association is not feasible of acceptance.
14. Andhra Pradesh State Housing Corporation Limited – Refund of VAT
amount for the period from 1.3.2010 to 29.2.2012 or till completion
of Indiramma Housing Scheme, which ever is earlier.
Read the following:
1. G.O.Ms.No.1045, Revenue (CT-II) Department, dt.20.8.2008.
2. From the Managing Director, Andhra Pradesh State Housing
Corporation Limited, Hyderabad Lr.No.4773/NKs/Tax-VAT/2007,
dt.7.11.2008.
3. G.O.Ms.No.383, Revenue (CT-II) Department, dt.2.3.2009.
4. G.O.Ms.No.478, Rev. (CT-II) Dept., dt.8.4.2009.
5. G.O.Ms.No.492, Rev. (CT-II) Dept., dt.9.6.2010.
6. From the Commissioner of Commercial Taxes, Ref.No.AIII(3)/224/
2009, dt.9.9.2010.
----
Notification.
of the Andhra Pradesh Value Added Tax Act, 2005, the Government of
Andhra Pradesh, having found it necessary to do so in the public interest
hereby direct that the Tax paid by the Andhra Pradesh State Housing
Corporation Limited, Hyderabad for the period two (2) years from 1.3.2010
to 29.2.2012 or till the period of completion of Indiramma Housing Scheme
which ever is earlier, under the provisions of the said Act, shall be refunded,
subject to verification of remittances of refund of tax to the Commercial
Taxes Department’s Head of Account.
------
15. Incentives for setting up of New Industrial Enterprises in Andhra
Pradesh-Industrial Investment Promotion Policy (IIPP) 2010-2015
[G.O.Ms.No. 61, Industries and Commerce (IP) Department,
dated 29-06-2010]
1. G.O.Ms.No.108, Industries & Commerce (IP) Department, dt. 20-05-96.
2. G.O.Ms.No.241, Industries & Commerce (IP) Department, dt. 15-07-98
5. G.O.Ms.No.178, Industries & Commerce (IP) Department,
dt. 21-06-2005
dt. 22-06-2007
7. G.O.Ms.No.300 Industries & Commerce (Tex) Department,
dt. 08-11-2005
dt. 06-10-2007
dt. 20-06-2008
dt. 23-04-2008
dt. 16-10-2008
dt. 20-12-2008
dt. 13-04-2010
15. From the Commissioner of Industries Single File.No.30/1/2010/0959,
dt. 23-06-2010.
***
ORDER:
Government is extending various Incentives for encouraging establishment
of new industrial Enterprises in the State since 1961. In the reference 5th read
above, Government have issued certain incentives to Tiny, SSI, Medium, Large
& Mega industries under Industrial Investment Promotion Policy 2005- 2010,
which was concluded by 31.03.2010. In respect of Mega projects which are
under pipeline status, the date of commencement of commercial production
was extended upto 31-03-2012 vide Government Order 13th read above. In
the Government Order 14th read above, Government have accorded extension
of the Industrial Investment Promotion Policy 2005-10 including policy for
promotion of Scheduled Caste/Scheduled Tribe entrepreneurs, Service Sector
for Scheduled Caste /Scheduled Tribe entrepreneurs and Pavalavaddi Scheme
etc., for a further period of three months i.e., upto 30.06.2010 or till new
Industrial Policy 2010-2015 comes into force whichever is earlier.
2. In order to bring out an attractive industrial policy by the Government
for the next five years period, official teams from Industries Department were
deputed to industrially developed States like Gujarat, Tamil Nadu and
Maharashtra to study the policies and to identify the best practices. Extensive
consultations were also held with Industrial Associations i.e., CII, FICCI,
FAPSIA, FAPCCI, ALEAP, COWE, AP Spinning Mills Association,
ASSOCHAM, etc to elicit their views in formulation of the New Industrial
Policy.
3. Series of meeting were conducted with number of industrial
associations, line departments, Head of Departments concerned and finalised
the draft Industrial Investment Promotion Policy 2010-15. A detailed study was
made on the Draft Industrial Investment Promotion Policy 2010-15, covering
the incentives being offered under the existing policy in comparison with
industrial policies of other industrially developed states like Gujarat,
Maharashtra, Tamilnadu etc. and the incentives proposed to be included in
the new industrial policy. After careful examination, the Government approved
the New Industrial Policy “Industrial Investment Promotion Policy (IIPP) 2010-
2015” giving major emphasis for Creation of Quality Infrastructure, promotion
of Manufacturing Investment Zones and Industrial Corridors, special focus on
MSMEs, growth enabling incentives to create a level playing field, to tap the
potential of ever expanding service sector related to industrial activity, fostering
industrial clusters, promotion of anchor industries for creation of ancillary base,
Capacity building and skill upgradation, inclusive development to build
competency in Women and Scheduled Caste & Scheduled Tribe Entrepreneurs,
Quality Competitiveness, Export Promotion, promotion of cleaner technology,

leveraging existing strengths for value addition, special focus on thrust sectors,
revitalization of MSMEs. The detailed policy document is appended at
Annexure-I.
4. Under the new “Industrial Investment Promotion Policy (IIPP) 2010-
2015”, the Government approved the following fiscal benefits covering the
categories of (a) Micro/Small Enterprises (b) Medium Enterprises & Large
Industries (c) Scheduled Caste & Scheduled Tribe Entrepreneurs (d) Women
Entrepreneurs and (e) Mega Projects.
4.1.0. Micro and Small Enterprises (MSE’s)
Small Enterprise means a Unit having the investment on plant and
machinery up to limit as defined by the Government of India from time to
time.
Micro Enterprise means a Unit in which Investment on plant and
machinery up to limit as defined by the Government of India from time to
time.
4.1.1. 100% reimbursement of Stamp duty and transfer duty paid by the
industry on purchase of land meant for industrial use.
4.1.2. 100% reimbursement of Stamp duty for Lease of Land/Shed/ Buildings
and also mortgages and hypothecations.
4.1.3. 25% rebate in land cost limited to ` 10.00 Lakhs in Industrial Estates/
Industrial Parks.
4.1.4. 25% Land conversion charges for industrial use limited to ` 10.0 lakhs.
4.1.5. Fixed power cost reimbursement @ ` 0.75 per unit (upper ceiling) on
the proposed revised rates (2010-11) for 5 years from the date of
commencement of commercial production. In case, decrease in Power
Tariff, the reimbursement will be reduced proportionately.
4.1.6. 15% investment subsidy on fixed capital investment subject to a
maximum of ` 20.00 lakhs.
4.1.7. Reimbursement of 100% VAT/CST or State Goods and Services Tax
(SGST) for a period of 5 years from the date of commencement of
commercial production to Micro Enterprises.
commercial production to Small Enterprises.
4.1.9. Interest subsidy under Pavala Vaddi Scheme on the term loan taken
on the fixed capital investment by New Micro and Small Enterprises
in excess of 3% per annum subject to a maximum reimbursement
of 9% per annum for a period of 5 years from the date of
commencement of commercial production.
4.1.10. Seed capital assistance to First Generation Entrepreneurs to set-up
Micro Enterprises @10% of the Machinery cost, which will be
deducted from the eligible investment subsidy.
4.1.11. 50% Reimbursement of cost involved in skill upgradation and training
the local manpower limited to ` 2000 per person.
4.1.12. 50% subsidy on the expenses incurred for quality certification/ patent
registration limited to ` 2.00 Lakhs for MSE’s.
4.1.13. 25% subsidy on specific cleaner production measures limited to
` 5.00 Lakhs
4.1.14. To extend investment subsidy to the identified service activities
related to industries setup in all Municipal Corporation limits in the state
as per the list appended as Annexure - II.
4.2.0. Medium Enterprises & Large Industries
Medium Enterprise means an industry in which Investment on plant and
machinery up to limit as defined by the Government of India from time to time.
Large Industry means an industry in which the investment on plant and
machinery is less than ` 250 crores except Micro, Small and Medium Enterprises.
4.2.3. 25% rebate in land cost limited to ` 10.00 Lakhs in Industrial Estates/
Industrial Parks.
4.2.4. 25% Land conversion charges for industrial use limited to ` 10.0 lakhs
only for Medium Enterprises.
4.2.5. Fixed power cost reimbursement @ ` 0.75 per unit (upper ceiling) on
the proposed revised rates (2010-11) for 5 years from the date of
commencement of commercial production. In case, decrease in Power
Tariff, the reimbursement will be reduced proportionately.

commercial production.
registration limited to ` 2.00 Lakhs only for Medium Enterprises.
` 5.00 Lakhs.
4.2.10. Infrastructure like roads, power and water will be provided at door
step of the industry for standalone units by contributing 50% of the
cost of infrastructure from IIDF with a ceiling of ` 1.00 Crore, subject
to (a) the location should be beyond 10 kms from the existing Industrial
Estates/IDA’s having vacant land/shed for allotment and (b) cost of
the infrastructure limited to 15% of the eligible fixed capital investment
made in the industry.
4.3.0. Scheduled Castes / Scheduled Tribe Entrepreneurs
SC/ST Entrepreneurs mean those units established as sole Proprietor or
invariably having 100% share in Partnership/Private Limited Companies vide
Government Order 10th read above. Scheduled Caste and Scheduled Tribe
entrepreneurs can also set up industries covered in the Annexure-III to avail
incentives in this policy.
4.3.3. 33 1/3% rebate in land cost limited to ` 10.00 Lakhs in Industrial
Estates/Industrial Parks.
4.3.4. 25% Land conversion charges for the industrial use limited to
` 10.0 lakhs.
4.3.5. Fixed power cost reimbursement @ ` 1.00 per unit (upper
ceiling)on the proposed revised rates (2010-11) for 5 years from
the date of commencement of commercial production. In case,
decrease in Power Tariff, the reimbursement will be reduced
proportionately.
4.3.6. Seed capital assistance to First Generation Entrepreneurs to set-up

Micro Enterprises @10% of the Machinery cost, which will be
deducted from the eligible investment subsidy.
4.3.7. 35% investment subsidy on fixed capital Investment for Micro and
Small Enterprises by SC and ST Entrepreneurs and additional 5%
investment subsidy for SC Women and ST Women Entrepreneurs, with
a maximum limit per unit is ` 50.00 Lakhs (i.e. 35% for SC and ST
Entrepreneurs and 40% for SC Women and ST Women entrepreneurs).
Additional 5% investment subsidy for units set up in Scheduled Areas
by ST entrepreneurs with a maximum limit per unit is ` 50.00 Lakhs.
commercial production to Micro Enterprises.
commercial production to Small Enterprises.
4.3.10. Interest subsidy under Pavala Vaddi Scheme on the term loan taken
on the fixed capital investment by Micro and Small Enterprises in
excess of 3% per annum subject to a maximum reimbursement
of 9% per annum for a period of 5 years from the date of
commencement of commercial production.
registration limited to ` 2.00 Lakhs for Micro and Small Enterprises.
` 5.00 Lakhs.
4.3.14. For Micro and Small Enterprises set up by Scheduled Caste and
Scheduled Tribe entrepreneurs, Infrastructure like roads, power and
water will be provided at doorstep of the industry for stand alone units
by contributing 50% of the cost of infrastructure from IIDF with a
ceiling of ` 1.00 Crore, subject to (a) the location should be beyond
10 kms from the existing Industrial Estates/IDAs having vacant land/
shed for allotment and (b) cost of the infrastructure limited to 15%
of the eligible fixed capital investment made in the industry. 50% of
the cost of infrastructure is raised to 75% in respect of units set up
by ST entrepreneurs in Scheduled areas.
4.3.15. The line of activity of Proclainer is considered as eligible exclusively

in case of Scheduled Caste and Scheduled Tribe entrepreneurs and
incentive shall be extended under service activity.
4.3.16. Joint venture industries of Scheduled Caste or Scheduled Tribe
entrepreneurs should be owned 100% by Scheduled Caste/Scheduled
Tribe entrepreneurs or a combination of Scheduled Caste and
Scheduled Tribe promoters. In case of combined ownership the
incentives will be determined basing on majority holding by Scheduled
Caste or Scheduled Tribe promoters. Such majority Scheduled Caste/
Scheduled Tribe share holding should continue for at least six (6)
years from the date of production, failing which the special incentives
allowed to Scheduled Caste/Scheduled Tribe entrepreneurs will be
recovered.
4.4.0. Women Entrepreneurs
Women entrepreneurs mean those units established as sole Proprietress
or invariably having 100% share in Partnership/Private Limited Companies vide
Government Order 11th read above.
4.4.1. Additional 5% investment subsidy on fixed capital investment subject
to a maximum of ` 5.00 lakhs to MSE’s.
4.4.2. All other benefits as per para No.4.1.0 (Micro & Small Enterprises
under IIPP 2010-15).
4.5.0. Mega Projects
Mega Project means the Industrial unit, which sets up with a capital
investment of ` 250 Crores and above or a project that creates employment
to more than 2000 persons.
4.5.1. Mega projects i.e. projects with an investment of ` 250 Crores and
above or a project that creates employment to more than 2000 persons
are eligible for all the incentives available for Large Industries and
Medium Scale Enterprises.
4.5.2. Further, the Government will also extend tailor-made benefits to suit
to a particular investment requirements on case to case basis.
4.6.0. Existing Micro/Small/Medium Enterprises Industries
50% subsidy on the expenses incurred for quality certification limited to
` 2.00 Lakh.
4.7.0. Infrastructure support

4.7.1. To provide ` 100.00 crores of budget every year for promotion of
quality infrastructure like roads, power, water, waste management etc.
under Industrial Infrastructure Development Fund (IIDF) Scheme.
4.7.2. Promotion of National Manufacturing Investment Zone (NMIZ) along
National Highways to capitalize the strengths in line with Government
of India initiatives for value addition within the State.
4.7.3. Promotion of Industrial Corridors to leverage the existing strengths for
optimum utilization of resources.
4.7.4. Reservation of 30-40% of the land for MSMEs in the upcoming
industrial estates developed by Andhra Pradesh Industrial Infrastructure
Corporation (APIIC).
4.7.5. APIIC shall allocate 16.2% of number of plots to Scheduled Caste
Entrepreneurs and 6% of number of plots to Scheduled Tribe
Entrepreneurs in new Industrial Estate and preferential allotment to
SC/ST entrepreneurs in Existing Industrial Estates.
4.7.6. Andhra Pradesh Industrial Infrastructure Corporation (APIIC) shall
allocate 10% of number of plots to Women Entrepreneurs in the new
Industrial Estates.
4.8.0. Other benefits (to all categories)
Reservation of 10% of water for industrial use from the existing projects
as well as future projects will continue.
4.9.0. Facilitation of Industries
4.9.1. Strengthening of existing Single Window System.
4.9.2. Creation of “Investment Promotion Cell”
A Cell would be created in the Commissionerate of Industries to facilitate
the investors in effective manner with adequate infrastructure and outsourcing
the support services to facilitate investors by providing pre-investment services
and also to facilitate them to get requisite clearances under the Single Window
Clearance System till the project is commissioned.
4.10.0. Textile Sector
Government felt that there is a need for promotion of Textile industry
in sustainable manner and also for value addition within the State for optimum
utilization of the cotton available in the State.
a) The eligibility period for Spinning/Weaving/Garmenting units

commissioned during IIPP 2005-10 period is extended by another 3
years, making total eligibility period as 8 years (2005-13).
b) To continue the benefits of existing incentives under Textile and Apparel
Policy 2005-10 [G.O.Ms.No.300 Industries & Commerce (Tex)
Department, dated.08.11.2005] by another 5 years.
5. To promote Andhra Pradesh as the best investment destination for
investors in India, the State Government have offered various incentives/
benefits to all eligible new industrial enterprises set up in the State except in
the Municipal Corporation limits of Vijayawada, Greater Visakhapatnam
Municipal Corporation and Grater Hyderabad Municipal Corporation excluding
existing Industrial Estates/Parks, Industrial Estates notified/ to be notified
and commence commercial production on or after 1.7.2010 but before
31.3.2015. However, the Industrial Enterprises located in Sanathnagar,
Azamabad, Chandulal Baradari and Kattedan Industrial Estates of Hyderabad
and Rangareddy Districts are not eligible for any incentives/concessions.
However, the service activities set up in all Municipal Corporation limits as
appended in Annexure II are eligible only for investment subsidy and all other
service/Business activities are not eligible for any incentives set up anywhere
in the State. Projects involving substantial Expansion/Diversification of existing
industries in the eligible lines of activities are also entitled for benefits offered
under the policy. The list of ineligible Industries/ activities is appended to, as
Annexure III.
6. Scheduled Caste and Scheduled Tribe entrepreneurs can set up
projects covered in the line of activities in Annexure III and Annexure IV to
avail the incentives under the Industrial Investment Promotion Policy (IIPP)
2010-2015 in the State, however projects proposed to be set up in the Municipal
Corporation limits of Vijayawada, Greater Visakhapatnam Municipal
Corporation and Grater Hyderabad Municipal Corporation shall obtain pollution
clearances wherever necessary. Service Sector projects set up by the Scheduled
Caste/Scheduled Tribe entrepreneurs will be limited to 50% of the Budget
provision in order to encourage the remaining 50% for the manufacturing sector.
7. The activities indicated in the Annexure-II, Annexure-III and
Annexure-IV will be reviewed from time to time for any revisions required.
8. Necessary amendments/ Orders will be issued by the concerned
Departments. Detailed operational guidelines will be issued by the
Commissioner of Industries separately.
9. This order issues with the concurrence of Finance (Exp.I&C)

Department, vide Peshi No.8440 of Principal Finance Secretary (FP)
dated 26.6.2010.
——
ANNEXURE-I
(G.O.Ms.No. Industries & Commerce (IP) Department, dated 29.6.2010)

1.0. INTRODUCTION:
1.1. Andhra Pradesh is strategically located on the south-eastern coast of
India and is considered as gateway to East & South East Asia. It is
fourth largest state in the country spread over an area of 2,76,754 sq.
kms and fifth largest by population. The State capital is Hyderabad.
Andhra Pradesh, situated south of the Vindhyas, is surrounded by
Madhya Pradesh, Orissa, the Bay of Bengal in the east and Tamil Nadu
and Karnataka in the south and by Maharashtra in the west.
1.2. Andhra Pradesh State Powered by its robust economic growth over
the decade and more particularly its spectacular growth of Nine percent
and more in the last four years – Andhra Pradesh acquired national
prominence and international recognition. A State that was considered
an agrarian state, a few decades back, has transformed and emerged
into a veritable hub of knowledge and a vibrant and fast growing
industrial powerhouse. Andhra Pradesh is the third largest economy
in the country. It is among the top three States in attracting investments
from domestic and foreign investors. The contribution of industrial sector
to the State GDP, last year at 25.1 percent, was higher than that of
agriculture. Industry has grown at an average annual rate of 8.6 percent
in the past five years, recording a double-digit growth in 2007-08.
1.3. The State considers industrial growth as a means to mitigate poverty
and unemployment. Industrial development promotes higher capital
formation; raises wage incomes to higher levels; and absorbs surplus
workforce, bottled up in rural areas, to industry. To realize these
benefits and hasten up the socio-economic changes, industrial
development is accorded top priority by the State government. The
Andhra Pradesh “Industries Investment Promotion Policy, 2010-15
(IIPP 2010-15) is aimed at “advancing the cause of inclusivity,
distributive justice, and creating employment opportunities across
different skill sets”.
EXCELLENT ENDOWMENT OF RESOURCES:

1.4. Andhra Pradesh has bountiful natural resources (coal, limestone,
bauxite, and a number of minor minerals), fertile land, water, fertile
river basins and extensive canal system, and conducive agro-climatic
conditions. The State is agriculturally prosperous. It is known as the
“Rice Bowl of India”. The State also has the second longest coastline
(972 km) among all the States in India and it is also the largest producer
of marine products with 40% share in country’s exports.
1.5. Andhra Pradesh is well connected with the rest of the world through
its seaports on the eastern coast and its international airport, which
is ranked as the fifth best airport in the world. A well-established road
and railway network link it to the rest of India. Vast Natural Gas
reserves found in Krishna–Godavari basin, which is one of the largest
Gas discoveries in India in the Eastern Region has opened up immense
possibilities for environment-friendly industrial development with greater
efficiency and cost effectiveness in Andhra Pradesh. The Natural Gas
find of 62 million standard cubic metres per day has already been
exploited, while further exploration is in full swing The State has
abundant water resources from its river system and Reservoirs.
1.6. Andhra Pradesh holds the first rank in area and production of Rice,
Citrus, Chilly, Oil Palm, Prawn, Egg, Broiler, Meat. It is second in
Fish, Mango, Tomato & Coriander, third in cotton, cashew; fourth
in flowers and fifth in grapes, banana, ginger, and guava. There
is large potential for production of variety of processed products.
1.7. The State is a home to more than 50 prestigious central and state
Research & Development laboratories. With the presence of renowned
research institutions like Centre for Cellular and Molecular Biology,
Centre for DNA Fingerprinting and Diagnostics, Indian Institute of
Chemical Technology, National Institute for Nutrition, International
Crops Research Institute for the Semi-Arid-Tropics (ICRISAT),
National Geophysical Research Institute (NGRI). These facilities offer
immense opportunities to Pharmaceuticals, Biotechnology, and fine
chemicals sectors in the State.
AN ATTRACTIVE INVESTMENT DESTINATION:
1.8. Andhra Pradesh is today a competitive and attractive investment
destination for foreign and domestic investments. Goldman Sachs
remarked, “Andhra Pradesh, the most attractive state we visited, has
adopted an innovative approach to attract foreign investments and

benefits from a stable, strong and reformist government”.
1.9. Hyderabad enjoys a pride of place in the World Bank survey. Its report
“Doing Business in India – 2009” has ranked Hyderabad as the 2nd
best Metro city in India. CII in its survey has rated Andhra Pradesh
as the best performing State in the manufacturing sector among the
four Southern States.
1.10. With the robust growth of the Economy and the Industry in the State
and the attendant strengths of a dynamic industrial economy, Andhra
Pradesh is the attractive destination for investments and offers a right
choice for any business endeavor. Its strength lies in its fully diversified
industrial base. The State has strong and growing presence in
(a) knowledge-based and high-technology sectors such as information
technology, biotechnology and pharmaceuticals, aviation and space
technology, (b) resource-based industries such as mining, cement, steel,
textiles, agro-industry and food processing, and (c) labour-intensive
industry such as garments, leather products.
1.11. There is a resurgence of engineering industry in Andhra Pradesh:
machine tools, foundry, forge, electrical machinery, precision machining
and engineering, and transport equipment.
1.12. The presence of Defense Research and Development Laboratories
has laid the foundation for the development of precision machine tools,
special purpose machines and has led to development of host of small
and medium Industries catering to the needs of Atomic Energy,
Defense, and Space, etc. Andhra Pradesh earned the distinction that
many of the components and sub-assemblies used in PSLV
Chandrayan, atomic submarine are made in Andhra Pradesh. The State
is thus well known for its Engineering Industry and earned a pride of
place in the industrial map of India.
1.13. Andhra Pradesh is the leader in Cement Production with an installed
capacity of 32.89 Million TPA, with large deposits of the limestone
and coal in the State. The Cement production in the next 3-4 years
is going to be doubled, as many more Cement Plants are coming up
in the State.
1.14. The State stands at the apex in the country in paper production, with
an existing capacity of 5.50 lakh TPA. Another 5.0 lakh tons are going
to be added in the next 3 years.
1.15. The State is an important producer of steel, with another ` 40,000

crores of investment under active implementation. This will increase
the steel production by another 10 million tonnes. Wide variety of
building materials, like Granites, Slate, Marbles are found in the State.
1.16. Hyderabad, which accounts for one-third of India’s total bulk drug
production, is the bulk drug capital of the country. A large number of
bulk drug units are located in and around Hyderabad with good
infrastructure and trained manpower.
1.17. Textiles is yet another area, which is growing rapidly in the State. The
state of Andhra Pradesh has well developed spinning and processing
sector in the textile industry. In fact, the state is the 3rd leading
producer of cotton in the country. Major investments are taking place
in this sector and soon AP will emerge as the textile hub of the country.
1.18. Andhra Pradesh is the second largest in the power generation in the
country. It has the lowest energy deficit in the country with a deficit
of 2 percent when compared to the national average of 9.3 percent.
It has an installed capacity of 13,300 MW and additional 15,000 MW
is going to be added with an investment of ` 64,000 crores in the next
5 years.
1.19. Andhra Pradesh offers power at the lowest cost compared to any of
the industrially developed states. Vast natural gas reserves of Krishna–
Godavari basin have opened up immense possibilities for environment-
friendly industrial and economic development of the state.
PERFORMANCE UNDER INDUSTRIAL INVESTMENT
PROMOTION POLICY (IIPP) 2005-10
1.20. The strides made under IIPP 2005-10 during the past five years have
been truly outstanding and the state had implemented an investment
of ` 40,120 Crores providing employment to 4,57,900 people. Of which,
` 29, 152 crores pertains to Large Scale Sector and the remaining
` 10,968 Crores pertains to MSME’s sector.
1.21. The policy for the next five years (2010-2015), will consolidate the
achievements of the past five years and pipe line investments thereby
further expanding the opportunities for development.
2.0. VISION
“To build a strong and vibrant industrial economy that spins off large
capital formation in the State and advances the inclusive development of all
VAT–70
sections of people and all sectors of the industry, and that creates increasing
employment opportunities, and raises wage incomes to higher levels through
skill up-gradation so as to improve the quality of life of citizens in the State.”
2.1.0. OBJECTIVES
2.1.1. To promote Andhra Pradesh as “THE BEST” investment destination
2.1.2. To increase manufacturing growth rate from 12% to 17%
2.1.3. To Create additional employment of 5 Lakh persons per year – 2 lakh
directly and 3 Lakh indirectly
2.1.4. To achieve ` 15,000 Crores of investment per year in the
manufacturing sector
2.1.5. Special focus on Micro, Small and Medium Enterprises with emphasis
on Food Processing
2.1.6. Inclusive development by facilitating enterprise creation and their
growth by building up their industrial competence in socially
disadvantageous groups.
2.1.7. To enhance the knowledge, skills of human resources for better
productivity and global competitiveness.
2.1.8. To create enabling environment for ensuring maximum value addition
to the abundantly available resources.
2.1.9. To build conducive ecosystem for sustained growth of industry
2.2.0. STRATEGIES
2.2.1. Creation of quality infrastructure in the Industrial Clusters, Industrial
Estates, SEZs.
2.2.2. Promotion of National Manufacturing Investment Zones (NMIZ) and
Industrial Corridors to capitalize the locally available resources and
strengths like availability of Natural Gas and Ports, Road network, Rail
linkages for accelerating growth of manufacturing industries.
2.2.3. Leveraging the existing strengths of potential sectors such as Pharma,
Textile, Cement, Paper, Steel, granite etc and Natural resources such as
Agricultural, Horticultural, Mineral deposits, Marine, Natural Gas etc.
2.2.4. Dovetailing the GOI schemes for optimum utilization.
2.2.5. Skill Development Programmes to enhance the skill sets and to cater
to the needs of industry.
2.2.6. Provide technical consulting services, technical know-how and

technology transfer.
2.2.7. Provide platforms for access to markets through interaction between
enterprises and global markets.
2.2.8. Creation of Investment Promotion Cell to provide pre-investment
services and also handholding services.
2.2.9. Strengthening and revitalization of District Industries Centers to provide
effective services.
2.2.10. Encouraging anchor industries.
2.2.11. Emphasis on revitalization of MSME sector.
2.2.12. Incentivizing investments in manufacturing sector including the service
activities related to industries.
2.2.13. Conduct road shows, trade fairs to showcase State’s strengths.
3.0. Applicability of the Policy
3.1. In order to achieve the objectives envisaged, various incentives/benefits
are offered to all eligible enterprises set up in the State except in the
Municipal Corporation limits of Vijayawada, Greater Visakhapatnam
Municipal Corporation and Greater Hyderabad Municipal Corporation
excluding existing Industrial Estates/Parks, Industrial Estates notified,
and to be notified. The industries / enterprises must commence
commercial production or after 01.07.2010 but on or before 31.03.2015.
However, the Industrial Estates existing in erstwhile Municipal
Corporation limits of Hyderabad and Kattedan Industrial Estate in
Rangareddy District are not eligible for any incentives.
3.2. The eligible service activities set up in all Municipal Corporation limits
as appended in Annexure–II are eligible only for investment subsidy
and all other service/Business activities are not eligible for any
incentives set up anywhere in the State.
3.3. Projects involving substantial Expansion/Diversification of existing
industries in the eligible lines of activities are also entitled for benefits
offered under the policy.
3.4. The list of ineligible Industries/ activities as Annexure III.
3.5. Operational guidelines of the policy will be notified separately.
3.6. Under the IIPP 2010-15, the Government proposes the following fiscal
benefits to eligible Manufacturing and Service enterprises covering the
categories of (a) MSME’s (b) Large Enterprises (c) SC/ST
Entrepreneurs (d) Women Entrepreneurs (e) Mega Projects (f) Sector
specific incentives
4.0. POLICY INTERVENSIONS
4.1.0 Infrastructure Initiatives
A. Land
4.1.1. Government will create land banks for industrial parks. Industrial Parks
will be developed across the State over the next 5 years. The land
banks will also meet the land requirements of anchor industries which
have huge employment potential. Efforts will be made to identify
waste/baron/dry lands in different parts of the State.
4.1.2. Development of quality infrastructure for industrial growth has been given
highest priority in the Policy. In line with this objective, Government of
Andhra Pradesh would provide ` 100.00 crores in State budget every
year for promotion of industrial estates in the state with quality
infrastructure like roads, power, water, waste management etc., and also
to provide external infrastructure to Special Economic Zones (SEZ’s).
4.1.3. Infrastructure Authority (IA) has been constituted for the rapid
development of physical and social infrastructure in the State through
private participation in the Designing, Financing, construction, operation
and maintenance of infrastructure projects.
4.1.4. Provide Infrastructure assistance to standalone units set up in remote
locations under Industrial Infrastructure Development Fund (IIDF) @
50% on the infrastructure cost limited to ` 1.00 Crores.
4.1.5. Upgradation and maintenance of infrastructure in the existing industrial
estates/parks on priority basis.
4.1.6. 100% reimbursement of stamp duty and transfer duty paid by the
industry on purchase of land, lease of land/shed/buildings, mortgages
and hypothecations meant for industrial use.
4.1.7. Reimbursement of 25% land cost limited to 10.00 lakhs to the units
in Industrial Estates/Industrial Parks developed by APIIC.
4.1.8. 25% reimbursement of land conversion charges limited to ` 10 Lakhs
for MSME’s.
4.1.9. Reservation of 30-40% of the land for Micro and Small enterprises
in the existing and upcoming industrial estates / parks developed by
APIIC.
4.1.10. Promotion of Ancillary Industries - Andhra Pradesh Industrial
Infrastructure Corporation (APIIC) will create adequate infrastructure
facilities near the Anchor Industries like NTPC – BHEL Joint Venture
for manufacturing Power Plant Equipment and other Major industries
for promotion of cluster of ancillary industries.
4.1.11. Promotion of Gas based Industries – Vast natural gas reserves
found in Krishna–Godavari basin with 62 million standard cubic metres
per day already being exploited, which is one of the largest Gas
discoveries in India in the Eastern Region has opened up immense
possibilities for environment-friendly industrial development with greater
efficiency and cost effectiveness in Andhra Pradesh.
4.1.12. In order to take maximum advantage of the Natural Gas potential in
the KG basin, Government of Andhra Pradesh is involved in the
Exploration and Production in the KG Basin through ‘A.P. Gas
Infrastructure Corporation Limited (APGIC)’ with the participation of
the APIIC and APGENCO.
4.1.13. APGIC, as a part of consortium has participated in New exploration
and Licencing Policy (NELP) – VIII round bidding for all 5 – blocks
(1-Deep Water Block , 4-Shallow Water Blocks) in KG basin and won
4- blocks (1-Deep Water Block , 3-Shallow Water Blocks).
4.1.14. Gas Transmission Grid - East-west Pipeline Kakinada-Maharashtra-
Gujarat has already been laid and it is in operation. Further 3 more
pipelines are awarded to different agencies for laying pipeline in the
State, which include:
i) Kakinada-Haldia
ii) Kakinada-Chennai
iii) Central India Pipeline : Kakinada-Madhyapradesh (via Bhilwara)
Thus the entire State of Andhra Pradesh can be covered with pipeline
network and City Gas Distribution (CGD) network.
4.1.15. Pipe Line Network and CGD : Keeping above gas Transmission
Grid in view, APGIC has already taken action fully tab the potential
and initiated the following action:
• MECON has been selected has a Technical Consultant to study

and prepare feasibility report for laying extensive “Pipeline
Network” within the State
• 18 Geographical Areas (GAs) have been identified for City Gas
Distribution (CGD) for transport, domestic, commercial and
Industrial use. Proposals for 7 geographic areas are submitted to
Petroleum and Natural Gas Regulatory Board (PNGRB) and 11
more are under preparation. The major districts covered in the first
7 geographic areas include:
– Visakhapatnam, Vizianagaram, Srikakulam, Krishna, East
Godavari, West Godavari, Khammam, Warangal, Karimnagar,
Ranga Reddy and Medak District and the remaining districts
will also be covered under the proposed 11 GAs.
4.1.16. APGIC is also a partner in Bhagyanagar Gas Ltd. (BGL), which has
already taken up the City Gas Distribution in 3 major cities of
Hyderabad, Vijayawada and Kakinada.
B. Power
4.1.17. The State has emerged as a key player in the country’s power sector
and has an energy deficit of 2% when compared to the national
average of 9.3%.. At national level, the state stands first in the
generation of hydroelectric power and is also looking to take the lead
in clean technologies such as wind, solar and bio-mass. The state is
also looking to utilize the vast natural gas reserves found in Krishna-
Godavari basin.
4.1.18. To make available power at most competitive rates, the Policy provides
for fixed power cost reimbursement @ ` 0.75 per unit (upper ceiling)
on the proposed revised rates (2010-11) for 5 years from the date of
commencement of commercial production. In case of decrease in
Power Tariff, the reimbursement will be reduced proportionately.
4.1.19. Promote merchant power plants through the PPP models to reduce
power shortage in the state .
4.1.20. Provide dedicated feeders to units located in industrial estates / parks
and industrial areas for uninterrupted power supply.
4.1.21. APTRANSCO will convert feeders having more than 50% of the
industrial load as dedicated/express feeders.
4.1.22. Efforts will be made to ensure uninterrupted power supply to the
industrial units in coordination with Energy Department.
4.1.23. Associated needs like Solar Power, Wind Power etc. will be taken up
by facilitation and interaction with other departments.
4.1.24. Encourage new captive power plats for self-consumption and will
examine providing Electricity duty exemption.
C. Water
4.1.25. The State is called “a River State” as it is blessed with major River
systems like Godavari, Krishna, Pennar, Vamsadhara and 36 others.
4.1.26. As of now there is 2746 TMC of dependable availability of water in
the State, of which 2092 TMC of water is being utilised.
4.1.27. In addition to the above, plenty of ground water resources are also
available in the State.
4.1.28. Reservation of 10% of water for industrial use from the existing
projects as well as future projects would be continued.
D. Airports
4.1.29. First green field International Airport of the country at Hyderabad is
one more feather in the cap of Andhra Pradesh, which is ranked as
the 5th best Airport in the World. Proximity to International Airports
at Chennai, Bangalore from several districts of Andhra Pradesh just
adds to the overall industrial growth in the state.
4.1.30. The other airports in the state are Visakhapatnam Airport, Vijayawada
Airport, Rajahmundry Airport and Tirupati Airport. The Government also
has plans to construct airports in eight other cities: Guntur, Ongole,
Nellore, Warangal, Kadapa, Tadepalligudem, Kurnool and Ramagundam.
E. Ports
4.1.31. Andhra Pradesh has one major port at Visakhapatnam. It is one of the
country’s largest and busiest ports. It is known as East Coast Gateway
of India. It is the only Indian port having three International accreditations-
ISO9001, ISO14001, OHSAS18001. The highlights of the port include:
i) Record cargo throughput of 64.60 MMT during 2007-08
ii) Highest annual Railway traffic among major ports - 35.5 MMT
in 2007-08
iii) Highest Import of coking coal among major ports - (30%)
4.1.32. The state has completed numerous projects under the Public Private
Partnership (PPP) and has the credit of being the first state for
development of ports in the private sector at Krishnapatnam,
Gangavaram, Nizampatnam and Kakinada, rapidly fueling the industrial
growth in the state. Details of Krishnapatnam and Gangavaram are
as detailed below:
4.1.33. Krishnapatnam Port is situated at a distance of 24 km from Nellore
in Nellore District, the southernmost coastal district in the state and
200 kilometer north of Chennai. Krishnapatnam Port is connected to
the National Highway-5 through a state highway. It has handled 8
million tonne of cargo in its first 8 months of operations. Four
deepwater berths are operational at the port now, (for coal, iron ore
and general cargo) and 2 breakwaters. It will soon have additional
berths, with facilities to handle containers.
4.1.34. Gangavaram Port has been developed as all weather, multipurpose,
deepest port in India with a depth up to 21 meters capable of handling
Super Cape size vessels of up to 200,000 DWT. Gangavaram Port
with its deep draft berths will act as the gateway port to existing and
Greenfield projects planned in the hinterland. It ability to handle larger
vessels efficiently will result in substantial savings to trade and port
users. It will be able to provide efficient cargo handling services for
a variety of bulk cargo groups including Coal, Iron Ore, Fertilizer,
Limestone, Food Grains, Steel products, Petrochemicals etc. The Port,
its related facilities and material handling system have been planned
to meet the highest standards in terms of pollution prevention and
safety.
4.1.35. The State also has minor ports at Mutyalampalem, Bhavanapadu,
Kalingapatnam, Bhimunipatnam, Narsapur, and Vodarevu.
F. Road Network
4.1.36. The State has an excellent road network which connects the state with
rest of the country through National Highway. A total of 1,88,568 km
of road are maintained by the State, of which State Highways comprise
10,231 km, National Highways 4,647 km and District Roads 32,222 km.
G. Rail Network
4.1.37. The State has excellent rail connectivity, connecting important growth
notes country.
H. National Manufacturing Investment Zones

4.1.38. The state would take advantage of National Manufacturing Investment
Zones (NMIZs) initiatives of Government of India and suitably facilitate
creation of required infrastructure in PPP mode duly identifying the areas
to declare as NMIZ for optimum utilization of available resources and
sub-region strengths like road network, rail network, ports etc.
I. Industrial Corridors
4.1.39. State will make efforts on the following lines:
i) Government of India Corridors – Efforts will be made to bring
atleast two Industrial corridors (1) Visakhapatnam to Chennai (via)
Vijayawada (2) Hyderabad (via) Renigunta joining the Chennai to
Bangalore Corridor for all-round development of the State.
ii) State Corridors – Promote Industrial Corridors along the National
Highways to capitalize the locally available resources and
infrastructure facilities.
J. Petroleum, Chemicals & Petrochemical Investment Region
(PCPIR)
4.1.40. PCPIR between Visakhapatnam - Kakinada, the largest PCPIR in
India is spread over an area of 604 Sq.Kms has been approved by
the Government of India and A.P is the first State to sign Memorandum
of Understanding (MoU) with Government of India on 1st October
2009. Later, the same has been notified by the Government of Andhra
Pradesh. The objective of PCPIR is to create world class
infrastructure like widening National Highways and State Highways,
rail links, upgradation of airports, seaports, power supply and water
supply, which would attract global investments leading to large scale
employment generation in the State.
4.1.41. The cost of total infrastructure for the project is approved at ` 19,031
crores. The role of the Government of India is to ensure availability
of external infrastructure linkages including Rail, Road, Ports, Airports.
Government of India will provide necessary viability gap funding through
PPP to the extent possible for creation of infrastructure. The role of
the State Government is to acquire the land necessary for the
infrastructure, processing and non-processing areas and to ensure that
after notifying the area, all physical infrastructure and utility linkages
are provided within a stipulated time.
4.1.42. The total investment expected is above 3 lakh crores over a period
of 7-10 years and employment projected is 12 lakhs (Direct 5.25 lakhs
and Indirect 6.75 lakhs). Till date, the committed investment is about
` 1,74,654 Crores.
4.2.0. Focus on MSMEs
4.2.1. Recognizing the importance of MSMEs in creating a multiplier impact
on the economic growth, through large scale employment generation,
exports and supplying mass consumption goods, a special focus is given
to aggressively develop the MSME sector in the State. The following
initiatives are proposed taking Prime Ministers Task Force Committee
recommendations as the guiding principle.
A. Strengthening and Revitalization of District Industries
Centres (DICs)
4.2.2. District Industries Centers would be strengthened and revitalized for
providing support services, which include:
i) Preparation of District-wise detailed plans
ii) Comprehensive information on policies/schemes
iii) Project profiles on viable activities
iv) Marketing support
v) Organising entrepreneurship and skill development programmes.
vi) Credit support
vii) Facilitating revival/rehabilitation of sick MSMEs
B. Other Growth Enabling Incentives MSEs
4.2.3. As a support measure, MSEs will be provided investment subsidy and
tax incentives in the initial stages as indicated
i) 15% investment subsidy limited to ` 20.00 lakhs to MSE’s
ii) Reimbursement of 100% VAT/CST or SGST for a period of 5 years
to Micro Enterprises
iii) Reimbursement of 50% VAT/CST or SGST for a period of 5 years
to Small Enterprises.
C. Credit Support
4.2.4. The State will extend the following support for credit flow to MSMEs:
a) Interest rebate reimbursement under Pavalavaddi scheme on Prime

Lending Rate on the term loan to an extent of 9% over and above
3% to MSEs for a period of 5 years
b) Popularize the collateral free loan scheme - CGTMSE actively take
measures which will enhance the loan rendering capacity of banks
c) APSFC will provide loans to MSMEs inline with Commercial Banks
under SIDBI-CGTMSE scheme
d) Seed capital assistance to First Generation Entrepreneurs to set-
up Micro Enterprises @10% of the Machinery cost and the same
be deducted from the eligible investment subsidy.
D. Marketing Assistance
4.2.5. Government of Andhra Pradesh is formulating a new Marketing Policy
to safeguard the interests of local Micro and Small Enterprises. The
policy highlights include:
i) Tender Forms will be made available free of cost.
ii) Exemption from payment of Earnest Money Deposit (EMD) and
Security Deposit (SD).
iii) Bill discounting facility will be made available on Government orders.
iv) 10% price preference i.e. where the bid of Micro and Small
Enterprises are within 10% of L1, the local Micro and Small
Enterprises will be given an offer of reasonable part of the order
at L1.
v) Reimbursement of cost incurred for quality certification/ patent
registration @ 50% limited to ` 2.00 lakhs for MSMEs.
vi) Provide platforms for interaction between Enterprises in Andhra
Pradesh and potential domestic and global markets through Trade
Fairs, Road shows.
vii) Encourage the SMEs to participate in national and overseas business
fairs & exhibitions, and international delegations.
viii) Consider to create A Facilitation Council – a quasi-judicial body
to redress the problems being faced by the local MSEs in
marketing their quality products
ix) Setting-up a permanent Exhibition-cum-convention Centre
exclusively display of MSME products.
E. Technology Up-gradation, Research & Development

4.2.6. Enhancing productivity through technological up-gradation is one of the
key drivers of high economic growth. With globalization and increased
competition, the survival of Industries using outdated technologies is
challenged. Therefore, to survive, grow and win, there is a pressing
need for SME’s to infuse technological innovations in their production
processes, marketing and management functions. The initiatives include:
i) Create Technology Facilitation Cell in the Commissionerate of
Industries with the help of APTDC, TIFAC, CII, CSIR and local
chamber of commerce to help MSMEs.
ii) Continue to provide necessary budget for the Technology
Development Fund.
iii) APTDC and ISB are entrusted to study Food Processing,
Engineering, Electronics, Precision Instrumentation, Bulk drugs /
Pharmaceuticals sectors to identify the technological gaps and to
prepare an action plan.
F. Revitalization of Sick Industries
4.2.7. The Sick Industries Revival and Rehabilitation Scheme of Andhra
Pradesh has been widely acknowledged and appreciated all over India.
4.2.8. Government of India is in process of finalization of a Scheme for
Rehabilitation of Sick Micro, Small and Medium Enterprises by setting
up a Rehabilitation Fund. Accordingly, the State would suitably modify
its Scheme, taking advantage of the Sick units Revival and Rehabilitation
scheme of Government of India.
G. Other Incentives to Medium and Large Industries
4.2.9. Reimbursement of 25% VAT/CST or SGST paid for a period of 5 years
to Medium Enterprises and Large Industries
4.3.0. Capacity Building/Skill development programme
4.3.1. The abundant availability of technical /skilled manpower, due to a large
number of engineering colleges, polytechnics and ITI Educational
Institutions producing 6,00,000 technical people per annum – highest
in the country is a great asset of the State.
4.3.2. State has already initiated number of measures to make them ‘Job
Ready’ viz. Jawahar Knowledge Centre (JKC), which provides
interaction between Academic Institutions and Industry. Opportunity
will be further provided to the industry to adopt more number of

Technical Institutions to build an Industry ready knowledge based skilled
workforce.
4.3.3. Public Private Partnership will be encouraged for imparting training.
4.3.4. Existing training assets in ITI’s, Polytechnics will be utilized for
organizing more number of training programmes.
4.3.5. The Confederation of Indian Industry (CII) prepared a plan on
“Mapping of Human Resources and Skills in Andhra Pradesh
2015”, indicating the available man power, skill gaps and training needs.
4.3.6. In addition to the above, State has also launched a skill development
programme under the banner of “Rajiv Udyog Sri”, wherein large
number of Departments namely Rural Development, Labour,
Employment & Training, Technical Education, Youth Services,
Municipal Administration are imparting training to enhance the
employability of literate and semi literate workforce.
4.3.7. 50% Reimbursement of cost incurred in skill up-gradation and training
the local manpower limited to ` 2,000/- per person as one time grant.
4.3.8. Efforts are to be made to bring in better coordination between various
organizations for skill development.
4.4.0. Industrial Clusters
4.4.1. Cluster based approach is increasingly being recognized as sustainable,
cost-effective and an inclusive strategy to ensure competitiveness and
improvement of Micro, Small and Medium Enterprises (MSMEs).
Considering the importance, the Government gives special emphasis
on cluster development approach in the new Policy, which will enable
the MSMEs to build their capacities in the clusters and gain from
emerging global opportunities.
4.4.2. Accordingly, Cluster Advisory Committee (CAC) will be constituted
with Industrial Associations, NI-MSME, MSME-Development Institute
(MSME-DI) etc as members for promotion of clusters by tapping the
funds under various cluster development schemes of Government of
India.
4.5.0. Service Sector
4.5.1. The MSMED Act 2006 of Government of India changed the
nomenclature of Industry as Enterprise. To capture the ever expanding
potential of Service, it is proposed to encourage service enterprises

related to industrial activities in all Municipal Corporations. The policy
provides for investment subsidy to the eligible service activities related
to industries as appended in Annexure-II.
4.6.0. Inclusive Development
4.6.1. Facilitating social equality and outreach to traditionally disadvantaged
social groups including women to start economic activity in industrial/
service sectors.
A. Women
4.6.2. Currently only five percentage of enterprises are managed by women.
There is a need to improve the contribution of women entrepreneurs
in starting enterprises in the next five years. Enterprises started by
woman entrepreneurs as a sole proprietary concern/partnership/private
limited companies or cooperatives which have 100% women
participation in the enterprise will be eligible for the benefits under the
policy. To facilitate creation of women enterprises in the State, the
proposed initiatives include:
i) 5% additional investment subsidy limited to ` 5.00 lakhs (totaling
to 20%)
ii) Another 5% additional subsidy for SC/ST Women (totaling to 40%)
iii) All other benefits as per the IIPP 2010-15
iv) Reservation of 10% of land in the Industrial Estates/Parks
developed by APIIC.
v) Encourage Exclusive industrial estates for Women Entrepreneurs.
vi) Organise special Entrepreneurship Development Programmes
(EDPs)/Skill Development programmes exclusively for Women.
vii) Constitution of Special awards to Women Entrepreneurs
B. SC/ST Entrepreneurs
4.6.3. Andhra Pradesh is the first State in the country to have an exclusive
policy for SC/ST Entrepreneurs for inclusive development of the State,
which has been acknowledged as a path breaking initiative and resulted
in enterprises creation and industrial capacity building in them. To take
forward this initiative, the incentives offered in IIPP 2005-10 would be
continued in the Industrial Investment Promotion Policy (IIPP) 2010-15.
4.6.4. SC/ST entrepreneur means those units established as sole proprietor

or invariably having 100% share in Partnership/Private Limited
companies. SC/ST entrepreneurs setting up industries in the ineligible
list are also eligible for incentives.
i) 100% reimbursement of Stamp Duty and transfer duty paid by the
ii) 100% reimbursement of stamp duty for Lease of Land/Shed/
Building and also mortgages and hypothecations.
iii) Reimbursement of 25% Land Conversion charges for the industrial
use limited to ` 10.00 lakhs.
iv) Seed capital assistance to First Generation Entrepreneurs to set-
up Micro Enterprises 10% of the Machinery cost, which will be
deducted from the eligible investment subsidy
v) Interest subsidy under Pavalavaddi Scheme on the term loan on
the fixed capital investment by New Micro and Small Enterprise
in excess of 3% per annum subject to a maximum reimbursement
of 9% annum for a period of 5 years.
vi) APIIC shall allocate 16.2% of number of plots to Scheduled Caste
Entrepreneurs and 6% of number of plots to Scheduled Tribe
Entrepreneurs in new Industrial Estate and preferential allotment
to SC/ST entrepreneurs in Existing Industrial Estates.
vii) 35% subsidy on fixed capital investment, Additional 5% subsidy
for SC/ST Women and additional 5% Investment Subsidy for the
units set up in the scheduled areas by ST entrepreneurs. Maximum
limit per unit is ` 50.00 lakhs.
viii) 33 1/3 % rebate on land cost in IEs/IDAs limited to ` 10.00
Lakhs.
ix) Power cost will be reimbursed @ ` 1.00 per unit for 5 years as
per guidelines.
x) 100% reimbursement VAT/CST or SGST paid for a period of 5
years from date of commencement of production for Micro
Enterprises.
xi) 50% reimbursement VAT/CST or SGST paid for a period of 5
years from date of commencement of production for Small
Enterprises.
xii) 25% reimbursement VAT/CST or SGST paid for a period of 5 years

from date of commencement of production for Medium and Large
Industries.
xiii) 50% of the cost of infrastructure is raised to 75% in respect of
units set up by ST entrepreneurs in Scheduled areas.
xiv)8% subsidy on capital equipment for technology upgradation limited
to ` 50.00 lakhs (for MSE s).
xv) Reimbursement of 50% subsidy on the expensed incurred for quality
certification/patent registration limited to ` 2.00 Lakhs for MSEs.
4.7.0. Mega Projects
4.7.1. Large Industries with high capital investment and economies of scale
will have multiplier effect by creation of ancillaries and SMEs and also
for large scale employment generation.
4.7.2. All general projects with ` 250 Crores and above Investment will be
classified as a mega project and they will be considered for tailor-made
benefits on case to case basis based on the kind of technology they
are bring in, employment potential, location of the unit etc. However,
if any project creates employment to more than 2000 persons, it will
be considered as Mega Project. As being employment intensive
industries - Spinning/Weaving/Garmenting projects with an investment
with ` 125 Crores and above will be classified as Mega Project.
4.7.3. All Mega projects will be facilitated through Single Window for
obtaining requisite clearances and will provide handholding services till
the project take-off.
4.8.0. Leveraging Existing Resources for value addition
4.8.1. The State will focus on thrust sectors like Food Processing,
Pharmaceuticals/Bulk Drugs, Auto Components, Defense &
Aerospace, Electronics, Apparel and Textiles, Semi Conductors, Solar
PV Manufacturing etc. for further industrial growth.
4.8.2. Special focus will be given to each of the thrust areas for achieving the
set growth in manufacturing sector by value addition within the State.
4.9.0. Textile Sector
4.9.1. Andhra Pradesh is the 3rd largest producer of cotton in India and
produces about 58 lakh bales of cotton. But, only 34 lakh bales are
being consumed by the Spinning Mills in the State and the rest is being
sent to other states. There is a need for value addition in the Textiles
Industry, within the State of Andhra Pradesh.
4.9.2. There is a need to capitalize existing strengths and for optimum
utilization of available resources, the sector needs to be given further
impetus to take A.P. ahead in the value chain in the textiles sector
for sustainability of the existing industries as well as for large
employment generation and value addition.
4.9.3. The eligibility period is extended from 5 years to 8 to Spinning/Weaving/
Garmenting units commissioned during the IIPP 2005-10.
4.9.4. To continue the existing incentives of Textile & Apparel Policy 2005-10
to the new Textile industries for 5 years.
4.10.0. Food Processing Sector:
4.10.1. Andhra Pradesh ranks first and second in the production of various
fruits, vegetables and other commodities, but only 1-2% of it is being
processed and there is a need to utilize these resources for value
addition within the state.
4.10.2. To declare food processing as seasonal industry, where ever necessary
and eligible to enable the industry to get relief from minimum electricity
charges during the closure (non-seasonal) period.
4.10.3. To continue Fixed Power Cost reimbursement @ ` 1.00 per unit on
the revised rates for 5 years as per the guidelines
4.10.4. Mega food parks setup as per Food Processing Policy of Government
of India
i) To reimburse 25% cost of external infrastructure for power, water,
approach roads and other infrastructures limited to ` 2.00 crs
ii) To provide VAT/Sales Tax reimbursement for Mega Food Parks
during the construction period for a period of 2 years limited to
a maximum ` 2.00 Crores.
iii) The Food Parks sanctioned under Mega Food Park scheme of
Government of India will be considered for Tailor-made benefits
on case to case basis.
4.11.0. Biotechnology
4.11.1. Biotechnology is growing consistently and rapidly in India and the
State is the leading centre for Biotechnology. The major strength
VAT–71
of the state is in Research and Development with the presence of

institutions like the Centre for Cellular and Molecular Biology,
Centre for DNA Fingerprinting and Diagnostics, National Institute
of Nutrition, International Crop Research Institute for Semi-Arid
Tropics (ICRISAT) etc Major Global players have already set-up
their base in the State. To tap the potential of this sector, special
focus will be given to Bio-technology for further development of
this sector.
4.12.0. Adoption of Clean Technologies
4.12.1. Industries will be facilitated in getting assistance from the funding
agencies like NEDCAP, IREDA etc in implementing the clean
technology projects using the various Government of India Schemes
for the state.
4.12.2. Provide incentives on specific cleaner production measures adopted
in new industries @ 25% limited to ` 5 lakhs
4.12.3. Monitor carbon emission and encourage the industries to go for
carbon auditing.
4.12.4. Facilitate all industries in obtaining carbon credit.
4.12.5. Facilitate setting up of effluent treatment plants and hazardous waste
treatment plants in various industrial estates and cluster with private
sector participation.
4.13.0. Export Promotion and Special Economic Zones (SEZ)
4.13.1. The exports from Andhra Pradesh are growing consistently year after
year. During 2008-09, the State has exported goods and services worth
of ` 77, 605 Crs, recording a growth of 35% during 2008-09 over the
previous year. The growth is led by software exports (` 32,509 Crs),
Engineering items (` 13,783 Crs), Agro forest products (` 5,799 Crs),
Mineral and Mineral products etc.
4.13.2. The State aims to double the exports of goods and services from the
present value of ` 71,000 Crores to ` 1,42,000 Crores, inline with
Government of India Foreign Trade Policy 2009-14.
4.13.3. In order to broaden the export base of Andhra Pradesh by strengthening
its presence in traditional markets and expanding into new markets with
value added innovative products, the policy proposes certain initiatives,
which include:
A. Promotion of Special Economic Zones (SEZs) for effective and

competitive export infrastructure
4.13.4. The state has a great potential to build industrial capacity and attract
FDI through SEZs. To enhance foreign investment and promote exports
from the country and to create a level playing field to the domestic
enterprises and manufacturers to be competitive globally, SEZs are
being promoted by Government of India as engines of economic
growth, supported by world class infrastructure and attractive fiscal
benefits In line with the initiative of Government of India, 110 SEZs
have been approved in the State of Andhra Pradesh and of which,
73 SEZ’s are notified across the Sectors, which is the highest in the
country, which include:
Multi Product 04
Pharma/Formulations 05
Biotechnology 04
Textile / Apparel 03
Footwear/Leather 02
Gems & Jewellery 01
Semiconductor/ Electronic 02
Multi Services 02
Kisan SEZ 01
Food Processing 01
Paper 01
Aerospace 01
Alumina 01
4.13.5. These SEZ’s are spread over all the parts of the State linking with
various industrial clusters. This will trigger a large flow of foreign and
domestic investment in SEZs, in infrastructure and productive capacity,
leading to generation of additional economic activity and creation of
employment opportunities, leveraging the local resources and
manpower. Efforts would be made to create basic infrastructure for
SEZ’s to realize its potential and to attract number of firms into them.
On completion of these SEZs, they would be able to generate a total
employment (direct & indirect) for over 25 lakh persons, with an
investment of over 70,000 crores.
4.13.6. As of Now, 20 SEZs are fully operational in the State with an

investment of ` 11.305 crores of investment providing employment to
72,,029 persons. The exports from these SEZs is about ` 5665 Crores.
The list of operational SEZs is tabulated below:
SEZ Activity
APIIC SEZ, Visakhapatnam Multi Product
Divi’s Laboratories, Visakhapatnam Pharmaceuticals
Ramky Pharma SEZ, Visakhapatnam Pharmaceuticals
Brandix, Visakhapatnam Textiles
Gems & Jewellery, Hyderabad Gems & Jewelry
Apache, Nellore Foot Wear
Sri City SEZ, Nellore Multi Product
IT & ITEs SEZ’s (13 Nos) throughout the State IT&ITES
B. Other Export initiatives

4.13.7. Organise national and international Exhibitions.
4.13.8. Organise Buyers and Sellers meet in India and Abroad.
4.13.9. Creation of infrastructure for export oriented units for optimum
utilization of ASIDE funds.
4.13.10.Support export oriented units to participate in national and international
Trade Fairs.
4.13.11. To establish Cell in Dr. MCRHRD to familiarize and create awareness
about WTO rules and regulations.
4.14.0. Industrial Facilitation
A. Single Window System
4.14.1. The State enacted Single Window Clearances Act in 2002, with an
aim to provide requisite clearances to entrepreneurs at a single point,
within fixed time frame. “Deemed Provision” in certain cases, if the
competent authority fails to communicate decision with the time frame.
The proposals of industries with investment upto ` 5 Crores will be
processed at the District Industries Centres level and all other proposals
at Commissionerate level.
4.14.2. District Level Committee, State Level Committee, Empowered

Committee and State Board to review the progress. Efforts will be
made to further strengthen the Single Window systems
4.14.3. To provide efficient, effective, transparent and citizen friendly interface,
a system is being developed for providing the services related to
Industries Department online/Electronically.
B. “INVESTMENT PROMOTION CELL”
4.14.4. Creation of “INVESTMENT PROMOTION CELL” in the
Commissionerate of Industries with adequate infrastructure and
outsourcing the support services to facilitate investors by providing pre-
investment services and also to provide hand holding Service
C. Investment Promotion
4.14.5. State Investment Promotion Board (SIPB) - State Investment
Promotion Board (SIPB) was constituted under the Chairmanship of
Hon’ble Chief Minister of A.P. with the respective Hon’ble Ministers
as Members to achieve speedy and quick decision making in the matters
related to industrial projects.
4.14.6. State Investment Promotion Committee (SIPC) - State Investment
Promotion Committee (SIPC) was constituted under the Chairmanship
of Chief Secretary to Government of A.P. to facilitate redressal of
issues pertaining to various Departments connected with the industrial
development and also facilitate the functioning of the State Investment
Promotion Board (SIPB) for taking a decision on the industrial projects
D. Exit Policy
4.14.7. Industries will be facilitated to exit from their business as per the
proposed Exit Policy of Government of India.
E. Business Continuity
4.14.8. The State would take effective measures from time to time to ensure
that the industrial establishments in Andhra Pradesh will run their
businesses in secure and peaceful industrial environment.
4.15.0. Simplification of Regulatory Framework
4.15.1. Regulation also affects the investment climate through its impact on
competition. Challenge of regulatory improvement is an ongoing process
and requires continuous efforts to review in line with changes. State
also reviews regulations periodically with an aim to create a congenial
environment for industrial growth. In line with this objective, the state
introduced the following measures:
i) Self Certification concept for all industrial units except hazardous
industries as notified by the Government of India from time to time
in respect of labour and factories regulations
ii) Common Annual return in place of multiple returns
iii) Maintenance of only two registers – Wage Register and Attendance
Register
iv) Systematization of labour inspections and introduction of joint annual
inspections with a prior intimation to the industry
v) Flexible women working hours.
vi) Export oriented units and units in parks declared as public utility
services
vii) All industries having installed capacity of power upto 75 HP are
exempted from obtaining prior Factory Plan approval from Factories
Department.
viii) All MSEs other than 66 Polluting industries are exempted from
obtaining CFE/CFO from APPCB and the Pollution
Acknowledgement issued by DIC will be treated as CFE/CFO.
ix) In Andhra Pradesh, the validity periods for renewal of CFO have
been increased as indicated:
Normal Industry ISO certified
Green 4 years 5 years
Orange 3 years 4 years
Red 2 years 3 years
x) The state government is contemplating to authorize chartered
engineers possessing requisite qualifications to perform the duty
of Inspector of Boilers with regard to registration, inspection and
renewal
4.16.0. Entrepreneurship Development
4.16.1. Entrepreneurship development is critical for the state to maintain its
growth trajectory. The state intends to foster entrepreneurship through
a systematic approach by leveraging existing industrial facilities,
educational facilities and linking them with existing incubation centers

by providing required financial support, mentoring. The following are
the proposed interventions for entrepreneurship development.
4.16.2. Create new enterprises and growth of existing businesses by setting
up local entrepreneurship cells across the state in partnership with
academic institutions, private sector and financial institutions. The local
cells apart from providing training and mentorship will also provide the
necessary access to financial capital to the entrepreneurs.
i) Entrepreneurship cell will organize regular entrepreneurship
development programmes and Government will extend support to
these programmes dovetailing with Government of India Schemes.
ii) Loan Melas will be organized in each district at regular interval
inviting the National Banks and Financial institutions for credit
linkage
iii) Encourage Center for Entrepreneurship Development (Association
of Lady Entrepreneurship of Andhra Pradesh) to collaborate with
recognized regional, national and international organizations involved
in entrepreneurship development.
4.17.0. Incubation Centres
4.17.1. K-hub Incubator – Government of A.P. encouraged Indian School
of Business (ISB) to set up Knowledge hub (k-hub) incubator to
support the start-ups and growth of high Technology Ventures with
the following motives:
a) Mentor entrepreneurial success
b) Unify a range of business development and professional services
c) Providing access to a global knowledge network.
4.17.2. ICRISAT Incubator - Agri-Business Incubator was established at
ICRISAT with the support of the National Science and Technology
Entrepreneurship Development Board (NSTEDB), Department of
Science and Technology, Government of India and Government of
Andhra Pradesh, to provide:
a) Opportunities for entrepreneurs to incubate agriculture technologies
so that they become effective agri-business ventures.
b) Business consultancy.
c) Facilitation of funding.
d) Infrastructure and facilities access in the Incubator.
4.17.3. Bio-Technology Incubator (BTIC)– with the support of Government
of Andhra Pradesh Indian Institute of Chemical Technology (IICT) has
setup a Biotechnology incubation centre to accelerate the
commercialization of new technologies, nurture the emerging ventures,
assist new enterprises to forge appropriate link with other biotech
companies, academia and government.
4.17.4. On similar lines, National Level R & D centers in the State would
be encouraged to set up Incubation Centers to encourage innovation
by the youth and for development for knowledge based and high
technology end products.
4.18.0. Marketing of Andhra Pradesh
To showcase Andhra Pradesh as the best investment destination by
focusing the potential strengths of the state, natural resources and opportunities
by organising regular road shows/trade fairs and delegations.
——
ANNEXURE-II
(G.O.Ms.No. Industries & Commerce (IP) Department, dt. 06.2010)

List of Service Enterprises related to industry, Eligible for
Investment subsidy
S.No. Activity
1. Industrial/Material testing laboratories
2. R&D Centres related to industry
3. Printing presses offset printing press, Flexi/Vinyl Printing, Flexo printing
4. Machine operated Seed grading services
5. Industrial Training Centres with necessary machinery and equipment.
6. Power Laundries
7. Ready made Garments units with investment more than 5.00 lakhs
on Plant & Machinery
8. Auto servicing and /or repairing units with investment more than 5.00
lakhs on Plant & Machinery
9. Packaging activity with investment more than 10.00 lakhs on Plant

& Machinery
10. General Engineering and Fabrication
11. Machine operated Book binding Enterprises and Note Books with
investment more than 5.00 lakhs on Plant & Machinery
12. Any other Service Enterprises notified by the State Level Committee
for inclusion in this list from time to time.
Note:
1. Service Sector projects set up by the entrepreneurs will be limited to
50% of the Budget Provision in order to encourage the remaining 50%
for the manufacturing sector.
2. The above service activities set up in all Municipal Corporation limits
are eligible only for investment subsidy and all other service / Business
activities are not eligible for any incentives.
——
ANNEXURE-III
(G.O.Ms.No. Industries & Commerce (IP) Department, dated 06.2010)

List of Ineligible Industries
S.No. Activity
1. All process of Edible Oil Seeds/Cakes viz., 1. Groundnut 2. Sesam
3. Safflower 4. Rape Seed/Mustard 5. Coconut (both tender & dry)
6. Sunflower, Niger Cotton Seed. (All processes include
Decorticating, Expelling, Crushing, Roasting, Parching, Frying)
2. Rice, Dall and Flour Mills including Roller Flour Mills, Modern Rice
Mills and Parboiled Mills, Idli Rava, Parched/Flaked Rice (Poha &
Murmura).
3. Coffee Roasting, Grinding.
4. Ice Cream, Ice Candy, Kulfy, Ice Fruit, Pepsy, Tuty Fruity etc. except
those having ISI, AG Mark or FPO Mark.
5. Chacolates, Peppermints and Confectionery, Chewing gum except
6. Packaging Drinking water & Aerated Water including soft drinks.
7. Nut Powder including Raw nut processing, Chikini Power and Pan
Masala and Tobacco based chewing products.
8. Khandasari Sugar and Sugar Mills and Jaggery making.
9. Powders of Chilly, turmeric, Masala, Spices, Curry, Sambar etc. except
10. Sweets.
11. Distilleries, Breweries, Beer and other Alcoholic Drinks except Winery
12. All table meat, animal rearing/farming like poultry, piggery etc.,
13. All types of Hatchery
14. Rectified Spirit (Alcohol) from out of Molasses.
15. Alcohol based Industries except Pharmaceuticals and Drug Industries.
16. Varnishes and Thinners.
17. Cotton/Jute/Iron Scrap Baling processes.
18. Cotton ginning except Modern ginning as per the norms of Technology
Mission on Cotton, Ministry of Textiles ,Government of India.
19. Chloral Hydrate.
20. Lime Kiln / Burnt Lime/ Hydrated Lime.
21. All types of printing presses
22. Book binding / Note Books / Exercise Note Books / Registers /
Ledgers / File Pads / Office Files etc.
23. Tobacco barons/tobacco re-drying/processing, Beedi /Cigarette
manufacturing and other tobacco based products
24. All types of Saw-mills, all types of wooden furniture including wood
based laminated products.
25. Road Metal/ Stone Crushing / Coal Pulverizing / Rock Sand.
26. Soap making units not operated by power driven machinery
27. Shampoos and other Cosmetic items except those having ISI Mark
28. Manure mixing industry
29. Cinematography/ Videography / Video Parlours /Theatres/ Photo
studios and colour film laboratories.
30. All industries of mobile nature like rigs, concrete mixing plants, road
metal mixing, readymade concrete mixing etc., including site oriented
industries.
31. Tailoring other than readymade Garments
32. Mining and Quarrying
33. All types of Generation, Transmission and Distribution of Electricity.
34. X-ray clinics and clinical/pathological laboratories and scanning, MRI
Tests
35. Servicing and /or repairing units activities excluding (a) Auto servicing
and/or repairing units; (b) Tyre Retreading units (c) Industrial material
testing laboratories (d) General engineering machining workshops
(e) common effluent treatment plants (f) Cold storage (g) Heat
treatment, electroplating and Galvanizing units (h) Seed processing
units
36. Calcium carbide and Silicon carbide manufacturing.
37. Ferro Alloys Manufacturing.
38. Steel Rerolling mills, rolling of rods including Tor steel angles, channels,
Flats etc.
39. Steel Structural and fabrication works other than heavy structurals.
40. Steel gates/grills and Bright bars.
41. G.I.Buckets, Gamelas, Boiling Pans, Trunks, Spades, Mamotees,
Shovels and Bins.
42. Hotels and Motels.
43. Composite Units setup for manufacture of an eligible items along with
ineligible items except when the proportion of in-eligible items in the
total production is less than 10% in value of the total turnover.
44. Any other industry notified by the State Government for inclusion in
this list from time to time.
Note: All types of Integrated Steel Plants are not eligible for Power cost
reimbursement.
——
ANNEXURE-IV
(Applicable only for the Scheduled Castes & Scheduled Tribe
Entrepreneurs)
The line of activities for industrial concern under Section 2(c) of the State
Financial Corporations Act, 1951
1. The manufacture, preservation or processing of goods;
2. Mining or development of mines;
3. The hotel industry;
4. The transport of passengers or goods by road or by water or by air
or by ropeway or by lift;
5. The generation or distribution of electricity or any other form of power;
6. The maintenance, repair, testing or servicing of machinery of any
description or vehicles or vessels or motor boats or trailers or tractors;
7. Assembling, repairing or packing any article with the aid of machinery
or power;
8. The setting up or development of an industrial area or industrial estate;
9. Fishing or providing shore facilities for fishing or maintenance thereof;
10. Providing weight bridge facilities;
11. Providing engineering, technical, financial, management, marketing or
other services or facilities for industry;
12. Providing medical, health or other allied, services;
13. Providing software or hardware services relating to information
technology, telecommunications or electronics including satellite linkage
and audio or visual cable communication;
14. Setting up or development of tourism related facilities including
amusement parks, convention centres, restaurants, travel and
transport(including those at airports)., tourist service agencies and
guidance and counseling services to the tourists;
15. Construction;
16. Development, maintenance and construction of roads;
17. Providing commercial complex facilities and community centres including
conference halls;
18. Floriculture;
19. Tissue culture, fish culture, poultry farming, breeding and hatcheries;
20. Service industry, such as altering, ornamenting, polishing, finishing, oiling,
washing, cleaning or otherwise treating or adapting any article or
substance with a view to its use, sale, transport, delivery or disposal;
21. Research and development of any concept, technology, design, process
or product, whether in relation to any of the matters aforesaid, including
any activities approved by the Small Industries Bank; or
22. Such other activity as may be approved by the Small Industries Bank.
Explanation 1:— The expression ‘processing of goods’ includes any art
or process for producing, preparing or making an article by subjecting any material
to a manual, mechanical, chemical, electrical or any other like operation.
Explanation 2:— If any doubt arises as to whether a concern is industrial
concern or not, the same shall be referred to the Small Industries Bank for
its decision and the decision of the Small Industries Bank thereon shall be final.
The Small Industries Bank means the Small Industries Development Bank of
India established under section (I) of section 3 of SIDBI Act, 1989 (39 of
1989).
Note: Service Sector projects set up by the SC/ST entrepreneurs
will be limited to 50% of the Budget Provision in order to encourage
the remaining 50% for the manufacturing sector.
——
16. Gate Pass Cum-Invoice as Waybill

[CCT's JC (CT) Enft. Ref. No. D2/723/05, dated 16-7-2012]
Sub:– APVAT Act, 2005 – Issue of notification under sub-rule (4)
of Rule 55 of APVAT Rules, 2005 – Certain category of
Manufacturers are notified as ineligible to use the Gate Pass
cum-invoice as waybill-Notification issued – Regarding....
----
In exercise of the powers conferred under sub-rule (4) of Rule 55 of
APVAT Rules, 2005, the Commissioner of Commercial Taxes, Andhra Pradesh
hereby notifies the following category of manufacturers as ineligible to use
the gate pass cum invoice as waybill. These Manufacturers shall make out
way bill on Form 600.
1) Cement and Cement Products
2) Plastic Furniture
3) Paper of all kinds
4) Sugar Excluding Khandasari Sugar
5) Laminated Sheets of All Kinds
6) Plywood and Particle Board of all kinds
7) Package drinking water
8) Electrical Fans of all kinds
9) Electrical Domestic wires
10) Iron and Steel
Further informed that sub-rule (4) of Rule 55 is not applicable to the
Manufacturers who are exempted from Excise levy.
This notification will come into force with effect from 10-8-2012.
17. Inclusion of 'Sugar excluding Khandasari Sugar' under
Sensitive Commodities
[CCT's JC(CT) Enft. Ref. No. D2/723/05, dt. 27-12-2011]
Sri Suresh Chanda, I.A.S., CCT
Sub:– APVAT Act, 2005 – Issue of Notification under sub-rule (2) of
Rule 55 of APVAT Act, 2005 – Inclusion of 'Sugar excluding
Khandasari Sugar' under Sensitive Commodities – Notification
issued – Regarding.
Ref:– G.O.Ms.No.932 Revenue (C.T.II) Dept. dt. 08-07-2011.
In exercise of the powers conferred under sub-rule (2) of Rule 55
of APVAT Rules, 2005, the Commissioner of Commercial Taxes, Andhra
Pradesh hereby notifies "Sugar excluding Khandasari Sugar" at entry 128
of schedule-IV of the APV AT Act, 2005 as Sensitive Commodity in addition
to the existing items for the purpose of said sub-rule.
This Notification will come into force with effect from 09-01-2012.
------
Tourism Policy 1135
18. Introducing of Andhra Pradesh New Tourism Policy, 2010 in Place
of Tourism Policy, 1998
[G.O. Ms No.75, Youth Advancement, (T&C) (T) Dept.
dt. 14-10-2010]
Order:
The Government of Andhra Pradesh, as a matter of policy to promote
the State as an attractive and competitive destination for Tourism, having
felt that there is an imperative need to encourage various entrepreneurs
in the area of development of Tourism Industry, have decided to grant certain
concessions / exemptions and reliefs to Tourism Units being established in
various parts of the State, keeping the State’s priorities and feasibility of
these units in view. Similarly, encouragement to the private and PPP tourism
projects established in different areas would not only provide employment
opportunities but also generate investment avenues thereby improving the
socio-economic status of the people of the area.
2. The Tourism Policy is the main instrument to guide required private
sector investment as per the priorities of the State which is also the document
that spells out the areas in which the Government itself will take the
leadership role, and with its own initiative create and deepen a market which
can then be considered by the private sector. The Department of Tourism
is implementing hitherto the Andhra Pradesh Tourism Policy, 1998 and now
it has become essential to refine and update the policy and bring it in tune
with the current tourism trends and investment norms in order to remain
attractive as a preferred investment destination and compete with other
States of the Country.
3. The Government, after careful consideration and detailed examination
of several issues connected to the area of Tourism, having obtained the
suggestions of various other line Departments, hereby order for release of
the Andhra Pradesh New Tourism Policy, 2010 replacing the existing Tourism
Policy, 1998.
4. The salient features of the Andhra Pradesh New Tourism Policy,
2010 are as follows:
Objectives of the New Tourism Policy will be as follows:
Position the State competitively for attracting private sector
investments in Tourism & Hospitality.
To promote inbound tourism in all potential destinations of the State
& not just to few destinations like Tirupati, Hyderabad, Vizag,
Puttaparthi, etc.
To target the incentives to the private sector better as per the

State Government priorities in terms of geographical areas &
tourism products.
To maximize the advantage of Hyderabad City to promote new
tourism products.
To give adequate focus to Aam Aadmi Tourism, Rural Tourism,
Eco Tourism, Adventure Tourism & Responsible Tourism.
To focus on maximum generation of employment in the sector
by development of Human Resources through capacity building.
Eligible Tourism Products:
The following tourism products 'will be eligible for receiving state\
support:
1) Hotels & Serviced apartments
2) Resorts
3) Heritage Hotels
4) Wellness Centres (spa/yoga/naturopathy/etc.)
5) Amusement Parks
6) Entertainment centres (aquarium/Indoor rides/Snow world/etc.)
7) Permanent exhibition complexes
8) Ropeways
9) Convention Centres
10) Wayside Amenities
11) Water Sports
12) Golf Courses
13) Wildlife safaris
14) Luxury Tourist Trains
15) Sea/River Cruises
16) Ecotourism Centers
17) Rural Tourism products, and
18) Adventure Tourism products
The following Incentives & Concessions will be granted under the
New Policy:
Concessional Allotment of Land
• Lease upto 33 years at 5% of basic value with an incremental
provision of 5% every year
• Tenure upto 33 years at first instance & first right of refusal
Tourism Policy 1137
• Government will facilitate land assembly. (Tourism Department will
maintain a land bank)
Capital Investment Subsidy
• For investments upto Rs.20.00 crores, 20% capital investment
subsidy, subject to maximum of Rs.20.00 lakhs
• For investments upto Rs.20.00 to Rs.100.00 crores, 25% capital
investment subsidy, subject to maximum of Rs. 30.00 lakhs
• Above Rs.100.00 crores are Mega Tourism Projects, where subsidies
are on case-to-case basis.
Reimbursement of Stamp Duty & Transfer Fee
• 50% reimbursement for lease & (through Govt. on lease basis)
• 25% reimbursement for purchase (Private parties)
Reimbursement of Vat
• 25% of VAT paid during a Financial Year will be ploughed back
to the unit as a grant towards the payment of VAT for the next
year. Benefit available for 5 years
Luxury Tax
• 5% on room tariff above Rs.1500/- per day for 5 years, on the
actual charged room rates. (Existing limit is Rs.600 per day on
published rates.)
• Once the GST system is introduced, the same benefit will be
passed on to the unit as reimbursement.
Entertainment Tax
• Ploughing back of 25% of Entertainment Tax for Entertainment
components in Theme Parks, Entertainment Centers, etc., (upto
5 years) (new provision) subject to the condition that the total
benefit on this account does not exceed 100% of the project cost.
Municipal Exemptions
• Exemption from payment of Conversion Charges
• Payment of Impact Fees will be levied under Category (c) (which
is about 50% of the impact fees paid by other commercial units).
Energy Incentive
• Reimbursement of 0.75 Paise / 0.90 Paise / 1 Rupee (according
to zone) per unit of the energy cost for 5 years.
In Addition To Financial Incentives And Concessions, There are 2

Non Financial Incentives Also:
• The Government will facilitate all clearances & permissions
• Support from the Government in Promotion & Marketing
A System Of Targeting Has Been Introduced To Encourage
Tourism Development In All Regions Of The State:
• Zone A: Region coming under GHMC Area.
• Zone B: Area under HMDA (Excluding GHMC), GVMC, Area
under VGMTUDA, Area under TUDA
• Zone C: All other places.
• Capital Investment Subsidy in Zone B will be 5% more than Zone
A, limited to Rs.5.00 lakhs.
• Capital Investment Subsidy in Zone C will be 5% more than Zone
B, limited to Rs.5.00 lakhs
In Addition, Targeting Of Incentives For Certain Types of Tourism
Products Is Also Made:
• Additional Capital Investment Subsidy incentive of 5% (limited to
Rs.5.00 lakhs) for;
• Beaches
• Water bodies
• Jalayagnam Sites
• Rural Tourism Products
• Eco Tourism Products
• Adventure Tourism Products
• Heritage Hotels
• Additional Capital Investment Subsidy incentive of 5% (limited to
Rs. 5.00 lakhs) for Women, SC/ST and PwD entrepreneurs
• All Additional Capital Investment Subsidy incentives shall not
exceed Rs.10.00 lakhs in all.
Department Of Tourism Will Provide Leadership in the following
Special Focus Areas:
• Aam Aadmi Tourism
Tourism Policy 1139
• Home Stay & Bed & Breakfast scheme
• Rural Tourism
• Recognition to Private Operators
• Customized Tours
• MICE, Medical, Heli & Film Tourism
• Human Resource Development
• Responsible & Safe Tourism
5. Government also order that the tenure of the present policy shall
be for five years, ie, 2010-2015.
6. Government further order that necessary funds required as obligation
during the implementation of the Andhra Pradesh New Tourism
Policy, 2010, shall be projected in the Budget of the Tourism
Department at appropriate time.
7. The details of the New Tourism Policy, 2010 are made available
on the website www.aptourism.in and www.aptdc.in.
------
19. Grant of Concessions/Exemptions under Tourism Policy,
1998 to Tourism Units
[G.O. Ms No.169, Youth Advancement, (T&C) (T/A2) Dept.
dt. 24-12-2011]
Read the following:
1) GO Ms.No.6, YAT & C (T) Dept., dt. 18.12.1998
2) Govt. letter No.1303/T/A2/2005, dt. 28.10.2005
3) GO Ms.No.14, YAT & C (T) Dept., dt. 4.9.2008
4) GO Rt.No.965, YAT & C (T) Dept., dt. 01.09.2010
---
Order:
Government announced Tourism Policy, 1998 in the G.O. 1st read
above extending certain concessions/exemptions to the tourism units which
are permanently registered as Tourism Units and issued with Eligibility
Certificates.
2. In the reference 2nd read above orders were issued to the effect
that the tax benefits envisaged in the Tourism Policy, 1998 be extended
only till 31.10.2005 and that all applicable taxes would be collectable from
1.11.2005 onwards. Accordingly, the Eligibility Certificates were issued to

the eligible tourism units valid from the dates of their commercial operations
till 31.10.2005 only.
3. In the G.O. 3rd read above, orders were issued upholding the
concessions and incentives envisaged in the Tourism Policy, 1998 in the
GO 1st read above till a new Tourism Policy comes into being.
4. Certain Tourism Units who could not avail the tax benefits for the
full period of five years in terms of Tourism Policy, 1998 due to fixation
of cut off date, represented/approached Courts of Law requesting to permit
them to avail the tax benefits for the full period of five years by issuing
revised eligibility certificates. Similarly, certain Units have represented that
they never collected any taxes from the customers in terms of Tourism
Policy and hence they did not pay the taxes to the concerned Department
and that still they are served with notices by the Departments for payment
of taxes.
5. In the wake of introduction of VAT Act, 2005 (1.4.2005), formation
of AP Electricity Regulatory Authority, the exemptions could not be
implemented as announced in the Tourism Policy as there are no provisions
in the respective Acts for grant of exemptions. Similarly, other departments
like Revenue (Registration & Stamps) MA & UD etc., also expressed their
inability to extend the benefits in view of various clauses provided in their
Acts and Rules.
6. Considering the impasse so connected, Government constituted a
3 Member committee comprising of 1) Special Chief Secretary (Finance),
- Chairman, 2) Principal Secretary (Revenue CT), Member, 3) Secretary
(Tourism), Member to examine the issue of tax benefits to those Tourism
Units which could not be given benefits for 5 years as envisaged in the
Tourism Policy, 1998. The recommendation of the 3 member committee
were also put before the State Tourism Promotion Committee and the
Empowered Committee of Ministers.
7. Government after careful examination of all the above issues, basing
on the recommendations of the Three Member Committee (Officers’
Committee), thereafter approved by the State Tourism Promotion Committee
and the Empowered Committee of Ministers, hereby order as follows:
1) (a) The Tourism Units that could not exhaust the 5 years period
of VAT/Sales Tax incentives as on 31.10.2005, shall be treated as units
availing tax deferment in lieu of tax exemption with effect from 1.11.2005.
The period of such tax deferment eligibility, the amount eligible for tax
deferment and repayment of VAT/Sales Tax, so deferred in respect of such
Tourism Policy 1141
units deemed to be availing tax deferment, shall be reckoned in the following
manner:
“Where any Units is availing a tax exemption (holiday) as on 31.10.2005,
it shall be treated as converted as a unit availing tax deferment. The balance
period of tax exemption available as on 31.10.2005 to such unit shall be
doubled. The amount eligible for deferment shall be the balance entitlement
available to such unit as on that dated (31.10.2005). The balance period,
mentioned above, would mean the difference of period between the date
of completion of five years, shown originally in the Incentive Eligibility
Certificate and dated: 31.10.2005.
Illustration :
xxx unit is granted VAT/Sales Tax exemption (holiday) for a period
of five years, say from 1.4.2002 for an amount of Rs.10 lakhs. As on
31.10.2005, the unit availed an amount of Rs.6 lakhs. Thus, the period availed
is (3) years and (7) months. The balance period still to be availed as on
31.10.2005, would be one year and five months. Now, the unit is eligible
to avail tax deferment for the balance amount of Rs.4.00 lakhs for a period
of two years and ten months (double of one year and five months). The
period of availment of VAT deferment shall be reckoned from 1.11.2005
and would expire by 31.8.2008 or availment of balance eligible amount of
Rs.4.00 lakhs, whichever is earlier.
b) Incentive of Luxury Tax exemption:– Unit that have not availed
the incentive from 1.11.2005 within a total period of five years from the
commencement date of commercial operation, may be granted exemption
from payment of Luxury Tax, for the balance un-availed period from
1.11.2005 till expiry of the period of five years.
2) In respect of the 12 units, newly registered by the Tourism
Department but not issued eligibility certificate, the following course may
be adopted.
a) In case they were registered and commenced commercial operation
prior to 31.10.2005 the incentive may be administered as per the
formulation under 1(a) and 1(b) above.
b) In case they were registered and commenced commercial operation
on or after 1.11.2005, they may be granted eligible tax incentives
by way of reimbursement only from the budget of Tourism
Department.
8. For those units who have been issued eligibility certificate with the
provision of limiting the tax benefits to 31.10.2005 irrespective of the fact
whether they have completed five years of commercial operations, the

Commissioner of Tourism will issue revised eligibility certificates incorporating
the provisions of deferment of tax payment as per the guidelines mentioned
above.
9. The Commissioner of Tourism, A.P., Hyderabad shall examine the
requests of the Tourism Units on case to case basis and issue necessary
orders basing on the above guidelines, keeping relevant Acts of the departments
concerned in view.
10. This G.O. issues with the concurrence of Finance Department
vide their U.O.No.2684/Spl.C.S/Fin, dated: 14.06.2011 and Revenue
Department vide their endorsement No.3569, dated: 09.06.2011.
-----
THE CENTRAL SALES TAX (AMENDMENT)
ACT, 2007
(Act No. 16 of 2007)
“Central Sales Tax (CST) is levied under the provisions of the Central
Sales Tax Act, 1956 (“the CST Act”) on the sale of goods in the course
of inter-State trade or commerce. The CST is levied by the Central
Government by virtue of entry 92A of the Union List, but the same is
assigned to the States within which the tax is leviable, by virtue of provisions
of Article 269 of the Constitution. The CST is leviable in the originating
State, i.e., the State from where the movement of the goods commences
and is collected and appropriated entirely by such State. The CST Act
is administered by the States by virtue of provisions of Section 9 of the
said Act.
2. CST being an origin-based tax is inconsistent with VAT (which
is a destination based tax). Moreover, CST results in cascading of tax (i.e.,
tax on tax), since it is not rebatable against VAT. In view of these factors,
there has been a consensus that the CST should be phased out. This is
also a pre-requisite for introduction of an integrated Goods and Services
Tax (GST), which the Government proposes to introduce by 1st April, 2010.
The issue of phasing out of the CST has been deliberated upon for over
a decade. The Empowered Committee of State Finance Ministers (EC)
constituted by the Government of India has been making efforts in this
direction since July, 2000. Finally, after a series of meetings, a consensus
has been arrived at between the Central Government and the State
Governments on the roadmap for phasing out of the CST as also on the
package of compensation to the States for revenue loss on this account.
3. Accordingly, it is proposed to phase out the CST in 4 steps, i.e.,
reducing the CST rate from 4% to 3% with effect from 1st April, 2007,
from 3% to 2% with effect from 1st April, 2008 from 2% to 1% with
effect from 1st April, 2009 and eventually abolishing the tax on 31st March,
2010. An integrated national Goods and Service Tax (GST) is proposed
to be introduced with effect from 1st April, 2010. The agreed package
for compensation to the States for revenue loss on account of phasing out
of the CST shall consist of non-monetary measures as well as monetary
measures.
4. The implementation of the above proposals requires the amendment
of the CST Act as also the Additional Duties of Excise (Goods of Special
1143
Importance) Act, 1957. Consequently the CST Act is proposed to be

amended to provide for reduction of CST rate from 4% to 3% as also
to provide the enabling powers to the Central Government to reduce it
further, in future, through notification in Official Gazette and to drop tobacco
from the list of declared goods, to enable the States to levy VAT on tobacco
at a rate higher than 4% rate applicable to declared goods.
5. The Additional Duties of Excise (Goods of Special Importance)
Act, 1957 is proposed to be amended to drop tobacco from the First Schedule
of the Act, to enable the States to levy VAT on tobacco without losing
their share out of the 1% devolution from the Divisible Pool of Central
Taxes. It is also proposed to omit Section 4 of the Additional Duties of
Excise (Goods of Special Importance) Act, 1957 and the Second Schedule
of the Act, as the same are no more required.
6. The bill seeks to achieve the above objects.”
——
A
A.F.Scrap Centre, Mahaboobgunj, Hyderabad
A.J. Stationery Private Limited, (Tin No. 28460171481) Gandhi Nagar,
Hyderabad
A.K. Agrico, (Tin No. 2886014966), Kishan Gunj, Hyderabad
A.M.C. Cookware (India) Private Limited, Hyderabad (Tin No.
28350275598)
Abhi Fabs, (Tin No. 28240133238) Hyderguda, Hyderabad
Abhinay Industries, Vijayawada (Tin No. 28810168430)
Accurate Transformers Limited, Hyderabad
Ace Tyres Limited, Bachupally, R.R.District (Tin No. 28950193322)
Hyderabad
Ace Tyres Limited, Bachupally, R.R.District (Tin No. 28950193322)
Hyderabad
Acer Engineers Private Ltd., (Tin No. 28800291006), Chintalapalli Village,
Sangareddy Mandal, Medak District
Addl. Commissioner Jt. Commissioner Jt.Commissioner
Aditya Music (India) Private Limited, (Tin No. 28070250743)
Advanta India Limited, Secunderabad (Tin 28300210448)
Agastan Bio Cheme Pvt. Ltd., (Tin No. 28390126540), Tilak Road,
Hyderabad
Allen Reinforced Plastics Private Limited, (Tin No. 28040123480) Ameerpet,
Hyderabad
Almond House (Tin No. 28610201643), Himayatnagar, Hyderabad
Amara Raja Electronics Private Limited, Diguvamagham Village,
Thavanampalle Mandal, Chittoor District (Tin 28520168084)
Amc Cookware (India) Private Ltd., (Tin No. 28350275598)
Ammana Industries, Ida Jeedimetla, Hyderabad (Tin No. 28680147256)
Anam Electrical Manufacturing Company, Kadiyam, East Godavari District
Anant Products, (Tin No. 28900119151), Transport Road, Shikh Village,
Secunderabad
Anchor Electronics & Electricals (P) Limited, Ramkote, Hyderabad (Tin
2890201977)
Andhra Petro Chemicals Ltd, (Tin No. 28420194827)
Andhra Pradesh Dairy Development Cooperative Federation Limited (Tin No.
28660129053), Lalapet, Hyderabad
Anil Enterprises, Vijayawada (Tin No. 28810225369)
Anu Fastners (P) Limited, R.R.District(Tin 28280198647)
Apollo Tyres Limited, Hyderabad
Archinova Design Pvt. Ltd., (Tin No. 28320143097), Begumpet, Hyderabad
Arihant Enterprises, Hyderabad (Tin 28160214947)
Arrow Cables Limited (Tin No. 28140213622)
Ashian Herbex Limited, Hyderabad (Tin No. 28430105425)
Ashish Health Care, (Tin No. 28160252971) Hyderabad
Ashwini Homeo Pharmacy, (Tin No. 28560176069) Hyderabad
Aurobindo Pharma Limited Ameerpet, Hyderabad, (Tin 28840211594)
Madras Auto Service, Secunderabad. Registered Dealers U/Vat (Tin
No. 28610204456)
Automotive Manufacturers Private Ltd., (Tin No. 28050131175), R.P.Road,
Secunderabad
Avanti Bufa Pvt. Ltd., (Tin No. 28950205447), Basheerbagh, Hyderabad
Avenir Power Technologies Pvt. Ltd., Hyderabad (Tin No. 28480126828)
B
Baba & Co., Hyderabad (Tin No. 28610139272)
Babulal Singhania, Hyderabad
Bajaj Associates (Tin No. 28730131896)
Bajaj Associates (Tin No. 28730131896)
Bajaj Sales Corporation, (Tin No. 28860220097) Hyderabad
Bajaj Sales Corporation, (Tin No. 28860220097) Hyderabad
Balaji Electronics.,(Tin No. 28190115812), 1-8-488, Chikkadpally,
Hyderabad
Balaji Medical Agencies (Tin No. 28180124607), Khairatabad, Hyderabad
Balaji Traders, Agapura, Hyderabad (Tin 28600205394)
Bambino Agro Industries Limited, Hyderabad (Tin 28320159587)
Basher Khan, Kothapet, Vijayawada (Tin 28460114057)
Beco Lifts (P) Ltd., Hyderabad (Tin 28670196985)
Belman Hotels (P) Limited, Lakdikapul, Hyderabad (Tin 286301975236)
Bennet Coleman & Company Limited, Banjara Hills,Hyderabad (Tin
28840213922)
Bharthi Builders, Hyderabad (Tin No. 28240252839)
Bhartia Industries Limited, Begumpet, Hyderabad
Bhel-Ge Gas Turbine Services Private Limited, (Tin No. 28020116917)
Bhooratnam Construction Company (P) Limited, Secunderabad (Tin No.
28560155990)
Blossoms Oils & Fats Limited, Kakinada (Tin No. 28080113326)
Blowin Usa, Hyderabad
Blue Star Limited, (Tin No. 28150108021), Bantia Estates, Secunderabad
Bright Star Rubber Industries, (Tin No. 28770101857), Bazarghat,
Hyderabad
Brij Melhyd Pvt. Ltd., Punjagutta Tin No. 280801900053)
C
C.R.I. Pumps (Pvt) Limited (Tin No. 28370125797), Ghasmandi,
Secunderabad
Cadbury India Limited, (Tin No. 28890210202), Gavaravaram, Eluru
Cal-On Instruments, (Tin No. 28560127278), Cherlapalli, Hyderabad
Cannon India Private Ltd., (Tin No. ), S.P.Road, Secunderabad
Cantronics Office Equipments (P) Ltd. (Tin 28340156547)
Ceat Limited (Tin No. 28900176672), Somajiguda, Hyderabad
Ch.Veeraju & Co., Rajahmundry (Tin No. 28940212593)
Charisma Printers (P) Limited Hyderabad (Tin 28900272702)
Charoen Pokchand (I) (P) Ltd., Vizianagaram
China State Construction Engineering (Hong Kong) Ltd., (Tin No.
28740860398), Banjara Hills, Hyderabad
Chitra Engineering Corporations, Santhoshnagar, Hyderabad (Tin No.
28650225439)
Circars Lakshmi Mill Stores ,Vijayawada (Tin 28910111520)
Control & Schematics Limited, Himayatnagar, Hyderabad (Tin
28490171868)
Controller of Stores, Rail Nilayam, Hyderabad
Cotton Corporation of India Limited, Guntur (Tin No. 28070123867)
Crompton Greaves Limited, (Tin No. 28600196761) Minverva House,
S.D.Road, Secunderabad
Crompton Greaves Ltd., Secunderabad (Tin 28600196761)
D
D.C.S.Trading & Services Private Limited, Hyderabad (Tin No.
28960193160)
Das Engineering Company, Nallakunta (Tin No. 28690165912)
Daughters of St. Paul, Sardar Patel Road, Secunderabad
Daughters of St.Paul, S.P.Road, Secunderabad
Deccan Chronicle Holdings Ltd., (Tin No. 28800185179), S.D. Road,
Secunderabad
Deccan Forge & Carbides, Hyderabad (Tin 28490122689)
Deccan Forge & Carbides, Hyderabad (Tin 28490122689)
Deccan Switchgears, Hyderabad (Tin No. 28250168869)
Degremont Limited, Nacharam, Hyderabad (Tin No. 28770155013)
Deltek Power Links, (Tin No. 28240145945) Begumpet, Hyderabad
Devi’s Laboratories Ltd., (Tin No. 28600188807), Ameerpet, Hyderabad
Dhanvanthary Surgicals, Hyderabad (Tin 28800204288)
Disney Footwear (P) Limited, Enkipadu, Vijayawada (Tin No. 28960128752)
Dr. B. Sanjeeva Reddy, Betamcherla, Kurnool Dist
Dujodwala Products Ltd., Secunderabad
Dulichand Silk Mills Ltd., Sy.No. 82, IDA, Jeedimetla, Hyderabad(Tin
28360115192)
Dynamic Medical & Surgical Private Limited, Hyderabad (Tin No.
28210155258)
Dynamic Techno Medicals Pvt. Ltd., (Tin No. 2814014834), Gandhi Nagar,
Hyderabad
E
Elegant Chemical Entrprises (P) Limited,Habsiguda, Hyderabad (Tin
28280132008)
Elmas Power Systems, Kushaigusda, Hyderabad (Tin 28780213439)
Epe Process Filters & Accumulators Pvt. Ltd. Secunderabad (Tin
28740212632)
Esennar Transformers (P) Limited, Medak (Tin No. 28060208516)
Evergreen International Limited, Pattancheru (TiNo. 28910186889)
Excel Engineering Industries, Ida. Kukatpally, Hyderabad(Tin
28970202019)
Feno Plast Ltd., (Tin No. 28790173604) , Park Lane, Secunderabad
F
Fibre Glass Auto Products, Medak District (Tin No. 28030185334) Geetha
Traders, Vijayawada (Tin No. 2815009670)
Foods, Fats & Fertilizers Ltd., Tadepalligudem (TiNo. 28040114556)
G
G.K.B.Rx Lens Pvt. Ltd., (Tin No. 28640158380), Abids, Hyderabad
G.K.B.Rx. Lens Private Limited, Hyderabad (Tin No. 28640158380)
G.M.R. Tuni-Anakapalli Expressways (P) Limited, Begumpet, Hyderabad
Involute Automation (P) Liimited (Tin No. 28520168569) Hyderabad
G.R.Power Switchgeat Limited (Tin No. 28750194622), Jeedimetla,
Hyderabad
G.S. Power Consultants (Tin No. 28150193478), Madhuranagar, Hyderabad
Gayatri Projects Limited, Hyderabad (TiNo. 28190175370)
Gem Oxides (P) Ltd., Hyderabad (Tin 28610205135)
Gemini Labs, Hyderabad (Tin 28360136920)
Ghai Constructions Limited (Tin 28901463862)
Gland Pharma Limited, Hyderabad (Tin No. 28680129796)
Glassy Impex, Mehdipatnam (Tin No. 28710141629), Hyderabad
Global Links (Tin No. 28550127440) Hyderabad
Globe Surgicals, Hyderabad (Tin No. 28530129995)
Goa Opto Lab Private Limited, Hyderabad (Tin No. 28730142178)
Godavari Clay (Mines), Bommuru, Rajahmundry (Tin No. 28960213821)
Godavari Clay (Mines), Bommuru, Rajahmundry (Tin No. 28960213821)
Godavari Cnsl (Tin No. 28050203052) Peddapuram, East Godavari District
Godrej & Boyce Manufacturing Co. Ltd, M.G.Road, Secunderabad (Tin
28270208218)
Godrej Boyce Manufacturing Co. Limited (Tin No. 28270208218) Hyderabad
Godrej Boyce Manufacturing Co. Limited, Hyderabad (Tin No.
28270208218)
Gogi Engineering Company, (Tin No. 28730131314), 2002/26, Lala Temple
Complex, Ranigunj, Secunderabad
Gold Mohur Food & Feeds Ltd., Hyderabad (Tin 28280166734)
Gold Prince Gold Plated Jewellery, Machilipatnam (Tin 28590163070)
Goutami Mineral Industries, Betamcherla, Kurnool Dist.
Gouthami Spun Piples (Tin No. 28110215369) Karimnagar
Grasim Industries Limited, Hyderabad, (Tin 28610117253)
Grindwell Norton Ltd, P.G.Road, Secunderabad, (Tin 28610170118)
Gurukrupa Associates,Raghava Ratna Towers,Chirag Ali Lane, Hyderabad
(Tin 28660192782)
H
H.P.C. Electricals Limited, Hyderabad (Tin No. 28370215813)
H.P.C. Electricals Limited, Secunderabad. (Tin 28370215813 )
Habeeb Sea Foods, Kothapet, Vijayawada (Tin 28450139148)
Hemadri Enterprises, Tadepally, (Tin 28160112612)
Henkel Loctite India (P) Ltd., Hyderabad (Tin 28760125008)
Himachal Pradesh Horticultural Produce Marketing and Processing
Corporation Limited (Tin No. 28390209669) Hyderabad
Himalaya Engineering Works (P) Limited (Tin No. 28180145559)
Hindustan Colas Limited, Visakhapatnam (Tin No. 28610163716)
Hindustan Construction Co. Limited, Hyderabad (Tin No. 28070123382)
Hitech Insulators, Hyderabad (Tin No. 28750142145)
Hotaco, Visakhapatnam
Hotel Kamal Private Limited, (Tin No. 28750242637) S.D.Road, Hyderabad
Hybrid Rice International (P) Limited (Tin 28470141346)
I
I.V.R. Prime Urban Developers Limited, Hyderabad
India Food Exports, Tuni, E.Godavari Dist. (Tin 28280158877)
Indian Hume Pipe Company Limited, Hyderabad (Tin No. 28910143336)
Indo Asian Fuse Gear Limited, Karkana,Secunderabad, (Tin 28320139896)
Indu Priya Agenies, Amalapuram
Inox Air Products Ltd., (Tin No. 28850278168), Autonagar, Visakhapatnam
Inter Labs (India) Private Limited, Yellareddyguda (Tin No. 28561255194)
Hyderabad
International Instruments Industries, (Tin No. 28240172135), R.P. Road,
Secunderabad
Irri Surya Prakasa Rao,(Tin 28600144769)
Ishaan Starch Industries (Tin No. 28310213002), Nalam Bhima Raju Road,
Rajahmundry
J
J. Chandramouli Reddy, D.No. 7-129, Santhi Nagar, M.R.Palli, Tirupati (Tin
28770147932)
J.P.R. Industries, (Tin No. 28820154397)
J.Vencoba Rao & Sons, (Tin No. 28300139832)
Jain Steel House, (Tin No. 28180193283) Feel Khana, Hyderabad
Jain Turmerics (Tin No. 28430103873), Main Road, Rajahmundry
Jain Turmerics, Rajahmundry (Tin No. 28430103873)
Janak Surgical Company, Nampally, Hyderabad, (Tin 28950283920)
Jasmine Biologicals Pvt. Ltd. (Tin 28120161954)
Javick Impex (P) Limited, Secunderabad (Tin 28470235533)
Jaycot Industries, (Tin No. 28830169852), Nampally, Hyderabad
Jindal Photo Limited (Tin 28220203693)
Jocil Limited, Guntur (TiNo. 28270207248)
Johnson and Johnson Ltd., Hyderabad (Tin 28750148062)
Jurong Infrastructure (India) Private Limited (Tin No. 28530168698)
Hyderabad
Jyothi Agencies, Visakhapatnam (Tin 28140182679)
K
K.B. Power Care Pvt. Ltd., Kukatpally, Hyderabad
K.K.Rao Engineering Works Private Limited, Hyderabad (Tin No.
28910169235)
K.R.Lime Industries, (Tin No. 28480197735) Pillutla Road, Piduguralla,
Guntur
K.R.Lime Industries, (Tin No. 28480197735) Pillutla Road, Piduguralla,
Guntur
K.S.Biyani & Company (Tin No. 28810244963), Begumbazar, Hyderabad
K.V.R. Forgings Limited, Kakinada (Tin 28600100246)
K.V.S.Industries (Tin 28340114546) Secunderabad
Kaiser India (Tin No. 28640153336) Vijayawada
Kakarla Electrics & Electronics (P) Limited (Tin No. 28610169827)
Hyderabad
Kakatiya Cement Sugar & Industries Limited, (Tin No. 28040100588)
Kala Jyothi Process Private Limited (Tin No. 28370164985), Musheerabad,
Hyderabad
Karachi Agencies, Hyderabad (Tin No. 28290199164)
Karkhana Zinda Tilismath, Hyderabad (Tin No. 28410162009)
Karuna Pharma (P) Ltd., (Tin No. 28350151244), Kavadiguda,
Secunderabad
Kavita Engineering Industries, Hyderabad
Kayvee Enterprises, Hyderabad (Tin 28970141976)
Keekabhai Jeewaji (Tin No. 28780147770), N.S. Road, Hyderabad
Keerthi Electronics, (Tin No. .28150164960), Begum Bazar, Hyderabad
Khazana Jewellery (India) Private Limited, (Tin No. 28560101670)
Hyderabad
Khurana Surgicals & Marketing (P) Ltd., (Tin No. 28960129722)
Kirloskar Brothers Limited, Secunderabad (Tin No. 28850251978)
Kirloskar Brothers Limited, Secunderabad(Tin 28850251978)
Koya & Company Construction (P) Limited, Hyderabad (Tin No.
28130126290)
Kozylon Industries Limited, (Tin No. 28940190962)
Krishna Traders, Vijayawada (Tin No. 2831012250)
L
L.G. Polymers India Private Ltd., (Tin No. 2876016098), R.R.V. Puram,
Visakhapatnam
L.G.Electronics India (P) Ltd.,Uppal, Hyderabad (Tin 28730106385)
Lanco Industries Limited, Chittoor (Tin No. 28350102841)
Lanco Kondapalli Power Private Limited, Hyderabad (Tin No. 28150199007)
Larsen & Toubro Limited, Hyderabad
Laser Dot Limited,(Tin 28110231277), Barkatpura, Hyderabad
Lawrence and Mayo(Opticals) Parklane, Secunderabad, (Tin 28710174318)
Laxmi Pumps Marketing Services, Kavadiguda (Tin 28270240907)
Laxminarayan Srikishan, Tandur (Tin No. 28290108178)
Liberty Rubber Products, Hyderabad (Tin 28840298118)
Lipi Marketing (P) Limited, Vijayawada (Tin 28672130486)
Lokesh Machines Limited, Hyderabad
Lotus Chocolate Company Limited, (Tin No. 28540124207) Hyderabad
M
M.R.F.Ltd., (Tin No. 28620142408), Hyderabad
M.S.T.C. Limited, Visakhapatnam (Tin No. 28820100562)
M.T.R.Foods Limited, Ramanthapur, Hyderabad (Tin 28500173937)
Madhu Enterprises, (Tin 28720137490) Secunderabad
Madras Auto Service, Hyderabad (Tin No. 28610204456)
Mahavir Enterprises, (Tin No. 28850194457) Bogulkunta, Hyderabad
Maheswari Marketing, Hyderabad (Tin No. 28610171379)
Manaksia Limited, (Tin No. 28450192401) Sunder Nagar, Hyderabad
Mangalam Timber Products Limited (Tin No. 28930257666) Hyderabad
Mangalam Timber Products Limited., Barkathpura, Hyderabad, (Tin
28930257666)
Manibadra Gift Center, (Tin No. 28700189321) Vijayawada
Margo Bio Controls (P) Ltd. , Hyderabad (Tin 28210131396)
Martand Trading Company (Tin No. 28240157488), Malakpet, Hyderabad
Masqati Dairy Products, Hyderabad (Tin No. 28680205844)
Matrix Laboratories Limited, Secunderabad (Tin 28370135109)
Maytas Hill Country Pvt.Ltd., 6-3-1186/5/A,Iii Floor, Amogh Plaza,
Begumpet, Hyderabad (Tin 28690270478)
Mayur Agencies , Hyderabad. (Tin 28606074961)
Mayura Caps & Containers (P) Limited, (Tin No. 28690138946) Hyderabad
Mayuri Film Distributors, Ramoji Film City, Hyderabad (Tin No.
28120164088)
Mayuri Traders, Kukatpally, (Tin No. 28970130433) Hyderabad
Mcdowell & Company Ltd., (Tin No. 28160121827), Ida, Nacharam,
Hyderabad
Meera Sai Agencies, (Tin 28030180290) Chatta Bazar, Hyderabad
Megha Engineering Enterprises, (Tin No. 28290203141), Balangar,
Hyderabad
Meher Agencies, Vijayawada (Tin No. 28960135930)
Meher Enterprises, Vijayawada (Tin No. 28920173826)
Mekins Agro Products Limited (Tin 28030123060)
Met Trade India Limited Secunderabad(Tin 28620236401)
Metro Chappals, Vijayawada (Tin No. 28810213923)
Metrochem Api Private Limited, Erragadda, Hyderabad
Micron Electricals, (Tin No. 28110211877), S.P. Road, Begumpet,
Hyderabad
The Central Sales Tax (Amendment) Act, 2007 1056
Importance) Act, 1957. Consequently the CST Act is proposed to be

amended to provide for reduction of CST rate from 4% to 3% as also
to provide the enabling powers to the Central Government to reduce it
further, in future, through notification in Official Gazette and to drop tobacco
from the list of declared goods, to enable the States to levy VAT on tobacco
at a rate higher than 4% rate applicable to declared goods.
5. The Additional Duties of Excise (Goods of Special Importance)
Act, 1957 is proposed to be amended to drop tobacco from the First
Schedule of the Act, to enable the States to levy VAT on tobacco without
losing their share out of the 1% devolution from the Divisible Pool of
Central Taxes. It is also proposed to omit Section 4 of the Additional Duties
of Excise (Goods of Special Importance) Act, 1957 and the Second Schedule
of the Act, as the same are no more required.
6. The bill seeks to achieve the above objects."
——
Nitya Sai Chemicals (P) Ltd., (Tin No. 28350108079), Dasapalla Hills,
Visakhapatnam
O
Oblum Electrical Industries (P) Limited (Tin No. 28620284610)
Oblum Insulators, Balanagar (Tin No. 28770210206) Hyderabad
Om Sai Musalamma Industries (Tin No. 28070178478), Kothaguda Village &
Mandal, Warangal District
Optical Disc Marketing (India) Private Ltd., (Tin No. 28510200935), M.G.
Road, Secunderabad
Ori Flame India (P) Limited, Hyderabad
P
P.H.Products Company, Sanathnagar,Hyderabad(Tin 28080184524)
Padmavathi Enterprises, Vijayawada (Tin No. 28370109210)
Paduka Agencies, Vijayawada (Tin No. 28680206523)
Palm Beach Hotel, (Tin No. 28170296750), Visakhapatnam
Paraxit Industries, Hyderabad, (Tin No. 28720179103) Hyderabad
Park Hotels, Visakhapatnam (Tin No. 28060147988)
Parsi Sivayya & Co., (Tin No. 28930211203) Nizamabad
Pasura Biotech Pvt. Ltd. L.B.Nagar, Hyderabad (Tin 28080197716)
Pasura Life Sciences Private Limited, Charlapalli, R.R.District (Tin
28250252968)
Pawan Power & Telecom Limited, (Tin No. 28360100739) Hyderabad
Payal Foot Wear , Sultan Bazar, Hyderabad (Tin 28400227743)
Peace India Limited, Hyderabad (Tin No. 28370180796)
Pearl Mineral Private Limited, Prakasam Distrist (Tin No. 28790153040)
Pendekanti Subbarayudu, Kadapa (Tin No. 28540213738)
Photon Energy Systems Limited, Ida, Bollaram, (Tin 28190168192)
Polisetty Somasundaram (Tin No. 28930139423), P.O. Box No. 54,
Mangalagiri Road, Guntur
Polisetty Somasundaram Tobacco Threshers Private Limited, (Tin No.
28540171058), D.No. 8-24-31, Mangalagiri Road, Guntur
Pooja Marketting, Secunderabad (Tin 28280118040)
Poshak Feeds Private Limited, Hyderabad (Tin No. 28650110688)
Positive Interares, Hyderabad (Tin No. 28070113100)
Power Mak Pvt Limited (Tin 28280129389)
Power Tech Services (Tin No. 28830116890) Hyderabad
Praag Distilleries Pvt. Ltd., A Unit of M/S Sarvaraya Sugars Ltd., ( Tin
28440173745)
Pragati Offset Private Ltd., Red Hills, Hyderabad
Prakash Exporters, (Tin No. 28280196028) Tuni, East Godavari
Pramod Enterprises, Secunderabad (Tin 28260222154)
Praveen Trading Company, Kurnool (Tin No. 28160276348)
Prem Enterprises, Warangal (Tin 280702014474)
Printers Den Packaging, Balanagar, Hyderabad
Pro Agro Seed Company (P) Limited (Tin 28930120314)
Putta Traders, Kadapa District (Tin No. 28160255590)
Q
Quality Care India Limited, (Tin No. 28550128410)
Quick Calls Private Limited (Tin No. 28570200060) Hyderabad
R
R. Kantilal & Co., ( Tin No. 28540280474), Osmangunj, Hyderabad
R.K. Industries, I.D.A. Kattedan, Hyderabad
R.K. Surgicals, (Tin No. 28770208945), Nampally Station Road, Hyderabad
R.K.Trading Company, Hyderabad (Tin No. 28150192023)
R.P.Enterprises, Vijayawada (Tin No. 28940299117)
Raghavendra Industries (Tin No. 28890134736), Mangalavaripeta,
Khanapur Mandal, Warangal District
Rahim Khan, Kothapet, Vijayawada (Tin 28370252285)
Rain Calcining Limited (Tin No. 28250116683), Somajiguda, Hyderabad
Rakshit Durgs Private Limited (Tin No. 28840241470)
Ram Bakery, Hyderabad (Tin No. 28380253093)
Rama Marketing Services, Rajahmundry (Tin No. 28540228191),
Rama Raju Surgicals Cotton Mills Limited, (Tin No. 28350142417)
Vijayawada
Rama Raju Surgicals Cotton Mills Limited, (Tin No. 28350142417)
Vijayawada
Ramakrishna Industries, Hyderabad (Tin No. 28080118176)
Ramakrishna Transformers, Hyderabad (Tin No. 28340203301)
Ramesh Auto Industries Private Limited, Ida, Kondapally (Tin
28140188596)
Ramky Infrastructure Limited, (Tin No. 28320469384) Somajiguda,
Hyderabad
Ramky Infrastructure Limited, (Tin No. 28320469384) Somajiguda,
Hyderabad
Rane Brake Linings Ltd., (Tin No. 28090100457), Tadbund, Secunderabad
Rangoli Marketing Co., (Tin No. 28200227685), Chirag Ali Lane, Hyderabad
Rashtriya Ispat Nigam Limited, Visakhapatnam (Tin No. 28470121364)
Ratnam Residential Junior College and High School, Nellore
Ravi Electronic Corporation, Vijayawada (Tin 28420153796)
Ravi Foods (P) Ltd., (Tin No. 60193704), Kattedan, Hyderabad
Ravindra Commercial Corporation, W.G.Dist.(Tin 28970175635)
Remi Sales and Engineering Ltd., D.No. 1-4-879 (Mch No. 968) Sbi Colony,
Street No. 8, Bakaram, Ghandi Nahar, Hyderabad-80 (Tin
28760165745)
Ricoh India Ltd., (Tin No. 28420166406), Banjara Hills, Hyderabad
Robo Silicon Limited, Hyderabad (Tin No. 28090293778)
Rocksand Minerals (P) Limited, Hyderabad (Tin No. 28720127305)
Roopa Industries (Tin No. 28440210411), Rajupet, Narsampet Mandal,
Warangal District
Rupanagudi Power Systems (P) Ltd., Hyderabad (Tin No. 28060255949)
S
S.A.S. Enterprises, Hyderabad (Tin No. 28620293631)
S.D. Developer (P) Ltd., (Tin No. 28320183352), Trimulgherry,
Secunderabad
S.L. Trading Company, Hyderabad (Tin 28410154637)
S.L.Trading Company, Hyderabad (Tin 28410154637)
S.P.M Telecom Nacharam, Hyderabad (Tin 286401105903)
S.R. Drugs & Intermediates (P) Ltd., (Tin No. 28660180657)
S.R. Drugs & Intermediates (P) Ltd., (Tin No. 28660180657)
S.R. Drugs & Intermediates (P) Ltd., (Tin No. 28660180657), Patancheru,
Medak District
S.R.Zee Enterprises, Vijayawada (Tin No. 28810213438)
S.S.G. Solutions (P) Limited, Hyderabad (Tin No. 28280169547)
S.S.R. Enterprises, (Tin No. 287801713529)
S.V. Large Format Digital Imaging Pvt. Ltd., (Tin No. 28470207791),
Hyderguda, Hyderabad
Sachdev Overseas., (Tin No. 28350169383), 1192, Macheodguda (Behind
M.G.Road), Secunderabad
Sai Agri Biotech, Khammam (Tin 28470210216)
Sai Baba Flame Proof Switchgear (P) Limited, Hyderabad (Tin No.
28240114032)
Sai Krishna Agencies, Hyderabad (Tin 28980151320)
Sai Protien Food Industries, Kondapally, Krishna Dist.
Sai Renewable Power (P) Ltd., West Godavari Dist. (Apgst.No.
Elr/01/4/2987)
Sai Sowmya Products, Hyderabad (Tin 28410103518)
Sai Sowmya Products, Hyderabad (Tin 28410103518)
Saint Gobain Glass India Limited, Tada, Nellore (Tin No. 2837021873)
Saloni, Begum Bazar, Hyderabad (Tin 28950190218)
Salvo Explosives and Chemicals (P) Limited, Nalgonda
Sambasiva Engineering Works, Guntur
Sandvik Smith Asia Limited, (Tin No. 28630151752)
Sangam Health Care Products Limited, S.P.Road, Hyderabad (Tin No.
28410130872)
Sanghvi Corporation, Hyderabad (Tin No. 28920168394)
Sanka Narasimharao Co. Vijayawada (Tin 28910111520)
Saptagir Camphor Ltd., B. Kothapalli, Anantapur District
Sarada Industries, Vijayawada (Tin No. 28020154359)
Sarveshwara Marketing, (Tin No. 28470110500), Goshmahal Road,
Hyderabad
Servet Feeds & Minerals (P) Limited, Hyderabad (TiNo. 2950146859)
Sha Mukesh Kumar Ricabchand, (Tin No. 28240172911) Vijayawada
Shalimar Fastenings Private Limited, (Tin No. 28440117097), Banjara Hills,
Hyderabad
Shalimar Ribbon House, Hyderabad (Tin No. 28020173468)
Shree Agencies (Tin No. 28435094523), Himayatnagar, Hyderabad
Shree Ram & Company, (Tin No. 28280162757), Kishan Gunj, Hyderabad
Shree Shyam Enterprises, Hyderabad(Tin 28680172573)
Siddaiah Naidu, Tirupathi (Ctr/02/02/52/71/Gir(Tot) Hyderabad
Sign Mart (Tin No. 28930263195) Hyderabad
Smt. B.S.Suseelamma (Mine Owner) Bethamcherla (Tin 28860174313)
Sneha Vinyl Products (P) Ltd., Chittoor (Tin 28710136100)
Solar Nimba Limited, (Tin No. 28370272849) Adoni
Solix Technologies Ltd., Tarnaka, Secunderabad
Somani Brothers, Hyderabad (Tin No. 28340201458)
Somani Ispat Private Limited, Hyderabad (Tin No. 28910296596)
Sony India (P) Ltd., Punjagutta, Hyderabad (Tin 28710160156)
South India Mineral Industries, Bethamcherla (Tin 28140124576)
South India Mining Company, Bethamcherla (Tin 28420104811)
Spandrel, Hyderabad (Tin No. 28880112297)
Specific Laboratories (P) Ltd., (Tin No. 28240296392), Rasoolpura,
Secunderabad
Spectra Smart Solutions Private Limited, (Tin No. 28790196981)
Panjagutta, Hyderabad
Speed-A-Way Private Limited, Hyderabad (Tin No. 28980128137)
Sravya Textiles Ltd (Tin 28350192426) Hyderabad
Sree Balaji Engineers & Contractors (Tin No. 28610195144),
Yellareddyguda, Hyderabad
Sree D’gravure (Tin No. 28760221232), Shed No. 4, Ida., Uppal,
Hyderabad
Sree Durga Pharma, (Tin No. 28230224735) Hyderabad
Sree Durga Pharma, (Tin No. 28230224735) Hyderabad
Sree Foam Agencies (Tin No. 28130213396), Kandakam Street,
Rajahmundry
Sree Rayalaseema Alkalies and Allied Chemicals Ltd., (Tin No.
28960200435), Bhagyanagar, Kurnool
Sri Aravinda Steels, Vijayawada (TiNo. 28680196241)
Sri Bhavani Rubber Industries, Vijayawada (Tin No. 28790145571)
Sri Dhanalakshmi Cotton & Rice Mills (P) Limited, Guntur, (Tin No.
28870138358) Hyderabad
Sri Durga Auto Coach Body Builders (P) Limited, Hyderabad (Tin No.
28490236373)
Sri Durga Traders, Vijayawada (Tin No. 28280155676)
Sri Lakshmi Press, Guntur (Tin 28490155863)
Sri Maruthi Steel Traders, Pan Bazar, Sec’bad. (Tin 28050211976)
Sri Meenaa Foods, (Tin No. 28600161356) Tanuku Road, Kumadavalli
Village, Palakoderu Mandal, West Godavari District
Sri Rajyalakshmi Cement Products, Vijayawada (Tin 28620102638)
Sri Rama Non Ferrous Foundry, Hyderabad (Tin No. 28960101495)
Sri Sai Printers (Gir No. Pjt/07/1/2940), Lakdi-Ka-Pool, Hyderabad
Sri Satyanarayana Swamy Parboiled Modern Rice Mill, (Tin No.
28850294755) Huzurnagar, Nalgonda District
Sri Srinivasa Dairy Products (P) Limited, Esamia Bazaar (Tin No.
28320101193) Hyderabad
Sri Srinivasa Medical Agencies, Hyderabad(Tin 28510115284)
Sri T.Venkateswara Stone Crushers, Vijayawada (.Grn U52/07/2/2912)
Sri Udaya Raghavendra Minerals, Bethamcherla (Tin 28230110023)
Sri Valli Computers, (Tin No. 28690267568) Park Lane, Secunderabad
Sri Venkata Raghavendra Minerals, Bethamcherla (Tin 28620153272)
Sri Venkata Sai Minerals, Bethamcherla (Tin 28980146858)
Sri Venkateswara Coir Products (P) Limited, (Tin No. 28110127196)
Hyderabad
Sri Venkateswara Granites, Rajahmundry (Tin No. 28510157964)
Sri Vijaya Durga Traders, Vijayawada (Tin No. 28720279304)
Sri Viswanatha Traders., (Tin No. 28190127840)
Standard Electronics, Vijayawada (Tin 98940192223)
Subhodaya Paper Mart, Palakol (Tin 28050211879)
Sudha Gold Covering Industries, Machilipatnam (Tin 28680102248)
Sudha Gold Covering Industries, Machilipatnam (Tin 28680102248)
Sudhakar Polymers Ltd (Tin No. 28630207139), Suryapet
Suguna Industries, Thanappa Chetty Street, Mittoor, Chittoor, A.P. (Tin No.
28020192480)
Suguna Machine Works (P) Limited, Secunderabad (Tin No. 28450198900)
Sun Food Corporation, (Tin No. 28250182061) Narasingapally,
Visakhapatnam
Sun Food Corporation, Visakhapatnam (Tin No. 28250182061)
Sunshine Chemicals (Tin No. 28830193520) Hyderabad
Super Pack, Malakpet, Hyderabad (Tin 28153738925)
Super Surgico Appliances Private Limited, Hyderabad (Tin No.
28930245832)
Supreme Agencies, Hyderabad (Tin No. 28120175146)
Supreme Industries, Hyderabad, (Tin 28950283920)
Supreme Music, (Tin No. 28720169209), Koti, Hyderabad
Suresh Offset Printers (Tin No. 28950248612), Ida Nacharam, Hyderabad
Surgitek, Abids, Hyderabad (Tin No. 28110123219)
Suri Spares and Suppliers Pvt. Ltd., (Tin No. 28150143329) Hyderabad
Surya Electrical Stores (Tin No. 28800136194), Samarangam Chowk,
Vijayawada
Suzlon Energy Limited, Ahmedabad
Swamy Plastics, Hyderabad (Tin No. 28290154253)
Swasthik Pharmaceuticals, Vijayawada (Tin 28960206546)
Swastik Mirch Stores, (Tin No. 28940109385) Begum Bazaar, Hyderabad
Synergy Associates (Tin No. 28070215338), Kukatpalli, Hyderabad
T
T.K.M.Pharma, 1-9-1126, Azamabad, Hyderabad (Tin 28890124066)
Tab Engineering Works, Jeedimetla, Hyderabad (Tin No. 28410103130)
Taher Ali Industries & Projects Private Ltd., Hyderabad (Tin No.
28640107552)
Taj G.V.K.Hotels Limited, Hyderabad (Tin No. 28270128581)
Taj Residency, Visakhapatnam (Tin No. 28700177972)
Technical Trade Links (P) Ltd., Secunderabad (Tin No. 28850131310)
Techno Lines (Tin No. 28090218021)
Texmo Industries, Rasoolpura, Ecunderabad(Tin 28070118047)
Tide Water Oil Co. (I) Limited, (Tin No. 28660128374)
Tiki Tar Industries (Tin No. 28030173015), Pendurthi, Visakhapatnam
Tolety Office Makers, Ameerpet, Hyderabad (Tin 28040174793)
Total Presentation Devices (P)Ltd, Hyderabad Tin No. 28100267135
Trailor Springs, Industrial Estate, Vijayawada
Trailor Springs, Industrial Estate, Vijayawada
Trident Powdertech Privatet. Limited ., Ida., Nacharam, Hyderabad. (Tin
28860195944 )
Twin Cities Hotels (P) Ltd., (Tin No. 28520120263), Kachiguda, Hyderabad
U
Uday Enterprises, Hyderabad (Tin 28930152324)
Ultramarine & Pigments Limited (Tin 28380150467)
Uma Industries, (Tin No. 28650138042)
Umashankar Industries (Tin No. 28750159702), Rajupet, Narsampet
Mandal, Warangal District
Uni Fab Engineering Works, #537, B.N.Reddy Nagar, Near Ganesh Temple,
Charlapally, Hyderabad (Tin 28220133465)
Uni Fab Engineering Works, #537, B.N.Reddy Nagar, Near Ganesh Temple,
Charlapally, Hyderabad (Tin 28220133465)
United Metal Tek Private Limited, Hyderabad (Tin No. 28780224982)
Unity Engineering Traders, Hyderabad (Tin No. 28920154814)
University of Hyderabad, Hyderabad
Unnati Industrial Co-Op Society Limited, (Tin No. 28290122340) Hyderabad
Urc Construction (P) Ltd., (Tin No. 28460173906), A.C. Guards, Hyderabad
V
V.A.Marketing, (Tin No. 28750111978) Hyderabad
V.B.Oil Mills (P) Ltd.,Adoni (Tin 28950165095)
V.E.C. Software, Hyderabad (Tin No. 28690114114)
Vamshi Rubber Limited, (Tin No. 28350160556), Himayat Nagar,
Hyderabad
Vamshi Rubber Limited, Banjara Hills, Hyderabad (Tin 28350160556)
Vamsi Art Printers Private Ltd., (Tin No. 28230186750), Red Hills,
Hyderabad
Varada Sathi Raju, Nellapalli, East Godavari Distrist (Tin No. 28960113038)
Vasundhara Traders, Chilakaluripet (Tin 28470122140)
Venkata Ramana Laminations Private Limited, (Tin No. 28590142031)
Hyderabad
Venkateswara Electricals & Engineering Corporation, Secunderabad (Tin No.
28170166382)
Venkateswara Granite Metal Suppliers, Rajahmundry (Tin No.
28550155764)
Venkateswara Metal Company, Rajuhmundry (Tin No. 28220202917)
V-Guard Industries Private Limited, (Tin No. 28580204554), Mansoorabad,
Gsi Post, Hyderabad
V-Guard Industries, Hyderabad (Tin No. 28580204554)
V-Guard Insdustries (P) Limited, Hyderabad (Tin No. 28580204554)
Victory Transformers & Switchgears Limited, Jeedimetla (TiNo.
28150191247)
Vidyuth Control Systems (P) Ltd., (Tin No. 28440292570), M.G. Road,
Secunderabad
Vijay Traders, Vijayawada (Tin 28130139579)
Vijayalaxmi Cashew Company, (Tin No. 28510297741) Kasibugga,
Srikakulam District
Vijayalaxmi Cashew Company, (Tin No. 28510297741) Kasibugga,
Vizianagaram
Vijaysri Camphor Industries, Shaikpet, Hyderabad
Vinayaka Cattle Feed, Proddatur, (Tin 28344048090)
Visakha Steel Allieds, Anakapally (Tin 28540111112)
Vishnu Priya Slate Industries, (Tin No. 28860191288) Markapur, Prakasam
District
Vishnu Products., (Tin No. 28260168513), 11-46-15a, Kanurivari Street,
Near Kothagulla, Vijayawada
Vishwajit Castings & Engineering Works (Tin No. 28150188046) Hyderabad
Viswanatha Transformers (P) Limited, Hyderabad (Tin 28520148781)
Volta Impex Private Limited, (Tin No. 28920296531) Hyderabad
W
Walker Shoes, Narasaraopet (Tin No. 28870145924)
Weitex India Limited, 1-3-176/35/22/26, Gandhi Nagar, Hyderabad
Weld Fuse Private Limited, (Tin No. 28880262356)
Western India Cashew Company (P) Limited, Tuni (Tin No. 28460281867)
Hyderabad
Wood Stock, Hyderabad
Y
Yasa Sri Gold Plating Works, Machilipatnam (Tin 28660158638)
Z
Zuari Cement Limited, Hyderabad (Tin No. 28030153712)
PROCEEDINGS OF THE
AUTHORITY FOR CLARIFICATION AND ADVANCE RULING
(Under Section 67 of APVAT Act, 2005)
Present : Sri T.Yugandhar Reddy, Addl.Commissioner(VAT)

Sri T.Vivek, Jt.Commissioner (VAT)
Sri K.Raghavaiah, Jt.Commissioner (Audit)
***
CCT’s Ref.No.PMT/P&L/A.R.Com/37/2005 DT.1-5-2005
Ref:- CCT’s Ref.No.PMT/P&L/A.R.Com/2005,
Dt.13.4.2005.
O R D E R:
M/s. Allen Reinforced Plastics Private Limited, (TIN
No.28040123480) Ameerpet, Hyderabad have filed an application
dt.27.4.2005 and sought clarification and advance ruling on the following
items under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of
APVAT Rules, 2005 alongwith the application fee of Rs.1000/-.
They sought clarification on the items given below.
The applicant claims to manufacture Fibre Reinforced Plastic (FRP)

and allied products and supplies to various defence organizations.
The FRP component and parts such as launch tubes for missiles and
other materials are sold to defence establishments. The applicant
seeks clarification on the rate of tax applicable to the said items.
Sri N.Venkateswara Rao, Director appeared for hearing on 30-4-

2005 and explained the case.
The following documents were submitted:
1 of page 2
1. Copy of invoice issued by Central Excise regulations indicating
HSN tariff code 9306.00 for FRP empty shells.
2. Copy of invoice containing tariff head No.3923.90 for storage
cum transportation container for BCM
3. Pictorial literature of the product.
The issue and the documents have been examined with reference to
the provisions of the APVAT Act and Rules and HSN Codes notified by
Government vide G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-
2005 and G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005 and
the ruling is given as under:
Item No.1: FRP empty shells claimed as falling under tariff
heading 9306.00 has not been notified by the Government.
Therefore the item should be held as liable to tax @ 12.5%.
Item No.2: Storage cum transportation container: In the G.Os cited

above the HSN code 3923 has been notified. As seen from the
documentary evidence furnished by the applicant this item is shown
as falling under tariff heading 3923.90. Therefore, this item is held
as liable to tax @ 4%.
Addl.Commissioner Jt. Commissioner Jt.Commissioner

Note: An appeal against this proceedings can be filed before the Sales Tax
Appellate Tribunal, A.P., Hyderabad within 30 days of this ruling.
To
M/s. Allen Reinforced Plastics Private Limited,

6-3-856/4, Sadath Manzil Colony,
Ameerpet, Hyderabad.
Copy submitted to the Commissioner of Commercial Taxes,A.P., Hyderabad.

Copy to the Deputy Commissioner (CT), Panjagutta Division.
Copy to the Commercial Tax Officer, Vengalrao Nagar Circle, Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Abhi Fabs, (TIN No.28240133238) Hyderguda,
Hyderabad have filed an application dt.3.5.2005 and sought clarification
and advance ruling on the following items under Section 67 of APVAT Act,
2005 read with Rule 66(2)(i) of APVAT Rules, 2005 alongwith the
application fee of Rs.1000/-.
They sought clarification on rate of tax on the following items:
1. Bedsheet material
2. Pillow covers
Sri C.Mahesh Chandra Reddy, Husband of Proprietrix and authorized

representative appeared for hearing on 30-5-2005 and explained the case.
The issue has been examined with reference to the provisions of the
APVAT Act and Rules and HSN Codes notified by Government vide
G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-2005 and
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005 and the ruling
is given as under:
The applicant claims to purchase Bedsheet material from

outside the state of A.P. and cuts into pieces and effects sale as
Bedsheets. In the G.Os cited above the government have notified
the HSN codes and the rates of taxes applicable to items falling
under exempt and 4% rate category.
As the items in question do not fall under any of the codes
notified by the government and applying the principles of
interpretation, Bedsheet material and Pillow covers are held as
liable to tax 12.5%.

To
M/s. Abhi Fabs,

Hyderguda,
Hyderabad.
Copy to the Deputy Commissioner (CT), Abids Division.
Copy to the Commercial Tax Officer, Hyderguda circle, Hyderabad.

2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. K.R.Lime Industries, (TIN No.28480197735) Pillutla
Road, Piduguralla, Guntur have filed an application dt.6.5.2005 and sought
clarification and advance ruling on the following items under Section 67 of
APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 alongwith
the application fee of Rs.1000/-.
1. Burnt lime
2. Cem powder
Sri Ramalingeswara Rao on behalf of M/s. K.R.Lime Industries

appeared for hearing on 30-5-2005 and explained the case.
is given as under : 1 of page 2
The applicant claims to produce Burnt lime by using lime
stone as raw material and coal as fuel to burn the lime stone and
supplies the same to sugar, paper and cem powder manufacturing
industries. Entry 43 of Schedule IV of A.P.VAT Act, 2005 refers to
Ores and Minerals. In the G.Os mentioned above, Government have
notified the HSN codes applicable to items falling under Schedule IV
of the A.P.VAT Act, 2005. Among other things HSN code 2521 and
2522 have been notified in the said G.Os. These codes refer to lime
stone flux, lime stone and other calcareous stone used for the
manufacture of lime or cement.
Therefore the items on which the applicant has sought
clarification attract tax @ 4%.

To
M/s. K.R.Lime Industries,

Pillutla Road,
Piduguralla, Guntur.
Copy to the Deputy Commissioner (CT), Guntur Division.
Copy to the Commercial Tax Officer, Circle, Guntur.

2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sri Satyanarayana Swamy Parboiled Modern Rice Mill,
(TIN No.28850294755) Huzurnagar, Nalgonda District have filed an
application dt.9.5.2005 and sought clarification and advance ruling on the
following items under Section 67 of APVAT Act, 2005 read with Rule
66(2)(i) of APVAT Rules, 2005 alongwith the application fee of Rs.1000/-.
They sought clarification on the following items:
1. The applicant claims to make exports of Rice and obtains

documents in support of such transactions. The applicant seeks
clarification whether on such transactions Rural Development
Cess is applicable.
2. In order to claim the benefit of zero rating to the exports, the

time available to the applicant to submit evidence in support of
such export transaction.
3. Whether a VAT registered dealer is exempt from payment of VAT

on Rice sold to an exporter on production of Form H.
Sri G.Prabhakar, Managing Partner appeared for hearing on 30-5-

2005 and explained the case. 1 of page 3
APVAT Act and Rules, 2005 and the ruling is given as under.
1. The A.P.VAT Act and Rules, 2005 do not provide for the
applicability or otherwise of A.P.Rural Development Cess
and its impact on exports of Rice. As such the cess is a
separate piece of legislation and has no bearing on the
transaction effected under the A.P.VAT Act, 2005. As the
subject matter falls outside the scope of this Act, this
Authority is not inclined to give any ruling on the issue.
2. Sub rule (6) of Rule 35 of A.P.VAT Rules, 2005 specify the

documents that are required to be in possession of a
dealer claiming zero rating for the exports or sales made
in the course of export. The documents must be produced
as and when the department requires during the course of
audit. Therefore it is advisable that the applicant is in
possession of the documents specified in the said rule at
the earliest, which will facilitate verification if warranted.
2 of page 3
3. Section 38(1)(a) entitles an exporter to claim refund of

tax when the sales fall under sub section (1) or (3) of
Section 5 of the CST Act. Therefore, a penultimate sale in
the course of export will also entitle the dealer to claim
the benefit input tax credit and at the same time such
sales are zero rated under the provisions of A.P.VAT Act,
2005.

To
M/s. Sri Satyanarayana Swamy Parboiled Modern Rice Mill,

Lingagiri Road, Huzurnagar,
Nalgonda District.
Copy to the Deputy Commissioner (CT), Nalgonda Division.
Copy to the Commercial Tax Officer, Circle, Nalgonda.
3 of page 3
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. K.R.Lime Industries, (TIN No.28480197735) Pillutla
Road, Piduguralla, Guntur have filed an application dt.6.5.2005 and sought
3. Burnt lime
4. Cem powder
Sri Ramalingeswara Rao on behalf of M/s. K.R.Lime Industries

is given as under : 1 of page 2
The applicant claims to produce Burnt lime by using lime
stone as raw material and coal as fuel to burn the lime stone and
supplies the same to sugar, paper and cem powder manufacturing
industries. Entry 43 of Schedule IV of A.P.VAT Act, 2005 refers to
Ores and Minerals. In the G.Os mentioned above, Government have
notified the HSN codes applicable to items falling under Schedule IV
of the A.P.VAT Act, 2005. Among other things HSN code 2521 and
2522 have been notified in the said G.Os. These codes refer to lime
stone flux, lime stone and other calcareous stone used for the
manufacture of lime or cement.
Therefore the items on which the applicant has sought
clarification attract tax @ 4%.

To
M/s. K.R.Lime Industries,

Pillutla Road,
Piduguralla, Guntur.
Copy to the Commercial Tax Officer, Circle, Guntur.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. The Rama Raju Surgicals Cotton Mills Limited, (TIN
No.28350142417) Vijayawada have filed an application dt.21.4.2005 and
sought clarification and advance ruling on the following items under Section
67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005
alongwith the application fee of Rs.1000/-.
1. Surgical Dressings, Pop powder, Cloth, Gauze, Bandages, Sterile

and Non-sterile surgical pads etc.
2. a) Belladona plasters for the treatment of boils, muscle stiffness,

joint pains etc., and adhesive plasters manufactured by Surplast
Tapes Pvt. Ltd., as per Drug Licence No.A/445.
b) First aid dressing strips for minor wounds and brushes etc.,
manufactured by Vibal Surgicals Pvt. Ltd. As per Drug Licence
No.A/723.
1 of page 2
Sri S.Kasiviswanatham, Depot Manager appeared for hearing on 30-

5-2005 and explained the case.
is given as under :
The items on which the applicant sought clarification do not
fall under Entry 88 of Schedule IV. As the G.Os mentioned above do
not list the HSN codes for these items, they are held as liable to tax
@ 12.5%.

To
M/s. Rama Raju Surgical Cotton Mills Limited,

11-24-78/E, Bhavannarayana Street,
Vijayawada – 520 001.
Copy to the Deputy Commissioner (CT), Vijayawada Division.
Copy to the Commercial Tax Officer, Circle, Vijayawada.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Ramky Infrastructure Limited, (TIN No.28320469384)
Somajiguda, Hyderabad have filed an application dt.10.5.2005 and sought
They sought clarification on the following:
When a contractor executing works contracts with Govt. Dept. and Local
bodies awards such works contract to another sub contractor on back to
back basis, whether both contractor and sub contractors are liable to
TDS @ 4% of 50% of total consideration and whether Form 501
received from the contractor can be endorsed to in favour of the sub
contractor.
Sri N.S.Murthy, Senior Manager appeared for hearing on 13-5-

The issue has been examined with reference to the provisions
of the APVAT Act and Rules and the ruling is given as under.
1 of page 2
There is no concept of contractor and sub contractor being
separately treated under the A.P.VAT Act. Whether one is a
principal contractor or sub contractor, the VAT dealer contractor
becomes liable to tax once he falls in the category of works
contractors. If such contractor executes works to the Govt.
contractee or local body contractee, such contractor is expected to
file Form VAT 501 certified by the contractee together with the VAT
200 otherwise he is liable to pay tax. Rule 17(3)(g) stipulates that
where the contractor VAT dealer awards any portion of his contract
to a sub-contractor, such contractor shall not be eligible for any
deduction relating to the value of the sub-contract. The sub
contractor, if he is a VAT dealer, in such a case he may either opt
for composition under clause (c) of Sub section 7 of Section 4 or
pay tax under clause (a) of sub section (7) of Section 4.

To
M/s. Ramky Infrastructure Limited,
6-3-1089/6/10, Ist Floor,
Gulmohar Avenue, Raj Bhavan Road,
Hyderabad – 500 082.

Copy to the Deputy Commissioner (CT), Division.
Copy to the Commercial Tax Officer, Circle, Hyderabad.
2 of page 2
PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/96/2005 DT. 25-5-2005

Dt.13.4.2005.
O R D E R:
M/s. Bajaj Sales Corporation, (TIN No.28860220097)

1. Plastic footwear
Sri Jagdev Singh Varma partner of the firm appeared for hearing on
23-5-2005 and explained the case.
1 of page 2
is given as under.
The rate of tax applicable to Plastic Footwear falling under
HSN code No.6402.19.90 is 4%.
To
M/s. Bajaj Sales Corporation,

22-7-270, A/C+B & G+H, Nizamabagh,
Dewandewdi, Hyderabad.

2 of page 2

PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/94/2005 DT.25 -5-2005
Dt.13.4.2005.
O R D E R:
M/s. Sree Durga Pharma, (TIN No.28230224735) Hyderabad
have filed an application dt.21.5.2005 and sought clarification and advance
ruling on the following items under Section 67 of APVAT Act, 2005 read with
Rule 66(2)(i) of APVAT Rules, 2005 alongwith the application fee of
Rs.1000/-.
1. Orthopedic & Fracture appliances
2. Handloom crepe bandage, Handloom bandage cloth, Infusion set

(saline sets)
Sri K. Pavan Kumar, Accountant of the firm has appeared for hearing
on 23-5-2005 and explained the case.
1 of page 2
is given as under.
1. Orthopedic and Fracture appliances covered under HSN
code 9021.10 are exempt from A.P.VAT Act, 2005.
2. All medical devises and equipment including bandages are
taxable @ 12.5%.

To
M/s. Sree Durga Pharma,

Yendurivari Street,
Vijayawada
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. The Rama Raju Surgicals Cotton Mills Limited, (TIN
No.28350142417) Vijayawada have filed an application dt.21.4.2005 and
3. Surgical Dressings, Pop powder, Cloth, Gauze, Bandages, Sterile

and Non-sterile surgical pads etc.
4. a) Belladona plasters for the treatment of boils, muscle stiffness,

joint pains etc., and adhesive plasters manufactured by Surplast
Tapes Pvt. Ltd., as per Drug Licence No.A/445.
b) First aid dressing strips for minor wounds and brushes etc.,
manufactured by Vibal Surgicals Pvt. Ltd. As per Drug Licence
No.A/723.
1 of page 2
Sri S.Kasiviswanatham, Depot Manager appeared for hearing on 30-

is given as under :
The items on which the applicant sought clarification do not
fall under Entry 88 of Schedule IV. As the G.Os mentioned above do
not list the HSN codes for these items, they are held as liable to tax
@ 12.5%.

To
M/s. Rama Raju Surgical Cotton Mills Limited,

11-24-78/E, Bhavannarayana Street,
2 of page 2
PROCEEDING OF THE
( Under Section 67 of APVAT Act, 2005)
Present : Sri T.Yugandhra Reddy, Addl.Commissioner (VAT)

CCT’s Ref.No.PMT/P&L/A.R.Com/155/2005 Dt:01-07-2005.
Ref: CCT’S Ref.No.PMT/P&L/A.R.COM/2005, Dt:13-4-

2005.
***
O R D E R:
M/s. Archinova Design Pvt. Ltd., (TIN No.28320143097), Begumpet,

Hyderabad have filed an application dt.15-06-2005 and sought clarification
and Advance Ruling on the following items under Section 67 of the APVAT
Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005. The application is
examined and found in order. Hence admitted.
The applicant is seeking clarification on the following:
1) Rate of tax for works contracts and composition scheme.

2) Any other levies on works contracts executed for customers other
than
Government.
3) Tax Deduction at Source – methodology and adjustment of excess
TDS
for the next month.
The case was posted for hearing on 30-06-2005. Sri Ramesh,

Managing Director of the firm appeared on behalf of the firm and explained
the case.
According to the applicant, he is executing works contracts for
interior decoration for organizations other than State Government. In
respect of a particular customer, the payment of the bill is cleared from
Head Office of the customer located outside the A.P. The applicant says that
the customer is insisting on a written clarification from the tax department
to know about the methodology of TDS and rate of tax.
After examining the facts, the ruling is given as under:

1 of 2
1. The tax rate applicable if the VAT dealer opts for composition in
respect of works contracts executed for any customer other than State
Government or Local Authority, will be 4% of the 50% of the consideration
received. This works out to 2% of the total value of the bill. The VAT dealer
is required to apply in form VAT 250 for composition of tax either for
individual contract or for all contracts in general.
2. The Tax Deduction at Source (TDS) will be 2% every time a bill is

paid. The tax deducted should go to the State where the work is executed.
The place where TDS is made is immaterial and if work is executed in A.P.
the tax must be remitted to tax department of A.P.
3. If any amount deducted over and above 2% as prescribed is found

to be in excess of the liability in respect of composition, VAT dealer can
adjust such amount for the next month. The condition prescribed under
sub-rule 3 of rule 17 of APVAT Rules,2005 is only with regard to TDS made
at 2% as specified in sub-section 4 of Section 22 of APVAT Act,2005 and
the VAT dealer opting for composition @ 2%, where there cannot be any
refund to such VAT dealer. If TDS is made in excess of 2% prescribed and
this reduces the consideration to be received by the contractor, such excess
recovery from the amounts payable to the contractor shall be credited to
the VAT dealer to be adjusted in the subsequent months.
ADDL.COMMISSIONER JT.COMMISSIONER
JT.COMMISSIONER
To
M/s. Archinova Design Pvt. Ltd.,
Architects, Interior Designers,
305, 3rd Floor, Prajay Corporate House,
Chikoti Gardens, Begumpet,
Hyderabad-500 016.
Copy submitted to the Commissioner of Commercial Taxes, A.P.,

Hyderabad.
Copy to the Commercial Tax Officer, Circle.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Balaji Medical Agencies (TIN No.28180124607), Khairatabad,

The applicant is seeking a clarification on the following:
Collection of VAT on sale of medicines by stockist to the retailers.

The case was posted for hearing on 30-06-2005. Sri K.V. Mohan Rao
on behalf of the firm appeared and explained the case.
According to the applicant, he is a stockist on behalf of M/s. Aristo

Pharma who is the manufacturer of medicines and first seller in the State.
The applicant is supplying medicines to other retailers including hospitals.
The applicant is charging the same price to his customers as charged by his
supplier. The applicant says that 5% discount is passed on by his supplier
by way of credit note for the value of the supplies made for each month.
The applicant says that he is not clear whether any tax is payable at his
hands when there is no value addition. The applicant, therefore, desires to
know whether any tax is payable at his hands.
1 of 3
After examining the facts, the ruling is given as under:
The main issue here is the discount of 5% allowed by the

manufacturer to the applicant. There is a clear provision in the Act and
Rules that credit and debit notes can be exchanged between the sellers and
buyers and if any changes regarding input tax and output tax credits are
required to be made, they have to be correctly accounted for in their
records and also reflected in the VAT returns. If the manufacturer is passing
on 5% discount subsequent to the original sale and he is trying to reduce
his output tax liability in the month in which the credit note is passed, the
dealer receiving the credit note should reduce his input tax credit in the
month in which he receives credit note. The illustration for this would be as
under:
Seller Buyer
Sells goods goods worth Rs.1,00,000
in June,2005.
5% discount passed for Rs. 5,000

in the month of Jun,2005
and credit note issued
in July,2005.
Result: The selling dealer can reduce The buying dealer purchased goods
his out put value relating to July to worth Rs.1,00,000/- in June,2005
the extent of Rs.5000/- and can and input tax @ 4% is Rs.4,000/-.
reduce output tax to the extent of Credit note received towards 5%
Rs.200/- in the return of July,2005. discount in the month of July,2005.
The buying dealer receiving the
credit note should reduce his input
value to be declared for July,05 to
the extent of Rs.5,000/- and
accordingly reduce his input tax
credit in the return for July,05 to
the extent of Rs.200/-.
The applicant should check with his supplier whether any benefit as
a result of credit note is claimed by him as illustrated above and the
applicant should accordingly carry out the changes in the input tax
2 of 3
claims as illustrated above. In case the supplier is not claiming any benefit
of reducing output tax for the credit notes passed by him in favour of his
customers, there is no need to make any changes at both ends and the
applicant may not be required to pay any tax since no value addition is
taking place at his hands.
JT.COMMISSIONER
To
M/s. Balaji Medical Agencies,
6-3-42/1, Premnagar, Khairatabad,
Hyderabad-500 004.

Hyderabad.

3 of 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Kakarla Electrics & Electronics (P) Limited (TIN
No.28610169827) Hyderabad have filed an application dt.8.6.2005 and
They sought clarification on the following :
The rate of tax applicable to :
1) Voltage Stabilizers
2) Ceiling Fans
Sri G.Narasimha Rao, Manager Accounts of the firm has appeared

for hearing on 29-6-2005 and explained the case.
1 of page 2
is as under.
1) Voltage Stabilizers: In the G.Os cited above, HSN codes for
products falling under Entry 39 of Schedule IV of the Act have been
notified. At Sl.No.7 of the notified entry, Electrical transformers,
Static convertors etc., are notified as falling under the HSN code
8504. Under that code Voltage stabilizers are also covered at
8504.40.40. As the chapter code has been notified all items falling
under the code are deemed as attracting the rate applicable to the
goods in the Schedule. Therefore, it is held that Voltage stabilizers
are liable to tax @ 4%.
2) Ceiling Fans : This item is not specified in any of the
Schedules of the Act. It is therefore held as liable to tax @ 12.5%.

To
M/s. Kakarla Electricals & Electronics (P) Limited,
Plot No.11, H.No.5-33/23,
Kukatpally Industrial Estate, Hyderabad – 72.
Copy to the Commercial Tax Officer, Sanathnagar Circle.
2 of page 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Keekabhai Jeewaji (TIN No.28780147770), N.S. Road,

The applicant is seeking clarification regarding the rate of tax on the

following:
Job work and labour charges on glass; whether constitutes part of

the turnover liable for tax.
The case was posted for hearing on 15-06-2005. Sri Shabbir,

Partner of the firm appeared on behalf of the firm and explained the case.
According to the applicant, he is a stockist and dealer of certain

Companies in respect of glass and mirrors and he is selling these goods as
per specification of the customer. He also mentioned that the glass is cut
according to the size ordered by the customer and certain work is done like
etching, stain glass, air brushing, polishing, engraving etc., as per
specification of the customer. In addition to this he is also doing special
packing for outside customers and in respect of local customers he is taking
the responsibility to
deliver the goods at customers’ place. As regards the transportation

charges, the money is paid by the applicant to the transporter and it is
collected from the customer by including it in the bill as a separate item. As
a proof of his claim, certain invoices were also produced. The applicant
seeks to know whether VAT is to be charged on the total amount shown in
the invoices which includes charges for special work done on glass and
mirror and transportation and packing charges.
After examination of the facts, it is clearly established that the
customer is not interested in buying plain glass or mirror at the time of
finalization of the contract for the transaction, but he is seeking a final
product with certain specifications. As a result of this understanding, the
applicant is required to deliver the goods after completing the work and
deliver in the manner and shape as desired by the customer. If the
contention of the applicant that labour component is a post sale transaction
is to be accepted, it requires a separate agreement outside the sale invoice
to prove that goods are initially sold on the basis of specific size or quantity
at a specific price and the customer already became owner of that property
sold by the applicant. In such a case, the question again would be whether
the post sale transaction is a works contract or a job work. In either case,
any damage to the property in question should be to the cost of the
customer but not to the applicant. However, the facts of the case and
explanation given by the applicant clearly indicate that the transaction is for
sale of end product and the intention between both the parties viz., the
seller and the buyer is only to transfer the end product in a particular shape
and manner. On account of this the total consideration charged in the
invoice becomes liable to tax.
JT.COMMISSIONER
To
M/s. Keekabhai Jeewaji,
5-2-992, N.S. Road,
Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT), Charminar Division.
Copy to the Commercial Tax Officer, Osmangunj Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Martand Trading Company (TIN No.28240157488), Malakpet,


following:
LIME STONE POWER QUARTZ POWDER

DOLOMITE POWDER CHALK POWDER
CALCITE POWDER STEATITE POWDER
SOAP STONE POWDER WHITE SHALL POWDER
CHINA CLAY POWDER WHITE CLAY POWDER
NATURAL RED OXIDE POWDER BARYTES POWDER
The case was posted for hearing on 28-06-2005. Sri Hitesh

Raythatha, Proprietor of the firm appeared and presented the case.
According to the applicant, all the items are natural minerals

converted into powder by pulverizing them. The applicant further explained
that these items are covered under Ores and Minerals specified in entry
No.43 of Schedule IV to the Act and taxable at 4%.
1 of 2
The issue in question is whether all the Ores and Minerals are
eligible for 4% tax even though only certain Tariff Codes are specified in the
HSN Codes notified by the Government. The nomenclature used in the
Schedule is “Ores and Minerals” and therefore, it cannot exclude certain
items of Minerals just because the corresponding HSN Code is not notified.
The next issue is whether Mineral as extracted from ground and converted
into powder form will continue to be identified as Mineral. It is found that
the identity or character of the Mineral is not lost just because it is
converted from rock to powder form, which is a physical process without
addition of any external substance.
In view of the above facts, the ruling is that all the items mentioned
in the application shall attract tax at 4% under entry 43 of Schedule IV to
the APVAT Act,2005 so long as no other substance is added to the natural
mineral while converting into the form of powder.
JT.COMMISSIONER
To
M/s. Martand Trading Company,
Plot No.35/1, Sripuram Colony, Malakpet,
Hyderabad-500 036.

Hyderabad.
Copy to the Commercial Tax Officer, Malakpet Circle.
2 of 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Suri Spares and Suppliers Pvt. Ltd., (TIN
1) Engine Bearings – suitable for :
b) Commercial & Light commercial vehicles

c) Cars & Jeeps
d) Industrial & Misc. Applications
e) Tractors
f) Stationery / Industrial engines
1 of page 3
2) Spare parts – suitable for
a) Industrial engines
b) Power generation equipment
c) Swaraj tractor engine
Sri K.Ramulu, Managing Director of the firm has appeared for

hearing on 29-6-2005 and explained the case.
is as under.
The applicant claims to be distributor for Kirloskar Oil
Engines Limited and purchases engine bearings suitable for
commercial and light vehicles, Cars and Jeeps, Tractors etc. The
applicant also claims to purchase spare parts for industrial engines,
power generation equipment and spare parts for tractor engines.
The rate of applicable to these items is as under:
1. Entry 10 of Schedule IV of the Act reads ‘bearings of all
kinds”. Goods under this Schedule are liable to tax @ 4%. In the
G.Os cited above, the HSN code applicable to the entry is 8482.
Under the code
2 of page 3
various types of bearings are listed. The entry also reads “bearings
of all kinds”. Therefore bearings of all kinds sold by the applicant
including that of tractors are held as liable to tax @ 4%.
2. Spare parts are not specified in any of the Schedules in the
Act. Therefore, they are held as liable to tax @ 12.5%. However,
Entry 63 of Schedule IV specifies Tractors, Attachments and parts
thereof. In the G.Os cited above the HSN codes for parts of Tractors
has been notified as falling under Schedule IV of the A.P.VAT Act.
Therefore, it is held that spare parts for Tractors are liable to tax @
4%.

To
M/s. Suri Spares & Suppliers Pvt. Ltd.,
148/1 & 2, R.P.Road,
Secunderabad – 500 003.
Copy to the Deputy Commissioner (CT), Secunderabad Division.
Copy to the Commercial Tax Officer, R.P.Road Circle.
3 of page 3

PROCEEDING OF THE
Present : Sri T.Yugandhra Reddy, Additional Commissioner (VAT)

Sri T.Vivek, Joint Commissioner (VAT)
Sri K.Raghavaiah, Joint Commissioner (Audit)
CCT’s Ref.No.PMT/P&L/A.R.Com/286/2005 Dt: 01-09-2005.

2005.
***
O R D E R:
M/s. Ishaan Starch Industries (TIN No.28310213002), Nalam Bhima

Raju Road, Rajahmundry have filed an application dt.19-08-2005 and
sought clarification and Advance Ruling on the following items under
Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT
Rules,2005 along with the application fee of Rs.1000/-. The application is
The applicant is seeking a clarification regarding the rate of tax on

tapioca, tapioca chips, tapioca flour and tapioca flour waste.
The case was posted for hearing on 23-08-2005. Sri T.

Suryanarayana, Authorised Representative appeared on behalf of the
applicant and explained the case.
The issue has been examined with reference to Entry 61 of Schedule

IV to the APVAT Act and the HSN Codes notified by the Government vide
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005.
The Government have notified different HSN Codes for the entry
“Starch and Sago” by the G.O. cited. The sub-item 6 in the HSN Codes for
entry 61 covers flour, meal and powder of dried leguminous vegetables
under heading 0713, or sago or of roots or tubers under heading 0714 or of
the products of sago and manioc (cassava) under heading 1106.20.10.
1 of 2
Therefore, the ruling is that the item mentioned by the applicant
i.e., tapioca, tapioca chips, tapioca flour and tapioca flour waste will
attract tax @ 4% under entry 61 of Schedule IV to the APVAT
Act,2005.
JT.COMMISSIONER
To
M/s. Ishaan Starch Industries,
8-2-38, Nalam Bhima Raju Road,
Rajahmundry.
Hyderabad.
Copy to the Deputy Commissioner (CT), Kakinada Division.
Copy to the Commercial Tax Officer, Rajahmundry Circle.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. L.G. Polymers India Private Ltd., (TIN No.2876016098), R.R.V.

Puram, Visakhapatnam have filed an application dt.04-08-2005 and sought
clarification and Advance Ruling on the following items under Section 67 of
the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along
with the application fee of Rs.1000/-. The application is examined and
found in order. Hence admitted.
The applicant is seeking a clarification regarding the adoption of 12

month period for the purpose of computation of base turnover to avail tax
incentives for the expanded production and turnover.
The case was posted for hearing on 28-08-2005. Sri A. Sarveswara

Row, Advocate and Authorised Representative appeared on behalf of the
According to the applicant he is availing tax holiday on the basis of
eligibility certificate issued which is effective from 10-10-1998 for a period
of 7 years. It was explained that the eligibility certificate was issued on 27-
03-2000 and the applicant could not avail tax holiday during the first year
i.e., from 10-10-1998 to 09-10-1999. The applicant cited a particular
Government Order where it is stipulated that the amount which could not
be availed during the first year can be adjusted against tax payable after
the completion of the eligibility period. The applicant, therefore, contends
that he can avail the benefit of tax incentives upto 09-10-2006. The
applicant is not seeking any ruling or clarification on this.
1 of 3
The applicant says that there was a dispute regarding adoption of 12

month period before the APVAT Act came into force on 01-04-2005 and the
request of the applicant to reckon 12 month period starting from 10th
October to 9th October of subsequent year instead of the financial year was
accepted by the Government and a Government Memo was issued vide
reference No.20966/CT-II(2)/2004-1, Dt.15-07-2004. The applicant is
seeking clarification whether:
i) the period as stipulated in Govt. Memo for computation of 12

month period holds good under the provisions of APVAT Act.
ii) the balance period as per provisions of sub-rule (1) of Rule 67 of

APVAT Rules can be 4 years ending on 09-10-2008.
After examining the facts of the case, the Government Memo in

question and the provisions of the APVAT Act and Rules, the ruling is given
as under:
(i) The provisions of APVAT Act and Rules,2005 do not

address the issue of computation of 12 month period for the
purpose of base turnover. However, the benefit of tax incentives,
the procedure relating to base turnover and claim for tax incentives
are generally stipulated by an administrative Government Order
which is binding on the dealer as well as the authorities of the tax
department. Therefore, the first issue of 12 month period to be
computed from 10th October to 9th October of subsequent year will
continue to hold good for calculation of base turnover and there
cannot be any change as a result of implementation of APVAT
Act,2005.
(ii) The second issue regarding the balance period available
to the applicant on the date of introduction of VAT from 1st
April,2005 is clarified as under:
Under sub-rule (1) of Rule 67 of APVAT Rules,2005 the

balance period available on 31-03-2005 shall be doubled. Therefore,
the applicant is having period available upto 09-10-2005 which
constitutes 6 months and 9 days and by doubling this, the period
will become 12 months and 18 days. The applicant therefore, shall
be eligible to claim the benefit of tax deferment for a period of 12
months and 18 days starting from 1st April,2005. However, the
computation of base turnover and 12 month period shall continue
on the basis of Government Memo issued earlier.
2 of 3
The claim of the applicant regarding eligibility upto 09-10-2006 on

account of non-availment of the incentives during the first year and
facility to adjust such tax of first year after the completion of the
eligibility period cannot be addressed by this authority. If a
particular Government Order allows such facility for the unavailed
amount of the first year to be adjusted against the tax payable after
09-10-2006, the applicant may have to approach the administrative
authorities to arrive at the eligible amount of the first year and to
adjust against the taxes actually payable after 09-10-2006.
JT.COMMISSIONER
To
M/s. L.G. Polymers India Pvt. Ltd.,
R.R.V. Puram,
Visakhapatnam.
Hyderabad.
Copy to the Deputy Commissioner (CT), Visakhapatnam Division.
Copy to the Commercial Tax Officer, Dwarakanagar Circle, Visakhapatnam.
3 of 3

PROCEEDING OF THE
Present : Sri T.Yugandhar Reddy, Additional Commissioner (VAT)

Dr. Sri K.Raghavaiah, Joint Commissioner (Audit)
Sri P. Satyanarayana Reddy, Joint Commissioner
(Enft)
CCT’s Ref.No./A.R.Com/133/2006 Dt:-1-11-2006
Ref: 1.CCT’S Ref.No.PMT/P&L/A.R.COM/2005, Dt:13-4-

05.
2. CCT’s Ref.No.PMT/P&L/A.R.Com/24/06,Dt.15.9.05
***
O R D E R:
M/s. Apollo Tyres Limited, Hyderabad have filed an application and
sought clarification and Advance Ruling under Section 67 of the APVAT Act,
2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with the
application fee of Rs.1000/-. The application is examined and found in
order. Hence admitted.
The case was posted for hearing on 31-10-2006. Sri K.Siva Kumar,
authorized representative of the firm appeared and explained the case.
They have also furnished certain documents at the time of hearing.
The applicant is seeking clarification regarding the amendment made
to sub rule (3) of Rule 16 of A.P.VAT Rules, 2005 by G.O.Ms.No.2201,
dt.29.12.2005. The issue has been examined. There are three questions
raised by the applicant, the clarification is given as under :
1. For all the invoices issued prior to 1st December, 2005, the applicant
is entitled to claim the benefit of reduction of VAT where credit notes are
issued against tax invoice for the discounts allowed to their customers
subsequent to issuing original tax invoice. Since the amendment to sub rule
(3) by addition of clause (f) is given effect 1.12.2005, the applicant will not
be eligible to reduce his sale price and consequently reduce his VAT liability
for all sales made after 1.12.2005, even though post sale discounts are
offered and credit notes are issued to the customers.
2. Where credit notes are passed subsequent to the amendment to
Rule 16 but the corresponding tax invoices, were raised prior to 1.12.2005,
the applicant can reduce VAT liability in his hands to the extent of postsale
discounts offered and credit notes issued in favour of their customers.
3. The question regarding application of the amended sub rule with
retrospective effect cannot be answered by us because the legality of the
amendment itself is questioned in a Writ petition before Hon’ble High Court
filed by Samsung India Limited. The applicant may therefore have to wait
for the decision in the writ petition before the Hon’ble High Court.
JT.COMMISSIONER
To
M/s. Apollo Tyres Limited,
3-5-45/4, Edenbagh Road, Ramkoti, Hyderabad – 500 001.

Hyderabad.
Copy to the Asst. Commissioner(LTU), Abids Divn.

PROCEEDING OF THE
(Enft)
CCT’s Ref.No./A.R.Com/117/2006 Dt:- 1-11-2006

05.
***
O R D E R:
M/s. I.V.R. Prime Urban Developers Limited, Hyderabad have filed
an application and sought clarification and Advance Ruling under Section 67
of the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along
The applicant is seeking clarification regarding payment of tax @ 1%
of the total consideration received at the time of execution of sale deed in
respect of the sale of apartments and houses as stipulated under clause (i)
of sub rule (4) of Rule 17 of A.P.VAT Rules, 2005.
The case was posted for hearing on 31-10-2006. Sri M.Ramachandra
Murthy, Chartered Accountant and authorized representative of the firm
appeared and explained the case. They have also furnished certain
documents at the time of hearing.
It was explained that the applicant is a Special Purpose Vehicle
Company (SPV) created by IVRCL Infrastructure Projects Limited
specifically for the purpose of development of National Games Village
Project in pursuance of the original agreement between Sports Authority of
A.P. (SAAP_, A.P.Industrial Infrastructure Corporation (APIAC0 and IVRCL
Infrastructure and Projects Limited (IVRCL) executed on 17th February
2001. The applicant stated that he cannot be compared with the builders
and contractors for the purpose of levy of tax under APVAT Act, 2005 since
the apartments and houses are not constructed in the pursuance of a prior
agreement with the prospective buyers. The applicant contended that
collection of 1% tax at the time of registration of apartments in favour of
the buyers is not legally correct because of the fact that no prior agreement
was entered into before the apartment or house was actually constructed.
They have also cited the decision of Hon’ble Supreme Court in the case of
Raheja Development Corporation Vs. State of Karnataka (141 STC 298). It
was also mentioned by them that IVRCL already paid a tax of Rs.3.28
crores in relation to this project from 2000-01 to 2006-07 under the
provisions of APGST Act, 1957 as well under AP.VAT Act, 2005.
The documents furnished by the applicant have been examined.
After hearing the arguments of the applicant and after examining the
documents the following facts emerged :
1) The original agreement for development of National Games Village
was entered into by IVRCL with SAAP and APIAC.
2) The land of 50 acres was earmarked for the project.
3) IVRCL was permitted to construct dwelling units with a built up area
of 13 lakh sq.ft. and after National Games are over, they were allowed to
sell them. A multi partite agreement was also signed recognizing and
accepting the creation of a Special Purpose Vehicle in the name of IVR
Prime Urban Developers Limited.
4) At the time of construction of the houses and apartments, there
were no individual buyers and these dwelling units were to be made
available to accommodate participants in the National Games and only
thereafter the developer was permitted to sell such units.
5) IVRCL was paying tax during the execution of the project under the
provisions of APGST Act and also under the provisions of A.P.VAT Act to the
extent of the value of the goods used in such construction.
6) It was stated by the applicant that IVRCL paid tax under Section 5F
of APGST Act, 1957 and under clause (c) of sub section (7) of Section 4 of
APVAT Act and an amount of Rs.3.8 crores is stated to have been paid
towards tax for the project.
Having gone into all the facts mentioned above, the clarification is
given as under :
i) In the latest judgement of Hon’ble A.P.High Court dt.12th October
2006 in the case of Larsen and Toubro Limited (Writ petition No.12124 of
2006) it was held that there cannot be two accretions of goods in works
contracts and consequently there cannot be two taxable events wherever a
contractor and an agent in the shape of sub contractor are involved in the
execution of the works contract and therefore, the tax cannot be imposed
once again if the transaction in question was already taxed either under the
provisions of APGST Act, 1957 or under the provisions of A.P.VAT Act,
2005.
ii) The Hon’ble Supreme Court held in the case of Raheja Development
Corporation Vs. State of Karnataka (141 STC 298) that if an agreement is
executed after the flat or dwelling unit is already constructed, it does not
amount to works contract. Therefore, the transaction in question appears
primafacie to be in the nature of sale of immovable property in case no
prior agreement was entered into with the prospective buyer upto the stage
of completion of entire construction of the dwelling unit.
iii) Tax collection @ 1% of the total consideration shown in the sale
deed being executed now cannot be insisted upon at the time of
registration of the property and the CTO concerned may issue a Certificate
to this effect to the Sub Registrar concerned.
iv) The Commercial Tax Officer concerned may examine the records
of the applicant as well as the records of IVRCL to ensure that no prior
agreements for sale of dwelling units are entered into with the prospective
buyers while the work was being executed for the National Games Village
and tax on the value of the goods used in the execution of the project was
already paid or is payable by or assessable in the hands of IVRCL under the
provisions of APGST Act or under the provisions of A.P.VAT Act, 2005.
JT.COMMISSIONER
To
M/s. IVR Prime Urban Developers Limited,
No.M022, 3RT, Vijayanagar Colony,

Hyderabad.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. I.V.R. Prime Urban Developers Limited, Hyderabad have filed
The applicant is seeking clarification regarding payment of tax @ 1%
of the total consideration received at the time of execution of sale deed in
respect of the sale of apartments and houses as stipulated under clause (i)
of sub rule (4) of Rule 17 of A.P.VAT Rules, 2005.
appeared and explained the case. They have also furnished certain
documents at the time of hearing.
It was explained that the applicant is a Special Purpose Vehicle
Company (SPV) created by IVRCL Infrastructure Projects Limited
specifically for the purpose of development of National Games Village
Project in pursuance of the original agreement between Sports Authority of
A.P. (SAAP_, A.P.Industrial Infrastructure Corporation (APIAC0 and IVRCL
Infrastructure and Projects Limited (IVRCL) executed on 17th February
2001. The applicant stated that he cannot be compared with the builders
and contractors for the purpose of levy of tax under APVAT Act, 2005 since
the apartments and houses are not constructed in the pursuance of a prior
agreement with the prospective buyers. The applicant contended that
collection of 1% tax at the time of registration of apartments in favour of
the buyers is not legally correct because of the fact that no prior agreement
was entered into before the apartment or house was actually constructed.
They have also cited the decision of Hon’ble Supreme Court in the case of
Raheja Development Corporation Vs. State of Karnataka (141 STC 298). It
was also mentioned by them that IVRCL already paid a tax of Rs.3.28
crores in relation to this project from 2000-01 to 2006-07 under the
provisions of APGST Act, 1957 as well under AP.VAT Act, 2005.
The documents furnished by the applicant have been examined.
After hearing the arguments of the applicant and after examining the
documents the following facts emerged :
1) The original agreement for development of National Games Village
was entered into by IVRCL with SAAP and APIAC.
2) The land of 50 acres was earmarked for the project.
3) IVRCL was permitted to construct dwelling units with a built up area
of 13 lakh sq.ft. and after National Games are over, they were allowed to
sell them. A multi partite agreement was also signed recognizing and
accepting the creation of a Special Purpose Vehicle in the name of IVR
Prime Urban Developers Limited.
4) At the time of construction of the houses and apartments, there
were no individual buyers and these dwelling units were to be made
available to accommodate participants in the National Games and only
thereafter the developer was permitted to sell such units.
5) IVRCL was paying tax during the execution of the project under the
provisions of APGST Act and also under the provisions of A.P.VAT Act to the
extent of the value of the goods used in such construction.
6) It was stated by the applicant that IVRCL paid tax under Section 5F
of APGST Act, 1957 and under clause (c) of sub section (7) of Section 4 of
APVAT Act and an amount of Rs.3.8 crores is stated to have been paid
towards tax for the project.
Having gone into all the facts mentioned above, the clarification is
given as under :
i) In the latest judgement of Hon’ble A.P.High Court dt.12th October
2006 in the case of Larsen and Toubro Limited (Writ petition No.12124 of
2006) it was held that there cannot be two accretions of goods in works
contracts and consequently there cannot be two taxable events wherever a
contractor and an agent in the shape of sub contractor are involved in the
execution of the works contract and therefore, the tax cannot be imposed
once again if the transaction in question was already taxed either under the
provisions of APGST Act, 1957 or under the provisions of A.P.VAT Act,
2005.
ii) The Hon’ble Supreme Court held in the case of Raheja Development
Corporation Vs. State of Karnataka (141 STC 298) that if an agreement is
executed after the flat or dwelling unit is already constructed, it does not
amount to works contract. Therefore, the transaction in question appears
primafacie to be in the nature of sale of immovable property in case no
prior agreement was entered into with the prospective buyer upto the stage
of completion of entire construction of the dwelling unit.
iii) Tax collection @ 1% of the total consideration shown in the sale

deed being executed now cannot be insisted upon at the time of
registration of the property and the CTO concerned may issue a Certificate
to this effect to the Sub Registrar concerned.
v) The Commercial Tax Officer concerned may examine the records
of the applicant as well as the records of IVRCL to ensure that no prior
agreements for sale of dwelling units are entered into with the prospective
buyers while the work was being executed for the National Games Village
and tax on the value of the goods used in the execution of the project was
already paid or is payable by or assessable in the hands of IVRCL under the
provisions of APGST Act or under the provisions of A.P.VAT Act, 2005.
JT.COMMISSIONER
To
M/s. IVR Prime Urban Developers Limited,
No.M022, 3RT, Vijayanagar Colony,

Hyderabad.

PROCEEDING OF THE

(Enft)
CCT’s Ref.No./A.R.Com/39/2006 Dt:-1-11-2006

05.
***
O R D E R:
M/s. Salvo Explosives and Chemicals (P) Limited, Nalgonda have
filed an application and sought clarification and Advance Ruling under
The applicant is seeking clarification on the following :
1. Goods vehicles purchased through tax invoice and used for the
purpose of carrying explosives manufactured by them are entitled for the
benefit of claiming input tax.
2. Whether Slurry explosives manufactured by them and used as
consumption in the execution of works contract would amount to sale under
AP. VAT Act, 2005.
3. Whether Detonating fuse, detonators, card relays used in carrying
out work are eligible for the benefit of input tax if such goods are purchased
through tax invoice.
4. Whether they can use C-Forms for purchasing explosives and
accessories from outside the State if such goods are to be used in carrying
out works contract.
5. Whether deployment of their vehicles on agreed hourly rental for
operation with their own driver and staff would attract VAT.
The case was posted for hearing on 31-10-2006. Sri K.Hanumanth

Rao authorized representative of the firm appeared and explained the case.
They have also furnished certain documents at the time of hearing.
The applicant also produced the relevant documents. After

examining the facts of the case, the following ruling is given as under :
1. Under the provisions of clause (a) of sub rule (2) of Rule 20 of

AP.VAT Rules, 2005 all automobiles including commercial vehicles are not
eligible for the purpose of claiming the benefit of input tax credit. Only
dealers of automobiles who purchase and sell are eligible to claim the
benefit of input tax credit.
2. The issue of levy of tax on explosives used for the purpose of

blasting needs to be examined and decided on the basis of specific terms in
the contract or agreement. If the contract or agreement stipulates that
certain quantum of explosives have to be necessarily used and such specific
quantities are removed from the premises of the applicant to the site with
specific reference to the customer, the value of turnover representing such
goods would necessarily attracts tax. There are well settled judgments on
this issue and there is no need for this authority to go into all such facts.
3. The eligibility of input tax credit with respect to the detonating fuse,
detonators, card relays etc. used in the execution of any work depends
upon whether the output is liable to tax or not. The applicant cannot say on
one hand that he can claim input tax credit but he is not liable to output
tax. If the value of the goods used in the execution of work is exigible to
tax, the benefit of input tax credit is also available under the provisions of
Section 13 of AP.VAT Act read with Rule 20 of AP.VAT Rules, 2005.
4. Regarding the eligibility to issue C-Forms, the same clarification

given in Item 3 holds good and if corresponding disposal of the goods
purchased by way of C-Forms is by way of sales including deemed sales,
there is eligibility for C-Forms.
5. Deployment of any vehicle on a rental basis needs to be examined

based on the facts of the specific agreement for the purpose of levy of tax
under sub section (8) of Section (4) of AP.VAT Act, 2005. The issues like
absolute possession and control during lease period have to be examined.
There are already well settled judgments of Courts on this issue and this
authority has no jurisdiction to issue any clarification in this regard.
JT.COMMISSIONER
To
M/s. Salvo Explosives and Chemicals Private Limited,
Sy.No.756, Ankireddypally Village,
Nalgond District.

Hyderabad.
Copy to the Commercial Tax Officer, Bhongir Circle.
PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Wood Stock, Hyderabad have filed an application and sought
clarification and Advance Ruling under Section 67 of the APVAT Act, 2005
read with Rule 66(2)(i) of APVAT Rules,2005 along with the application fee
of Rs.1000/-. The application is examined and found in order. Hence
admitted.
1. Whether he is required to pay tax on his purchases from
unregistered dealers in the State under the provisions of sub section (4) of
Section 4 of A.P.VAT Act if his outputs are sold within the State attracting
12.5% tax and also sold in the course of interstate trade and tax is payable
under the CST Act ?
2. Whether waybill is required to be used whenever he is procuring

rough saw dust from local saw mills / timber depots or carpentary
workshops whenever he is using his own drugs for the purpose of
transportation to his factory.
The case was posted for hearing on 31-10-2006. Sri K.Hanumantha
Rao, Advocate, authorized representative of the firm appeared and
explained the case.
The issue is examined and clarification is given as under :
1. The provisions of sub section (4) of Section 4 of A.P.VAT Act will be
attracted only when inputs are purchased from unregistered dealers and
corresponding outputs are disposed off other than by way of sale. In the
circumstances specified by the applicant his outputs are taxable either
under AP.VAT Act or under CST Act and therefore no tax is payable on the
purchases made from unregistered dealers.
2. Whenever any goods taxable under the provisions of A.P.VAT Act are
transported from one place to another, Rule 55 requires that a waybill
should accompany the goods in movement. In case the supplier of the
goods to the applicant cannot issue a waybill, the applicant can choose the
option of issuing his own waybills for the transportation of raw material to
his premises.
JT.COMMISSIONER
To
M/s. Wood Stock, D-35, Phase IV Extension,
IDA Jeedimetla, Hyderabad – 500 055.
Hyderabad.
Copy to the Deputy Commissioner (CT), Hyderabad (Rural) Division.
Copy to the Commercial Tax Officer, IDA Gandhinagar Circle.

PROCEEDING OF THE
Present : Sri T.Yugandhar Reddy, Addl.Commissioner (VAT)

CCT’s Ref.No.PMT/P&L/A.R.Com/22/2005 Dated 2-5-2005

Ref.CCT’S REF.NO.PMT/P&L/A.R.COM/2005, DATED 13-4-2005
***
O R D E R:
M/S Sri Viswanatha Traders., (TIN No.28190127840), 12-27-

104/A, 1st Floor, Seelomveri Street, Kothapeta, Guntur-I, have filed an
application on 23-4-2005 and sought clarification and Advance Ruling on
the following items under Section 67 of the APVAT Act, 2005. They also
enclosed an application fees of Rs.1000/-. The application is examined and
The case was posted for hearing on 30-4-2005
M.K.Viswanath Authorised signatory of the firm appeared on behalf of the
firm and presented the case. The issues raised by the dealers are examined
with reference to the provisions of the AP VAT Act and Rules and HSN
Codes notified by Government vide G.O.M.No.398, Revenue (CT-II)
Department, dt.31-3-2005 and G.O.Ms.No.490, Revenue (CT-II)
Department, dt.15-4-2005 and the ruling is as under.
Question :1 : Whether purchases of chillies on behalf of non-resident
principals for which purchase tax is paid under APGST Act could be
represented in Form VAT 115 as stock held as on 1-4-2005 for claiming
input tax credit or not?
Under Section 17(5) (e) of the AP VAT Act, every commission agent
carrying on the business of buying and selling on behalf of any non-
resident principal is a dealer under the AP VAT Act. Further under
Section 13(2)(a), of the AP VAT Act, a dealer registered as a VAT
dealer would be entitled to claim credit of sales tax paid under the
APGST Act on the closing stock held on 1-4-2005, provided such
goods are purchased between 1-4-2004 and 31-3-2005 and such
tax is eligible for input tax credit.
Question :2 : Whether export sales of chillies to territory outside India
falling under Section 5(1) and 5(3) of CST Act, 1956 are exempted from
payment of purchase tax or not?
For the purchase of chillies after 1-4-2005 ie., after the
commencement of AP VAT Act, 2005, made in pursuance of an
export order or with reference to contract of sale agreed upon with
foreign buyers for such transaction there is no liability of purchase
tax under Section 4 (4) of the AP VAT Act, 2005.
Question : 3 : Whether chillies and Chillies Powder are same commodity ?

Chilly is one kind of spices and the commodity “ spices “ is
enumerated in Entry 59 of the IV Schedule to the AP VAT Act. This
entry encompasses spices of all varieties and forms. The applicant
has to pay tax @ 4% on 0the sale price of Chilly powder if chillies
are purchased from non-VAT dealers. In the event of purchase of
chillies from a VAT dealer, the applicant can claim input tax credit.
Question : 4 : Whether trading of chillies in futures trading like NCDEX is
taxable ?
Since they are in the nature of securities such transactions are not
liable to tax unless selling or delivery dealer is a resident of A.P.
The transaction would be liable to VAT at the time of physical
delivery by the seller if delivered in A.P.
Question : 5 : Whether curry powder (ie., Masala Powders like Sambar
Powder, Rasam Powder, Mutton Masala, Chicken Masala etc.,) is taxable
under item 59 of IVth Schedule of the AP VAT Act, 2005 ?
Curry Powders are taxable @ 4% under 59 of the IV Schedule of the
AP VAT Act, 2005.
Question : 6 : That the VAT dealer sold chillies to dealers of outside the
state under the CST Act by raising invoices. However goods are kept in the
state of A.P. at the option of the buyer. In the circumstances, how to pay
tax and when to pay tax ?
The issue squarely falls under the CST Act and therefore outside the
purview of this Authority. Hence no Ruling is given.
Question : 7 : Whether chillies seeds are taxable @ 4% or 12.5% ?
In the light of Entry 59 of the IV Schedule and the HSN codes
notified in the G.Os, chilly is a spice and spices in all forms
constitute single commodity. Therefore, chilly seeds are liable to
tax @ 4%.
JT.COMMISSIONER
To
M/s Sri Viswanatha Traders,

12-27-104/A, 1st Floor Seelomvari Street, Kothapeta,
GUNTUR-1.

Hyderabad.
Copy to the Deputy Commissioner (CT),
Division.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Dynamic Techno Medicals Pvt. Ltd., (TIN No.2814014834),

Gandhi Nagar, Hyderabad have filed an application dt.19-05-2005 and
Rules,2005. The application is examined and found in order. Hence
admitted.
1) Whether “Aids & Implements used by Handicapped persons”

issued in G.O.Ms.No.919, Dt.08-11-2003 under APGST Act
rightly fall under Sl.2 of Ist Schedule to APVAT Act?
The case was posted for hearing on 23-05-2005. Sri M. Srinivas,
Authorised Signatory of the firm appeared on behalf of the firm and
presented the case.
The issues raised by the firm have been examined with reference to
Government vide G.O.Ms.No.398, Revenue (CT.II) Dept., Dt.31-03-2005
and G.O.Ms.No.490, Revenue (C T-II) Dept., Dt.15-04-2005 and the ruling
is given as under:
1 of 2
1) The “Aids and Implements” used by handicapped persons

are notified at Sl.No.2 against Entry 2 to the Ist Schedule
read with the HSN Codes notified against such entry by
the Government vide G.O.Ms.No.398, Revenue (CT.II)
Dept., Dt.31-03-2005 and G.O.Ms.No.490, Revenue (C T-
II) Dept., Dt.15-04-2005 which would alone fall under
Entry 2 of the Ist Schedule, liable for exemption. Other
goods not falling under the HSN Codes notified against the
Entry 2 of Ist Schedule are taxable @ 12.5% under Vth
Schedule. By G.O.Ms.No.919, Dt.08-11-2004 the
Government exempted sale of appliances mentioned in the
Annexure enclosed to the said G.O. for use by the
physically handicapped and mentally retarded persons
from the levy of sales tax under the APGST Act. Whereas
there is no specific and exclusive list notified with
reference to Entry 2 of the Ist Schedule except the
relevant HSN Codes notified by the Government.
JT.COMMISSIONER
To
M/s. Dynamic Techno Medicals Pvt. Ltd.,
1-4-879/41/B/1, New Bakaram, Gandhinagar,
Hyderabad.

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. K.S.Biyani & Company (TIN No.28810244963), Begumbazar,

Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with the
The applicant is seeking a clarification regarding the rate of tax on
Katha (Kasu).
The case was posted for hearing on 24-05-2005. Sri Omprakash,
Accountant appeared on behalf of the firm for the personal hearing and
explained that Katha is a product derived from wood bark which a forest
produce. The applicant is also produced certain documents like invoices
issued by the manufacturers, forest documents etc. He is also explained
that the item is notified in 4% category by certain states under VAT Acts.
The documents produced and also the sample product shown
by the applicant have been examined. It is found that the basic
material used by the manufacturer, The Indian Wood Products Co.
Ltd., Izatnagar, Bareilly is a forest produce but what is sold is
“Katha Paan Sugandh” which is a processed product. This product is
not included in any of the entries in the schedules to APVAT
Act,2005 or it is notified in the HSN Codes. The applicable HSN Code
is “4403.99.14” because its technical name khair wood with a
scientific name Acacia Catechu. This code not notified by the
Government of Andhra Pradesh for the list of the items in Schedule
IV taxable at 4%.
The ruling, therefore, given that the item “katha (kasu)” is
taxable at 12.5%.
JT.COMMISSIONER
To
M/s. K.S. Biyani & Company,
15-7-430/2, Begum Bazar,
Hyderabad.

Hyderabad.
Copy to the Commercial Tax Officer, Begum Bazar Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Kaiser India (TIN No.28640153336) Vijayawada have
filed an application dt.20.5.2005 and sought clarification and advance ruling
on the following items under Section 67 of APVAT Act, 2005 read with Rule
The rate of tax applicable to manually operated sprayers, power

operated sprayers, spare parts and accessories thereof.
Sri T.S.Prasad, Accountant of the firm has appeared for hearing on

1 of page 2
is given as under.
Entry 20 of Schedule IV of A.P.VAT Act refers to plant
protection equipment and accessories thereof. In the G.O. cited
above mechanical appliances under Entry 20 of Schedule IV of the
Act have been notified as falling under tariff sub heading
8424.20.00. As the items on which clarification is sought answer
the description of appliances such as spray guns and similar
appliances, it is held that the rate of tax applicable to these items is
4%.

To
M/s. Kaizer India,
D.No.33-21-33, Eluru Road,
Seetharampuram
Vijayawada.

Copy to the Deputy Commissioner (CT), Vijayawada-II Division.
Copy to the Commercial Tax Officer, Suryaraopet Circle.
2 of page 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Kala Jyothi Process Private Limited (TIN No.28370164985),

Musheerabad, Hyderabad have filed an application dt.23-05-2005 and
The applicant is seeking clarification on the following.
1. The applicant is printing books, periodicals and journals for the

customers who supply paper and ink. According to the applicant only
binding material with negligible value are transferred from their side to
customers side, whereas the chemicals, plates and film are utilized but not
transferred to their customers. The issue basically is where the transfer
constitutes a job work or a works contract. The applicant is asking whether
the transactions falls within the scope of Sub-section (7)(a) of Section 4 of
APVAT Act,2005 and if so 4% VAT can be charged only on the value of the
goods transferred to their customers.
2. The applicant is seeking a clarification on books, periodicals and journals

printed on behalf of their customers where material is not supplied by the
customers. The applicant is seeking a clarification whether exemption
available on sales of books, periodicals and journals is applicable of their
transactions. Alternatively the applicant is seeking a clarification whether
such transactions fall within the scope of Sub-section (7)(a) of Section 4 of
APVAT Act,2005 and if so 4% VAT can be charged on the value of the goods
involved. He is also seeking a clarification whether value of chemicals,
plates and film can be excluded for calculation of VAT.
3. The applicant is printing post cards, printed cards, calendars, posters

catalogues, inlay cards and other printed matter using his own material.
The applicant is seeking a clarification whether all these transactions fall
under Entry 47 of Schedule IV and whether 4% can be charged on the bill
amount.
4. The applicant is printing post cards, printed cards etc., as mentioned in

item 3 above with the paper supplied by his customers. The applicant is
seeking a clarification whether these transactions can be treated as works
contract and 4% VAT can be charged on the value of the goods transferred
to his customers.
The case was posted for hearing on 24-05-2005. Sri appeared on

behalf of the firm for the personal hearing and explained the full details of
the transactions involved.
After examination of the facts involved in the case with

reference to the provisions of APVAT Act,2005, the following ruling
is given.
1. Where any material is supplied by the customer and a

particular type of work is executed, the true nature of the
transaction to be treated as a job work or a works contract is to be
decided whether work is incidental or ancillary and it is a
predominant component with material value being insignificant. If
the transaction is a job work, it is exempted from tax but at the
same time no input tax credit will be allowed in respect of any
material used or consumed. To this extent, any tax paid capital
goods used is also not eligible for the benefit of input tax credit.
Conversely if the transaction falls within the scope of works
contract, the tax paid on the materials used or transferred will be
eligible for the benefit of input tax credit but the requirement is
that the value of the goods incorporated or transferred must not
less than the purchase value as specified under Sub-rule (1)(d) of
Rule 17 of APVAT Rules,2005 and the tax rates applicable for the
goods incorporated or transferred will be rates applicable for such
goods as specified in the Schedules to APVAT Act,2005. The
applicant will have two options viz., not opting for composition and
paying tax on the value of the goods transferred at the tax rates
applicable and claiming 90% of the input tax paid on purchase of
such goods used in such works. The second option could be
composition where 4% of 50% of the total amount build for such
transaction shall be payable without the benefit of input tax credit.
2. In respect of the transactions where entire material is

purchased by the applicant and used in the printing of books,
periodicals and journals, the benefit of exemption under Entry No.5
of Schedule I is not available to him because he is not the publisher
and seller of printed books, periodicals and journals. He is only
printing the material where the incidental property is not owned by
him. The benefit of exemption is only available to those publishers
or incidentally property owners who sell those journals and books.
The transaction in the hands of the applicant is in the true nature of
works contract and he will have 2 choices. The first choice could be
to opt for composition and pay 4% tax on 50% of the total amount
billed without taking the benefit of input tax credit. The other
option could be to charge and pay tax on the actual value of the
goods transferred at the tax rates applicable and claim input tax
credit to the extent of 90% for the purchases made from other VAT
dealers through proper tax invoices. Any material used or
consumed in the whole process will add value to the product which
is transferred. Therefore, the value of the goods transferred must
have value addition taking into account of other items indirectly
consumed in the whole process. The deductions from the total
amount build could be only as provided for under Sub-rule (1)(e)
and Rule 17 of APVAT Rules,2005.
3. Printing of post cards, printed cards, calendars, posters etc.,

and supplying them will fall under Entry No.47 of Schedule IV
taxable at 4%. The applicant can charge 4% VAT for these items
and he can also issue tax invoices if the customers are VAT dealers.
For these transactions the applicant can claim full benefit of input
tax if the purchases are made from VAT dealers through tax
invoices.
4. In respect of the post cards, printed cards, calendars etc.,

where paper is supplied by customers, the transactions clearly the
same as pecified in item 2 above and the same ruling given thee
under shall apply.
The applicant has choice to opt for composition in respect of

items 1,2 and 4 above for specific contracts or specific customers
by way of making an application in form VAT 250 and he shall not
claim any input tax credit for such transactions. For these
transactions, the purchases will become non-creditable purchases
as provided in box No.6 of form VAT 200 and correspondingly, 50%
of the consideration received in respect of composition contracts
shall be recorded in box No.12 of form VAT 200.
The ruling on the issues raised by the applicant is given as

stated above.
JT.COMMISSIONER
To
M/s. Kala Jyothi Process Private Ltd.,
1-1-60/5, R.T.C. Cross Roads, Musheerabad,

Hyderabad.

PROCEEDING OF THE

2005.
***
O R D E R:
M/S. Suresh Offset Printers (TIN No.28950248612), IDA Nacharam,

The applicant is seeking clarification and advance ruling on the
following.
1. Printing of cini wall posters and tax rate applicable.
2. Tax payment by way of composition of tax.
3. The tax rate to be charged and collected from customers for the two
items mentioned above.
The case was posted for hearing on 23-05-2005. Sri G. Laxmana
Rao, appeared on behalf of the firm for the personal hearing and sought
clarification on the above items.
The ruling is given as under:
1. Entry No.47 of Schedule IV to APVAT Act,2005 covers the
items specified by the applicant and therefore, the tax rate
applicable will be 4% as specified in the Schedule.
2. The transaction is purely a sale and therefore, the option
composition is not available.
3. The applicant can charge 4% VAT to his customers and he an
also issue tax invoices if the customers are VAT dealers. The
applicant can claim the benefit of input tax credit in respect of tax
paid on the purchases of inputs used if the purchases are made
from other VAT dealers through tax invoices.
The ruling on the issues raised by the applicant is given as
stated above.
JT.COMMISSIONER
To
M/s. Suresh Offset Printers,
Road No.12, Plot No.22, IDA Nacharam,

Hyderabad.

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. The Andhra Pradesh Dairy Development Cooperative Federation

Limited (TIN No.28660129053), Lalapet, Hyderabad have filed an
application dt.19-05-2005 and sought clarification and Advance Ruling on
the following items under Section 67 of the APVAT Act, 2005 read with Rule
66(2)(i) of APVAT Rules,2005 along with the application fee of Rs.1000/-.
The application is examined and found in order. Hence admitted.
The applicant is seeking clarification on the following issues.
1. APDDCF is marketing dairy products of District Milk Producers Union

within and outside the State of A.P. as an agent on behalf of Unions
(Principals). The Federation is issuing its own invoices and also collecting
the sale proceeds from their C&F Agents, stockists and dealers. The
Federation is deducting certain expenditure, paying taxes to Department
and issuing certificates to the Unions to enable them to claim exemption. A
clarification is sought regarding the procedure to be adopted and the tax of
the Principal and the Agent.
2. The applicant is also seeking clarification regarding input tax credit to be

claimed on all chemicals utilized for exempted and taxable turnover.
1 of 3
The case was posted for hearing on 24-05-2005. Sri M. Ramgopal,

General Manager (Marketing) appeared on behalf of the firm and explained
the procedure adopted by M/s. APDDCF regarding marketing the products
of District Milk Unions.
After careful examination of all the facts and statements

brone on the application and the provisions of APVAT Act and
Rules,2005, the following ruling is given.
(i) Under Sub-rule (2) of Rule 34 of APVAT Rules, every resident

principal selling any goods in the State through his agent has two
options.
(a) Supplying his own invoices to the Agent to be issued to

customer. Or
(b) Authorising the agent to issue agent’s invoices on his
behalf
with the seal and stamp of the principal. In such a case, the
principal must issue an authorization in form 522-A.
As explained during the course of the hearing, M/s. APDDCF

can maintain separate identity on the invoices issued by them on
behalf of each principal, collect the sale proceeds and pass on the
net proceeds after deducting the expenses but the tax payable on
such sales must be accounted for and paid by the resident principal
so as to enable him to claim the benefit of input tax credit.
However, M/s. APDDCF must maintain records in form 522
containing details of all the goods received and sold as prescribed
in clause (b) of sub-rule (2) of Rule 34.
The applicant also raised the issue of stocks transferred

outside the state and ‘F’ form obtained in the name of M/s. APDDCF
though the stocks actually belong to principals (Co-op Unions)
within A.P. As the issue falls outside the scope of APVAT Act,2005,
this authority cannot give any clarification on the matter.
The applicant has sought a clarification regarding the claim of

input tax credit on chemicals used for exempted and taxable
turnover.
2 of 3
The provisions of Rule 20 are very clear and a VAT dealer has
two options. The first option is claiming input tax credit on specific
inputs for specific outputs which are taxable. The other option is to
apply a formula AXB/C where common inputs are used in the
outputs exempted and outputs taxable. The applicant should furnish
an additional enclosure to VAT return in form 200-A to calculate
these adjustments of input tax credit and he should also make a
final adjustment in the return for the month of March for the 12
months period ending with March every year.
JT.COMMISSIONER
To
M/s. The Andhra Pradesh Dairy Development Cooperative Federation Ltd.,
Lalapet,

Hyderabad.
3 of 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Ch.Veeraju & Co., Rajahmundry (TIN No.28940212593)
Rs.1000/-.
The rate of tax applicable to Stone Ballast
The applicant submitted the following documents :
1. Copy of judgment in case of State of Maharastra Vs.Mahalaxmi
Stores.
Sri S.R.Ashok, Senior Advocate and Sri S.Chakrapani, Advocate on

behalf of the firm has appeared for hearing on 30-6-2005 and explained the
case.
is given as under.
The applicant claims to supply stone ballast to railway
contractors as well as others. In pursuit of the said business, the
applicant claims to reduce boulders into ballast and contends that
ballast falls under Item 43 of Schedule IV of the Act and seeks
confirmation to this effect. In support of the contention the
applicant relies on the trade circular of Commissioner of Sales Tax,
Maharastra wherein a clarification was issued regarding scope of
the word “minor minerals”. It states that boulders are ordinarily
obtained by extraction from the earth and that building stones,
boulders and gitti obtained from building stones and boulders fall
within the scope of minor minerals. In the decision of the Supreme
Court relied on by the applicant the question whether crushing
boulders into small size gitti amounts to manufacture was
considered. It was held that such process of converting stone
boulders into stone chips, gitti and stone ballast does not amount to
manufacture. In other words the applicant is trying to contend that
the substance and the ballast being the same as boulder and
boulder being mineral, it should fall under Item 43 of Schedule IV
of the Act.
In the G.Os cited above, the Government have notified the
items and the HSN codes for the items that fall under the entry. At
Sl.No.1 of the Entry 43 notified in the said G.Os, HSN code 2601 to
2617 are mentioned. Chapter 26 of the Central Excise Tariff adopted
for notifying the HSN code refers to ores, slag and ash and the
subsequent chapters refer to mineral fuels, mineral oils, inorganic
chemicals, organic or inorganic compounds of precious metals and
so on. The notified chapter codes do not mention stone boulders or
any of its forms in varying sizes and nomenclatures. We have
browsed the code further and found that stone boulders are
assigned the HSN code 2516.90.20. Assuming that ballast is not
different from stone boulder, it cannot be held as falling under
Entry 43 of the Schedule IV of the Act as the scope of the entry is
defined and explained by way of notifying the HSN codes. The code
under which stone boulders are stated to be falling not having been
notified, we hold that stone ballast is liable to tax @ 12.5%.

To
M/s. Ch.Veeraju & Co.,
D.No.24-14-5, R.V.Nagar,
Rajahmundry.


PROCEEDING OF THE


2005.
***
O R D E R:
M/s. G.R.Power Switchgeat Limited (Tin.No.28750194622),

Jeedimetla, Hyderabad have filed an application Dt.15-06-2005 and sought
for clarification and advance ruling on the following items under Section 67
of the APVAT Act, 2005 read with rule 66 (2) (i) of APVAT Act, 2005 along
found to be in order. Hence, admitted.
The applicant is seeking clarification as under :
To specify the applicable rate of VAT on 11 KV Vaccum Circuit

breakers.
The case was posted for hearing on 29-06-2005. Sri K.V.Rao, Manager,
Sales of the firm appeared on behalf of the firm and explained the case.
The applicant submitted the following documents.
1) Copy of the invoice bearing No.GST/02/05-06, dt. 26-4-2005.
The issue has been examined with reference to the provisions of the APVAT
Act
And Rules and HSN codes notified by the Government and the ruling is give
as under.
1 of 2
The applicant stated that the commodity 11 KV 3 Pole, 630A.50
HZ.20 KA Porcelain clad vaccum circuit breakers are excisable
goods under excise tariff code 8535-21-21. Under entry 39 of the IV
Schedule, HSN codes notifed for certain electronic goods do not
include the HSN Code 8535. Hence, they fall under residual entries
of V Schedule and liable to tax @ 12.5%.
JT.COMMISSIONER
To
M/s. G.R. Power Switchgear Limited,
“Kotamma Bhavan”, 27/B, IDA, IV Phase, Jeedimetla,
Hyderabad-500 055.

Hyderabad.
Copy to the Commercial Tax Officer, IDA, Gandhinagar Circle.
2 of 2

PROCEEDINGS OF THE
***
Dt.13.4.2005.
O R D E R:
M/s. Godrej Boyce Manufacturing Co. Limited (TIN
Rate of tax applicable to Bed Linens, Hand towels and Face towels
Sri J.Jayaram, Senior Officer, Finance of the firm has appeared for
1 of page 2
is given as under.
The applicant claims to bring Bed linens, Hand towels and
Face towels into the State from outside A.P. and effects sale. In the
G.Os cited Government notified the HSN codes and the rates
applicable to various items falling under exempt and 4% rate
category.
As the items in question do not fall under any of the entries
in the schedule they are held as liable to tax @ 12.5%, in
accordance with the language in Schedule V of the A.P.VAT Act,
2005.
To
M/s. Godrej Boyce Manufacturing Company Limited,

5-1-94 to 97, Lala 1 Land Mark,
M.G.Road, Secunderabad.

Copy to the Asst. Commissioner (LTU) Abids Division.
2 of page 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Keerthi Electronics, (Tin No..28150164960), Begum Bazar,

Hyderabad have filed an application Dt.20-06-2005 and sought for
clarification and advance ruling on the following items U/S.67 of the APVAT
Act, 2005 read with rule 66 (2) (i) of APVAT Act, 2005 along with the
application fee of Rs.1000/-. The application is examined and found to be in
order. Hence, admitted.
The clarification sought for is as follows :
Rate of tax applicable on commodities

a) Voltage Stabilizers &
b) T.V.Antenna
The case was posted for hearing on 29-06-2005. Sri B.K.Baheti, Advocate
along with Accountant appeared on behalf of the firm and explained the
case.

-NIL-
ACT
AND RULES and HSN codes notified by the Government and the ruling is
give as under.
1 of 2
1) Voltage stabilizers with HSN code 8504 fall under

I.T.products of entry 39 of the IV Schedule taxable @
4%.
2) Aerials, Antennas and other parts falling under HSN code
8529 are liable to tax @ 4% U/E.39 of the IV Schedule.

To
M/s. Keerthi Electronics,

14-5-11, Begum Bazar,
Hyderabad.
Copy submitted to the Deputy Commissioner (CT), Charminar Division.
Copy to the Commercial Tax Officer, Mehdipatnam Circle.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. R. Kantilal & co., ( Tin No.28540280474), Osmangunj,

Hyderabad have filed an application Dt.25-06-2005 and sought for
clarification and advance ruling on the following items under Section S.67 of
the APVAT Act, 2005 read with rule 66 (2) (i) of APVAT Act, 2005 along
The applicant is seeking clarification as under:
1) To clarify the rate of tax on playinf cards,
2) Whether the goods mentioned hereunder are exempted or

taxable, if so, at
what rate-- a) Rakhi, b) Kajal
3) What is the rate of tax on the goods -- a) Plastic Combs, b) Imitation

Jewellery,
c) Photo Albums
The case was posted for hearing on 28-06-2005. Sri Champalal Jain,
Proprietor and Sri Ganpath Raj, appeared and explained the case.
APVAT Act and Rules and HSN codes notified by the Government and the
ruling is as under.
1 of 2
1) In the entry 60 – Sports goods, HSN Code 9504 has

been notified.
Specific Code 9504.40.00 covers “playing cards”. Hence,
the rate of tax applicable is 4%.
2) Since the goods (a) Rakhi and (b) Kajaj are not included
in the IV
Schedule, they fall under V Schedule and liable to tax @
12.5%.
3) The rate of tax on the following goods is :

a) Plastic combs 12.5%
b) Imitation Jewellery 12.5%
c) Photo Albums 4% in view of the HSN Code
4820.50
notified under entry 25 of the IV
Schedule.
To
M/s. R. Kantilal & Company,

15-1-2, J.N. Road, Opp: Osmangunj,
Hyderabad-500 012.
Copy to the Commercial Tax Officer,Begumbazar Circle.
2 of 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Venkateswara Metal Company, Rajuhmundry (TIN
No.28220202917) have filed an application dt.22.5.2005 and sought
Copy of judgment in case of State of Maharastra Vs.Mahalaxmi Stores.

case.
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005and the ruling
is given as under.
of the Act.

To
M/s. Venkateswara Metal Company,
D.No.60-13-8, Ramdaspeta,
Rajahmundry.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Venkateswara Granite Metal Suppliers, Rajahmundry
(TIN No.28550155764) have filed an application dt.22.5.2005 and sought
1. Trade circular of Commissioner of Sales Tax, Maharastra.
2. Copy of judgment in case of State of Maharastra Vs.Mahalaxmi
Stores.

case.
is given as under.
of the Act.

To
M/s. Venkateswara Granite Metal Suppliers,
D.No.60-13-8, Ramdaspeta,
Rajahmundry.

PROCEEDINGS OF THE
Present: Sri T.Yugandhar Reddy, Addl.Commissioner(VAT)

***
Dt.13.4.2005.
O R D E R:
M/s. Kakatiya Cement Sugar & Industries Limited, (TIN

1. Whether they can claim input tax credit only on Cement division
purchases and on Cement division turnovers?
2. Whether input tax credit under Rule 20 of A.P.VAT Rules, 2005
shall be treated separately division-wise?
3. Whether the formula mentioned under Rule 20(6) & (7) be
applicable division-wise only?
4. Applicability of the said formula is unjust and unreasonable?
Sri A. Siva Sankar Reddy, General Manager (Finance) appeared on

behalf of the firm for hearing on 13-7-2005 and explained the case.
APVAT Act and Rules and the ruling is given as under:
1. Whether they can claim input tax credit only on Cement

division purchases and on Cement division turnovers?
The applicant is entitled to take input tax credit on all inputs pertaining to
taxable output irrespective of the fact that the output is coming out of
Cement division or other divisions. In cement division, the applicant is
entitled for full input tax credit on the following:
• Local sales of cement
• Inter-state sales of cement
• Exports
The applicant is eligible for restricted input tax credit on the exempted
transactions like branch transfers or consignment sales of cement. In such
exempt transactions, input tax credit can be availed for an amount of tax in
excess of 4% tax paid on inputs. If the applicant uses a common input for
both exempt transactions and taxable sale, then the input tax credit shall
be restricted by applying the formula A X B / C as envisaged under Rule 20.
In the sugar division, the applicant is entitled for full input tax credit in
respect of sales of taxable goods like molasses. The applicant is not entitled
for any input tax credit in respect of sales of exempt goods like Sugar. If
the applicant uses a common input for both exempt goods (Sugar) and
taxable goods (molasses), then the input tax credit shall be restricted by
applying the formula A X B / C as envisaged under Rule 20.
For the power division, no input tax credit can be allowed, as the entire
output is exempt.
2. Whether input tax credit under Rule 20 of A.P.VAT Rules,
2005 shall be treated separately division-wise?
As per sub section 5 of Section 13 to A.P.VAT Act, 2005; no input tax credit
shall be allowed on the following:
(a) Works contracts where the VAT dealer pays tax under the provisions of
clauses (b), (c) and (d) of sub section (7) of Section 4;
(b) Transfer of a business as a whole;
(c) Sale of exempted goods except when such goods are sold in the course
of export or exported outside the territory of India;
(d) Exempt sale;
(e) Transfer of exempted goods on consignment basis or to branches of the
VAT dealer outside the State otherwise than by way of sale;
(f) Supply of goods by the VAT dealer as mentioned in sub section (9) of
Section 4 of AP VAT Act.
Further, the procedure for availing input tax credit is given in Rule
20 to A.P.VAT Rules, 2005. Since the VAT dealer is eligible for input tax
credit for all his taxable activities, the dealer can follow sub rule 6 of Rule
20 of A.P.VAT Rules and can claim input tax credit separately for each
division for each tax period. Accordingly, it is clarified that the dealer is
eligible to apply formula to restrict his input tax credit for each and every
division separately. When common inputs relating to all divisions are used,
the input tax credit related to such common inputs should be subjected to
the formula stated above taking into consideration the total taxable
turnover and total exempt turnovers of all the divisions. For this purpose,
the taxable turnover and total turnover shall be the amounts that have
arisen using those common inputs. The examples for common inputs for all
divisions could be items used in office or for sales.
As per sub rule (6) of Rule 20 of A.P.VAT Rules where any VAT
dealer is able to establish that specific inputs are meant for specific outputs,
the input tax credit can be claimed separately for taxable goods. In the
instant case, in a particular division when such inputs are used in that
division only and the output is taxable and exempted, the restriction of
input tax credit relating to the formula can be applied in a particular month
with reference to turnovers of that division. This automatically implies
applying the formula separately for each division for each tax period and
the consolidated figures relating to specific inputs shown in Form VAT 200A
which is to be enclosed along with Form VAT 200. The VAT dealer is
required to follow this procedure continuously from April to March tax
periods and the adjustments in respect of March tax period are to be made
on the same lines and the adjustments should be furnished in Form VAT
200B to be enclosed along with Form VAT 200A and Form VAT 200 for the
month of March.
The applicant shall keep a monthly VAT account and in the VAT
return, he can report consolidated figures along with enclosure in Form VAT
200A every month and in Form VAT 200B every March.
3. Whether the formula mentioned under Rule 20(6) & (7) be
applicable division-wise only?
This is already clarified in the answer to query no.2. However, at the

cost of repetition, it is reiterated that the formula mentioned under Rule 20
(6) and Rule 20(7) shall be applicable division-wise only and the
consolidated figures shall be shown the Form VAT 200 A every tax period
and on Form VAT 200 B in tax period of March.
4. Applicability of the said formula is unjust and unreasonable?
It is the opinion of the applicant and no ruling can be given on this. This
authority cannot go into merits and demerits of the provisions in the Law
and Rules.
To
M/s. Kakatiya Cement Sugar & Industries Limited,
1-10-14/1, Gurukrupa,
Ashok Nagar, Hyderabad – 500 020.

Copy to the Asst Commissioner (CT) Intelligence, LTU, Secunderabd
division.
PROCEEDINGS OF THE
Present: Sri T.Yugandhar Reddy, Addl.Commissioner (VAT)

***
Ref: - CCT’s Ref.No.PMT/P&L/A.R.Com/2005, Dt.13.4.2005.
O R D E R:
M/s. Tide Water Oil Co. (I) Limited, (TIN No.28660128374) have
66(2)(i) of APVAT Rules, 2005 along with the application fee of Rs.1000/-.

1. Whether they can allow Trade discount in the VAT invoice itself?
2. Whether VAT is recoverable at their end for Free issues under
Trade scheme or not ?
3. Whether they can maintain invoice serial numbers as per their
operational convenience?
4. Whether their customers can claim input tax credit for the credit
notes received from the company on discounts / price variation
etc. ?
Sri R.Venugopal, Deputy Manager (Sales) appeared on behalf of the

firm for hearing on 20-7-2005 and explained the case.
5. Whether they can allow Trade discount in the VAT invoice itself?
The applicant is entitled to show the trade discount allowed in the

Tax Invoice itself and collect VAT on the net consideration i.e. VAT at
the applicable rate on the net amount (total consideration charged
minus the discount allowed). The discount allowed shall be in the
nature of normal trade discount. According to Sub-Rule 2 of Rule 16
of APVAT Rules, 2005 – all amounts allowed as discount shall not be
included for the purpose of determining taxable turnover provided
such discount is allowed in accordance with the regular practice of
the VAT dealer, or is in accordance with the terms of a contract or
agreement entered into in a particular case and provided also that
accounts show that the purchaser has paid only the sum originally
charged less the discount;
6. Whether VAT is recoverable at their end for Free issues under Trade
scheme or not?
Free issues are not taxable. Therefore, VAT need not be recovered
at the applicant’s end for free issues under trade scheme.
7. Whether they can maintain invoice serial numbers as per their

operational convenience?
The applicant has factories at Mumbai, Chennai, Silivassa etc, and

products manufactured there are transferred to Andhra Pradesh.
The provisions of AP VAT Act & AP VAT Rules’2005 do not govern
the maintenance of invoices at these locations, which are outside
the State of Andhra Pradesh.
Coming to raising of invoices in the State of AP and maintaining
serial numbers as per the operational convenience, the applicant
shall follow the provisions mentioned in Rule 26 and Rule 27 of AP
VAT Rules’2005. The applicant shall issue a tax invoice if the
products are sold to another VAT dealer and a normal invoice if the
products are sold to a non-VAT dealer. The tax invoice shall bear a
serial number that is either printed or computer generated and date
on which it is issued. The applicant can maintain more than one set
of serial numbers of tax invoice provided there is a relation
between the serial numbers. For example, if the applicant is issuing
invoices from two locations or offices, the serial number of the tax
invoice can start with the location code followed by the number and
date. The same structure shall be followed at the other location.
8. Whether their customers can claim input tax credit for the credit
notes received from the company on discounts / price variation etc.?
The customers of the applicant on receiving the credit note from the
applicant on discounts / price variation can not claim input tax credit
on the tax amounts mentioned in the credit notes. On the other hand,
they shall reduce input tax credit by such tax amounts in the tax
return for the tax period during which the credit notes are received.
To
M/s. Tide Water Oil Co. (I) Limited,

54-15-1/1, Yellamanchili Complex,
Near Layola College,
Vijayawada– 520008.
Copy to the Assistant Commissioner (CT) Intelligence, LTU,

Vijayawada division.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. C.R.I. Pumps (Pvt) Limited (TIN No.28370125797), Ghasmandi,

Secunderabad have filed an application dt.20-08-2005 and sought
The rate of tax on.-

1) Starters.
2) Starter spares.
3) Electric Motors.
4) Electric Motor Spares.
The case was posted for hearing on 31-08-2005. Sri J. Chandra

Sekher, Assistant Manager appeared on behalf of the firm and explained
the case.
The entries in the schedules and the HSN Codes notified by the
2005 and G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005
have been examined.
1) The item “starters” is notified under HSN Code 8536 for the sub-
item 21 of Entry 39 in Schedule-IV to the Act. Therefore, the rate of
tax shall be 4%.
1 of 2
2) Starter Spares: Starter spares are not covered under HSN Code
8536 but they are covered under HSN Code 8538 which is not
notified by the Government. Therefore, the tax rate shall be @
12.5%, since these items are not covered under Schedules I, II, III,
IV and VI.
3) Electric Motors: Electric Motors are covered under HSN Code

8501 which is notified by the Government against sub-item 5 of
Entry No.39 of Schedule IV to the Act. Therefore, the rate of tax on
electric motors shall be 4%.
4) Electic Motors Spares: As regards the spares of electric motors,
the sub-item 6 of Entry 39 in Schedule IV to the APVAT Act,2005
deals with parts of HSN Code 8501 and a specific HSN Code of 8505
is notified by the Government for this sub-item which deals with
parts of electrical motors. Therefore, the rate of tax shall be 4%.
The Government have since made amendments to certain

entries in the schedules to the APVAT Act,2005 vide
G.O.Ms.No.1564, Dt.17-08-2005 and it is found that some changes
have been made to the Entry No.17 of Schedule IV to the Act by
incorporating “electric motors and oil engines upto a capacity of 10
H.P”. This change is notified as coming into effect from the date of
Gazette publication which is 18-08-2005. Therefore, the rate of 4%
for electric motors shall be applicable in respect of electric motors
upto a capacity of 10 H.P. from 18-08-2005, whereas the rate shall
continue to be 4% on starters and spare parts of starters.
JT.COMMISSIONER
To
M/s. C.R.I. Pumps (Pvt) Limited,
5-1-527, 4-Hill Street, Ghasmandi,

Hyderabad.
Copy to the Deputy Commissioner (CT), Begumpet Division.
Copy to the Commercial Tax Officer, Ranigunj Circle.
2 of 2

PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/266 /2005 DT.2-9-2005
Ref:- CCT’s Ref.No.PMT/P&L/A.R.Com/2005, Dt.13.4.2005
O R D E R:
M/s. Chitra Engineering Corporations, Santhoshnagar, Hyderabad

(TIN No.28650225439) have filed an application dt 09.08.2005 and sought
Rate of tax to be deducted at source for the contracts executed for

Central Government Departments.
Sri P.Sekhar, S.T.P, Authorised Representative appeared for hearing

APVAT Act and Rules.
The applicant claims that he executes works contract for
Central Government Departments and seeks to know the rate of tax
to be deducted at source while being paid for the work by the
contractee. According to Sec.22(4) read with Rule 18(a) tax at the
rate of 2% shall be deducted at source in respect of contracts
executed for Departments other than State Governments or Local
Authorities. Since the applicant claims to execute contracts entirely
for Central Government Departments, TDS applicable is 2% on the
contract amount upto 28.9.2005.
The Govt. have since amended the provisions relating to

works contract. As per the amended provision [Sec.22(4)] in
Ordinance 38 dt.29.8.2005 tax @ 4% shall be deducted at source.
Rule 18(a) has also been amended in G.O.1634 dt.31.8.2005 to that
effect. Accordingly, tax @ 4% shall be deducted by the contractee
awarding the contract.

To
M/s Chitra Engineering Corporation,
9-7-12/1, Yadagiri Nagar, Opp. Santhosh Nagar
HYDERABAD– 500 059.

Copy to the Deputy Commissioner (CT), Saroor Nagar Division.
Copy to the Commercial Tax Officer, Saroor Nagar Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Controller of Stores, Rail Nilayam, Hyderabad have filed an

application on 15.07.2005 and sought clarification and advance ruling on
the following items under Section 67 of APVAT Act, 2005 read with Rule
i) Whether transportation charges and forwarding charges incurred
by the applicant prior to sale are to be reckoned for the purpose
of calculation of VAT.
ii) Whether the applicant can amend the terms of contract entered
into with the suppliers prior to 1.4.2005 for supply of materials
against Form-N in view of the new VAT Act.
iii) The rate of tax applicable to various types of scrap sold by the
applicant.
i) Copies of delivery order issued by the applicant.

ii) Copy of terms and conditions of public auction sale.
Sri M.D.Prasad, Stores Department, appeared on behalf of the firm

is given as under.
The applicant is a branch of railway and registered separately
as a VAT dealer. The applicant is engaged in purchase of materials
for operation and maintenance requirements and also effects sale
of all condemned and scrap material, which are either obsolete or
no longer required for the railways.
The applicant seeks to know whether freight / transportation

charges and forwarding charges are to be loaded for calculation of
VAT. The contention of the applicant that these components are
presale expenditures and would like to know whether they should
be reckoned for the purpose of calculation of VAT. As these
components go into purchase value, which forms the basis for
determining the sale consideration by the applicant, it shall be
necessary for the applicant to reckon these components and
accordingly calculate VAT on the sale consideration.
As regards the necessity of the applicant to amend the terms

of contract entered into with the suppliers prior to introduction of
VAT and to supply Form-N against such purchases, it is clarified
that consequent to introduction of A.P.VAT Act, 2005, the
Government order relating to supply of Form-N and concessional
rate of tax @ 4% issued under APGST Act stands rescinded. The
applicant is therefore advised to follow the provisions of A.P.VAT
Act, 2005.
As regards the rate of tax applicable to different types of

scrap material the applicant had listed 45 different types of scrap
material on the application. Majority of the items are ferrous scrap;
some are scrap of plastic, glass, wood, rubber, paper, coconut coir
etc. The list also includes sale of waste oil. Perusal of delivery order
issued by the applicant on conclusion of the auction gives a
description of various items sold by the applicant as scrap only.
Thus broadly speaking the applicant is effecting sale of metallic and
non-metallic scrap. It is therefore clarified that all scrap of metallic
nature are liable to tax @ 4% and non-metallic are liable to tax at
the rates applicable to the goods in accordance with the entries in
Schedule of the Act.
To
M/s. Controller of Stores,

VIth Floor, Rail Nilayam,
South Central Railway,

Copy to the Deputy Commissioner (CT), Division

PROCEEDINGS OF THE

***
O R D E R:
M/s. D.C.S.Trading & Services Private Limited, Hyderabad (TIN

No.28960193160) have filed an application dt 19.08.2005 and sought
Rate of tax applicable for the product “Dual-Carbide-Insert motor

grader blades / Cutting edges (Insert made of Tungsten powder).
The applicant submitted the following documents:
1. Product literature
2. Purchase order placed on the applicant by The Singareni
Collieries Company Limited
3. Import documents
Sri M.V.Krishna, Chartered Accountant, appeared on behalf of the
is given as under.
The applicant claims to import Dual-Carbide-Insert motor

grader blades / Cutting edges (Insert made of Tungsten powder)
from other countries and sells the same in the local market i.e., A.P.
and seeks to know the rate of tax applicable to the product. Besides
the product literature the applicant also filed import documents
which among other things include Bill of entry issued by the New
Custom House, Mumbai. This document contains the customs tariff
8431.49.90 as the applicable code for the product for which the
applicant is now seeking a ruling regarding the VAT rate applicable.
In the G.Os cited above this code has not been notified.
Having regard to the documentary evidence and the language

in Schedule V of the A.P.VAT ct, 2005, we hold that this product is
liable to tax @ 12.5%.
To
M/s. DCS Trading & Services Private Limited,
H.No.8-3-678/42/C/5, Santhosh Manor,
Navodaya Colony,Yellareddy Guda, Hyderabad – 500 073.

Copy to the Commercial Tax Officer, Hyderguda Circle.

COMMERCIAL TAXES DEPARTMENT.
PROCEEDINGS OF THE
(Under Section 67 of APVAT Act, 20050
Present: Sri T. Yugandhar Reddy, Addl.Commissioner(VAT)

Sri T. Vivek, Jt.Commissioner (VAT)
Sri K. Raghavaiah, Jt. Commissioner(Audit)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/116/2005. Dated 2-09-2005.
Ref:- CCT’s.Ref.No: PMT/P&L/A.R.Com/2005, Dated 13-04-2005.
O R D E R:
M/s. JASMINE BIOLOGICALS PVT.LTD.,(TIN.28120161954)have filed

an application Dated 1-7-2005 and sought clarification and advance ruling
66(2)(i) of APVAT Rules, 2005 along with the application fee of Rs.1,000/-
Whether plant extract i.e. biofertilizer imported from China and sold
to local dealers is exempt from VAT or not ?

Xerox copies of--
1. Invoice issued by Beijing Kingbo Biotech Co.Ltd., China in favour
of the applicant
2. Bill of entry
3. Certification of origin
4. Copy of invoice issued by the applicant for sale of Exodus (bio-
fertilizers)
5. Analysis report for plant extract (bio-fertilizer)
Mr. A.S.N.Murthy, A.S., appeared for hearing on 8-6-2005 and explained

the case.
G.O.Ms.No:398, Revenue (CT.II) Department Dated 31-03-2005 and
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005 as
superceded in G.O.Ms.No.1615 Revenue (CT.II) Department, dt.31.8.2005
and G.O.Ms.No.1596 Revenue (CT.II) Department dt.27.8.2005 and the
ruling is given as under:
The applicant imported plant extract i.e.biofertilizer from China and

sold in the State of A.P. The documents produced show that the
commodity ‘plant extract’ is covered under HSN Code 3101.00.99 as
seen from the Bill of Entry. By consuming raw material imported,
they made exodus (bio-fertilizers) and sold in the local market.
In the G.Os.referred supra, the Government have notified HSN

Code 3101 under entry 26-Organic manure,not liable to tax but
exempt under 1st schedule to the APVAT Act.
However, by an amendment made,by G.O.Ms.No.1596 Revenue

(CT.II) dt.27-8-2005 entry 19 of the IVth schedule has been
substituted, wherein ‘bio-fertilizers’ also are brought into entry 19
of the IV schedule liable to VAT @ 4%.
Therefore, biofertilizers are exempt under entry 26 of the 1st

schedule from VAT whereas taxable @ 4% w.e.f. 27-8-2005 under
entry 19 of the IVth schedule.
Addl.Commissioner Jt.Commissioner Jt. Commissioner.
NOTE:- An appeal against this proceedings can be filed before the Sales
Tax Appellate Tribunal, A.P. Hyderabad within 30 days of this
ruling.
To
M/s. JASMINE BIOLOGICALS PVT.LTD.

RED HILLS, HYDERABAD.
Copy submitted to the Commissioner of Commercial Taxes, A.P. Hyderabad

Copy to the Deputy Commissioner(CT) ______________ Division.
Copy to the Commercial Tax Officer,_____________ Circle.

PROCEEDING OF THE

2005.
***
O R D E R:
M/s. Nitya Sai Chemicals (P) Ltd., (TIN No.28350108079), Dasapalla

Hills, Visakhapatnam have filed an application dt.05-07-2005 and sought
Applicability of tax rate on “coal tar” and whether the item can be
interpreted as covered under Entry 69 of Schedule IV to the APVAT Act.

Row, Advocate and Authorised Representative aoppeared on behalf of the
and explained the case.
The applicant explained that “coal tar” is being purchased for use as
a raw-material to manufacture “coal tar pitch”. According to the applicant
the supplier is charging 12.5% on the sale value of coal tar. The applicant
feels that Entry 69 dealing with “coal including coke in all its forms but
excluding charcoal” should cover coal tar.
The matter has been examined with reference to Entry 69 of

Schedule IV to the Act and the HSN Codes notified by the Government for
the Entry 69 vide G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-
2005 and G.O.Ms.No.490,
1 of 2
Revenue (CT.II) Department, Dt.15-04-2005. The Government have
notified HSN Codes 2701, 2704, 2713.11 and 2713.12 for Entry 69. The
examination of the HSN Tariff Codes revealed that the applicable tariff code
for coal tar is “2706.00.10”, which is not notified by the Government.
The ruling is therefore, given that coal tar is not covered in

Schedule-I, Schedule-III, Schedule-IV or Schedule-VI and therefore
it falls within the scope of Schedule-V to the APVAT Act,2005 and
the applicable tax rate shall be 12.5%.
JT.COMMISSIONER
To
M/s. Nitya Sai Chemicals (P) Ltd.,
Plot No.14, Dasapalla Hills,
Visakhapatnam.

Hyderabad.
Copy to the Commercial Tax Officer, China Waltair Circle, Visakhapatnam.
2 of 2

PROCEEDINGS OF THE
*****
O R D E R:
M/s. PASURA BIOTECH PVT.LTD.L.B.NAGAR, HYDERABAD

(TIN.28080197716)have filed an application Dated 1-7-2005 and sought
APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with
the application fee of Rs.1,000/-

Whether plant extract (Soya) purchased from other states and sold
to local dealers as Biospark SL is exempt from VAT or not ?
Xerox copies of--
5. Invoice issued by Vivaswam Bio Pharmaceuticals, Dombivli,
Maharastra in favour of the applicant
6. Invoice raised by the applicant showing the sales of ‘Biospark SL’

the case.
superceded in G.O.Ms.No.1615 Revenue (CT.II) Department, Dt.31.8.2005
and G.O.Ms.No.1596 Revenue (CT.II) Department, dt.27.8.2005 and the
The applicant purchased plant extract (Soya) from the dealers of
other States of A.P. The documents produced show that the
commodity ‘plant extract’ (Soya) don’t contain any HSN code. It is
used as raw material for making of their product, ‘biospark’ SL.
Code 3101 under entry 26-Organic manure,not liable to tax but
exempt under 1st schedule to the APVAT Act. “Biospark SL’, sold by
the applicant if it encompasses into ‘Bio-fertilizer, it is liable for
exemption upto 26.8.2005.
However, by an amendment made, by G.O.Ms.No.1596 Revenue
substituted, wherein bio-fertilizers also are brought into entry 19 of
the IV schedule liable to VAT @ 4%.
Therefore, ‘biofertilizers’ are exempt under Entry 26 of the 1st
schedule from VAT upto 26.8.2005 whereas taxable @ 4% w.e.f. 27-
8-2005 under entry 19 of the IVth schedule.

ruling.
To
M/s. PASURA BIOTECH PVT.LTD., L.B.NAGAR, HYDERABAD.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. PASURA LIFE SCIENCES PRIVATE LIMITED, CHARLAPALLI,
R.R.DISTRICT (TIN.28250252968)have filed an application Dated 1-7-2005
and sought clarification and advance ruling on the following items under
Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,
2005 along with the application fee of Rs.1,000/-

Whether plant extract (Soya) purchased from dealers of other states
and sold to local dealers biospark SP is exempt from VAT or not ?
Xerox copies of --
7. Invoice issued by Vivaswan biopharmaceuticals in favour of the
applicant.
8. Invoice revised by the applicant showing the sale of biospark
SP/SR.

the case.
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005 and the
The applicant purchased plant extract (Soya) from the dealers of
outside the State and sold in the State of A.P. The documents
produced show that the commodity ‘plant extract’ (Soya) don’t
contain any HSN code. It is used as raw material for making of their
product, biospark SP (SR etc).
Code 3101 under entry 26-Organic manure, not liable to tax but
exempt under 1st schedule to the APVAT Act. ‘Biospark SP/SR’ sold
by the applicant if it encompasses into ‘biofertilizer’, it is liable for
exemption upto 26.8.05.
Therefore, biofertilizers are exempt under entry 26 of the 1st
ruling.
To
M/s. PASURA LIFE SCIENCES PRIVATE LIMITED, CHARLAPALLI,
R.R.DISTRICT

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Peace India Limited, Hyderabad (TIN No.28370180796) have
Rate of tax applicable to Printed envelopes covers.
The applicant submitted the following document.

Samples of items produced by the applicant.
Sri N.Venkata Ratnam, Managing Director appeared on behalf of the
is given as under.
The applicant states that he has a small scale industry and
planning to make envelopes of printed and plain variety for sales in
the open market. The applicant intends to buy paper from the paper
mills and will produce printed envelopes and plain envelopes. In the
circumstances, he seeks to know rate of tax applicable to the item
purchased by him.
Entry 25 of Schedule IV of the A.P.VAT Act, 2005 reads
“Exercise note books including Graph books and laboratory note
books, office stationery including computer stationery, writing pads
and account ledgers”. As seen from the entry, among other things,
office stationery is also mentioned. Samples produced by the
applicant conform to the description of office stationery appearing
in the entry. Therefore, we hold that items on which the applicant
sought ruling attract 4% VAT in accordance with the Entry 25 of
Schedule IV of the Act.

To
M/s. Peace India Limited,
H.No.1-55/4, Kondapur Village,
R.R.District. Hyderabad – 500 032.

Copy to the Commercial Tax Officer, Madhapur Circle.

PROCEEDINGS OF THE
*****
O R D E R:
M/s. SAI AGRI BIOTECH, KHAMMAM(TIN.28470210216) have filed


Whether plant extract i.e. biofertilizer imported from China and sold
to local dealers is exempt from VAT or not ?
Xerox copies of
9. Invoice issued by Beijing Kingbo Biotech Co.Ltd., China in favour
of the applicant
10. Bill of entry
11. Packing list
12. Cargo Transportation Insurance Policy
5. Analysis report for plant extract (bio-fertilizer)

the case.
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005 and as
and G.O.Ms.No.1596 Revenue (CT.II) Department dt.27.8.2005 the ruling
is given as under:
The applicant imported plant extract i.e.biofertilizer from China and
sold in the state of A.P. The documents produced show that the
commodity ‘plant extract’ is covered under HSN Code 3101.00.99 as
seen from the Bill of Entry.

Code 3101 under entry 26-Organic manure, not liable to tax but
exempt under 1st schedule to the APVAT Act.

Therefore, biofertilizers are exempt under Entry 26 of the 1st

ruling.
To
M/s. SAI AGRI BIOTECH,

KHAMMAM.


PROCEEDINGS OF THE

*****
O R D E R:
M/s. SHREE SHYAM ENTERPRISES, HYDERABAD(TIN.28680172573)

have filed an application Dated 13-7-2005 and sought clarification and
advance ruling on the following items under Section 67 of APVAT Act, 2005
read with Rule 66(2)(i) of APVAT Rules, 2005 along with the application fee
of Rs.1,000/-

Rate of tax on Scrapped / Used / Old / Broken refractory bricks
The applicant submitted the following documents:-
Copies of tax invoices issued by the Sellers.
Sri Mahesh Agarwal, Proprietor appeared for hearing on 24-8-2005

Documents submitted by the applicant reveals that they have

been purchasing (1) refractory bricks burnt-imported (2) Worn-out
alumina bricks (3) Worn-out / used mag-chrome bricks from
various industries and selling to other dealers. As seen from the
sale invoices issued by the applicant, they have sold “used fire
bricks alumina” and “used refractory fire bricks high Alumina”.
Entry 3 of the IVth Schedule enumerates. All kinds of bricks
including fly ask bricks, refractory bricks. Therefore, used refractory
bricks / used and worn-out firebricks alumina fall under the said
entry and liable to VAT @ 4%.
ruling.
To
M/s. SHREE SHYAM ENTERPRISES,
HYDERABAD.
Copy to the Deputy Commissioner(CT), Abids Division

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Tab Engineering Works, Jeedimetla, Hyderabad (TIN
1. A.B.Switches [(11Kv to 33Kv), (11000 Volts to 33000 Volts)]
2. H.G.Fuse sets
3. H.T. & line materials (11000v to 33000v)

Copy of declaration submitted by the applicant to the central excise to the
department under Rule 173B showing excise tariff applicable to the items
stated above.
Sri A.Hussain, Accountant appeared on behalf of the firm for hearing
is given as under.
The applicant claims that he is a manufacturer of A.B.
Switches and H.G. fuse sets and fabricated H.G. and H.T. line
materials. The applicant seeks to know the rate of tax applicable to
the said items in the light of the provisions in the A.P.VAT Act,
2005. The documentary evidence submitted by the applicant shows
that A.B.Switches and H.T. fuse sets (11 Kv to 33 Kv) fall under
excise code 8535.00. However, Transmission tower line upto 400 Kv
is shown as attracting HSN code 7308.90. In the G.O. cited above
HSN code 8535 has not been notified. Therefore, in terms of the
language under Schedule V of the Act, A.B.Switches and H.G. fuse
sets are held as liable to tax @ 12.5%.
As regards H.T.line material, the HSN code 7308.20.11 has

been notified in the G.Os cited above under Entry 64 of Schedule IV
of A.P.VAT Act. The entry refers to transmission towers line. Items
listed under Schedule IV are liable to tax @ 4%. Therefore, we hold
that H.T and line materials squarely fall under Entry 64 of Schedule
IV of the Act and therefore liable to tax @ 4%.

To
M/s. Tab Engineering Works,
Plot No.28/A, Phase IV, I.D.A.,
Jeedimetla, Hyderabd – 500 066.

Copy to the Deputy Commissioner (CT), Hyderabad(Rural) Division.
Copy to the Commercial Tax Officer, Jeedimetla Circle.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. The Andhra Petro Chemicals Ltd, (TIN No.28420194827) have

filed an application Dated 9-6-2005 and sought clarification and advance
Rule 66(2)(i) of APVAT Rules, 2005 along with the application fee of
Rs.1,000/-

Refund of excess ITC under VAT Act w.e.f.1-4-2005.
The applicant submitted the following documents:-

Copies of returns in Form VAT 2000, Form-VI (CST) for the month of 4/05.
Sri K.A.Prasad, G.M.Finance, appeared for hearing on 29/8/05 and

explained the case.
The applicant states that he purchases petro chemicals such as

Naptha, LSHS etc., from HPCL by paying VAT @ 12.5%. They manufacture
oxo- alcohol and sell outside the State of A.P., by paying @ 4% as out put
tax. Thus they are accumulating the input tax as the rate of tax on inputs
@ 12.5% as against output rate of 4% under the CST Act. They request for
a clarification and order for issue of refunds atleast on quarterly basis.
The issue on hand has been examined with reference to the facts
and the provisions of Act. Under Section 15 of the APVAT Act, the State
Government has the power to grant refund of tax. Therefore, this Authority
is not empowered to issue a clarification or order modifying grant of
refunds.
Accordingly, the application is disposed of.

ruling.
To
M/s. The Andhra Petro Chemicals Ltd,
Venkatarayapuram, West Godavari District.

Copy to the Deputy Commissioner(CT), Eluru Division.
Copy to the Assistant Commissioner (CT) (LTU) Eluru Division.
PROCEEDING OF THE


2005.
***
O R D E R:
M/s. The Synergy Associates (TIN No.28070215338), Kukatpalli,

1) Rate of tax on product “C-9”.

2) Entry Tax applicability.
3) Input tax credit applicability.
The case was posted for hearing on 23-08-2005. Sri S. Srinivas

Chowdary, Partner appeared on behalf of the firm and explained the case.
1) The applicant produced a copy of the invoice issued by M/s.

Reliance Industries Ltd., in respect of the product “C-9” and from
the invoice, the tariff code applicable to the product is seen as
2710.19.90. After examining the entries in schedules to the APVAT
Act and the HSN Codes notified by Government vide G.O.Ms.No.398,
Revenue (CT.II) Department,
Dt.31-03-2005 and G.O.Ms.No.490, Revenue (CT.II) Department,
Dt.15-04-2005 it is established that the item in question is not
covered by any of
1 of 2
the entries in the schedules to the Act and no HSN Code is notified
for this
product by the Government. After perusal of the tariff heading
2710, it is found that most of the petroleum products are covered
under this heading including petrol, diesel, lubricants, kerosene oil,
aviation turbine fuel etc. As seen from the VIth Schedule to the
APVAT Act only petrol, aviation motor spirit, aviation turbine fuel
and diesel oil are included in this schedule with specific tax rates.
In Schedule-IV to the APVAT Act, a specific entry for kerosene oil
sold through public distribution system (PDS) is found at Entry
No.40, taxable at 4%. The product “C-9” is not specified in any of
the schedules to the VAT Act and therefore, the tax rate shall be
12.5% under Schedule-V to the APVAT Act,2005.
2) Applicability of Entry Tax is outside the scope of this Authority.

Hence, a ruling cannot be given. The applicant will have to refer to
the notification issued by State Government from time to time
under Entry Tax Act to see whether the item is notified and also to
know the rate of entry tax applicable.
3) As regards the eligibility for input tax credit on the product, the
provisions under Section 13 read with Rule 20 will be applicable. It
is clarified that any fuels used for automobiles, for captive power
generation or for use in power plants will not be eligible for input
tax credit and at the same time any inputs used for personal
consumption or any inputs used in respect of exempted goods or
exempt transactions will not be eligible for the benefit of input tax
credit. The applicant is required to see Rule 20(2) and accordingly
make a claim for input tax credit.
JT.COMMISSIONER
To
M/s. The Synergy Associates,
Plot No.55, Sy.No.161, Hydernagar, Kukatpalli,
Hyderabad, R.R.District.
Hyderabad.
Copy to the Commercial Tax Officer, Hydernagar Circle.
2 of 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. United Metal Tek Private Limited, Hyderabad (TIN
No.28780224982) have filed an application and sought clarification and
read with Rule 66(2)(i) of APVAT Rules, 2005 alongwith the application fee
of Rs.1000/-.
1. Rate of tax applicable on Imported Aluminium with LDPE
composite panel.
2. Rate of tax in the absence of C-Form under CST Act for interstate
sales.

Copy of notification of Government of National Capital Teritory of Delhi,
Finance (Accounts) Department, Delhi Schivalaya, I.P.Estate, New Delhi.
Sri A.Venkateswarlu, Manager appeared on behalf of the firm for

hearing and explained the case.
is given as under.
The applicant states that he imports aluminum with LDPE

composite panel from China and seeks to know rate of tax
applicable under the A.P.VAT Act, 2005.
Entry 27 of Schedule IV of the Act reads “ferrous and non-

ferrous metals and alloys and extrusions thereof”. Thus besides
ferrous metals, non ferrous metals and oils and extrusions thereof
are clubbed together in the entry. Aluminum is known as a non-
ferrous metal. The customs clearance documents submitted by the
applicant shows the HSN code 7606.91.90. On the basis of evidence
furnished and in terms of the provisions of the A.P.VAT Act, 2005
we hold that the rate of tax applicable to the imported aluminum
with LDPE composite panel is liable to tax @ 4% .
The applicant also seeks ruling on the rate of tax applicable

in the absence of C-Form under CST for interstate sale transactions.
As the jurisdiction of this Authority is confined to the provisions of
A.P.VAT Act, 2005 we are not inclined to issue any ruling on this
point.
To
M/s. United Metaltek Private Limited,
Flat No.102, Road No.44,
Banjara Hills,
Hyderabad.

Copy to the Commercial Tax Officer, Jubilee Hills Circle.

PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/267 /2005 DT.2-9-2005
O R D E R:
M/s. Unity Engineering Traders, Hyderabad (TIN No.28920154814)

have filed an application dt 09.08.2005 and sought clarification and
of Rs.1000/-.
Rate of tax to be deducted at source for the contracts executed for

Central Government Departments.
Sri P.Sekhar, S.T.P, Authorised Representative appeared for hearing

APVAT Act and Rules.
The applicant claims that he executes works contract for
Central Government Departments and seeks to know the rate of tax
to be deducted at source while being paid for the work by the
contractee. According to Sec.22(4) read with Rule 18(a) tax at the
rate of 2% shall be deducted at source in respect of contracts
executed for Departments other than State Governments or Local
Authorities. Since the applicant claims to execute contracts entirely
for Central Government Departments, TDS applicable is 2% on the
contract amount upto 28.9.2005.
The Govt. have since amended the provisions relating to

works contract. As per the amended provision [Sec.22(4)] in
Ordinance 38 dt.29.8.2005 tax @ 4% shall be deducted at source.
Rule 18(a) has also been amended in G.O.1634 dt.31.8.2005 to that
effect. Accordingly, tax @ 4% shall be deducted by the contractee
awarding the contract.
To
M/s Unity Engineering Traders,

9-6-166, East Maruthi Nagar,
Near Champapet, Vyshali Nagar (Post)
R.R.District – 500 079.
Copy to the Deputy Commissioner (CT), Saroor Nagar Division.
Copy to the Commercial Tax Officer, Saroor Nagar Circle.

PROCEEDINGS OF THE
Present: Sri T. Yugandhar Reddy, Addl.Commissioner (VAT)

Sri K. Raghavaiah, Jt. Commissioner (Audit)
Sri P.Sat.yanarayana Reddy, Jt.Commissioner (Enft)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/468/ 2005. Dated 03- 05-2006.
O R D E R:
I. M/s. Laxmi Pumps Marketing Services, Kavadiguda

(TIN.28270240907) have filed an application and sought clarification and
of Rs.1,000/-
II. They sought clarification on the following:

Rate of tax applicable under APVAT Act on control panel used for
running of submersible pump.
III. The applicant submitted the following documents:
1) A write up on the issue along with the brochure on the products.
2) Copies of the tax invoices issued by Khyati Tech, Pune and tax
invoices issued by the applicant.
Sri S.Prabhakar, appeared for hearing and explained the case.
APVAT Act and Rules and HSN Codes notified by Government vide G.O. Ms.
No 398, Rev.(CT.II) Dept.,Dt.31-03-2005 and G.O.Ms.No.490, Rev.(CT.II)
Dept. dt.31-03-2005 as superceded in G.O. Ms .No. 1596, Rev.(CT.II) Dept,
dt.27-08-2005 and in G.O.Ms.No.1615, Rev.(CT. II) Dept.,dt.31-08-2005
and the ruling is given as under:
The applicant is a dealer carrying on business in submersible pumps,
control panels, starters and other connected accessories.
The applicant seeks to know the rate of tax on “control panel”. As
per the contention of the applicant control panel is to be necessarily used
for running of the submersible motors (single phase) whereas it is an option
for 3 phase submersible motors.
The applicant purchases “control panels” from outside state

dealers The applicant sold such goods by raising sale invoices as
Khyati 1PH/3PH control panel KSR 22” inclusive of VAT. Even
though, these goods are essential to the running of the submersible
motors, they are distinct and different from the motors. Control
Panels are notified in HSN Code No.8537—which refers to “boards,
panels……equipped with two or more apparatus of heading 8535 or
8536 for electric control or the distribution of electricity” Hence,
submersible pumps / motors and control panels are not one and the
same. The enumeration of entries in IV Schedule are ‘exhaustive’ in
nature and strict interpretation would be with reference to the
language of the entry.
‘Control panel’ used for running of submersible pumps
covering HSN Code 8537 fall under the residual entry of V Schedule
and liable to tax at @ 12.5%
ruling.
To
M/s. Laxmi Pumps Marketing Services,
Hyderabad.
Copy to the Deputy Commissioner(CT) Secunderabad Division.
Copy to the Commercial Tax Officer, Gandhinagar Circle Circle.

PROCEEDINGS OF THE

Sri P.Satyanarayana Reddy, Jt.Commissioner (Enft)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 536/ 2005. Dated 03- 05-2006.
O R D E R:
M/s. Prem Enterprises, Warangal (TIN.280702014474 ) have filed an

application and sought clarification and advance ruling on the following
APVAT Rules, 2005 along with the application fee of Rs.1,000/-

If any tax is levied under APVAT Act on purchase of cotton made for
deemed export sales of lint under Sec.4 (4) of VAT.
Clarification letter.
Sri Prem Kumar, Proprietor, appeared for hearing and explained the
case.
dt.27-08-2005 and in G.O.Ms.No.1615, Rev.(CT. II) Dept. ,dt. 31-08-2005
M/s. Prem Enterprises, Warangal is a dealer carrying on

business of purchase of unginned cotton from regulated market
yard and from farmers and the said unginned cotton is ginned to
yield ginned cotton / lint and cotton seeds.
The applicant purchases cotton and ginned into lint and sold
to exporters outside the state under sec.5(1) of CST Act and under
Sec.5(3) of the CST Act and no purchase tax is paid by the dealer
for his sales.
The dealer seeks to know if he has to pay tax under the
APVAT Act,2005, on the purchase of cotton made for relevant sales
of lint made to exporters outside the state under sec.4(4) of the
APVAT Act.
The ruling is given as follows :

1) No purchase tax is liable under sec.4(4) if the goods so
purchased are exported under sec.5 (1) of the CST Act
2) Under sec.4 (4) of APVAT Act, no purchase tax is leviable
where the cotton so purchased is ginned into lint and sold in
course of export supported by Form ‘H’ to an exporter.
ruling.
To
M/s. Prem Enterprises,
Old Beet Bazar, Warangal.
Copy to the Deputy Commissioner(CT) Warangal Division.
Copy to the Commercial Tax Officer, Fort Road Circle.
R5GOVERNMENT OF ANDHRA PRADESH

PROCEEDINGS OF THE
Sri. P.Satyanarayana Reddy, Jt.Commissioner(Enft)
***
Dt.13.4.2005.
O R D E R:
M/s. J.P.R Industries, (TIN No.28820154397) have filed an
Rate of tax applicable to Welded Wiremesh made of GI wire and wire
rod coils used for Poultry Cages meant for rearing and laying units, such
as single coveer, bouble cover, etc..
a) Photograph of the item
b) Copies of invoice
c) Copy of Form ER1 issued under Rule 12 under Central Excise Rule
7(5) of CENVAT credit Rules 2002 showing Central Excise tariff code
number.
Sri PJanardhan Reddy authorized Representative, appeared on
behalf of the firm for hearing and explained the case.
G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-2005,
G.O.Ms.No.490, (CT.II) Department, Dt.15-04-2005, G.O.Ms.No.1615
Revenue (CT-II) Department Dt. 31.8.2005 and G.O.Ms No. 795 Revenue
(CT II) Department dated 29.6.2006 and the ruling is given as under.
The applicant is manufacturing and marketing welded wire
mesh, used for Poultry cages meant for Poultry keeping, farming
and rearing. Besides, he also manufactures laying units known as
single cover, double cover etc., made of iron wire. The applicant
claims that the equipment falls under Entry 70 of Schedule IV of
A.P.VAT Act, 2005 and that in the G.Os cited above the basic raw
material G.I Wire, Rods etc. are classified under HSN Code
7217.20.10. In support of the contention he submitted a copy of the
central excise return.
We considered the documentary evidence submitted by the
applicant and also the contention of the applicant under
G.O.Ms.No.795 Revenue (CT-II) Department dt. 29.6.2006, with
effect from 1.7.2006 under item 105 of Schedule IV woven wire
nettings and mesh are enumerated as liable to tax @ 4%. Further in
respect of M/s Weld Fuse Pvt. Ltd in CCT’s
Ref.PMT/P&L/A.R.Com/226/2005 dt. 24.8.2005 on similar issue it
was clarified that these products attract tax liability
@ 4%. Hence it is clarified accordingly.
To
M/s. J.P.R. Industries,
H.No.16-10-1/M, 167, Srikrupa Agricultural Market,
Malakpet, Hyderabd – 35.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/10 / 2006. Dated 3-07-2006.

O R D E R:
M/s. MATRIX LABORATORIES LIMITED, SECUNDERABAD ( TIN.

28370135109) have filed an application and sought clarification and
of Rs.1,000/-
Whether the transaction of transfer by way of sale of Anti Retro Viral
business unit, (one of the business units) to M/s. Astrix Laboratories
Limited under an agreement, amounts to transfer of business as an ongoing
concern and exempt from payment of VAT under Rule 36 of the APVAT
Rules,2005.
1) Form 570
2) Authorization Form appointing Sri P. Srinivasa Reddy, as an
Advocate.
3) A copy of Business Transfer agreement between the applicant
and M/s. Astrix Laboratories Limited, dt.30-12-2005.
Sri P.Srinivasa Reddy, Advocate and Sri Muralidharan, Asst.General
Manager of the company, appeared for hearing on 30-6-2006 and explained
the case.
G.O.Ms.No.398,Rev. (CT.II) Dept,dt.31-3-2005 and
G.O.ms.No.490,Rev.(CT.II)Dept,dt.15-4-2005 and the ruling is given
as under :
The applicant is a registered company under the Companies

Act. They are the dealers in bulk drugs i.e., active pharmaceuticals
ingredients (API). The business is sub-divided into the following
business segments namely –
1) Anti-retro viral segment

2) Central nervous systems segment
3) Cardio vascular segment
4) Anti-asthma segment
5) Anti-fungal segment
6) Other segments
The applicant transferred, it’s ARV products segment unit
situated at Survey No.10 & 42, Gaddapotharam (V), Karepally
Industrial Estate, Jinnaram Mandal, Medak District, by way of sale
to M/s. Astrix Laboratories Limited (TIN 28807202450) as an
ongoing concern. Accordingly, vide agreements dated 20-12-2005,
effecting from 30-12-2005 and 2-1-2006, the applicant transferred
the following units by way of sale.
1) Land and building transferred as a part of sale deed dt.2-1-

2006.
2) Movable assets like plant and machinery equipment etc.,

inventory of stocks, employees, all contracts, relating to ARV Unit,
know how, all drug master file, license of patents etc., are also
transferred as part of various agreements. All these movable or
immovable facilities pertaining to ARV unit was transferred on as is
where is basis. Thus, they stated that the statute envisaged
transfer of one unit of the business while continuing with other
businesses.
The Advocate, appearing for personal hearing has explained

the terms and conditions laid down in the contract and claimed that
the transactions of transfer of one unit of manufacturing facility by
way of sale is exempt as a case of transfer of business as a whole
U/R.36 of the APVAT Rules. He also drawn the attention of this
authority of the A.P. High Court decision in the case of M/s.
Coromandal Fertilizers Vs. State of A.P. (112 STC.1), wherein it was
held that if a dealer transfers one of its several businesses as
ongoing concern, it is still a transfer of business and the goods
involved therein can not be considered as sold in the course of
business but in the course of winding up of the particular business
unit. It was also held that goods involved in transfer of cement
business is in the course of winding up of cement business and it is
not necessary that the company should have closed the fertilizer
business as well in order to claim that the transaction is in the
course of closure of business.
The contentions of the applicant are examined with reference

to various agreements, and High Court decision referred herein and
found that Rule 36 of the APVAT Rules contemplates exemption on
the transfer of one unit out of the several businesses, as an ongoing
concern on as is where is condition along with the employees and
various assets and liabilities, ongoing contracts etc., Accordingly,
we hold that transfer of ARV unit by way of sale as an ongoing
concern is not liable to VAT and exempted U/R.36 of the APVAT
Rules, 2005.
The clarification and advance ruling given herewith is subject

to the conditions prescribed in Rule 36. All the conditions applicable
in the circumstances, to the dealers are binding on the applicant
and also on the dealers acquiring the unit of business.
ruling.
To
M/s. Martix Laboratories Limited,
Alexander Road, Secunderabad.

Copy to the Deputy Commissioner(CT) Punjagutta Division.
Copy to the Commercial Tax Officer, Vengalrao Nagar Circle.

PROCEEDINGS OF THE
***
Dt.13.4.2005.
O R D E R:
M/s. S.S.R. Enterprises, (TIN No.287801713529) have filed an
Rate of tax applicable to Welded Wiremesh made of GI wire used for
Poultry Cages meant for rearing and laying units, Tree guards etc.
d) Photograph of the item
e) Copies of invoice
f) Copy of Form ER1 issued under Rule 12 under Central Excise Rule
number.
Sri P.janardhan Reddy authjor, appeared on behalf of the firm for
To
M/s. S.S.R Enterprises,
H.No.A-19 &20 IDA Kukatpally,
Balanagar, Hyderabd – .
opy submitted to the Commissioner of Commercial Taxes,A.P., Hyderabad.
Copy to the Deputy Commissioner (CT),Hyderabad Rural Division.
Copy to the Commercial Tax Officer, IDA Gandhinagar Circle.
R5GOVERNMENT OF ANDHRA PRADESH

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Uma Industries, (TIN No.28650138042) have filed an
Rate of tax applicable to Welded Wiremesh made of GI wire and wire
rod coils used for Poultry Cages meant for rearing and laying units, such
as single coveer, bouble cover, etc..
g) Photograph of the item
h) Copies of invoice
i) Copy of Form ER1 issued under Rule 12 under Central Excise Rule
number.
Sri PJanardhan Reddy authorized Representative, appeared on
behalf of the firm for hearing and explained the case.
To
M/s. Uma Industries,
H.No15-2-686,
Siddiamber Bazar, Hyderabd
Copy to the Commercial Tax Officer, Osmangunj Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Madras Auto Service, Hyderabad (TIN No.28610204456) have

filed an application on 8.09.2005 and sought clarification and advance
Rs.1000/-.
Rate of tax applicable to Engine Bearings

Sri N.Ramanujam, Deputy Manager, appeared on behalf of the firm
The applicant claims that he is a distributor for automobile,

industrial and Diesel spares and that he is purchasing the items
from M/s. Bimetal Bearings Limited, Coimbatore. The applicant
wants to know the rate of tax applicable to the items.
Entry 10 of Schedule IV of A.P.VAT Act, 2005 reads “bearings
of all kinds”. Items listed in Schedule IV are liable to tax @ 4%. The
applicant claims to sell Engine bearings which are suitable for
commercial and light commercial vehicles, cars and jeeps, tractors
and industrial and other miscellaneous appliances. As the entry
reads ‘bearings of all kinds’ we hold that they are liable to tax @
4%.
To
M/s. Madras Auto Services,

5-4-187/1, Mahatma Gandhi Road,

Hyderabad.
Copy to the Deputy Commissioner (CT), Abids Division
Copy to the Commercial Tax Officer, Narayanaguda Circle.
PROCEEDING OF THE

CCT’s Ref.No.PMT/P&L/A.R.Com/469/2005 Dt: 23-12-2005

2005.
***
O R D E R:
M/s. S.R. Drugs & Intermediates (P) Ltd., (TIN No.28660180657),
Patancheru, Medak District have filed an application and sought clarification
1) Entry Tax provisions regarding Acetic Acid, Acetic Anhydride, Chlorine

and whether Entry Tax can be availed as input tax credit.
2) Whether Entry Tax is exempted for SSI Units, the value of levying Entry
Tax and the reasons for levying Entry Tax.
The case was posted for hearing on 03-12-2005. Sri C.

Satyanarayana Reddy, Managing Director of the firm appeared on behalf of
the firm and explained the case.
As per the provisions of APVAT Act,2005, the Advance Ruling

Authority can give clarification on issues falling within the scope of the Act
and Rules. Out of the issues raised in the application only one aspect of
Entry Tax is specified under sub-section (5) of Section 22 of APVAT Act
which can be clarified. According to this sub-section, any Entry Tax paid can
be claimed as input tax credit subject to the restrictions applicable under
Section 13 of the APVAT Act,2005.
1 of 2
In view of the above, the ruling is given that:
1) Entry Tax can be claimed as adjustment subject to restrictions in

Section 13 of the VAT Act read with Rule 20 of the VAT Rules.
2) All other questions relating to Entry Tax do not fall within the
purview of this authority.
JT.COMMISSIONER
To
M/s. S.R. Drugs and Intermediates (P) Ltd.,
Plot No.24B/1, I.D.A., Phase-I,
Patancheru-502 319, Medak District.

Hyderabad.
Copy to the Deputy Commissioner (CT), Nizamabad Division.
Copy to the Asst. Commissioner (CT), LTU, Nizamabad Division.
2 of 2

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/471/ 2005. Dated 17-12-2005.
O R D E R:
I. M/s. Sudha Gold Covering Industries, Machilipatnam

(TIN.28680102248) have filed an application Dated 16-12-2005 and sought

Rate of tax applicable to gold plated jewellery. .
III. Mr. Sadhu Gandhi, Managing Partner appeared for hearing on 16-12-
IV. The issue has been examined with reference to the provisions of the
V. The applicant claims to manufacture gold plated jewellery

and seeks to know the rate of tax applicable to the item.
We have heard the applicant and perused entries in the

schedules to the APVAT Act, 2005. By Act No.23 of 2005 entry 96
has been added in the Schedule IV to the Act. The entry reads
“Artificial and rolled gold jewellery, imitation and costume
jewellery”. As the applicant in engaged in the manufacture of gold
plated jewellery which is known as artificial/imitation jewellery, it
squarely falls under the scope of Entry 96. As the entry came into
effect on and from 29th of August, 2005, the item in question is
liable to tax at 4% from the said date.
ruling.
To
M/s. _Sudha Gold Covering Industries,
12/39, Rustumabad,
Machilipatname,
Krishna Dist..

Copy to the Deputy Commissioner(CT) Vijayawada-II Division.
Copy to the Commercial Tax Officer, Machilipatnam Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Sri Durga Auto Coach Body Builders (P) Limited, Hyderabad
(TIN No.28490236373) have filed an application and sought clarification
2. They sought clarification on the following:
i) Whether it is necessary to take clearance certificate from

C.T.Department to register a vehicle by the road
transport authorities.
ii) Whether it is possible to adjust input tax credit before

obtaining clearance certificate from the
C.T.Department.
3. Sri G.Babu Rao, Director appeared on behalf of the firm for hearing
4. The issue has been examined with reference to the provisions of the
5. The applicant claims that he is a dealer engaged in the business of

building body on chasis. The applicant further states that the Road
transport authorities are insisting on payment of VAT before granting
registration under the Motor Vehicle Act for such vehicles. Further the
applicant seeks to know whether such clearance certificate is necessary
from the C.T.Department for each and every vehicle for which body has
been built by the dealer on the chasis provided by the customer. Further,
the applicant would like to know whether he can take credit of tax paid on
inputs used in body building activity.
We have considered the contents of the application and heard

the applicant. As per the provisions of the Act, a VAT dealer is
eligible to claim input tax credit on purchases which are meant for
business use except such items which are specifically excluded.
Section 13 of the A.P.VAT Act stipulates the conditions for claiming
input tax credit. Rule 20(2) provides details of items not eligible for
input tax credit. In view of the legal position, the applicant is
required to calculate the eligibility for input tax credit and make a
claim on Form VAT 200. For the purpose of registration of the
vehicle by the road transport authority a clearance certificate can
be issued by the assessing authority on the basis of Form VAT 200.
It is not appropriate to insist upon full payment of output tax for
each vehicle without giving credit to input tax available or eligible
in a tax period. The clearance certificate may contain details of
vehicles with chasis numbers built by the applicant in a tax period.
To
M/s. Sri Durga Auto Coach Body Builders (P) Limited,

Plot No.89/A, IDA, Phase-I,
Jeedimetla,
Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT), Hyderabad (Rural) Division

PROCEEDINGS OF THE

***
O R D E R:
M/s. Ram Bakery, Hyderabad (TIN No.28380253093) have filed an
They sought clarification on rate of tax on the following:
1. Toast (Roasted bread)

2. Dilkhush, Dilpasand
3. Curry puff
4. Tie-Biscuits / Kharpuff
5. Cakes & Pastry
Sri S.B.Chandra, Authorised Representative appeared on behalf of

the firm for hearing on 2-09-2005 and explained the case.
is given as under.
The applicant contends that Toast (Roasted bread) is
modified form of Fresh bread which is heated at high temperatures
in order to prolong the shelf life of the bread slice and therefore not
very different from fresh bread. It is further contended that since
the applicant does not sell the bread with a brand name and merely
converts it into a roasted form it continues to be unbranded bread
and therefore eligible for exemption. We are unable to agree with
the contention of the applicant. The slice of fresh bread, though
unbranded, when subjected to the heating process becomes roasted
bread and acquires commercially a new identity. As fresh bread and
roasted bread do not stand on the same footing they have to be
treated differently. Therefore, we hold that roasted bread cannot be
equated with fresh bread and in the circumstances hold that it is
Other items mentioned at Sl.No.2 to 5 above are all food

items. These items do not find place in the entries of Schedules in
the A.P.VAT Act, 2005. Therefore, in accordance with the language
in Schedule V of A.P.VAT Act we hold that, Dilkhush, Dilpasand,
Curry puff, Tie-Biscuits/ Kharpuff & Cakes & Pastry are liable to tax
@ 12.5%.
To
M/s. Ram Bakery,
5-2-1029, N.S.Road,
M.J.Market,
Hyderabad.

Copy to the Commercial Tax Officer, N.S.Road Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Rashtriya Ispat Nigam Limited, Visakhapatnam (TIN
Whether purchases of inputs like raw materials and consumables
used in production of finished goods alone would attract purchase tax or all
items purchased in the course of business ?
Sri A.Sarveswara Rao, Advocate, Authorised Representative

appeared on behalf of the firm for hearing on 23-8-2005 and explained the
case.
APVAT Act and Rules and the ruling is given as under.
The applicant seeks to know whether purchase tax as
provided under Section 4(4) of A.P.VAT Act, 2005 is attracted only
to such inputs like raw materials or consumables purchased from
non VAT dealers and used in the production of finished goods or
extends to all purchases made in the course of business from non
VAT dealers.
Section 4(4) of A.P.VAT Act, 2005 provides for the payment
of tax on purchases under certain circumstances by a VAT dealer.
Primarily this is a tax payable by a VAT dealer who in the course of
his business purchases taxable goods from a person or a non VAT
dealer or from a VAT dealer in circumstances in which no tax is
payable by the selling VAT dealer. Three specific circumstances are
listed in the section. Applicability of this section is limited to these
circumstances alone and it does not extend to purchases of goods
other than inputs or consumables used in the course of his
business. In other words the purchase of either raw material or
consumables is linked to the three circumstances stated in the
section. Only in these circumstances shall a VAT dealer be liable to
pay purchase tax. Provisions of this section are not attracted when
such purchases are ‘NOT’ linked to the said circumstances

To
M/s. Rashtriya Ispat Nigam Limited,
Visakhapatnam Steel Plant,
Visakhapatnam – 530 031.

Copy to the Asst. Commissioner (LTU) Visakhapatnam division.
PROCEEDINGS OF THE

***
O R D E R:
M/s. Das Engineering Company, Nallakunta (TIN No.28690165912)

have filed an application on 12.09.2005 and sought clarification and
of Rs.1000/-.
(i) Whether the applicant is required to deduct tax from the sub
contractors if the contract is for Government / other than Government.
(ii) Liability of tax if the involvement of material by the sub contractor is
very nominal and if such materials are purchased from outside the State or
India or from a dealer other than a VAT dealer in the State and the amount
to be deducted from the sub contractor in the event of TDS being more
than liability and the treatment of excess amount.
Sri Anirudh Gupta, Partner and T.Ramesh Babu, STP have appeared
on behalf of the firm for hearing on 28-9-2005 and explained the case.
The applicant claims that he is in the business of executing

works contract to Government and Local authorities and also to
others. The applicant also states that he executes agreements for
sub contracts in both the cases and in the circumstances seeks to
know the liability in the light of amendments made in Ordinance 20
of 2005 and G.O.Ms.No.1614 dt.31.8.2005. The applicant has raised
the following questions :
(i) Whether the applicant is required to deduct tax from the sub
contractors if the contract is for Government / other than Government.
As per Section 4(7)(b) any dealer executing any works
contract for the Government or Local authority shall be liable to pay
tax by way of composition at 4% on the total value of the contract
executed. Under sub section (3) of Section 22 of the Act tax @ 4%
shall be deducted at source by the Contractee (Government Dept. /
Local authority) and shall be remitted to Government in the
prescribed manner. In the case of contract executed for other than
Government as per the amended provisions in sub section (4) of
Section 22, tax @ 4% shall be deducted at source. However such
deduction shall not be made by a dealer or a firm awarding the
contract where the value of the contract does not exceed to Rs.10
lakhs.
(ii) Liability of tax if the involvement of material by the sub contractor is

very nominal and if such materials are purchased from outside the State or
India or from a dealer other than a VAT dealer in the State and the amount
to be deducted from the sub contractor in the event of TDS being more
than liability and the treatment of excess amount.
If a sub contractor uses any materials in the contract by

purchasing them from outside the State / India or from any dealer
other than a VAT dealer in the State, such dealer shall be liable to
pay tax on the goods at the rates applicable to them under the Act.
A new provision under Section 4(7)(e) has been inserted by
Ordinance 20 of 2005, to this effect.
The applicant further seeks to know how the excess amount

is dealt with if the TDS amount is more than his liability. According
to Rule 17(3)(h) where any tax is deducted under sub section (4) of
Section 22 and the contractor opted to pay tax by way of
composition under clause © of sub section (7) of Section 4 of the
Act, no refund of such tax deducted shall be allowed to the
contractor. The reason is that tax liability and tax deduction are at
the same rate. Sub section 4 of Section 22 refers to deduction of tax
@ 4% in the case of VAT dealer executing works contract for
Central Govt. or a Company or a statutory body or an undertaking
or an institution other than Government or Local authority and as a
result of amendment to clause (c) of sub section (7) of Section, the
rate of tax by way of composition is 4% of total consideration. If
the circumstances stated in the said sub section are present no
refund of tax deducted shall be allowed.
The applicant raised the question of material involved in sub

contract being nominal and such material purchased from outside
A.P., whether there would be any liability on the part of sub
contractor. The issue can be decided on the basis whether
transaction is in the nature of job work or works contract. If it falls
under job work, it is not taxable but the sub contractor cannot use
‘C-Forms’ to buy goods from outside A.P. with concessinal rate of
4%. If the transaction is a works contract, the sub contractor is
exempted provided main contractor ‘opted for’ composition and to
the extent of value of goods purchased from outside A.P., the sub
contractor is liable to pay tax at the rates applicable to the goods.
In case, the sub contractor pays tax on such goods, the main
contractor can claim deduction for that turnover for paying tax by
way of composition. Another issue arising out of this is whether
TDS is to be made against sub contractor by main contractor. The
answer is in the negative because sub contractor is exempt and TDS
@ 4% is already made against main contractor.
To
M/s. Das Engineering Company,

2-1-436, Nallakunta,
Hyderabad.

Hyderabad.
Copy to the Commercial Tax Officer, Vidyanagar Circle.
PROCEEDINGS OF THE

***
O R D E R:
M/s. Sarada Industries, Vijayawada (TIN No.28020154359) have

Rs.1000/-.
Rate of tax applicable to Plastic Footwear.

i) Reference of Director (Technical), Footwear Design and
Development Institute, Ministry of Commerce, GOI.
ii) Invoice showing purchase of different types of raw
materials from outside the State.
iii) Copies of tax invoices issued by the applicant
Sri N.Srinivasa Babu, Manager, appeared on behalf of the firm for

G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005 as
and G.O.Ms.No.1596 Revenue (CT.II) Department, Dt.27.8.2005 and the
The applicant states that he manufactures Plastic Footwear. He
seeks to know the rate of tax applicable to the Footwear sold by him. The
applicant submitted a certificate issued by Director, Technical, FDDI,
Ministry of Commerce, GOI and contains information about the components
of Plastic Footwear and its classification under the HSN codes. Among other
things the Certificate states that Poly Urethane and PVC coated rexine used
in the making of Footwear is classified as Plastic Footwear and also refers to
Chapter 64 of the HSN code and concludes that the terms Rubber and
Plastics include woven fabrics or other textile fabrics with an external layer
of rubber or plastics being visible to the naked eye and therefore such
material are plastics. Thus, it reiterates that Footwear made out of these
materials in different combinations will be identified as Plastic Footwear.
The applicant also filed invoices showing purchase of artificial PU sole, foam
and other materials used in manufacture of different types of Footwear.
Sale invoices issued by him describe such Footwear as “Hawai”.
We have considered the documentary evidence and also the
contention of the applicant. Entry 46 of Schedule IV of A.P.VAT Act,
2005 reads “Plastic Footwear and Hawai chappals”. Thus in so far
as manufacture of Footwear made entirely of Plastics / PU / PVC
coated rexine, we hold that the applicant is liable to tax @ 4%.
However, if the applicant manufactures Footwear with
leather content, even if it is used partly either as in-sole or upper or
any part of the Footwear, it will be treated as other than Plastic
footwear and would fall outside the scope of entry 46 of Schedule
IV of the Act. In such circumstances the applicant will be liable to
tax @ 12.5% in terms of the language in Schedule V of A.P.VAT Act,
2005.
To
M/s. Sarada Industries,

D.No.14-17-10, Upstairs, Makanivari Street,
Gandhinagar, Vijayawada.

Hyderabad.
Copy to the Deputy Commissioner (CT), Vijayawada-II Division
Copy to the Commercial Tax Officer, Seetharampuram Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Aditya Music (India) Private Limited, (TIN
No.28070250743), Narayanaguda, Hyderabad have filed on application
They sought clarification on the following issues :
1. To clarify the rate of tax on Pre-recorded Audio cassettes HSN Code
8524.
2. To clarify the rate of tax on Pre-recorded Compact disc HSN Code
8424.
The case was posted for hearing on 30-4-2005. Sri Rajneesh
Kumar Jha, Accounts Manager of the firm appeared and explained the case.
of the APVAT Act and Rules and HSN codes notified by Government vide
G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31.3.2005 and
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15.04.2005 and the ruling
is given as under.
1. Pre-recorded Audio cassette falls under Entry 39 of

Schedule IV with HSN code 8524, taxable @ 4%.
2. Pre-recorded Audio compact discs falls under Entry 39 of
Schedule IV with HSN code 8524, taxable @ 4%.
Addl.Commissioner(VAT) Jt.Commissioner(VAT)
Jt.Commissioner(Audit)
To
M/s. Aditya Music (India) Private Limited,
3-5-1091/7, Venkateswara Colony,
Narayanaguda, Hyderabad-500 029.
Copy submitted to the Commissioner of Commercial Taxes, A.P.,Hyderabad.
Copy to the Commercial Tax Officer, Barkatpura Circle.

Copy submitted to the Deputy Commissioner (CT), Abids Division.

PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. IRRI SURYA PRAKASA RAO,(TIN.28600144769 ) have filed an


(1) Whether Jaggery purchased from farmers and sold locally attract VAT
at purchase or sale point ?
(2) Whether Jaggery purchased from farmers and later sent on
consignment basis for sale in other states attract tax under VAT Act ?
(3) Whether they are eligible for ITC on packing material and other inputs
for Jaggery sent on consignment sales.
III. The issue has been examined with reference to the provisions of the
APVAT Act and Rules the ruling is given as under:
IV. The applicant is a dealer in Jaggery. According to the applicant,

he is effecting purchases from local farmers and from other dealers
in the state and selling in the state and also sending on
consignment basis outside A.P. He is seeking clarifications on the
points noted supra, which are examined with provisions of the
APVAT Act and held as under.
i) Jaggery purchased from farmers and sold locally
attract VAT at the point of sale of Jaggery. There is
no purchase tax at the time of purchase.
ii) If Jaggery is purchased from farmers by the
applicant and later sent on consignment basis to
their agents outside the state for effecting sales,
purchase price of such Jaggery attracts VAT under
sec.4(4) of the APVAT Act. The ‘ Purchase Price’
shall include any expenditure incurred upto the
stage of delivery to him.
iii) On such transactions as noted at item No.2, the
applicant is eligible for ITC on packing material over
and above 4% paid as per Sub-Section(6) of
ruling.
To
M/s. Irri Surya Prakasa Rao,
Nidadavole.


PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 271 / 2005. Dated 5-9-2005.
O R D E R:
I. M/s. Mitter Brothers, Pendurthy (TIN.28410119232) have filed an


Whether the commodity, rock phosphate is a chemical fertilizer or not.

Copies of purchase invoices issued by the suppliers in favour of the
applicant.
IV. Sri A.Sarveswara Rao,Authorised Representative, appeared for hearing

V. The issue has been examined with reference to the provisions of the
VI. The applicant states that he is a trader in rock phosphate. He

purchases powder form of rock phosphate and sells in the market.
The applicant relied on the decision of the APHC in State of A.P. vs.
MMTC Ltd., (118 STC, 190), it is held that rock phosphate is
classifiable as chemical fertilizers falling under entry 23 of the 1st
schedule to the APGST Act. Even otherwise, the applicant contended
that as the powder is a form of natural mineral it falls under entry
43 of IVth schedule to the APVAT Act
Having regard to the facts of the case and the orders of the High
Court of A.P. rock phosphate is held as a chemical fertilizer liable to
tax @ 4% under the IVth schedule.

ruling.
To
M/s. Mitter Brothers, Pendurthy,
Visakhapatnam.
Copy to the Deputy Commissioner(CT) Visakhapatnam Division.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Vasundhara Traders, Chilakaluripet (TIN.28470122140) have

Rs.1,000/-

Whether they are eligible for ITC for VAT paid on purchase of cotton lint
used for manufacture and sale of cotton yank yarn or not ?

Copies of invoice issued by CCI, Adilabad.
Sri S. Venkateswara Rao, proprietor, appeared for hearing on 30-8-
The applicant states that they own cotton spinning mills. Upon
purchasing cotton lint from VAT registered dealers, they convert it
into cotton hank yarn and sell such yarn in hank locally and also
outside the state. They wish to know whether they are eligible to
claim IT that was paid on purchase of cotton lint.
The goods, cotton hank yarn, manufactured by the applicant is

enlisted at entry 10 of 1st schedule and thus exempted from VAT.
Section 13(5)(c) specifically stipulates that no input tax will be
eligible if the sale of goods are exempt from VAT except when such
goods are sold in the course of export or exported outside the
territory of India. Therefore, the applicant is not eligible to claim
ITC paid on the corresponding purchases of cotton lint.
ruling.
To
M/s. Vasundhara Traders,
Chilakaluripet.


PROCEEDINGS OF THE

***
O R D E R:
M/s. Cotton Corporation of India Limited, Guntur (TIN

No.28070123867) have filed an application on 13.09.2005 and sought
Applicability to Section 4(4) of A.P.VAT Act on purchases of Cotton.
Sri V.Bhaskar, Reddy, Advocate appeared on behalf of the firm for

The applicant M/s. Cotton Corporation of India Limited claims
to be engaged in processing of kapas and its trading. The applicant
claims to purchase kapas from farmers and after processing, cotton
bales are disposed of by way of export. In the circumstances, the
applicant seeks to know the tax liability on the transaction. The
applicant has raised the following specific issues for ruling.
(i) Whether the applicant can claim exemption of VAT on the
purchase of Cotton if the FP bales are exported. Whether the
applicant has liability under Section 4(4) of the A.P.VAT Act
on the purchase of Cotton.
Section 4(4) creates liability at the point of purchase in the
circumstances stated in the clauses thereunder. A dealer shall be
liable to pay tax @ 4% on the purchase price of goods if after such
purchase the goods are either used as inputs for goods which are
exempt from tax under the Act or used as inputs for goods which
are disposed of otherwise than by way of sale in the State or
dispatched to outside the State and disposed of otherwise than by
way of consumption.
In the case of the applicant, Cotton is purchased and after
pressing them into bales they are exported. As per clause (ii) of
Section 4(4), levy at purchase point is excluded if the goods are
exported outside the territory of India. Further, as per Entry 79 of
Schedule IV of the A.P.VAT Act, Cotton in all its unmanufactured
state whether ginned or unginned bale or pressed or otherwise is
treated as Cotton. Therefore purchase of Cotton by the applicant,
pressing them into bales and export thereof does not attract the
circumstances stated in Section 4(4) of the Act. Therefore we hold
that the applicant has no liability under Section 4(4) of the Act on
the transaction.
(ii) Whether the applicant is liable to tax under the Act on purchase of
kapas prior to export order date.
We have considered the question. As per the language of
Section 4(4) purchase of kapas prior to the date of export order
does not attract tax as the applicant states that purchases are
meant for export. Therefore the applicant has no liability under the
Act.
(iii) Whether kapas and ginned cotton are different goods for the purpose of
the Act and the liability under VAT if they are considered as one and the
same or different commodities.
We have considered the question. Entry 79 of Schedule IV of
the Act reads “Cotton, that is to say, all kinds of cotton (indigenous
or imported) in all its unmanufactured state, whether ginned or
unginned, baled, pressed or otherwise but not including cotton
waste”. It is clear from the language of the entry that cotton in all
its forms is one and the same commodity and as such no artificial
distinction is made by the legislature. Therefore, kapas and ginned
cotton are treated as one commodity for the purpose of VAT Act.
Secondly the liability to tax arises under the Act if the applicant
sells kapas or ginned cotton. The taxable event arises only when
the goods listed under Schedule IV are put to sale.

To
M/s. Cotton Corporation of India Limited,

4/2, Ashok Nagar,
GUNTUR – 522 002.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Sun Food Corporation, Visakhapatnam (TIN No.28250182061)

have filed an application on 8.09.2005 and sought clarification and advance
Rs.1000/-.
Rate of tax on the following items :
i) Cashew nut shell oil

ii) Cashew nut shell deoiled cake
iii) Cashew husk
Sri B.Babu, Manager appeared on behalf of the firm for hearing on

The applicant states that he purchases raw cashew nuts and
processes the same into Kernel and obtains certain bye products in
the process. The applicant seeks to know the rate of tax applicable
to the following products.
(i) Cashew nut shell oil :

According to the applicant it is a vegetable oil obtained from
Cashew nut shell and can be considered as vegetable oil and may be
liable to tax as specified under Entry 67 of Schedule IV of the
A.P.VAT Act.
We have examined the plea of the applicant. Entry 67 reads
“vegetable oils – all kinds of vegetable oils including solvent oils
and coconut oils”. As Cashew nut shell oil is derived from cashew
nut which is a vegetable oil, we are inclined to agree with the plea
of the applicant and hold that cashew nut shell oil is liable to tax @
4% under Entry 67 of Schedule IV of the A.P.VAT Act, 2005.
(ii) Cashew nut shell deoiled cake :
According to the applicant this is a residual cake after
obtaining the oil and may be treated as falling under Item 87 of
Schedule IV of the A.P.VAT Act.
We have examined the plea of the applicant. Entry 87 reads

“oil cakes and deoiled cakes”. As the entry is broad in its sweep it
may be construed that all kinds of deoiled cakes fall within the
ambit of the entry. Therefore we hold that Cashew nut shell deoiled
cake attracts tax @ 4% as per Entry 87 of Schedule IV of the A.P.
VAT Act, 2005.
(iii) Cashew husk :

The applicant states that Cashew husk is obtained after
decorticating cashew nuts while processing for kernel and further
states that this item may fall under Entry 41 of Schedule I of the
A.P.VAT Act, 2005.
We have examined the plea. Entry 41 of Schedule I of the Act

reads “Husk of Pulses, Paddy, Ground nut and Wheat bran”. As the
entry specifies husk of various products, we are unable to agree
with the view of the applicant that Cashew husk is also included
under the entry. Therefore we hold that Cashew husk falls outside
the scope of Entry 41 of Schedule I of the Act and shall fall squarely
within the ambit of Schedule V of the Act and liable to tax @ 12.5%.
To
M/s. Sun Food Corporation,

Narsingpalli,Kasimkot Mandal,
Visakhapatnam.

Hyderabad.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 55 / 2006. Dated 5 - 10-2006.
O R D E R:
I. M/s. Bennet Coleman & Company Limited, Banjara Hills,Hyderabad

of Rs.1,000/-

Whether the printing and publication of Newspapers and other allied
publication weekly’s and Monthly Magazines fall under Item No.5 of
Schedule I and exempt from VAT tax.
A write up on the issue.
IV. Sri K.Siva Kumar Advocate along with Mr. B.R.M.K.Sarma accounts
Department, appeared for hearing and explained the case.
superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept. dt.27.08.2005, in
G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005, G.O.Ms.No.502,
Rev. (CT-II) Dept., dt.1-5-2006 w.e.f. 1-5-2006, G.O.Ms.No.656, Revenue
(CT-II), Dept. dt.2.06.2006 G.O.Ms.No.795, Revenue (CT-II), Dept.
dt.29.06.2006 and the ruling is given as under:
The applicant seeks to know whether printing and sale of
daily news papers, viz., Times of India and Economic Times are
exempt or not. Like-wise the applicant also wishes to know whether
publication and sale of other allied monthly and weekly magazines
are exempt from levy of VAT u/e/ 5 of the 1st schedule of APVAT
Act or not.
News papers are excluded in entry 54 of List II of the 7th
Schedule to the Constitution of India. Hence, sales of news papers
are exempt from levy of VAT as provided under the Constitution.
However ‘News Print’ is specifically mentioned at entry 44 in
Schedule IV taxable @ 4%.
Other allied monthly and weekly magazines published and
sold by the applicant are also exempt from levy of VAT u/e.5 of the
1st Schedule to the APVAT Act.
Regarding the purchase/import/stock receipt of news print,
the applicant, being registered TIN VAT dealer, has to follow the
rules prescribed in Rule 55 of the APVAT RULES.
Sd/- Sd/- Sd/-
Addl/Jt/Commis
sioner.
ruling.
To
M/s Bennet Coleman & Co.,Ltd.,
Banjara Hills, Hyderabad.

PROCEEDINGS OF THE
*****
O R D E R:
I. M/s. Elmas Power Systems, Kushaigusda, Hyderabad

(TIN.28780213439) have
filed an application and sought clarification and advance ruling on the

Rate of tax applicable to Transformers with HSN code 8504
Copy of Invoices of Elmas Power Systems.
IV. Sri P. Siva Sankar Rao, Authorized Representative, appeared for

Rev. (CT-II) Dept., dt.1-5-2006 w.e.f. 1-5-2006, G.O.Ms.No.656,
Revenue (CT-II), Dept. dt.2.06.2006 G.O.Ms.No.795, Revenue (CT-II),
Dept. dt.29.06.2006 and the ruling is given as under:
The applicant sought clarification on rate of tax applicable to

transformers with HSN Code 8504. The transformers are liable to
tax @ 12.5%.
Sd/- Sd/- Sd/-

Addl/Jt/Commissioner
ruling.
To
M/s. Elmas Power Systems,
Kushaiguda, Hyderabad.
Copy to the Deputy Commissioner(CT) Saroornagar Division.
Copy to the Commercial Tax Officer,Keesara Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 81 / 2006. Dated 5 -1 0 -2006.
O R D E R:
M/s. Lipi Marketing (P) Limited, Vijayawada.(TIN.28672130486)

have filed an application on and sought clarification and advance ruling on
(1) Inkjet Printing Machine HSN Code : 8443
(2) CNC Router Magazine “ “ 8465
(3) Laser Engraver ` “ “ 8479
(4) Cutting Plotter “ “ 8441
(5) Seaming Machine “ “ 8515
(6) PVC Sheet Fabric “ “ 3920
(1) A write up on the issue.
Mr.Mathew Varghese, Proprietor, appeared for hearing and explained
the case.
Act and Rules and HSN Codes notified by Government vide G.O.Ms.No:398,
Revenue (CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490,
Revenue (CT.II) Department Dated 15-04-2005 as superceded in
G.O.Ms.No.1596, Revenue(CT-II) Dept. dt.27.08.2005, in G.O.Ms.No.1615,
Revenue (CT-II), Dept. dt.31.08.2005, G.O.Ms.No.502, Rev. (CT-II) Dept.,
dt.1-5-2006 w.e.f. 1-5-2006, G.O.Ms.No.656, Revenue (CT-II), Dept.
dt.2.06.2006 G.O.Ms.No.795, Revenue (CT-II), Dept. dt.29.06.2006 and
The following goods (1) Inkjet Printing Machine (8443), (2)

CNC Router Machine (8465), (3) Laser Engraver (8479), (4) Cutting
Plotter (8441) are notified under Entry 102 of IV Schedule of APVAT
Act,2005 “Machinery of all kinds” by G.O.Ms.No.795 of 2006, dt.29-
6-2006 and are liable to tax @ 4% w.e.f. 1-7-2006.
Seaming Machine is not under 8515 but the HSN Code is
8463.90 notified in he IV Schedule of APVAT Ac, 2005 liable to tax @ 4%
w.e.f. 1.7.2006.
PVC Sheet Fabrics (3920) notified under Entry 90 of IV
Schedule of APVAT Act,2005 is liable to tax @ 4% vide
G.O.Ms.No.1615 Rev.(CT.II) Department, dt.31-8-2005, with effect
from 1-9-2005.
.
Sd/- Sd/- Sd/-
ruling.
To
M/s. Lipi Marketing (P) Limited,
Vijayawada.

Copy to the Deputy Commissioner(CT) Vijayawada Division.
Copy to the Commercial Tax Officer, Benz Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Crompton Greaves Ltd., Secunderabad (TIN.28600196761)

have filed an application and sought clarification and advance ruling on the

The rate of tax (VAT) on the following commodities.
1) Ballasts (chokes) on FTL
2) Ballasts ( “ ) for M.V.lamps
3) Ballasts ( “ ) for S.V.lamps
4) Ballasts ( “ ) for C.F.L.
III. Mr.Jayaraman, Sr.Executive (Finance), appeared for hearing and

explained the case.
V. The applicant sought for clarification on the rate of tax

applicable to the items enumerated supra. The applicant is a dealer
in Electrical and Electronic ballasts (chokes) for Fluorescent tubes,
M.V.lamps, S.V.lamps and CFL lamps.
The issue raised by the applicant is examined with reference to the

facts of the case, and HSN Codes notified by the Government of A.P.
vide G.O.Ms.No.1615 Rev (CT.II) Department dt.31-8-2005, and
found that HSN Code 8504 which was notified against UPS and its
parts, is removed with effect from 31-8-2005. Therefore, entire
chapter, 8504-Electrical transformers, static converters and
inductors which includes “ballasts for discharge lamps or tubes”, is
excluded from the HSN Codes against entry 39 of the IVth Schedule.
Hence, all items referred therein are liable to VAT @ 12.5%.
ruling.
To
M/s. Crompton Greaves Ltd.,
Secunderabad.


PROCEEDINGS OF THE

***
CCT’s Re f.No.PMT/P&L/A.R.Com/420/2005 DT.5-11-2005
O R D E R:
1. M/s. G.K.B.Rx. Lens Private Limited, Hyderabad (TIN

of Rs.1000/-.
Rate of tax applicable to the following :

i) Opthalmic lenses
ii) Contact lenses
iii) Spectacle frames & Goggles
iv) Cleaning solution
v) Accessories
3. Sri N.Pentaiah, Advocate & Sri Prasanth Singh, Marketing Manager

appeared on behalf of the firm for hearing on 26-10-2005 and explained
the case.
5. We have heard the applicant and considered the question.
The applicant relies on the HSN code applicable to some of the
products on which the ruling is sought. The codes relied upon are
9001, 9003, 9004. In G.O.Ms.No.1615 dt.31.8.2005, HSN code
applicable to some items falling under Schedule I and Schedule IV
have been notified. The HSN codes on which the applicant relied as
applicable to the products in question have not been found in the
said G.O.
We have also perused Schedules appended to the A.P.VAT
Act, 2005 and do not find the products in question. Therefore in
terms of the language of Schedule V of the A.P.VAT Act, 2005 all the
products in question are liable to tax @ 12.5% with effect from
31.8.2005.

To
M/s. G.K.B.Rx.Lens Private Limited,
c-16 to 19, Malthi Naik Plaza, Reddy Hostel Lane,
Abids, Hyderabad.
Hyderabad.
Copy to the Commercial Tax Officer, M.J.Market Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Hindustan Construction Co. Limited, Hyderabad (TIN

Is the assessing authority justified in issuing Form VAT 117

proposing to deny transition relief on the ground that the applicant has no
direct work order from the Irrigation & CAD (PW) Department, Warangal,
A.P.

Copy of Form VAT 117.
Sri C.V.K.Sarma, Advocate appeared on behalf of the firm for

The applicant has apparently filed a claim before the
assessing authority for transition relief. The assessing authority
issued a notice proposing to reduce sales tax credit on the ground
that the applicant has no direct work order and to this effect a
notice in Form VAT 117 was issued.
According to Section 67(2) no application shall be
entertained where the question raised in the application is already
pending before any Officer / Authority of the department /
Appellate Tribunal / Court.
In view of this legal provision we are unable to entertain the
application and accordingly it is disposed of.
To
M/s. Hindustan Construction Co. Limited,
401, Archana Apartment, Kapadia Lane,
Raj Bhavan Road,
Hyderabad

Hyderabad.
Copy to the Commercial Tax Officer, R.P.Road Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Jyothi Agencies, Visakhapatnam (TIN.28140182679)have filed

an application and sought clarification and advance ruling on the following

1) Whether plastic sheet made of HDPE fall under entry 90 of the
IVth Schedule.
2) Whether HDPE woven fabric – marketed as mosquito net fall
under entry 90 of the IVth Schedule.

1) Copies of tax invoices issued by the applicant
2) Copies of sale invoices of the suppliers.
IV. Sri Ch.Raja, Proprietor appeared for hearing and explained the case.
G.O.Ms.No:1615 Revenue (CT.II) Department Dated 31-08-2005 and the
VI. The applicant purchases commodities viz., plastic sheet

(reinforced) made of HDPE and HDPE woven fabric (mosquito net)
from the dealers of outside the state and trade in the state of
Andhra Pradesh. Copies of purchase invoices produced at the time
of personal hearings reveal that plastic sheet reinforced and
laminated do not fall under HSN Code 3920 whereas HDPE woven
fabric mosquitonet fall under HSN code 3926.90, which is not
notified by the Government of A.P. Both these commodities fall
under articles of plastics other than “all kinds of packing material”
(entry 90 of IVth Schedule) and liable to tax @ 12.5% under the
residuary entry of Vth Schedule.
ruling.
To
M/s. Jyothi Agencies,
Visakhapatnam.

Copy to the Deputy Commissioner(CT) Visakhapatnam Division.
Copy to the Commercial Tax Officer,Daba Gardens, Visakhapatnam Circle.
PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Shalimar Ribbon House, Hyderabad (TIN No.28020173468)

Rate of tax applicable to Narrow woven fabrics art silk ribbon
3. The applicant submitted the following documents:

Sale invoice issued by M/s. Rajendra Textiles, Surat.
4 Sri N.Vishal, Managar appeared on behalf of the firm for hearing on
6 The applicant states that he is a seller of Narrow woven fabrics art
silk ribbon and that he purchases this item from dealers situated outside
the State of A.P. and furnished a copy of purchase invoice issued by M/s.
Rajendra Textiles, Surat. Description on the invoice shows that the
applicant purchases Narrow woven fabrics art silk ribbon. The applicant
seeks to know the rate of tax under A.P.VAT Act, 2005 applicable to the
item in question.
We have heard the applicant and perused the documentary

evidence. Entry 52 of Schedule IV of the Act as amended in
G.O.Ms.No.1564 dt.17.8.2005 reads “Readymade garments,
Bedsheets, Pillow covers, Towels, Blankets, Travelling rugs,
Curtains, Crochet laces, Zari, Embroidery articles and all other made
ups” As seen from the language of the entry “other made ups” also
fall within the ambit of the entry. Physical sample produced for our
perusal supported with documentary evidence wherein the width of
the silk ribbon is mentioned, leads us to the conclusion that the
item can be classified as made up. Therefore we hold that Narrow
woven art silk ribbon is liable to tax @ 4%.
To
M/s. Shalimar Ribbon House,

15-6-536, Begum Bazar,
Hyderabad – 12.

Hyderabad.
Copy to the Commercial Tax Officer, Afzalgunj Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/377/ 2005. Dated 5 -11-2005.
O R D E R:
M/s. Sneha Vinyl Products (P) Ltd., Chittoor (TIN. 28710136100) have filed

Whether coated fabric is taxable or not.

Copies of sale invoices issued by the applicant.
Sri C.Srinivasa Rao, Managing Director, appeared for hearing and

explained the case.
Act and Rules HSN Codes notified by the Government vide G.O.Ms.No.1615
Rev.(CT.II) Dept. Dt.31-8-2005 and the ruling is given as under:
The applicant states that they make

‘coated fabrics’ and sell in the state and as well outside the state.
They state that the product dealt by them fall under Central Excise
Tariff Heading No.5903.1010 for which they also adduced evidence
of copies of sale invoices in which they mentioned same Tariff sub-
heading. They also stated that the product is liable for additional
excise duty.
Entry 86 of the IVth schedule to the APVAT Act
enumerates PVC cloth, waterproof cloth, tarpaulin and Rexene,
liable to 4%. As per the HSN Code notified against entry 86 of the
IV Schedule, it is found that item “textile fabrics impregnated with
Poly vinyle Chloride” is notified.
The Central Government vide notification No.31&32/2004 dt
9.7.2004 have exempted the goods falling under heading 5903.10
from levy of additional excise duty. That means, the goods falling
under entry 5903.10 are amenable to additional excise duty but are
exempted specifically by a notification. Therefore, goods which are
liable to additional excise duty shall be exempted from the levy of
sales tax Therefore, the goods produced & sold and falling under
sub-heading 5903.10.10, by the applicant are exempt from levy of
VAT.

ruling.
To
M/s. Sneha Vinyal Products (P) Ltd.,
I D A Renigunta, Tirupathi.

Copy to the Deputy Commissioner(CT) Chittoor Division.
Copy to the Commercial Tax Officer,II Tirupathi Circle.

PROCEEDINGS OF THE
*****
O R D E R:
I. M/s. SUBHODAYA PAPER MART, PALAKOL (TIN. 28050211879) have


Rate of tax on wedding cards, invitation cards, printed cards, illustrated
post cards, personal greeting cards with messages along with or without
envelopes.
Sri P.Murali representative, appeared for hearing and explained the

case.
Act and Rules and HSN Codes notified by the Government vide
G.O.Ms.No.1615 Rev.(CT.II) Department, dt. 31-8-2005 and the ruling is
given below :
The applicant is a trader in paper and also in wedding cards,

greeting cards etc.
Entry 47 to the IV Schedule covers printed material. Against the

entry HSN Code 4909 is notified. Which covers items --- printed or
illustrated post cards , printed cards bearing personal greetings,
messages or announcements, whether or not illustrated with or
without envelops or trimmings HSN Code 4909 –0010-deals with
greeting or wedding cards Therefore, all cards enumerated supra
are included in entry 47 of the IVth Schedule liable to tax @ 4%.
Addl.Commissioner Jt.Commissioner Jt.Comissioner.
ruling.
To
M/s. Subhodaya Paper Mart,
Palakol.

Copy to the Deputy Commissioner(CT) Eluru Division.
Copy to the Commercial Tax Officer, Palakol Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. The Swasthik Pharmaceuticals, Vijayawada(TIN.28960206546)

Rate of tax on Benedicts‘solution under the APVAT Act.

1) Copy of Form 26 issued by the Drug Control Administration,
Andhra Pradesh.
2) Copy showing list of products being manufactured by the
applicant.
3) Copies of sale invoices.
IV. Sri D.Ramesh Babu, Partner, appeared for hearing and explained the
case.
VI. The applicant states that Benedicts’ solution manufactured
under a drug license and sold by them falls under entry 88—Drugs
and Medicines of IVth schedule liable to VAT @ 4%.
The arguments of the applicant are heard. The documents
furnished are perused. The applicant besides making drugs and
medicines of I.P. and B.P. Category, are also making Benedicts’
solution of qualitative type. The said commodity, a chemical,
manufactured and sold by them, is identified as a specialized
chemical used to test ‘sugar content’ in blood and urine. In other
words,. it is a reagent chemical for conducting a specific test in
laboratories, clinics and research institutes. Benedicts’ solution is
neither a drug and medicine nor a medicated good as it does not
cure/ mitigate any disease and in commercial parlance is not
identified as drug and medicine. Therefore, it falls in the residuary
entry of Vth schedule liable to tax @ 12.5%.

ruling.
To
M/s. The Swastik Pharmaceuticals,
Vijayawada.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. V.E.C. Software, Hyderabad (TIN No.28690114114) have filed

Whether sales of hand paintings, sculptures are exempt under

A.P.VAT Act, 2005.
3. Sri Prashant Lahoti, Proprietor appeared on behalf of the firm for

5. The applicant is a Software company and intends to engage itself in
the business of procuring hand painting sculptures made by private artisans
and sell them. The applicant therefore seeks to know whether sales of such
hand paintings and sculptures made by private artisans and sold by the
applicant are liable to tax and if so at what rate.
Sales of paintings and sculptures by the applicant who is a
VAT registered dealer are liable to tax. As these items are not listed
in the Schedules to the A.P.VAT Act, it is held that they are liable to
tax @ 12.5% in accordance with the language of Schedule V of the
A.P.VAT Act, 2005.

To
M/s. VEC Software,

G.S.Plaza, III Floor, Road No.1,
Banjara Hills, Hyderabad – 500 034.

Hyderabad.
Copy to the Deputy Commissioner (CT), Panjagutta Division
Copy to the Commercial Tax Officer, Jubillee Hills Circle.

PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Navadurga Mineral Industries, Secunderabad

of Rs.1,000/-
II. They sought clarification on the rate of VAT applicable to sale of

Natural fullers earth.
III. The applicant submitted the following documents :

Copies of invoices raised by the applicant.
IV. Mr.V. Nagendra Prasad, Authorised Representative, appeared for

VI. The applicant seeks clarification on the rate of VAT applicable

to sale of Natural Fullers earth. Entry 43 of IV schedule reads –
“ores and minerals”. Items in this schedule are exigible to tax @
4% VAT. Natural fullers earth which is also known as bentonite
powder attracts HSN Code – 2508-10. Therefore, the rate of tax
under APVAT Act applicable to Natural Fullers earth is @ 4%.

ruling.
To
M/s. Navadurga Mineral Industries,
Secunderabad.
Copy to the Commercial Tax Officer, Musheerabad Circle.

PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner(Audit)
Sri P. Satyanarayana Reddy, Jt.Commissioner (Legal)
*****
CCT’s Ref.No: /A.R.Com/ 173 /2006. Dated 5-12 -2006.
O R D E R:
I. Ghai Constructions Limited (TIN 28901463862) have filed an

II. The applicant submitted the following documents:
Brief writeup on nature of transactions
Copy of agreement.
Sri D.Hari Kishan, Advocate appeared for hearing and explained the case.
III. The applicant has stated that they were awarded a works Contract
by RITES Ltd Management Consultant of A.P. Power Generation Corporation
for total value of Rs. 6,14,80,000 to execute the work “ Earth work in
formation and supply of PSC Sleepers for ( plain track and points and
crossings), CMS points & crossings, P.way track fittings, 50 MM track ballast
and linking of track for expansion of Railway siding of Rayalaseema Thermal
power station, stage-II at V.V. Reddynagar (near Muddanuru), Cuddapah
District,AndhraPradesh”.
It is stated by the applicant that as per the terms and conditions of
agreement the material required for execution of works contract have to be
purchased by the applicant only from the sellers identified by the contractee
and before shipment of such goods they have to be pre-inspected by
representations of RITES LTD to ensure that the goods are of required
quality and specifications. The applicant has further stated that, in this
process, most of the goods are required to be purchased from vendors
outside the state of Andhra Pradesh, and contended that such transactions
fall under the provisions of Section 2 (g) (ii) of CST Act 1956 w.e.f.
13.5.2002.
IV. The applicant sought clarification on the following:
1) The applicant in his Written submissions and at the time of personal
hearing contended that, due to the contractual obligations of the
works contract since the goods are purchased from specified
interstate suppliers located outside the State of A.P. by issuing form
“C” by the applicant against payment of 4% CST, no TDS deduction
is applicable under the provisions of APVAT Act, 2005.
In support of their contention, the applicant has relied on the CCT’s
Circular No.AI(3)/911/2005, dt. 23-01-2006 and also on the decisions
of the Supreme Court of India in the following cases:
a) Sahney Steel Press Works Ltd. Vs. CTO., 60 STC 301(SC)
b) English Electric Company Vs. State of Madras – 23 STC, 32
(SC)
2) Whether the applicant is eligible for claiming Input Tax Credit relating to
purchases made from Local Registered dealers and used in the execution of
works contract..
3) With regard to the remaining amount pertaining to installation charges,
labour, loading and unloading charges and incidental charges etc., whether
we are eligible to claim exemption of VAT and on which no TDS is to be
made by the contractee.
After examining the relevant provisions of APVAT Act and Rules,
copies of agreement, written and oral submissions made by the
applicant, the following clarification is issued.
1) In so far as the transactions that are falling under the
provisions of Sec.2 (g) (ii) of CST Act, 1956 no TDS can
be made under APVAT Act, 2005, subject to providing
satisfactory documentary evidence of identification of
outside the State seller, by the contractee, inspection
of the material etc. by the contractee before the
movement of such goods to the place of execution of
works contracts in A.P. Further the contractor has to
purchase these goods by issue of “C” form and he
should be paying tax under Sec.4 (7)(a) of A.P.VAT
Act, 2005.
2) If the applicant is paying tax under Sec.4 (7) (a) of
APVAT Act, 2005 and has not opted for composition of
tax, the applicant is eligible for claiming Input tax
credit on local purchases made subject to the
provisions of Sec. 13 and Rule, 20 of APVAT Act and
Rules.
3) The applicant is eligible for exemption subject to the
conditions stipulated under Rule 17 of APVAT Rules.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Ghai Constructions Limited
S.D. Road, Secunderabad.

Copy to the Deputy Commissioner (CT) Secunderabad Division.
Copy to the Commercial Tax Officer, General Bazar Circle.

PROCEEDINGS OF THE

Sri P. Satyanarayana Reddy, Jt.Commissioner (Enft.)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/485/ 2005. Dated 6 -6 -2006.
O R D E R:
I. M/s. J.Chandramouli Reddy, D.No.7-129, Santhi Nagar, M.R.Palli,

Tirupati (TIN 28770147932) have filed an application Dated 23-11-2005

Whether they are eligible to claim input tax credit on the steel
supplied by Tirumala Tirupathi Devasthanam, Tirumala for whom the
applicant is executing works contract?
The applicant submitted work agreement and documents

relating to certain works relating to Padmavathi Women’s Junior
College at Tirupathi for construction of new college building.
The applicant is a works contractor who is executing works for TTD,

Tirumala. As per the terms of contract and agreement the contractor is to
execute and complete the work as per the specifications agreed upon
against the payment of a lumpsum amount. The applicant has stated that
during the execution of the works TTD, Tirumala is supplying steel for
carrying out its works and deducting the value of the steel so supplied from
the gross value of the bill at the time of making payments to the
contractor.
The applicant has sought clarification as to whether he can deduct
the amount deducted from this turnover of steel from gross bills while
arriving at the net turnover at his hands and also whether he is eligible to
claim input tax credit on the value of the amount deducted against supply
of the steel. He has also stated that TTD, Tirumala are purchasing the said
steel supplied to the works contractor from Visakhapatnam Steel Plant in
A.P.
IV. The case was posted for hearing on 3-6-2006, Mr.S.M.Raja Gopal
Naidu, Chartered Accountant, applicants respondent appeared for hearing
V. The issue has been examined with reference to the documents

produced, oral submissions made at the time of hearing and relevant
provisions of APVAT Act, 2005 and Rules made there under and the ruling is
given as under:
VI. The applicant is not eligible to deduct value of the goods

supplied to arrive at his net turnover since the supply of steel to the
contractor and deduction of its value from the total consideration
agreed upon for executing the works contract, amounts to purchase
of the said goods by the contractor. The total consideration received
from the works contract therefore becomes the turnover at the
hands of the contractor. For this reason and also in the absence of
tax invoice issued by the supplier makes the applicant ineligible to
claim input tax credit on the said value of the supply of steel. The
applicant is liable to pay tax under sub-section (7) of Section 4 of
A.P.VAT Act, 2005.
ruling.
To
M/s J.Chandra Mouli Reddy,

Copy to the Deputy Commissioner (CT), Chittoor Division.
PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Meera Sai Agencies, (TIN.28030180290) Chatta Bazar,

Hyderabad have filed an application Dated 16-2-2006 and sought

Rate of tax applicable to Plastic and Hawai Footwear.
Invoice showing purchase of different types of plastic
footwear.
IV. The case was posted for hearing on 3-6-2006, Sri Mohan Hirandan,
Proprietor appeared for hearing on 3-6-2006 and explained the case.
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005as
superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept. dt.27.08.2005 and in
G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005 and the ruling is
given as under:
VI. The applicant states that he is dealing in Plastic Footwear and
Hawai Footwear and seeks to know the rate of tax applicable to
the product. In support of the claim the applicant filed the
invoice under Rule 11(2) of Central Excise Act & Rules issued by
M/s Lakhani India Ltd., Faridabad from whom the applicant is
purchasing footwear. The said invoice contains 64.01 as the HSN
Code for Tariff Heading.
As the applicant is engaging in buying and selling of Plastic
footwear and Hawai Chappals we hold that the applicant is liable
to tax @ 4% in terms of Entry 46 of Schedule IV of the AP VAT
Act, 2005.
Through G.O.Ms.No.1596 dt.27-8-2005 the Schedule entry has
been amended to read as “Plastic footwear and Hawai
Chappals”. In G.O.Ms.No.1615 dt.31-8-2005 specific 8 digit
HSN codes have been notified under the entry 46 of IV
Schedule. The item codes notified by Government fall under
Chapter 64. The applicant is liable to tax @ 4% if he carries on
trading in those items. If the applicant happens to sell footwear
other than those specified in Entry 46 and HSN codes notified
thereunder, he is liable to tax @ 12.5%.
ruling.
To
M/s Meera Sai Agenices,
Chatta Bazar, Hyderabad.

Copy to the Deputy Commissioner (CT) Charminar Division.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Mohan Enterprises, (TIN.28120248575) Yousuf Bazar, Chatta

Bazar, Hyderabad have filed an application Dated 16-2-2006 and sought

Rate of tax applicable to Plastic and Hawai Footwear.
Invoice showing purchase of different types of plastic
footwear.
IV. The case was posted for hearing on 3-6-2006, Sri Mohan Hirandan,
Proprietor appeared for hearing on 3-6-2006 and explained the case.
given as under:
VII. The applicant states that he is dealing in Plastic Footwear and
Hawai Footwear and seeks to know the rate of tax applicable to
the product. In support of the claim the applicant filed the
invoice under Rule 11(2) of Central Excise Act & Rules issued by
M/s Lakhani India Ltd., Faridabad from whom the applicant is
purchasing footwear. The said invoice contains 64.01 as the HSN
Code for Tariff Heading.
As the applicant is engaged in buying and selling of Plastic
footwear and Hawai Chappals we hold that the applicant is liable
to tax @ 4% in terms of Entry 46 of Schedule IV of the AP VAT
Act, 2005.
Through G.O.Ms.No.1596 dt.27-8-2005 the Schedule entry has
been amended to read as “Plastic footwear and Hawai
Chappals”. In G.O.Ms.No.1615 dt.31-8-2005 specific 8 digit
HSN codes have been notified under the entry 46 of IV
Schedule. The item codes notified by Government fall under
Chapter 64. The applicant is liable to tax @ 4% if he carries on
trading in those items. If the applicant happens to sell footwear
other than those specified in Entry 46 and HSN codes notified
thereunder, he is liable to tax @ 12.5%.
Addl.Commissioner Jt. Commissioner Jt. Commissioner.
ruling.
To
M/s Mohan Enterprises,
Chatta Bazar, Hyderabad.


PROCEEDINGS OF THE

Sri P.Satyanarayana Reddy, Jt.Commissioner(Enft.)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 581/2005. Dated 6 - 06-2006.
O R D E R:
M/sTolety Office Makers, Ameerpet, Hyderabad (TIN.28040174793)

. They sought clarification on the following:

Rate of tax applicable to Aluminium Panel Sheets (High bonded) with
HSN Code 7606.11.90
. The applicant submitted the following documents:
1) Copy of purchase invoices
2) Brochure (Alstrong Aluminium composite material)
Sri K.V.Mohan Rao, STP appeared for hearing and explained the
case.
(CT-II), Dept. dt.2.06.2006 and the ruling is given as under:
The Aluminium Panel Sheet (High Bonded) with thickness
exceeding 0.2 mm with HSN Code 7606.11.90 is notified through
G.O.Ms.No.1615, Revenue (CT.II) Dept., dated 31.8.2005 w.e.f.
01.9.2005 in the IV Schedule of AP VAT Act, 2005 against the Entry
27 and therefore liable to tax @ 4%.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Tolety Office Makers,

Copy to the Commercial Tax Officer, Srinagar Colony Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sunshine Chemicals (TIN No.28830193520) Hyderabad
Rs.1000/-.

The rate of tax applicable to Bentonite.

1. Copies of sale invoice
2. Copy of transit form issued by department of Mines and Geology.
Sri M.Chandra Sekhar, Proprietor of the firm has appeared for

1 of page 2
is given as under.
The applicant claims to be manufacturer of Bentonite which is
also known as Fullers Earth used as a Bleaching agent in refining
edible and non-edible oils. The applicant claims to pay royalty to the
Mines & Geology and furnished transit forms issued by that
department in support of the claim. The transit forms describe the
mineral in question as “activated bleaching earth”.
Entry 43 of Schedule IV of the Act refers to “Ores and
Minerals”. In the G.Os cited above, the notified HSN code 2508.10
of Entry 43 refers to activated Bentonite powder. In the
circumstances, it is held that the rate of tax applicable to the
Bentonite mineral powder is 4%.

To
M/s. Sunshine Chemicals

1-1-534, Gandhinagar,
Copy to the Commercial Tax Officer, Gandhi Nagar Circle.

PROCEEDINGS OF THE

***
CCT’s Re f.No.PMT/P&L/A.R.Com/254/2005 DT. 6-9-2005
O R D E R:
1. M/s. Naushad Construction Company, Kovvuru, West Godaviri Dist.

Whether stone chips sold by the applicant by converting stone falls under
Entry 43 of Schedule IV of the Act and taxable @ 4% ?

i) Copy of invoice
ii) Copy of challan paid towards Royalty on Minor Minerals
4. Sri V.S.Shiva Ram, Authorised Representative appeared on behalf of
the firm and requested for issue of clarification without personal hearings.
APVAT Act and HSN Codes notified by Government vide G.O.Ms.No.398,
Revenue (CT.II) Department, Dt.31-03-2005 and G.O.Ms.No.490, Revenue
(CT.II) Department, Dt.15-04-2005 and the ruling is given as under:
6. The applicant claims that he extracts stone boulders from their own
quarries and crushes them into stone chips and they paid seignorage to
Mines Department. The Mines Department collected the seignorage by
classifying stone boulders as ‘Minor mineral’. The mineral extracts from the
ground is converted into stone chips without any external substance. The
product sold by the applicant converting boulders into stone chips is a
natural mineral without addition of any external substance.
In the G.Os cited above, the Govt. notified certain
commodities assigning with HSN codes. At Sl.No.1 of the Entry 43,
HSN codes 2601 to 2617 are notified against the said entry. Stone
boulders / ballast is assigned with HSN code 2516.90.20. Therefore,
Entry 43 do not cover Stone ballast and hence it is liable to tax @
12.5%.
To
M/s. Naushad Construction Company
Kovvuru, West Godavari District.
Hyderabad.
Copy to the Deputy Commissioner (CT), Eluru Division
Copy to the Commercial Tax Officer, Nidadavolu Circle.

PROCEEDINGS OF THE

***
CCT’s Re f.No.PMT/P&L/A.R.Com/231/2005 DT. 6-9-2005
O R D E R:
1. M/s. Sri Venkateswara Granites, Rajahmundry (TIN

of Rs.1000/-.
Whether stone chips sold by the applicant by converting stone falls under
Entry 43 of Schedule IV of the Act and taxable @ 4% ?

i) Copy of Certificate issued by the Department of Mines &
Geology, Govt. of A.P.
ii) Copy of Permit issued by Department of Minor Minerals
iii) Copy of tax invoice
4. Sri V.S.Shiva Ram, Authorised Representative appeared on behalf of
the firm and requested for issue of clarification without personal hearings.
APVAT Act and HSN Codes notified by Government vide G.O.Ms.No.398,
(CT.II) Department, Dt.15-04-2005 and the ruling is given as under:
6. The applicant claims that he extracts stone boulders from
their own quarries and crushes them into stone chips and they paid
seignorage to Mines Department. The Mines Department collected the
seignorage by classifying stone boulders as ‘Minor mineral’. The mineral
extracts from the ground is converted into stone chips without any external
substance. The product sold by the applicant converting boulders into stone
chips is a natural mineral without addition of any external substance.
In the G.Os cited above, the Govt. notified certain
commodities assigning with HSN codes. At Sl.No.1 of the Entry 43,
HSN codes 2601 to 2617 are notified against the said entry. Stone
boulders / ballast is assigned with HSN code 2516.90.20. Therefore,
Entry 43 do not cover Stone ballast and hence it is liable to tax @
12.5%.

To
M/s. Sri Venkateswara Granites
Rajahmundry
Hyderabad.
Copy to the Deputy Commissioner (CT), Kakinada Division
Copy to the Commercial Tax Officer, Aryapuram Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Blue Star Limited, (TIN No.28150108021), Bantia Estates,

1) Whether in the facts and circumstances of this case the applicant herein
are entitled to pay tax in respect of contracts at an all inclusive price
entered into prior to the commencement of the APVAT Act,2005 (w.e.f.
April 1,2005) at the rate of 4% of 50% of the consideration on the basis
that option for composition in Form VAT 250 has already been filed in
respect of these contracts under the APVAT Act,2005.
2) Whether in the facts and circumstances of this case the applicant here in
are entitled to pay tax in respect of contracts at an all inclusive price
entered into between 01st April,2005 to 28th August,2005 at the rate of 4%
of 50% of the consideration on the basis that option for composition in
Form VAT 250 has already been filed in respect of these contracts under the
APVAT Act,2005.
3) Whether in the facts and circumstances of this case the applicant here in
are entitled to pay tax in respect of contracts where the VAT element is to
be
1 of 3
charged separately entered into between 01st April,2005 to 28th

August,2005 at the rate of 4% of 50% of the consideration on the basis
that option for composition in Form VAT 250 has already been filed in
respect of these contracts under the APVAT Act,2005.
The case was posted for hearing on 24-10-2005. Sri R. Raja Raman,
Consultant and Sri M. Srinivasa Rao, Manager (Accounts) appeared on
behalf of the firm and explained the case.
According to the applicant, they are receiving goods from their

factory outside Andhra Pradesh and they are using such goods in the
execution of works contracts in the State. They have contended that the
goods received from their factory are used in the ongoing works which
commenced before 01-04-2005 and also in the works which commenced
before 01-09-2005 i.e., before changes in provisions relating to works
contracts are made in VAT Law from 1st September,2005.
The main question appears to be the rate of tax applicable for the
ongoing works on account of APVAT Act coming into force from 01-04-2005
and on account of amendments made to VAT Act from 01-09-2005.
After examining the facts of the case with reference to the provisions
of APVAT Act,2005 and the Rules there under the ruling is given as under:
1) In respect of the ongoing works which commenced prior to

01-04-2005, the applicant will have the option to opt for
composition for the remaining portion of the contract which is
executed after 01-04-2005. This means that the goods must be
incorporated in the execution of such works contract after 01-04-
2005 and there must be factual evidence for this so that the
applicant will have the option to pay tax under sub-section (7)(c) of
Section 4 of the APVAT Act,2005. If no option was exercised on the
date of commencement of new Act and work was executed, the
applicant will have to pay tax under sub-section 7(a) of Section 4 of
the Act. He will not have any choice to opt for composition at this
stage for any work already executed without opting for
composition.
2) As regards the works taken up after 01-04-2005, the

applicant has mentioned about two different situations where price
is inclusive of tax in certain cases and where VAT element is to be
charged separately. It
2 of 3
is found that the tax liability in both the situations does not
change at all. The only issue is whether the composition at 4% of
50% of the consideration can be continued after 28th August,2005
on account of changes in the tax rates structure. The applicant,
having opted for composition based on the tax structure applicable
on the date of giving option should be entitled to get out of the
composition on account of the change in tax rate structure. This
being so, the applicant can now opt out of composition for such
ongoing works and he can choose to pay tax under sub-section
(7)(a) of Section 4 of the Act. In case he does not opt to come out
of composition for such ongoing works, he will have to pay tax at
4% of the total consideration and he shall also be required to pay
tax at 4% or 12.5% in respect of the goods purchased or brought
from outside the State or purchased from non VAT dealers in the
State. The use of such goods in the execution of works contract and
the date of incorporation will have to be taken into consideration to
determine the date of taxable event and tax liability.
JT.COMMISSIONER
To
M/s. Blue Star Limited,
207, Sikh Road, Bantia Estate,
Secunderabad-500 003.

Hyderabad.
Copy to the Commercial Tax Officer, Maredpally Circle.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Megha Engineering Enterprises, (TIN No.28290203141),

Balangar, Hyderabad have filed an application dt.20-10-2005 and sought
1) The main contactor is under composition under Sec.4(7)(b) or (c). The

contractee is deucting/collecting tax at source at 4% of the contract value.
This contractor purchases some material from outside the State of A.P. or
from non VAT dealers for use in the execution of the contracts. If the goods
purchased in the above situation are taxable at 4% in the State of Andhra
Pradesh, whether the contractor is liable to pay tax at 4% at the time of
purchase of materials.
2) In any case the total liability of the contractor is 4% only under

composition and the same is collected/deducted at source itself. If the
goods purchased are taxable at 12.5% in the State whether the contractor
is liable to pay tax of 12.5% at the time of purchase or 8.5% of the
purchase value at the time of receipt of the payment from the contractee.
Since the tax is deducted at 4% on the entire contract value and the value
of the purchases from outside the state are to be deducted from the
contract value the difference tax is worked to 8.5% on the purchase value.
1 of 4
3) The main contractor is under composition under Sec.4(7)(b) or (c). The

contractee is deducting/collecting tax at source at 4% of the contract value.
The contractor gives part of the work to the sub-contractor. The sub-
contractor is exempted from tax as per the proviso to Sec.4(7). If such sub-
contractor purchases material from outside the State for use in the
contract, he is liable to pay tax on the purchase value of the goods. In such
a case whether the main contractor will get deduction of the outside
purchases value out of the total contract value or not. Otherwise it amounts
to double taxation on these purchases once in the hands of the sub-
contractor and once again in the hands of the main contractor.
4) The main contactor is transferring the proportionate tax burden to the

sub-contractor when he is awarding the part of the contract to sub-
contract. In such circumstances, is there any possibility to transfer the
proportionate TDS to the sub-contractor account. If the TDS is transferred
to sub-contractor can the sub-contractor utilize the TDS against the tax
payable on the purchase value of the goods that are purchased from
outside the State of Andhra Pradesh.
5) If there any obligation on the main contractor to make TDS from the
amounts payable to the sub-contractor, when the sub-contractor pays tax
under Sec.4(7)(a) or opts for composition under Sec.4(7)(b) or (c) or (d).
The case was posted for hearing on 11-11-2005. Sri M.

Ramachandra Murthy, Chartered Accountant appeared on behalf of the firm
and explained about the issues involved in the questions on which
clarification was sought.
After examining all the questions with reference to the provisions of

APVAT Act and Rules, the following ruling is given as under facts with
reference to the provisions of the Act and Rules, the ruling is given as
under:
1) Wherever any contractor purchases goods from non VAT

dealers or from outside the State for the purpose of use in
execution of works contract, such contractor is liable to pay tax on
the value of such goods at the time of incorporation which may
include certain expenditure over and above the purchased price, at
the tax rates applicable to such goods. This change has come into
effect from 29th August,2005. The applicant should decide the date
of taxable event based on the incorporation of the goods.
2) Wherever any goods purchased from non VAT dealers are

in 12.5% category, the applicant will have to pay 8.5% tax over and
above 4%
2 of 4
tax already deducted at source based on the date of

incorporation of such goods in the execution of the works contract
involved. The taxable event in this situation also depends upon the
date of incorporation of goods.
3) Wherever any sub-contractor purchases goods from non

VAT dealers and the main contractor for that particular contract is
already under composition, the tax on the goods purchased from
non VAT dealers will have to be paid by the sub-contractor based on
the date of incorporation of such goods and the main contractor can
deduct such taxable turnover from the total value of the contract so
that 4% tax is paid by him on the remaining turnover by way of
composition.
4) Where the main contractor is already under composition

and tax at 4% is already deducted for such contracts at source by
the contractee, there is no requirement to make TDS by the main
contractor if any portion of such contract is awarded to a sub-
contractor because the sub-contractor is now exempt as per the
changes made from 01-09-2005. As regards the transfer of the TDS
amounts by the main contractor to sub-contractor, there is no such
provision available in the Act and Rules. In clause (h) of sub-rule
(3) of Rule 17, it is specified that no refund of tax deducted at
source is available for the contractor who opts to pay tax by way of
composition in respect of the works executed for any person other
than the State Government or Local Authority. This provision is
based on the assumption that tax liability in respect of works
contact covered under composition and tax deduction at source are
equal. However, due to the change in the Law, a sub-contractor
may be required to pay tax on goods purchased from non VAT
dealers and this tax may be 4% or 12.5% depending upon the rates
applicable to such goods. It would be fair that the difference of tax
of 8.5% on goods taxable at 12.5% is required to be paid by the
sub-contractor, whereas the 4% portion can be adjusted from TDS
already made against the main contractor. The mechanism could be
that 4% tax component is treated as already paid and covered by
TDS at the hands of main contractor and only remaining 8.5% is
payable. The sub-contractor can declare the turnover in respect of
goods taxable at 12.5% by showing the actual tax liability at 12.5%
but in the adjustment boxes on the VAT return (Box 22) he may
declare 4% tax component already paid at the hands of main
contractor. For the adjustment claimed in VAT return by the sub-
contractor, he shall have evidence in the form of a declaration given
by main contractor and the same can be filed along with VAT return.
3 of 4
5) As regards the question whether main contractor should
make TDS from the amounts payable to the sub-contractors, the
provision of sub-section (4) of Section 22 is applicable. However, as
a result of changes made in law from 29th August,2005, a
subcontractor is not liable to pay tax whenever the main contractor
opted for composition and it is immaterial whether subcontractor is
in composition or not for such contract. His liability is limited to the
extent of purchases from outside the State or from non VAT dealers
in the State. There may be a situation where double TDS is required
to be made against the same contract both in the hands of main
contractor as well as in hands of the sub-contractor but this
question is to be addressed to the Commissioner of Commercial
Taxes whether 501 or 501-A are transferable either as a whole or in
parts from the main contractor to the sub-contractor.
JT.COMMISSIONER
To
M/s. Megha Engineering Enterprises,
S2, Tie Balanagar,
Hyderabad-500 004.

Hyderabad.
Copy to the Commercial Tax Officer, Balanagar Circle.

4 of 4

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. R.K. Surgicals, (TIN No.28770208945), Nampally Station Road,

Hyderabad have filed an application and sought clarification and Advance
Ruling on the following items under Section 67 of the APVAT Act, 2005 read
with Rule 66(2)(i) of APVAT Rules,2005 along with the application fee of
Rs.1000/-. The application is examined and found in order. Hence admitted.
The applicant is seeking a clarification of rate of tax on the following:
Rate of VAT on disposable surgical gloves, disposable anesthesia

items, disposable face mask, cap, aprons, HIV Aids Kit, B.P. Appratus,
Thermometers, weighing scale, All rubber items, operation theater items,
cardiac items (Heart Valves and Stents).
The case was posted for hearing. Sri R.K. Gupta, Partner appeared
on behalf of the firm and explained about various items on which
clarification is sought regarding the rates of tax applicable.
After examining the list of the items submitted by the applicant, it is

found that all the items are used for medical purposes and they are of two
categories i.e., disposable/single use and items of multiple use. The Entry
No.88 of Schedule IV has been amended with effect from 1st
September,2005 so as to include hypodermic Syringes, hypodermic
needles, catguts, sutures, surgical cotton, dressings, plasters, catherters,
cannulae, bandages and similar articles.
1 of 2
The result of these added items gives the impression that

disposables and one time use items used for medical purposes have the
benefit of 4%, whereas durables and multiple use items are outside 4%
category. The words “similar articles” added is also very significant in this
regard. Taking this into consideration, the ruling is given as under:
1) All items which are for single use and which are disposables
shall be taxable at 4%.
2) All items which are for multiple use like house hold gloves,
hot water bags, water beds, similar rubber items etc., are
outside 4% category and they are liable to tax at 12.5%.
JT.COMMISSIONER
To
M/s. R.K. Surgicals,
5-8-105/E, Gadwal Compound,
Behind Kamat Hotel, Nampally Station Road,
Hyderabad-500 029.

Hyderabad.
Copy to the Commercial Tax Officer, Nampally Circle.

2 of 2

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Somani Brothers, Hyderabad (TIN No.28340201458) have filed

2. They sought clarification on the rate of tax on the following:
i) Computer printer ribbons

ii) Laser toner powder
iii) Inkjet and Laser printer catridges
1. The applicant submitted the following documents.
Copies of tax invoice showing purchase, sales effected by the applicant.
4. Sri Kishore Somani, Managing Partner appeared for hearing on 3-12-

6. The applicant claims to be a manufacturer and seller of

Ribbon catridges, laser toner powder etc. He seeks to know the rate
of tax applicable to the items mentioned at para 2 above.
Documentary evidence furnished by the applicant has been
perused. Entries in the schedules to the A.P.VAT Act, 2005 have
been gone through.
As regards computer printer ribbon, we find that Entry 39

refers to various I.T. products and HSN codes applicable to these
items have also been mentioned against the sub entries. In
G.O.Ms.No.1615 Rev. (CT.II) Dept. dt.31.8.2005, the HSN codes
applicable to certain items in Schedule I and Schedule IV have been
notified. At sub entry (3) of Entry 39 that refers to computer
systems and peripherals, HSN code 8471 has been notified. At sub
entry (4) of the same entry parts and accessories of HSN code 8471
has also been notified. The HSN code 8471 refers to automatic data
processing machines and units thereof. Under the said code laser
jet printer, Inkjet printer are also found attracting HSN code
8471.60.26 and 8471.60.27 respectively. A computer printer ribbon
does not have any other usage except as an accessory of a
computer printer which can be of Inkjet or laser jet variety. Since
the HSN code 8471 takes within its sweep laser and Inkjet printers
and parts and accessories of the items falling under the said code
having been notified at sub entry (4) of Entry 39, we hold that
computer printer ribbon falls squarely within the ambit of Entry 39
of Schedule IV to the A.P.VAT Act, 2005. Accordingly, it is liable to
tax @ 4%.
As regards rate of tax applicable to laser toner powder sub

entry (3) & (4) of Entry 39 notified in the G.O. cited above has been
examined. Sub entry (3) refers the HSN code 8471 whereas sub
entry (4) refers to parts and accessories of HSN code 8469, 8470
and 8471. As explained by the applicant, toner in powdered form
serves as a refill for laser printing and falls within the sweep of HSN
code 8471. Having regard to the nature of the product and its usage
we are inclined to hold that laser toner powder falls within the
sweep of HSN code 8471 and as it has been notified at sub entry (4)
of Entry 39 in the said G.O., the item is liable to tax @ 4%.
As regards Inkjet laser catridge, we once again rely on sub

entries (3) & (4) of the Entry 39 of the HSN codes as notified in the
G.O. cited above. As an Inkjet and laser printer catridge is an
accessory of an Inkjet and laser printers and since the related HSN
code 8471 has been notified, we hold that catridge used in both
type of printers is also liable to tax @ 4%.
To
M/s. Somani Brothers,
10-2-15, 2nd Floor,
Damodharadas Nivas,
West Maredpally,
Secunderabad – 26.

Hyderabad.
Copy to the Deputy Commissioner (CT), Secunderabad Division
Copy to the Commercial Tax Officer, Market Street Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. V-Guard Insdustries (P) Limited, Hyderabad (TIN

of Rs.1000/-.
i) Whether the applicant have to apply the formula A x B/C to

arrive at the input tax eligibility despite maintaiing separate
stock registers for materials purchased from A.P. and outside
A.P. and transferring stock to the applicant branches situated
outside A.P. from out of stock purchased from A.P.?
ii) Whether bifurcation of basic price and VAT is to be necessarily

shown while effecting sales of non VAT dealers ?
iii) Rate of tax applicable to telephone cables.
i) Copy of notice of assessment in Form VAT 305A issued by

Asst.Commissioner(LTU), Saroornagar
ii) Copy of invoice showing purchase of cables showing Central
Excise tariff sub heading
4. Sri G.Madhusudhan, Senior Officer (Accounts) appeared for hearing

6. The applicant claims to be a branch office engaged in trading

of Electrical and Electro mechanical products and stabilizers of
various models. The applicant claims to purchase some models from
VAT dealers within A.P. and some from outside A.P. The applicant
claims that he is maintaining two separate stock registers for the
material purchased from A.P. and outside A.P. Further the applicant
claims to transfer the stock to his branches situated outside A.P.
and in the process transfers a few stabilizers purchased from A.P.
to his branches situated outside A.P. The applicant states that he is
maintaining two separate registers and whenever they transfer the
stock purchased from A.P. VAT dealers to outside A.P. branches, he
reduces the input tax credit in the monthly return by 4% for that
stock. However, the AC(LTU) Saroornagar issued a notice of
assessment applying the formula A x B/C and restricted the input
tax credit. In the circumstances, the applicant seeks to know
whether application of the formula is warranted.
We have considered the plea of the applicant. It is clear from
the documentary evidence furnished by the applicant that notice in
Form VAT 305A has been issued by the AC(LTU) Saroornagar
division. According to Section 67(2) a question raised in the
application if already pending before any officer of the department
does not merit consideration by the advance ruling authority. Thus
statutorily this authority is barred from entertaining the question
pending before an officer / authority of the department. As a notice
of the assessment issued in Form VAT 305A is statutory in nature
and that applicant has been given an opportunity to file his
objections, this issue cannot be considered by this authority.
Therefore, we are unable to pass any ruling on this issue.
As regards permissibility of the practice of bifurcation of
basic price and VAT in case of sales effected to non VAT dealers, we
hold that statute prescribes the format of tax invoice in the case of
sales made by a VAT dealer to another VAT dealer. In the case of
sales made by a VAT dealer to a non VAT dealer, the law does not
prohibit bifurcation of basic price on VAT. Therefore the applicant is
at liberty to show the basic price of VAT separately even in respect
of sales made to non VAT dealers.
As regards the rate of tax applicable to Telephone cables,
Entry 38 of Schedule IV to the A.P.VAT Act reads “Industrial cables
(High voltage cables, XL PE Cables, Jelly filled cables, optical fibre
cables) In G.O.Ms.No.1615 Rev.(CT.II) Dept. dt.31.8.2005 HSN code
applicable to certain items of Schedule I and Schedule IV have been
notified. We perused the notification and do not find Entry 38 that
refers to cables. Documentary evidence furnished by the applicant
showing purchases from M/s. Imperial Cables Private Limited, New
Delhi contains excise tariff heading 8544.90. This code has not been
notified in the said G.O. Therefore, we hold that telephone cables
attract VAT rate of 12.5% in terms of language of Schedule V to the
A.P.VAT Act, 2005.
To
M/s. V-Guard Industries Private Limited,
Plot No.24 & 25, Mansoorabad,
Sri Lakshmi Nagar Colony, Hyderabad – 68.
Hyderabad.
Copy to the Deputy Commissioner (CT), Saroornagar Division
Copy to the Commercial Tax Officer, Saroornagar Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Khurana Surgicals & Marketing (P) Ltd., (TIN
No.28960129722), Hill Fort Road, Naubat Pahad, Hyderabad have filed an
application and sought clarification and Advance Ruling on the following
items under Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i) of
APVAT Rules,2005 along with the application fee of Rs.1000/-. The
application is examined and found in order. Hence admitted.
Whether orthopedic implants and artificial joints fall under Entry 2 of
Schedule-I and whether exempted.
The case was posted for hearing. Sri Gurmeet Singh, executive
Director
appeared and explained the case.
It was explained by them that Government have notified HSN Code
9021.10 for Orthopedic or fracture appliances and HSN Code 9021.31for
artificial joints against Entry No.2 of Schedule-I. They have contended that
they are paying tax on orthopedic instruments and medical equipments and
claiming exemption on the implants and artificial joints. The relevant
invoices were also produced to prove that the items dealt by them are
classified under HSN Codes.9021.10, and 9021.90.
After seeing relevant documents and the HSN Codes notified by the
Government, the ruling is given as under:
In so far as the items covered by the HSN Codes notified by
the Government against Entry No.2 in Schedule-I to the Act are
concerned, they are exempted and in case the items dealt by the
applicant clearly fall under these categories, they are eligible for
exemption under the Act.
JT.COMMISSIONER
To
M/s. Khurana Surgicals & Marketing (P) Ltd.,
5-10-180/2, II Floor, Sandhu Chambers, Hill Fort Road, Naubat Pahad,
Hyderabad-500 004.

Hyderabad.
Copy to the Commercial Tax Officer, Basheerbagh Circle.
2 of 2

PROCEEDING OF THE

2005.
***
O R D E R:
M/s. Sree D’Gravure (TIN No.28760221232), Shed No.4, IDA.,
Uppal, Hyderabad have filed an application and sought clarification and
Advance Ruling on the following items under Section 67 of the APVAT Act,
(i) Whether tax is applicable If job work is done on roto gravure cylinders
supplied by customers and printing work is done by them.
(ii) The tax rate applicable where cylinders along with printing are supplied
by the applicant to the customers.
The case was posted for hearing. Sri
According to the applicant they are manufacturers of roto gravure
cylinders and their activity is part and parcel and ancillary to printing
industry. They have contended that they print the material based on the
master provided by the customers and the cylinders in some cases are
supplied by the customers themselves and in certain other cases their own
cylinders are used for supply to the customers. It was explained that the
material used in the first category where cylinders are supplied by the
customers is in the nature of job work whereas in the 2nd category of
transactions, it is in the nature of works contract. They have produced
copies of certain invoices raised by them. As seen from these invoices it is
observed that in certain transactions engraving charges are collected
whereas in certain other transactions supply of cylinders as per instructions
is shown.
After examining the nature of transactions of the applicant, the
ruling is given that:
(i) Where cylinders are provided by the customers and the work is
done by the applicant and it does not involve significant component
towards any materials, such transactions may constitute job work.
However, if such works involve transfer of material constituting
significant portion and it will become a works contract and the
applicant will be required to pay tax on the materials incorporated
at the rates applicable to them. The applicant will however, have
the option to pay tax at the rate of 4% by way of composition on
the entire charges collected.
(ii) As regards supply of cylinders along with printing, the
transactions clearly fall under the category “sales” as seen from the
billing pattern and therefore, they will attract tax @ 12.5%.
JT.COMMISSIONER
To
M/s. Sree D’ Gravure,
Shed No.4, IDA, Uppal,
Hyderbaad.

Hyderabad.
Copy to the Commercial Tax Officer, Tarnaka Circle.
2 of 2

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 527/ 2005. Dated: 07-03-2006.
Ref: - CCT’s. Ref.No: PMT/P&L/A.R.Com/2005, Dated 13-04-2005.
O R D E R:
I. M/s. Basher Khan, Kothapet, Vijayawada

(TIN.28460114057
have filed an application and sought clarification and advance ruling
on the following items under Section 67 of APVAT Act, 2005 read
with Rule 66(2)(i) of APVAT Rules, 2005 along with the application
fee of Rs.1,000/-

1. Rate of tax applicable to Dry Fish

1. Note containing the circumstances of the applicant, dictionary
meaning of the word “Cured” and “Dry”, gist of judgment of
Hon’ble Supreme Court in the case of of Kerala Fishermen’s
Welfare Fund Board, Vs. Fancy Food and another and properties
of the product in question;
2. A copy of A.P. High Court judgment in the case M/s. Sri Krishna
Dry Fish Traders Vs. The State of A.P.
IV. Mr. Hyder Vali A.R. appeared for hearing and explained the case.
VI. The applicant is dealing in Fish, which he purchases within and

outside the State of A.P. and sells locally. The applicant claims that Dry Fish
sold by him is merely sun-dried, neither cured nor frozen. In the
circumstances he claims that it falls under entry 24 of First Schedule to the
AP VAT Act, 2005 which contains list of items exempt from VAT. In support
of the contention that tax is exempt on dry fish, the applicant relies on the
judgment of A.P. High Court in the case of M/s. Sri Krishna Dry Fish Traders
Vs. The State of A.P. and The Supreme Court in the case of Kerala
Fishermen’s Welfare Fund Board.
We have heard the representative and also called for
remarks of the officer concerned. The Deputy Commissioner (CT)
Vijayawada-I Division reported that the applicant had claimed
exemption on the said product, but the officers issued notice to the
applicant to pay tax @ 12.5% w.e.f. 01.04.2005 though the
prescribed Form VAT 305A was not issued.
According to Sec.67 (2) no application shall be

entertained where the question raised in the application is pending
before any officer or authority of the Department or Appellant
Tribunal or any Court. In the case of the applicant it is confirmed by
the Dy. Commissioner (CT) concerned that a notice had been issued
asking the applicant to pay tax @ 12.5% and the period from which
such tax demanded has also been specified in the notice. However,
the said officer has not used the prescribed form 305A.
We have considered the contention of the authorized

representative that the notice does not purport to be an issue
pending before the officer/Authority of the Department, as the
prescribed form VAT 305A was not used. The contention is devoid of
merit as the notice issued by the officers of the Department has all
the characteristics of a notice of assessment as it contains the issue
at hand and also rate of tax applicable to the goods in question and
the period for which the tax is demanded. These are generally
essential ingredients of notice of assessment. Use of prescribed
form is a matter of technicality. It has also been held by various
judicial for that merely not citing a provision of the law or use of
form does not vitiate the proceedings initiated under a statute.
In the circumstances we hold that the question raised

in the application being pending before an officer of the
department, the application does not merit consideration.
Therefore, this Authority is not inclined to issue Ruling. In view of
the disqualification of the application for consideration of the issue
raised therein, we refrain ourselves from going into the merits of
the case.

ruling.
To
M/s. Basheer Khan,
Kothapet, Vijayawada

Copy to the Deputy Commissioner (CT) Vijayawada-I Division.
Copy to the Commercial Tax Officer, Kothapet Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 526/ 2005. Dated:07-03-2006.
O R D E R:
I. M/s. Habeeb Sea Foods, Kothapet, Vijayawada

(TIN.28450139148) have filed an application and sought
clarification and advance ruling on the following items under
Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT
Rules, 2005 along with the application fee of Rs.1,000/-

Hon’ble Supreme Court in the case of of Kerala Fishermen’s
Welfare Fund Board, Vs. Fancy Food and another and properties
of
the product in question;
2. A copy of A.P. High Court judgment in the case M/s. Sri
Krishna Dry
Fish Traders Vs. The State of A.P.
IV. Mr. Hyder Vali A.R. appeared for hearing and explained the case.

judgement of A.P. High Court in the case of M/s. Sri Krishna Dry Fish
Traders Vs. The State of A.P. and The Supreme Court in the case of Kerala

exemption on the said product, but the officers issued notice to the
applicant to pay tax @ 12.5% w.e.f. 01.04.2005 though the
prescribed Form VAT 305A was not issued.

the said officer has not used the prescribed form 305A.


Therefore, this Authority is not inclined to issue Ruling. In view of
the disqualification of the application for consideration of the issue
raised therein, we refrain ourselves from going into the merits of
the case.
ruling.
To
M/s. Habeeb Sea Foods,

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Janak Surgical Company, Nampally, Hyderabad,

advance ruling on the following items under Section 67 of APVAT Act,
2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the
application fee of Rs.1,000/-

1. Whether input tax credit can be taken on purchase of raw
material from VAT dealers within the State

1. Copies of tax invoices showing purchase of inputs.
2. Copies of invoices showing job work/labour charges claimed by
certain dealers.
IV. Mr. Raj Kamal, Partner, appeared for hearing and explained the case.
VI. The applicant is a VAT dealer who deals in retail sales of Hospital
Surgical Equipment, Surgical Instruments and Physio Therapy Equipment.
The applicant claims that he purchases these items mostly from outside the
State and partly within the State. In the course of such activity he buys
material from local fabricators in finished form and that some of the
fabricators are not registered with the C.T. Dept. The applicant further
states that he also buys certain Hospital Equipment from fabricators who
buy the required raw material on behalf of the applicant from VAT
registered dealers and pass on these bills, along with the bill for fabrication
charges to the applicant. In the circumstances, the applicant seeks to know
whether he can claim input tax credit of VAT paid on the raw material
purchased by the fabricator on behalf of the applicant.
We have heard the representative and perused

documentary evidence. According to the provisions of AP VAT Act,
2005, the applicant is eligible to claim credit for VAT paid on inputs
provided such inputs are purchased by the applicant from the VAT
registered dealer having TIN. Further the applicant is required to
know that inputs listed in Rule 20 (2) of AP VAT Rules 2005 are not
eligible for input tax credit. Further it is also necessary that though
the inputs are purchased by the fabricator on behalf of the
applicant, consideration for the said purchases of inputs should
have been paid by the applicant only. Further, it is also necessary
that the selling VAT dealers indicate the name of the applicant as
the buying dealer with TIN. The applicant is eligible to claim input
credit only in the circumstances stated above. As regards the job
work charges, bills raised by the fabricator do not qualify for input
tax credit.
ruling.
To
M/s. Janak Surgical Company,
5-8-107/B, Nampally, Station Road,

Copy to the Deputy Commissioner (CT) Abids Division.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Rahim Khan, Kothapet, Vijayawada

(TIN.28370252285) have filed an application and sought
clarification and advance ruling on the following items under
Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT

Hon’ble Supreme Court in the case of Kerala Fishermen’s
Welfare Fund Board, Vs. Fancy
Food and another and properties of the product in question;
2. A copy of A.P. High Court judgment in the case M/s. Sri
Krishna Dry Fish Traders Vs. The State of A.P.
IV Mr. Hyder Vali A.R. appeared for hearing and explained the case

judgement of A.P. High Court in the case of M/s. Sri Krishna Dry Fish
Traders Vs. The State of A.P. and The Supreme Court in the case of Kerala

exemption on the said product, but that the officers issued notice to
pay tax @ 12.5% w.e.f. 01.04.2005 though the prescribed Form VAT
305A was not issued.

the said officer has not used in the prescribed form 305A.


Therefore, this Authority is not inclined to issue Ruling in terms of
Sec.67 (2)(i) of the A.P. VAT Act, 05. In view of the disqualification
of the application for consideration of the issue raised therein, we
refrain ourselves from going into the merits of the case.
ruling.
To
M/s. Rahim Khan,


PROCEEDING OF THE


2005.
***
O R D E R:
M/s. AMC Cookware (India) Private Ltd., (Tin No.28350275598),

Ameerpet, Hyderabad have filed an application Dt.16-06- 2005 and sought
for clarification and Advance Ruling on the following items under Section 67
of the APVAT Act, 2005 read with rule 66 (2) (i) of APVAT Act, 2005 along
The applicant seeking clarification as under :
Rate of tax applicable to Stainless steel domestic kitchenware articles and

utensils.
The case was posted for hearing on 29-06-2005. Sri Mani, S/o. Krishna
Murthy, on behalf of the firm appeared and explained the case.
1) Invoice Cum delivery Challan No.A1/AP/INV/2005/00345, dt. 28-

3-2005.
2) Invoice Cum delivery Challan No.A1/AP/INV/2005/10250, dt. 17-
5-2005
3) Product literature and brochures.
1 of 2
Act
and Rules and HSN codes notified by the Government and the ruling is give
as under.
The dealers stated that the goods i.e. special stainless steel
cooking systems/cookers imported from Germany fall under
Custom Tariff Code No.7323.99.20.
The HSN code No.7323.99.20 is notified under entry 27 at Sl.No. 73

” OTHER UTENSILS”. . Therefore, the goods under reference would
fall under kitchen ware utensils liable to tax @ 4%.
To
M/s. AMC Cookware (India) Private Ltd.,

6-3-788/43, Ist Floor, Durganagar Colony, Ameerpet,
Hyderabad-500 016.
Copy submitted to the Deputy Commissioner (CT), Division.

2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Anant Products, (TIN No.28900119151), Transport Road, Shikh

Village, Secunderabad have filed an application dt. -2005 and sought
The applicant is seeking clarification regarding the rates of taxes

under the APVAT Act,2005 on the following items:
1. Oat Wheat Cereal.

2. Crunchy Muesli
3. Wheat Bran
4. White of Oats.
The case was posted for hearing on 06-07-2005. Sri S.B.
Chandrana, Authorised Representative appeared on behalf of the firm and
explained the case.
During the course of hearing, the applicant also produced invoices

issued by his supplier and also produced samples of the product purchased
and sold by him.
On examination of the documents produced and the samples

exhibited by the applicant, it is established that the item “Crunchy Muesli”
is covered under Excise Tariff Chapter 19 which deals with preparations of
cereals, floor, starch or milk and
1 of 2
pastry / cooked products. The invoices issued by the supplier indicates
Chapter Heading 19 and Excise Duty of 16% was also shown in the invoice.
With regard to the three other items specified by the applicant, it is found
that they are covered under Chapter 11 of Excise Tariff which deals with
products of the milling industry. As seen from the HSN Codes notified under
entry 28 of Schedule IV to the APVAT Act,2005, the Excise Tariff Codes
1101, 1102 and 1106 are fully covered whereas certain items under Tariff
Code 1103 and 1104 only are notified. The invoices issued by the supplier
do not indicate any Tariff Code but no excise duty is charged on the three
items after excluding “Crunchy Muesli”. As seen from Excise Tariff, items
falling under Chapter 11 do not attract any excise duty. Obviously, the
items other than “Crunchy Muesli” are covered under Chapter 11 and
therefore, no excise duty was collected by the supplier. Out of the three
items covered under Chapter 11 of the Excise Tariff, it is observed that
“wheat bran” is covered under entry 41 of Schedule-I to the APVAT
Act,2005 which is exempted.
On the basis of the facts emerging from the documents produced,

the entries in the Schedules to the APVAT Act,2005 and the HSN Codes
notified, the ruling is as under:
i) Wheat bran shall be exempted from tax.

ii) Crunchy Muesli shall be taxable @ 12.5%.
iii) Oat wheat cereal and white of oats shall be taxable @
4%.
JT.COMMISSIONER
To
M/s. Anant Products,
Plot No.10, R.C.H. Colony, Transport Road, Shikh Village,
Secunderabad.

Hyderabad.
Copy to the Commercial Tax Officer, Bowenpally Circle.
2 of 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Mayura Caps & Containers (P) Limited, (TIN
Whether local purchase of LDO from IOC, HPCL., BPCL is eligible for
input tax credit when used in the manufacturing activity.
Sri Narayan Kakani, Director of the firm has appeared for hearing on
1 of page 2
The applicant claims to manufacture Printed metal containers

used in items like cosmetics, tooth powder, talcum powder etc. The
applicant claims to use LDO as fuel to heat the Oven through which
printed metal sheets are passed to dry up the printed matter on the
sheets. The LDO is used for generating hot air for the purpose of
drying the printed metal sheets. In the circumstances the applicant
seeks to know whether input tax credit is available on the purchase
of Light Diesel Oil.
According to Section 13(1) of A.P.VAT Act, 2005, input tax
credit shall not be allowed in respect of tax paid on the purchases
of goods specified in Schedule VI. Schedule VI of the Act specifies
Diesel Oil. Thus read together, it is construed that no input tax
credit shall be allowed in respect of such goods as are specified in
that Schedule. Accordingly, it is held that the applicant is not
eligible for claiming input tax credit on the purchase of Light Diesel
Oil.

To
M/s. Mayura Caps & Containers (P) Limited,
7-3-86, Plot No.71,
S.E.I.E., Katteden, Hyderabad-77.
Copy to the Commercial Tax Officer, Rajendra Nagar Circle. 2 of page
2
PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Om Sai Musalamma Industries (TIN No.28070178478),

Kothaguda Village & Mandal, Warangal District have filed an application
dt.25-05-2005 and sought clarification and Advance Ruling on the following
items under Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i) of
The applicant is enjoying the benefit of tax exemption under

G.O.Ms.No.606, Rev(s), Dt.9-4-1981 issued in exercise of the powers under
Section 9 of APGST Act,1957 and he is seeking a clarification whether by
virtue of Section 69 of APVAT Act,2005, read with Rule 67 of APVAT
Rules,2005, he can claim deferment of tax with regard to the tax payable
on the sales of products manufactured by him after 1.4.2005.
The case was posted for hearing on 06-07-2005. Sri V. Bhaskar

Reddy, Advocate appeared on behalf of the applicant and argued the case.
The learned representative stated that sub-section (1) of Section 69

stipulates that any industrial unit availing a tax holiday or tax exemption on
the date of commencement of APVAT Act,2005 shall be treated as a unit
availing tax
1 of 3
deferment. He also mentioned that sub-section (3) stipulates that the
period of eligibility, method of debiting the eligibility amount and the
repayment shall be in the manner prescribed and rule 67 of APVAT
Rules,2005 provides the detailed procedure. It was contended by the
learned Advocate that the words “tax holiday” and “tax exemption” were
specifically mentioned in sub-section (1) of Section 67 of the Act and the
word “tax exemption” is applicable to the applicant since he is exempted as
per G.O.Ms.No.606, Dt.9-4-1981 which was in operation on the date of the
commencement of the APVAT Act,2005.
The issues in question are;
(i) Whether the words “tax exemption”, used in sub-section (1) of

Section 69 of APVAT Act,2005 are applicable to any units enjoying tax
benefits other than under G.O.Ms.No.108, Industries and Commerce (IP)
Department, Dt.20-05-1996 as on 31-3-2005.
(ii) Whether G.O.Ms.No.606, Rev(s), Dt.9-4-1981 is in force on the date of

commencement of the APVAT Act,2005 as stipulated under sub-section (1)
of Section 69 of the Act.
With regard to the first issue, the learned Advocate argued that any
tax incentive given for sales tax either by way of tax holiday or tax
deferment or by whatever other nomenclature is only in exercise of the
powers under Section 9 of APGST Act and therefore, the Target 2000
scheme providing sales tax holiday or deferment though issued by
Industries and Commerce Department without citing Section 9 of APGST
Act is deemed to have been issued under the provisions of APGST Act. The
learned Advocate also cited two judgments reported in 65 STC (page 1) and
92 STC (page 110). The first judgment is delivered by Apex Court in the
case of Pournami Oil Mills Vs State of Kerala. It was held that it is a well
settled principle of law that where the authority making an order has power
conferred upon it by statute to make an order made by it and an order is
made without indicating the provision under which it is made, the order
would be deemed to have been made under the provision enabling the
making if it. The second judgment is delivered by High Court of A.P. in the
case of P.P.P. Industries Vs Commissioner of Industries confirming the
judgment of Supreme Court in holding that benefit of sales tax exemption is
deemed to have been issued under Section 9 of APGST Act. As seen from
these judgments, it is held by the courts that any benefit of sales tax given
to encourage industrial investment is deemed to have been provided under
the relevant Sales Tax Act though it is not specified in the notifications
issued by a different administrative department. On the strength of
2 of 3
these arguments, the learned Advocate says that no distinction can be

made between a Target 2000 Scheme and any other scheme in force on a
day prior to the commencement of the APVAT Act,2005 and units enjoying
tax exemption on the date of commencement of the APVAT Act,2005 should
be automatically eligible for conversion into deferment as stipulated under
We find merit in the arguments made by the learned

Advocate and we are inclined to agree that if an industrial unit is
enjoying any benefit of tax exemption or tax holiday on the date of
commencement of APVAT Act 2005, it shall be eligible to convert
such tax exemption to tax deferment and the procedure to claim
deferment, the balance period available and repayment shall be as
prescribed in rule 67 of APVAT Rules,2005. However, with regard to
the second issue, whether the applicant was eligible for the tax
exemption under G.O.Ms.No.606 and whether G.O.Ms.No.606 was in
force on 31st March 2005 will not be decided by this authority and it
shall be within the ambit of the Government to decide the validity of
the G.O. and if valid, it shall be the responsibility of the field officer
to establish whether the applicant is actually eligible for tax
exemption under the G.O. in question as on 31st March 2005.
The ruling is given as stated above.
JT.COMMISSIONER
To
M/s. Om Sai Musalamma Industries,
Kothaguda Village & Mandal,
Warangal District.

Hyderabad.
Copy to the Deputy Commissioner (CT), Warangal Division.
Copy to the Commercial Tax Officer, Narsampet Circle.
3 of 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Paraxit Industries, Hyderabad, (TIN No.28720179103)
Whether : i) Transportation charges attract VAT

ii) Installation charges attract VAT
iii) To show unit rate in the delivery challan for
sprinkler and drip irrigation separately.
1. Copies of invoice issued.

2. Copies of delivery challans.
Sri N.Pradeep Kumar, Asst. General Manager of the firm has

1 of page 3
The applicant claims to supply sprinklers and drip irrigation
systems as per the guidelines and rates approved by Govt. of A.P.,
and that the applicant is being paid transportation and installation
charges separately per hector basis. Besides, the applicant also
claims that he is paying service tax on installation charges @
10.2%. In the circumstances the applicant seeks clarification
whether transportation and installation charges attract VAT.
Perusal of invoices issued by the applicant indicate that there

is a sale of complete set of drip irrigation system. Besides, he is
also charging amounts towards installation, transportation / fitting
and assembling charges etc. The description on the invoice
therefore indicates that the applicant is obligated to install the
system at the customer’s site and being paid for such work. As seen
from the invoice, the applicant has charged VAT on such items of
work. As the applicant supplies the system, erects it at the site and
finally being responsible for making it operational, expenses
incurred prior to the completion of work (installation etc.) form part
of the consideration. Therefore, the installation and transportation
charges are liable to VAT.
2 of page 3
The question whether the applicant can show unit rate in

delivery challans for sprinklers and drip irrigation system
separately is a matter of choice of the applicant. As such there is no
legal bar on this issue.
To
M/s. Parixit Industries,
11-5-421/5, Red Hills,
Copy to the Commercial Tax Officer, Agapura Circle.
3 of page 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Raghavendra Industries (TIN No.28890134736),

Mangalavaripeta, Khanapur Mandal, Warangal District have filed an



availing tax
1 of 3



the relevant Sales Tax Act though it is not specified in the
2 of 3
notifications issued by a different administrative department. On the

strength of these arguments, the learned Advocate says that no distinction
can be made between a Target 2000 Scheme and any other scheme in
force on a day prior to the commencement of the APVAT Act,2005 and units
enjoying tax exemption on the date of commencement of the APVAT
Act,2005 should be automatically eligible for conversion into deferment as
stipulated under Section 69 of the Act.

JT.COMMISSIONER
To
M/s. Raghavendra Industries,
Mangalavaripeta, Khanapur Mandal,
Warangal District.

Hyderabad.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Roopa Industries (TIN No.28440210411), Rajupet, Narsampet

Mandal, Warangal District have filed an application dt.25-05-2005 and



availing tax deferment. He also mentioned that sub-section (3) stipulates
that the period of
1 of 3
eligibility, method of debiting the eligibility amount and the repayment shall
be in the manner prescribed and rule 67 of APVAT Rules,2005 provides the
detailed procedure. It was contended by the learned Advocate that the
words “tax holiday” and “tax exemption” were specifically mentioned in
sub-section (1) of Section 67 of the Act and the word “tax exemption” is
applicable to the applicant since he is exempted as per G.O.Ms.No.606,
Dt.9-4-1981 which was in operation on the date of the commencement of
the APVAT Act,2005.


issued by a different administrative department. On the strength of these
arguments, the learned Advocate says that no distinction can be made
2 of 3
between a Target 2000 Scheme and any other scheme in force on a day
prior to the commencement of the APVAT Act,2005 and units enjoying tax
exemption on the date of commencement of the APVAT Act,2005 should be
automatically eligible for conversion into deferment as stipulated under
JT.COMMISSIONER
To
M/s. Roopa Industries,
Rajupet, Narsampet Mandal,
Warangal District.

Hyderabad.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Surya Electrical Stores (TIN No.28800136194), Samarangam

Chowk, Vijayawada have filed an application dt.21-05-2005 and sought
The applicant is seeking a clarification regarding rates of taxes on

the following items:
Switches, connectors & relays, lamp-holders, plugs, sockets,

miniature circuits breakers (MCBs), isolators, fuses etc., falling under Excise
Tariff Code 8536.
The case was posted for hearing on 05-07-2005. Sri P. Kameswara

Sarma appeared on behalf of the firm and explained the case.
The applicant referred to G.O.Ms.No.398 and G.O.Ms.No.490

notifying the HSN Codes for different entries in the Schedules to the APVAT
Act,2005. In particular, he referred to Sl.No.21 under entry 39 of Schedule
IV to the Act which specifies Excise Tariff Code 8536 dealing with switches,
connectors and relays, electronic fuses etc. He has also mentioned that the
preamble of the notifications issued explains that where a 4 digit Excise
Tariff Code is notified for any entry in the schedule to the Act, all the items
falling under that tariff code will be eligible for the rate of tax against the
entry of the Schedule.
1 of 3
The issue has been examined with reference to the HSN Codes
notified by the Government and the specific items falling under Excise Tariff
Code 8536. It is noticed that several items like switches, fuses, miniature
circuit breakers, lamp holders, plugs and sockets are covered under Excise
Tariff Code 8536. As seen from the Central Excise Tariff, the items falling
under Tariff Code 8536 are as under:
8536 Electrical apparatus for switching or

protecting
electrical circuits, or for making
connections to or in electrical circuits
(for example, switchs, relays fuses,
surge suppressors, plugs, sockets,
lamp-holders, junction boxes), for a
voltage not exceeding 1,000 volts.
8536 10 Fuses:
8536 10 10 For switches having rating upto 15 amps,
rewireable
8536 10 20 For switches having rating above 15 amps,
high
rupturing capacity or rewireable
8536 10 30 Other rewireable fuses
8536 10 40 Other high repturing capacity fuses
8536 10 50 Fuses gear
8536 10 60 Electronic fuses
8536 10 90 Other
8536 20 Automatic circuit breakers:
8536 20 10 Air circuit breakers
8536 20 20 Moulded case circuit breakers
8536 20 30 Miniature circuit breakers
8536 20 40 Earth leak circuit breakers
8536 20 90 Other
8536 30 00 Other apparatus for protecting electrical
circuits
Relays:
8536 41 00 For a voltage not exceeding 60 V
8536 49 00 Other
8536 50 Other switches:
8536 50 10 Control and switch gears
8536 50 20 Other switches of plastic
8536 50 90 Other
Lamp-holders, plugs and sockets:
8536 61 Lamp-holders
8536 61 10 Of plastic
8536 61 90 Of other materials
8536 69 Other
8536 69 10 Of plastic
8536 69 90 Of other materials
2 of 3
8536 90 Other apparatus:
8536 90 10 Motor starters for AC motors
8536 90 20 Motor starters for DC motors
8536 90 30 Junction boxes
8536 90 90 Other
The items specified by the applicant appears to be falling

under Excise Tariff Code 8536. So long as the items are clearly
falling within the scope of Excise Tariff Code 8536, the rate of tax
under the provisions of APVAT Act,2005 shall be at 4%.
JT.COMMISSIONER
To
M/s. Surya Electrical Stores,
Samarangam Chowk,
Vijayawada.

Hyderabad.
Copy to the Commercial Tax Officer, Samarangam Chowk Circle.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Umashankar Industries (TIN No.28750159702), Rajupet,

Narsampet Mandal, Warangal District have filed an application dt.25-05-
2005 and sought clarification and Advance Ruling on the following items
under Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT



availing tax
1 of 3



the relevant Sales Tax Act though it is not specified in the
2 of 3
notifications issued by a different administrative department. On the

strength of these arguments, the learned Advocate says that no distinction
can be made between a Target 2000 Scheme and any other scheme in
force on a day prior to the commencement of the APVAT Act,2005 and units
enjoying tax exemption on the date of commencement of the APVAT
Act,2005 should be automatically eligible for conversion into deferment as
stipulated under Section 69 of the Act.


JT.COMMISSIONER
To
M/s. Umashankar Industries,
Warangal District.

Hyderabad.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Usha Kiran Industries (TIN No.28430151791), Rajupet,
Narsampet Mandal, Warangal District have filed an application dt.25-05-
2005 and sought clarification and Advance Ruling on the following items



availing tax
1 of 3

issued by a different administrative department. On the strength of
2 of 3
these arguments, the learned Advocate says that no distinction can be

made between a Target 2000 Scheme and any other scheme in force on a
day prior to the commencement of the APVAT Act,2005 and units enjoying
tax exemption on the date of commencement of the APVAT Act,2005 should
be automatically eligible for conversion into deferment as stipulated under

JT.COMMISSIONER
To
M/s. Usha Kiran Industries,
Warangal District.

Hyderabad.
3 of 3

PROCEEDINGS OF THE
***
O R D E R:
M/s. Arrow Cables Limited (TIN No.28140213622) have filed an

Rate of tax applicable to the following items :

i) Alluminium Conductor Steel Reinforced
ii) All Aluminium Conductor
iii) All Aluminium Alloy Conductor
iv) Aeriel Bunched Cables
v) Poly Vinyl Chloride cables
vi) Aluminium Wire scrap
vii) Alluminium Alloy Wire Scrap
viii) Poly Vinyl Chloride cables
ix) Aluminium Alloy wire scrap
x) Poly Vinyl Chloride scrap
xi) HTGS Steel scrap
xii) HDPE scrap
xiii) Copper scrap

Copies of invoice-cum-delivery challan issued under Central Excise
Rules.
Sri K.S.Varma, Managing Director appeared on behalf of the firm for
i) Aluminum Conductor Steel Reinforced, All Aluminum
Conductor and All Aluminum Alloy Conductor :-
As seen from the documentary evidence furnished by the

applicant such as the invoice-cum-delivery challan issued under
Central Excise Rules, tariff heading No.7604 has been cited. In the
G.O. cited above, HSN code 7604 has been notified as applicable to
sub entry 38 of Entry 27 of Schedule IV of the A.P.VAT Act. Goods
listed under Schedule IV of the Act attract tax @ 4%. Thus the 3
items are held as liable to tax @ 4%.
ii) Aeriel Bunched Cables, Poly Vinyl Chloride cables :-

The applicant has removed these goods under Central Excise
Rules under tariff heading 8544. In the latest G.O. dt.27.8.2005,
only 8544.70 is notified for the sub-item 26 of Entry 39 in Schedule
IV and the HSN codes for Entry 38 in Schedule IV were withdrawn.
As a result of these changes, the HSN code applicable to the item in
question is found to be withdrawn. A circular was also issued by
Commissioner(CT) vide AIII(1)-1, dt.22.9.2005 wherein it is stated
that Aluminium and Copper cables excluding single core wires upto
6 sq.mm. will be treated as industrial cables enumerated in Entry
38 of Schedule IV taxable @ 4%. In the circumstances, the
applicant shall follow the latest G.O.Ms.No.1596 dt.27.8.2005 and
the guidelines issued in CCT’s Circular to determine tax rate.
iii) Aluminium Wire scrap, Aluminium Alloy wire scrap :-

Invoice-cum-delivery challan under the Central Excise Rules
issued by the applicant shows tariff heading 7602 for these items.
This code has been notified as applicable to 7602 of Entry 37 of
Schedule IV of the Act in the G.O.s cited above. Therefore these
items are held as liable to tax @ 4%.
iv) PVC Scrap, HDPE Scrap :-

As seen from the documentary evidence furnished by the
applicant PVC falls under tariff heading 8544. Scrap generated in
the course of manufacturing PVC cables is also treated as the same
commodity. Accordingly scrap of both these items is held as liable
to tax @ 12.5%.
v) HTGS Steel scrap :-

The applicant has not furnished any documentary evidence
regarding the tariff heading applicable to this item. On perusal of
entries in the Schedules to the A.P.VAT Act, it is found that Entry 71
of the Schedule IV of the Act reads Iron & Steel scrap. This entry
has 3 sub entries. As the product description matches with the
language of the Entry 71, we hold that HTGS steel scrap is liable to
tax @ 4%.
vi) Copper Scrap: -
The applicant has not furnished any documentary evidence.

In the G.O. cited above Entry 27 of Schedule IV of the A.P. VAT Act,
2005 and various sub entries falling under that entry and the HSN
codes applicable to them have been notified. At sub entry 19 of
Entry 27 notified therein copper waste and scrap is also included.
As the commodity identity matches with the language of sub entry,
we hold that copper scrap is liable to tax @ 4%.
To
M/s. Arrow Cables Limited,
Flat No.106, Badam Sohana Apartments,
Raj Bhavan Road,
Somajiguda,

Hyderabad.
Copy to the Commercial Tax Officer, Somajiguda Circle.
PROCEEDINGS OF THE

***
O R D E R:
1. M/s. BHEL-GE Gas Turbine Services Private Limited, (TIN

of Rs.1000/-.
Whether the applicant is eligible to claim input tax credit on

expenditure incurred towards supply of Food and Gifts to the dealers.
3. The applicant filed the following documents :

i) Copies of tax invoice showing purchase of certain items
meant for distribution as Gifts
ii) Copies of Food invoice issued by the supplier.
4. Sri R.Vijay Kumar, Advocate and authorized representative of the
firm appeared on behalf of the firm for hearing on 7-11-2005 and explained
the case.
6. The applicant claims to have organized an Annual Dealer Distribution
meeting at a hotel and as part of that meeting claims to have supplied Food
and also gifts such as Leather pouches, Denim shirts etc., to the dealers.
The applicant therefore seeks to know whether he is eligible for input tax
credit as the supply of food and gift articles is claimed as a business
practice.
We have heard the representative and perused the
documentary evidence. Rule 20(2) lays down a list of items that are
not eligible for input tax credit. Among other things the said Rule
excludes goods that are purchased and provided free of charge as
gifts by VAT dealer otherwise than by way of business practice. The
applicant however contends that supply of gifts and food etc., at the
dealer distribution meeting is a business practice and the input tax
incurred on such expenditure is eligible for credit.
We are unable to agree with the contention of the applicant
as the word business practice does not take in its ambit, supply of
Food and articles given as gifts. In order to constitute a business
practice, goods must be supplied free of charge as gifts in the
normal course of business. At best supply of food and other articles
of gift on occasions like meetings and conferences can be construed
as a goodwill gesture and therefore distinguishable from a business
practice. Therefore we hold that the applicant is not eligible for
input tax credit.
To
M/s. BHEL-GE Gas Turbine Services Private Limited,

203, 204, Ashok Bhoopal Chambers, S.P.Road,
Secunderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT), Begumpet Division

Copy to the Commercial Tax Officer, Begumpet Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 405/ 2005. Dated 7-11-2005.
O R D E R:
M/s. Kirloskar Brothers Limited, Secunderabad(TIN.28850251978)

Rate of taxapplicableto “Centrifgal, monobloc and submercible
pumps”
Sri C.V.K. Sarma, Advocate appeared for hearing and explained the case.
APVAT Act and Rules and (HSN Codes notified in G.O.Ms.No:1615
Revenue (CT.II) Department, dt.31.08.2005 and the ruling is given as
under:
The applicant states that entry 17 of the IVth Schedule originally read as
“Centrifugal, monobloc and submercible pumps” and whereas by
G.O.Ms.No.1564 Rev.(CT.II) Dept. dt.17-8-2005, entry 17 is substituted as
---centrifugal, monobloc and submercible pumps sets, electric motors and
oil engines upto a capacity of 10 HP including their starters and parts and
accessories thereof”
Following amendment of the entry, the applicant seeks clarification
whether the phrase “upto a capacity of 10 HP “ would qualify for all
products in the entry or otherwise.
The issue has been carefully examined and hereby clarify that
the phrase “capacity upto 10 HP “ would qualify only to electric
motors and oil engines, but not to other centrifugal, monobloc and
submersible pumps
ruling.
To
M/s. Kirloskar Brothers Limited,
Secunderabad.

Copy to the Commercial Tax Officer,_R.P.Road Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. National Highway Authority of India, Rajahmundry have filed an

Statutory position regarding tax to be deducted at source.

3. The applicant filed the following documents :
i) Copy of Annuity payment certificate
ii) Details of projects executed by the contractors
4. Sri G.S.V.P. Prabhakara Rao, Manager (Finance) appeared on behalf
of the firm for hearing on 7-11-2005 and explained the case.
6. The applicant is an agency working under the Ministry of Shipping,

Road Transport and Highways, Govt. of India and awarded contracts to
certain contractors for execution of works namely laying of express way.
The applicant has stated that contracts for laying road between
Rajahmundry and Dharmavaram and Dharmavaram and Tuni are awarded
to M/s. Gammon India Limited and M/s. Punj-Lloyd Limited respectively and
that the contractors have issued invoices towards annuity payment duly
certified by the concessionaire. In the circumstances, the applicant seeks to
know the statutory position regarding deduction of tax at source.
We have heard the representative and considered the
question. As per Section 4(7) works contracts executed for
agencies other than State Govt., and local authority, tax @ 4% shall
be deducted from the consideration payable to the contractor. As
per Section 22 (4) any Central Govt. Dept. or Statutory body or an
undertaking or an Institution awarding a contract whose value
exceeds Rs.10 lakhs is required to deduct tax @ 4% from the
amount payable to the contractor and the said agency shall remit
such amount to the Govt. in the prescribed manner. As the applicant
stated that invoices have been raised by the contractors after
introduction of VAT, the above mentioned provisions are sqarely
applicable to the transaction. Therefore the applicant is required to
deduct tax @ 4% on the invoice submitted by the contractors and
remit to the Govt., in the prescribed manner.
To
M/s. National Highways Authority of India,

D.No.78-14-21, Syamala Nagar,
Rajahmundry.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Sai Baba Flame Proof Switchgear (P) Limited, Hyderabad (TIN
of Rs.1000/-.
i) Rate of tax applicable to Distribution transformers

ii) Rate of tax applicable to Repair of sick transformers
3. Sri S.Chandrasekhar, Manager appeared on behalf of the firm for

5. The applicant claims to be a manufacturer of electrical distribution

transformers and supplies to A.P. TRANSCO discoms. The applicant seeks to
know the rate of tax applicable to distribution transformers on sales
effected to discoms as well as other private parties. The applicant also
seeks to know the tax liability in case of repair of sick transformers.
question. Entry 39 of Schedule IV of the A.P.VAT Act as it stood
prior to the amendement made to the Schedule in G.O.Ms.No.1596
Rev (CT.II) Department, dt.27.8.2005 includes Electrical
transformers, forming part of the sub entry 7 and notified as
attracting HSN code 8504. Thus the product in question was taxable
@ 4% prior to that date. Consequent on amendment and
modification of the entry and HSN codes as notified in
G.O.Ms.No.1615 Revenue (CT.II) Dept., dt.31.8.2005, the HSN code
applicable to sub entry 7 has been deleted. Thus Electrical
transformers falling under sub entry 7 of Entry 39 no longer attract
the said HSN code and as a result should be construed as falling
outside the scope of Entry 39 of Schedule IV. As per the language of
Schedule V of the A.P.VAT Act, 2005 goods that are not listed in any
of the Schedules attract 12.5% rate of tax. In the circumstances,
we hold that Electrical transformers are liable to tax @ 12.5%
following amendement to the Schedule.
The other issue is rate of tax applicable to repair of sick

transformers. It is clarified that the applicant is liable to tax
applicable to the parts, components that are used in the repair of
transformers. Therefore, the applicant is advised to charge and pay
tax applicable to the said parts.
To
M/s. Saibaba Flameproof Switchgears (P) Limited,

5-1-568/1, Hill Street,

Hyderabad.
Copy to the Deputy Commissioner (CT), Hyderabad(Rural) Division

PROCEEDINGS OF THE
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 407/ 2005. Dated 7 -11-2005.
O R D E R:
I. M/s. Suguna Machine Works (P) Limited,

Secunderabad(TIN.No.28450198900) have filed an application Dated 4-10-
2005 and sought clarification and advance ruling on the following items
under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT

1) VAT rate applicable for entry 17 of IVth Schedule
2) VAT rate applicable for entry 17 after amendment to the entry 17
vide G.O.Ms.No.1564 Rev.(CT.II) dt.17-8-2005.
3) VAT rate applicable for compressor pump and Piston pump.

Literature of the products dealt by the applicant.
C.Ravichandran, Regional Manager, appeared for hearing and explained

the case.
APVAT Act and Rules and G.O.Ms.No.1615 Rev.(CT.II)_ Department
dt.31.8.2005 and the ruling is given as under :
The applicant represents that entry 17 is substituted vide G.O.Ms.No.1564
Rev.(CTY.II) mdt.17-8-2005 wherein the phrase, “upto a capacity of 10 HP”
needs to be clarified to the effect whether it qualifies for all items included
in the said entry or restricted to only electric motors and oil engines.
The issue has been examined and clarification is given as under.
The phrase is applicable to ‘electric motors’ and ‘oil engines’ but not
to other items. Therefore, all centrifugal, monobloc and submercible
pump sets irrespective of capacity including their starters, parts
and accessories are liable to tax @ 4%. Only electric motors and oil
engines upto a capacity of 10 HP are also liable to tax @ 4%.If the
capacity of electri motors and oil engines is exceeding 10 HP, they
are liable to tax @ 12.5%.
Regarding ‘compressors’ pumps and ‘piston pumps’ following the
doctrine of ‘nocir a soocis’ compressor pumps and piston pumps are
also liable to VAT under entry 17 of the IVth Schedule, @ 4%.
ruling.
To
M/s. Suguna Machine Works (P) Ltd,

Copy to the Deputy Commissioner(CT) Chittoor Division.
Copy to the Commercial Tax Officer, Chittoor I Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 512/ 2005. Dated 08 - 08-2006.

O R D E R:
I. M/s. Dhanvanthary Surgicals, Hyderabad (TIN. 28800204288) have


Rate of tax under APVAT Act on Artificial Aids or rehabilitation aids
for use by orthopadiecally handicapped persons.

1) Brochure on company’s product Index.
2) MGRM Medicare Limited (MGRM) Company’s products.
3) Sale invoices of the MGRM Company , Gurgoan, Haryana-15.
4) Tax invoice of Dhanvanthari Surgicals.
Sri M.K.Hanumantha Rao, Proprietor, appeared for hearing on 26-7-

Dhanvanthari Surgicals, Basheerbagh, Hyderabad, is a dealer

carrying on business of surgicals, equipments, artificial aids rehabilitation
aids etc, for use by orthopadiecally handicapped persons. The ruling is as
follows :
The orthopaedic and fracture appliances that covered under
HSN code 9021.10 alone fall under Entry 2 of the 1st Schedule, not
liable to tax.
ruling.
To
M/s. Dhanvanthary Surgicals,
Basheerbagh, Hyderabad.
Copy to the Deputy Commissioner(CT) Abids Division.

PROCEEDINGS OF THE

****
CCT’s Ref.No: PMT/P&L/A.R.Com/66/2006. Dated 8- 08-2006.
O R D E R:
I. M/s. Grasim Industries Limited, Hyderabad,(TIN.28610117253) have

Rs.1,000/-

Whether the debit notes raised by the applicant for additional boom
pumping operations undertaken directly by them and also by the third party
contractor at the customer’s site constitute part and parcel of sale price of
readymade cement.
1) Specimen copy of offer-cum-order form
2) Copy of sale bill of RMC
3) Copy of debit note raised for boom pumping charges.
4) Copy of agreement with M/s. G.S.Lamba & Company for boom
pumping
operations
IV Mr. R.K.Chittlangia, Manager, operations of the company dealer

superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept. dt.27-08-2005 and in
G.O.Ms.No.1615, Revenue (CT.II) Dept. and the ruling is given as under:
VI. The applicant, M/s. Grasim Industries Limited,

Hyderabad are the registered dealers dealing in manufacture and
trading of ready mix concrete (herein after referred as RMC).
Customers place orders for RMC on “offer cum order form” at their
factories located at Miyapur and Qutbullapur, R.R.District. The
orders contain details of quantity, grade and rate of RMC besides
the clause for line / boom pumping charges. The applicant states
that boom pumping charges are additional services and are
provided at the option of the customer at their site either by the
applicant company or through third party contractors i.e. M/s.
G.S.Lamba & Co., Supply and sale of RMC at the agreed rate in the
order form is for inclusive of freight and boom pumping charges at
the site of the customer. Boom pumping charges agreed upon are
collected from the customers through separate debit notes.
However, payment to the third party contractors, is separately
settled by the applicant in accordance with the terms of the
contract in force. Thus, the applicant contends that the amount of
consideration collected from the customers through debit notes
pertaining to boom pumping charges, would not form part of “sale
price” for levy of VAT.
Whole issue has been examined and the applicant was

personally heard on 26-7-2006. As seen from the offer letters, filed
by the applicant and the terms and conditions laid down thereof in
the offer letter, the applicant company collects boom pumping
charges in majority of the cases.. Wherever, the applicant has not
charged and collected boom pumping charges, the rate of RMC is
higher than the cases where the applicant charged separately the
boom pumping charges. This practice has been almost uniform and
clearly shows that boom pumping charges are either collected
separately through debit notes or included in the sale price.
Regarding the contention that boom pumping charges are collected
on behalf of the third party, is not acceptable as the terms and
conditions of the contract between the applicant and M/s.
G.S.Lamba & Co., Hyderabad denotes that, the applicant pays only
@ Rs. 105.30 per cum of RMC whereas, the applicant collects @
Rs.350/- per cum from the customers. Therefore, what the
applicant collects is not reimbursed to the third party contractor.
As far as the sale of goods Act and VAT Act are concerned,
the entire “sale price” is the consideration for transferring that title
in the goods. The “sale price” is one and indivisible and it cannot be
sub-divided into its component parts. Thus, the amount of money
which goes from the pocket of the customer to the pocket of the
applicant company as a condition or consideration for passing of the
property in goods, is the sale price.
Therefore, charges, collected towards boom pumping which

incur before actual delivery and appropriation of goods to the
purchaser forms part of “ any charges” collected at the time of
delivery or before the sale is concluded Hence, we hold that, boom
pumping charges collected through debit notes are exigible to VAT.
Addl. Commissioner Jt. Commissioner Jt. Commissioner.
ruling.
To
M/s. Grasim Industries Limited,
Hyderabad.
Copy to the Asst.commissioner (LTU).

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 504 / 2005. Dated: 8-8-2006.
O R D E R:
M/s. Visakha Steel Allieds, Anakapally (TIN 28540111112) have filed

They sought clarification with regard to rate of tax on the following :
Whether “Hot dip galvanization” a process wherein Zinc is coated on
the surface of steel after chemical cleaning, falls under works contract liable
to VAT or exempt.
1) A write up on the job work of hot dip galvanization of the
customer’s steel articles.
2) Authorization appointing Sri C.Umakanth Sarma as Authorized
Representative.
3) A copy of the STAT’s orders in the case of M/s. Kaptan Galfat (P)
Limited Vs. State of A.P. (27 APSTJ.84).
Sri Umakanth Sarma, Advocate, appeared for hearing on 26-7-2006

given as under:
The applicant states that the process of galvanization
involves sereral processes such as degreasing, pickling, fluxing,
drying, galvanizing and quenching and dichromating. They
undertake work of hot dip galvanizing of the customers articles.
That means, under a contract of work, they receive steel/steel
articles from various customers and galvanize to give required zinc
coating and return to the customers, In the process of
galvanization, the applicant purchases goods such as, zinc, acids,
caustic soda, zinc chloride, ammonium chloride etc. and also
furnace oil. As per their own statement, in the year, 2005-06, they
collected so called job work charges of Rs.1,12,84,894/- wherein
Rs.62,06,692/- representing value of zinc (55%) and
Rs.50,78,202/- (45%) representing value of labour, power, fuel
and other consumables
Consequent to 46th amendment and the decisions of the
Supreme Court in the cases of Builders’ case 73 STC, 370 and
Gannon and Dunkerly case 88 STC,204, it is open to the states to
divide the works contract into two separate contracts by a legal
fiction (i) Contract for sale of goods involved in the said works
contract and (ii) contract for supply of labour and service. If the
works contract involves an intention to transfer the property in
goods and not as an incident of contract of service, such contract
becomes divisible contract by fiction.
In respect of works contract of movable properties, the
transfer of property in goods takes place on the principle of ‘accretion’. For
example, when grey cloth is given to the contractor for dyeing, the dyes
and chemicals, which belonged to the contractor are transferred to the
customers when the dyes and colours are supplied (deemed supply) or used
in dyeing. Likewise, in the works contract of galvanization also, in the
course of work undertaken by the applicant, zinc and other chemicals,
forming part of ‘zinc coating’ are transferred in the process of galvanization
while the consumables such as power, fuel and other consumables are used
but not transferred to the customer. Therefore, the turnover relating to
property in zinc transferred to the customer. However, if the contractor has
not transferred any goods in the execution of works contract, such
contracts usually termed as “job works”. But the STAT in the case of
Paramount Studio Vs. State of A.P. –T.A.No.697/99, dt.22-7-2005,
following the decision of the Supreme Court in the case of Associated
Cement Companies Limited, case (2001) 124 STC.59 observed that even in
the contracts of skill and labour like, photography, to the extent of value of
goods transferred in such process/work are liable to tax. Similarly, the High
Court of Bombay in the case of Commissioner of Sales Tax Vs. Hari and Co.
(148 STC.92), it is observed that irrespective of whether the transfer of
property is incidental or ancillary to a works contract, once works contract
involves transfer of property, the provisions of art.366 (29 A) of
Constitution of India are attracted notwithstanding that the value of goods
may represent a small percentage of the amount paid for the execution of
works contract.,
Therefore, we hereby clarify that in the works contracts

executed by the applicant, involving the processing of
galvanization, value of the goods such as zinc transferred in the
execution of such work, amounts to “ deemed sale” liable to tax @
4% (i.e. at the rate of tax applicable to zinc) under section
4 (7) of the APVAT Act. However, if the applicant (contractor) is
not under composition, he is also eligible to claim input tax credit
on the local purchase of inputs to the extent of 90% of the tax paid
on the goods purchased other than those specified in sub-rule (2)
of rule 20 and shall be eligible to issue a tax invoice.
ruling.
To
M/sVisakha Steel Allieds, Anakapally.
Copy to the Deputy Commissioner (CT)Visakhapatnam Division.
Copy to the Commercial Tax Officer, Anakapalli Circle.

PROCEEDINGS OF THE
***
O R D E R:
1. M/s. A.M.C. Cookware (India) Private Limited, Hyderabad (TIN

of Rs.1000/-.
The rate of tax applicable to Stainless steel, Domestic kitchen ware

items / articles and utensils.

Copy of bill of entry for home consumption issued under customs
regulations.
4. Sri K.Siva Kumar, Authorised representative appeared on behalf of

the firm for hearing and explained the case.
6. The dealer is engaged in the business of importing and

selling Stainless steel cooking items / articles / utensils and seeks
to know the rate of tax applicable to the items. Copy of bill of entry
for home consumption issued under the customs regulations
indicates HSN code number 7323.93.90 as the applicable code for
the items in question.
We have perused the entries in the schedules of A.P.VAT Act,
2005. Entry 7 of Schedule IV of the Act as amended in
G.O.Ms.No.1564 Revenue (CT.II) Dept., Dt. 17.8.2005 reads “All
utensils including Pressure cookers and pans excepting utensils
made of precious metals”.
As seen from the entry all utensils are included regardless of

the metals they are made of except the precious metals. The
applicant seeks ruling on the Stainless steel, Kitchen ware items
and utensils. They are liable to tax @ 4% as the words all utensils
take within their ambit utensils made of stainless steel. Therefore,
we hold that stainless steel utensils are covered by Entry 7 of
Schedule IV of the Act and liable to tax @ 4%.
To
M/s. A.M.C. Cookware (India) Private Limited,

6-3-788/43, Ist Floor,
Durganagar Colony, Ameerpet, Hyderabad – 16.

Hyderabad.
Copy to the Commercial Tax Officer, Maredpally Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Rangoli Marketing Co., (TIN No.28200227685), Chirag Ali Lane,

The applicant is engaged in the business of providing different types

of floorings, modular ceiling and aluminium composite paneling. The
applicant seeks to know whether he can opt for composition under sub-
section (7)(c) of Section 4 of the Act. The applicant also wanted to know
the tax rates on the following items.
a) G.I. metal false ceiling.

b) Texture wall finish.
c) Earth paving cement concrete tiles.
d) G.I. powder coated sections.
e) Glass mosaic tiles.
f) Wooden flooring.
g) PVC flooring.
h) Aluminium composite panel.
1 of 3
The case was posted for hearing on 11-11-2005. Sri Harish Jhawar,
Partner appeared and explained the case.
According to the applicant, he is dealing in different types of flooring

tiles including wooden flooring and also in providing texture wall finish,
false ceiling and aluminium paneling. It was explained that he is treating
the transactions as works contracts and therefore, wanted to opt for
composition. It was further stated that the rates were quoted by him to his
customers taking the 2% tax rate available by way of composition in
respect of the works executed to customers other than State Government
or Local Authority. It was also stated that, as a result of the changes made
in the VAT Law from 29th August,2005 in respect of provisions relating to
works contracts, there is difficulty for him to recover the additional tax
burden from the customers and also that there is some amount of
confusion regarding the tax component when any goods used in the works
are brought from outside the State.
After examining the facts of the case with reference to the provisions
of the Act and Rules and in particular the Act 23 of 2005, the ruling is given
as under:
(i) For any work fully completed and bills already raised
upto 28th August,2005, the tax rate by way of
composition is only 2% irrespective of whether the
goods used are purchased from VAT dealers in A.P. or
purchased from non VAT dealers in A.P. or brought
from outside A.P.
(ii) In respect of the works including ongoing works where

the goods are incorporated in the works subsequent to
28th August,2005, the applicant will have the choice to
exercise his option once again for composition due to
the change in the composition tax rates. He can either
opt for the new rate of 4% by way of composition or he
can opt out of the composition for the ongoing works
by properly informing the concerned authorities. This
can be done even after receiving this ruling in respect
of the ongoing works which commenced prior to 28th
August,2005.
(iii) In case any goods are purchased from non VAT dealers
in A.P. or brought from outside A.P. and such goods are
used in the execution of works contract for which
composition is opted, the applicant can identify such
items which attract 12.5% tax and he shall pay 12.5%
on the value of such
2 of 3
goods incorporated. After paying such tax, the
value of such goods on which 12.5% is paid can be
deducted from the total value of the contract, so that
4% is paid on the remaining portion of the contract.
(iv) In case any portion of the work is given as sub-

contract by him, the sub-contractor will be exempted
provided the applicant opted for composition for such
work. The ruling given under item (iii) above shall
apply if the sub-contractor purchases any goods from
non VAT dealers or outside the State. The applicant can
deduct the turnover on which the sub-contractor paid
the tax from his turnover.
(v) There is no requirement for the applicant to make any

TDS against the sub-contractor because the sub-
contractor is normally exempt once the applicant is
under composition.
(vi) As regards the rates of taxes on the items cited by the

applicant, all the items except aluminium composite
panel will attract 12.5%. The aluminium composite
panel shall attract tax at 4%.
JT.COMMISSIONER
To
M/s. Rangoli Marketing Co.,
G-64, Raghava Ratna Towers, Chirag Ali Lane,
Hyderabad-500 001.

Hyderabad.
Copy to the Asst. Commissioner (CT), Nampally Circle.
3 of 3

PROCEEDING OF THE

Ref: CCT’S Ref.No.PMT/P&L/A.R.COM/2005, Dt:13-4-2005.

***
O R D E R:
I. M/s. Sree Rayalaseema Alkalies and Allied Chemicals Ltd., (TIN

No.28960200435), Bhagyanagar, Kurnool have filed an application dt.19-
08-2005 and sought clarification and Advance Ruling on the following items
II. The applicant is seeking a clarification on the following:
1) Whether a dealer, engaged in manufacturing activity of goods, uses coal

and furnace oil for steam generation, is entitled for input tax credit under
APVAT Act.
III. The case was posted for hearing on 24-10-2005. Sri G.N. Chetty,
Advocate along with representatives of the company appeared and
explained the case.
IV. According to the applicant, they are manufacturing chemicals like

caustic soda, potassium hydroxide and oils like castor oil derivatives, fatty
acids, soap noodles, soaps etc. It was explained that huge quantities of
steam are required for manufacturing of the said finished products. For the
purpose of steam generation, they have contended that they are using coal,
husk and hydrogen as fuels. It was further explained that boilers are
installed and turbines/D.G. Sets are also installed for cogeneration of
power. According to them steam generated from boiler to some extent is
taken for manufacturing process whereas to some extent it is also used for
power generation. In addition to usage of coal, husk and hydrogen it was
contended that furnace oil used directly as a fuel of diesel generator sets.
They have furnished the illustrations for the steam generation sets along
with the quantities of coal consumed, steam generated and steam supplied
to boilers and turbines separately. They are seeking to know regarding the
eligibility of input tax credit for the tax paid on purchases of coal and
furnace oil under the provisions of Act and Rules.
After examining the details furnished by them, it is clear that coal is

used for direct generation of power as well as for use in manufacturing
process. The coal used for manufacturing process initially generates steam
which is also simultaneously generating power to some extent in addition to
manufacturing process. As regards the furnace oil, it is clearly stated by
them that it is used only in diesel generator sets. The figures of coal
consumption furnished for the month of September indicates that 4,540
M.Ts is used for power generation and 4,003 M.Ts is used for
manufacturing process. The Authority does not have any scope or access to
examine the veracity of correctness of this particulars. However, the ruling
is given on the basis of the provisions regarding input tax eligibility under
Section 13 of the Act read with Rule 20 of the Rules as under:
Furnace Oil used in diesel generator sets is not eligible for

the benefit of input tax credit since it is clearly laid down under
sub-rule (2)(b) of Rule 20 that any fuel used for captive power
generation is not eligible for input tax credit.
Coal used to the extent of power generation is not eligible for

the benefit of input tax credit under clause (h) of rub-rule (2) of
Rule 20 to the extent coal is used in manufacturing process, it is
eligible for the benefit of input tax credit.
ADDL.COMMISSIONER JT.COMMISSIONER JT.COMMISSIONER
To
M/s. Sree Rayalaseema Alkalies and Allied Chemicals Ltd.,
40-304, K.J. Complex, Bhagyanagar,
Kurnool-518 004.

Hyderabad.
Copy to the Deputy Commissioner (CT), Kurnool Division.
Copy to the Asst. Commissioner (CT), LTU, Kurnool.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. China State Construction Engineering (Hong Kong) Ltd., (TIN
No.28740860398), Banjara Hills, Hyderabad have filed an application and
1. Whether on advance payment, the tax deducted at source (‘TDS’), is to

be deducted at all in view of the specific exemption granted for the
Hyderabad International Airport Limited (‘HIAL’) payment vide Government
Order Ms.No.1254, Revenue (CT.II) Dept., Dt.June 24,2005.
2. Whether the withholding tax in the hands of the contractee has to be
remitted on the gross value of the invoice or on the net amount after
adjusting the interim payment made and tax with held theeon.
3. Whether in terms of Government Order Ms.No.1254, Revenue (CT.II)
Dept., dated June 24,2005, in relation to refund of tax on purchase of
goods used for HIAL or its contractors and sub-contractors, the taxes
deducted and paid on advance payments are eligible for taking credit and
granting refund in terms of said Government Order.
4. Where tax withholding has to be effected from the payment being made
in relation to works contract, what is the method of determining the tax
payable. Whether the principle of 100+Tax Rate would be applicable and to
be applied on such payment for determining the tax to be deducted by the
contractee at the time of payment to the contractor.
5. Whether the tax withholding has to be done by the contractor on the
portion of the work sub contracted by him to another contractor despite
opting for composition under the APVAT Act on the total contract value in
view of the refund of the taxes paid under G.O.Ms.No.1254, Revenue
(CT.II) Dept., dated June 24,2005.
The case was posted for hearing on 29-12-2005. Sri Artheer Wong,
Finance Manager, Project Controller along with Sri T. Vinod Kumar,
Authorised Representative appeared and explained the case.
It was explained by the applicant that they have been awarded Civil
Construction Project to construct Passenger Terminal Building as a part of
the International Airport being developed as a joint venture by G.M.R.
Construction Limited along with Airport Authority of India and Government
of Andhra Pradesh. According to the contract, they are given some advance
payment and subsequently progressive payments are released for the work
done or for achieving the milestones as per the contract. It was also
mentioned that the contract agreement stipulates that the applicant shall
opt for composition and 4% tax rate shall not form part of the contract. It
was also mentioned that the employer is deducting tax at source and the
employer is claiming reimbursement of tax under Section 15 of the Act by
virtue of G.O.Ms.No.1254, Dt.24th June,2005.
After examining all the facts of the case, the ruling is given as
under:
(i) Advance payment which is not in relation to any specific

quantum of work or for any goods incorporated in the execution of
works contract, may not attract tax and therefore, no TDS is to be
made. However, as and when this advance payment is adjusted in
the subsequent bill released for specific work executed, the TDS will
have to be made on the full value of the bill though advance is
deducted there from.
(ii) The taxe paid on purchases made by contractors and sub-

contractors executing works for Hyderabad International Airport
Ltd., is eligible for refund according to the orders issued in the G.O.
cited subject to the conditions laid down thereunder. As regards the
eligibility for tax credit, it is to be clearly understood that input tax
credit is not available for the contractors who are in composition.
(iii) With regard to the determination of the tax component as and

when payment is being released towards the works executed, the
terms of the contract and the work estimates will decide the issue
and wherever tax is built as a separate component it will have to be
construed as Rs.100/- for work executed and in addition Rs.4/- is
the tax over and above price of Rs.100/-. In case the total price
agreed upon between the employer and the contractor is inclusive
of tax the tax fraction is to be applied to separate the tax
component (R/R+100),
(iv) As regards the requirement to with-hold tax by the applicant in
respect of any work sub-contracted by him to another, it is clarified
that no such requirement is there once the applicant is under
composition.
JT.COMMISSIONER
To
M/s. China State Construction Engineering (Hong Kong) Ltd.,
14, Avenue-4, Road No.10, Banjara Hills,
Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT), Punjagutta Division.
Copy to the Commercial Tax Officer, Jublee Hills Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. S.D. Developer (P) Ltd., (TIN No.28320183352), Trimulgherry,
Secunderabad have filed an application and sought clarification and
Whether tax deduction at the rate of 2% is required to be made

under sub-section (4) of Section 22 of the Act in respect of construction and
selling residential apartments once the applicant is paying 1% tax on the
total consideration based on value accepted for the purpose of registration
and stamp duty.
The case was posted for hearing 29-12-2005. Sri P. Venkateswara

Rao, Sales Tax Practitioner appeared and explained the case.
According to the applicant, they are building and selling residential

apartments and they are already under composition. They are paying 4%
tax rate on 25% of the consideration which comes to 1% of the total
consideration. It was mentioned that AWHO, an association for Army
Officers is collectively organizing and monitoring collections from the
individual members and payment to the contractor. The applicant did not
produce any documentary evidence of contract during the hearing. It was
explained that the applicant himself is constructing and selling apartments
to individual buyers/owners.
Based on the explanation given by the applicant, the ruling is given

as under:
In case the applicant is constructing and selling apartments,

the tax applicable is 4% of 25% of the total consideration received
or receivable or market value fixed for the purpose of stamp duty
whichever is higher. According to the provisions of sub-rule (4) of
Rule 17, the tax at the rate of 1% of the total consideration is to be
made by way of demand draft and such instrument is to be
presented at the time of registration of the property to the Sub-
Registrar who is registering the property. In view of this, there will
not be any requirement to make TDS in respect of such dealers who
construct and sell residential apartments.
JT.COMMISSIONER
To
M/s. S.D. Developer (P) Ltd.,
Gum Rock, Trimulgherry, Near Teachers Colony,

Hyderabad.
Copy to the Commercial Tax Officer, Marredpally Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/548/ 2005. Dated - 03-2006.

O R D E R:
I. M/s. Sri Maruthi Steel Traders, Pan Bazar, Sec’bad.

(TIN.28050211976)

1. Rate of tax applicable to CI Rough Casting

1. Product literature
IV. Mr. Krishna Chandra Bung appeared for hearing and explained
the
case.
V. The issue has been examined with reference to the provisions of
the
AP VAT Act and Rules and HSN Codes notified by Government vide
VI. The applicant claims that he is trading in Cast Iron Rough Casting
and in support of the said fact he furnished a copy of the literature of
products traded by him. As seen from the literature and also some physical
samples produced before us, the applicant is buying and selling Cast Iron
items which are used as Railing, Staircases, Grills etc. In the course of
hearing, the applicant also explained that these items do not require further
machining and they are used as such in the construction of Railing,
Staircases etc.
We have examined the entries under the AP VAT Act, 2005

Entry 70 of Schedule IV to the Act refers to Iron Steel and as many as 16
sub entries refer to various items. We do not find any reference to the kind
of products sold by the applicant in any of the sub entry under the main
entry.
In the circumstances, the items on which the applicant is

seeking clarification in our view fall out-side the scope of entry 70 of the
said Schedule. Therefore, it follows that the items such as Cast Iron Grills,
Railing etc. sold by the applicant in the State of A.P. fall within the scope of
Schedule V to the AP VAT Act, 05 and accordingly liable to tax @ 12.5%.
ruling.
To
M/s. Sri Maruthi Steel Traders,
4-5-214 & 215, Pan Bazar, Sec’bad.

Copy to the Deputy Commissioner (CT) Secunderabad. Division.
Copy to the Commercial Tax Officer, Mahankali Street Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sri Dhanalakshmi Cotton & Rice Mills (P) Limited,
Guntur, (TIN No.28870138358) Hyderabad have filed an application
Query-1: If the turnover of Hank yarn and Electrical energy are to be taken
for calculating eligible input tax credit available on Paddy, Cotton seed and
Rice bran etc., which are not used as common inputs in manufacture /
generation of Hank yarn or electrical energy, the company will be put to
undue hardship when compared to independent units of similar business
viz.,Rice mills, Oil mills.
Taking the above facts into consideration, as per Rule 20, sub rule
(6) and given in illustration 4 (specific inputs to specific outputs) when
Division inputs relating to specific and common inputs for that division are
maintained in our accounts, we opine that the formula relating to restriction
of input tax credit (ITC) with reference to outputs can be applied taking into
consideration of turnovers relating to that division only. This method shall
be followed by us for each month and also 12 month period ending March
every year. Please clarify and give advance ruling.
Query-2: We also request you to kindly give advance ruling with respect to
Rate of tax for the following products.
(a) Cotton seed Hulls :
(b) Scrap: (i) Iron scrap, (ii) Gunny scrap and (iii) Aluminum scrap.
(c) Paddy Husk dust (Ash) :
(d) Soap stock :
Query-3: Whether sales tax paid on capital goods purchased during
1.4.2004 to 31.3.2005 and installed during the same period are eligible for
tax relief.
Copy of Hon’ble Sales Tax Appellate Tribunal order dt.23.3.1983 in
the case of M/s. Coramandel Agro Products Vs. State of Andhra Pradesh.
Sri V.Chandrasekhara Rao, Finance Manager of the company
is given as under.
9. Whether the formula relating to restriction of input tax credit with

reference to outputs can be applied division-wise separately?
As per sub section 5 of Section 13 to A.P.VAT Act, 2005; no
input tax credit shall be allowed on the following:
(a) works contracts where the VAT dealer pays tax under the
provisions of clauses (b), (c) and (d) of sub section (7) of Section
4;
(b) transfer of a business as a whole ;
(c) sale of exempted goods except when such goods are sold in the
course of export or exported outside the territory of India ;
(d) exempt sale;
(e) transfer of exempted goods on consignment basis or to
branches of the VAT dealer outside the State otherwise than by way
of sale ;
(f) supply of goods by the VAT dealer as mentioned in sub section
(9) of Section 4.
Further, the procedure for availing input tax credit is given in
Rule 20 to A.P.VAT Rules, 2005. Since the VAT dealer is eligible for
input tax credit for all his taxable activities, the dealer can follow
sub rule 6 of Rule 20 of A.P.VAT Rules and can claim input tax credit
separately for each division for each tax period. Accordingly, it is
clarified that the dealer is eligible to apply formula to restrict his
input tax credit for each and every division separately. When
common inputs relating to all divisions are used, the input tax
credit related to such common inputs should be subjected to
formula taking into consideration the total taxable turnover and
total exempt turnovers of all the divisions. For this purpose, the
taxable turnover and total turnover shall be the amounts that have
arisen using those common inputs. The examples for common
inputs for all divisions could be items used in office or for sales.
As per sub rule (6) of Rule 20 of A.P.VAT Rules where any
VAT dealer is able to establish that specific inputs are meant for
specific outputs, the input tax credit can be claimed separately for
taxable goods. In the instant case, in a particular division when
such inputs are used in that division only and the output is taxable
and exempted, the restriction of input tax credit relating to formula
can be applied in a particular month with reference to turnovers of
that division. This automatically implies applying formula separately
for each division for each tax period and the consolidated figures
relating to specific inputs shown in Form VAT 200A which is to be
enclosed alongwith Form VAT 200. The VAT dealer is required to
follow this procedure continuously from April to March tax periods
and the adjustments in respect of March tax period are to be made
on the same lines and the adjustments should be furnished in Form
VAT 200B to be enclosed alongwith Form VAT 200A and Form VAT
200 for the month of March.
In the instant case, the VAT dealer is having separate
divisions dealing with Cotton, Oil, Power, Rice and Spinning. The
method of claiming input tax credit for different divisions shall be
as under :
1. Cotton Division: This is purely a trading activity. The input tax
credit can be fully claimed without applying formula A x B / C.
10.Oil Division : The input tax on purchases of cotton seed, rice
bran, packing material, chemicals, stores and spares can be
fully claimed so long as no exempt transactions like branch
transfers / consignment sales are involved. However, with
regard to sales of cotton seed hulls which are exempted, the
formula A x B/C shall be applied for this division.
3. Power Division: The output is fully exempted and no input tax
can be claimed at all for this division.
4. Rice Division: Since the applicant claims to use husk for boilders
of his unit and if no consignment sales / branch transfers are made,
the input tax can be fully claimed.
5. Spinning Division: Since cotton hank yarn is exempted, the tax
paid on common inputs i.e., cotton lint, stores and spares etc., can
be claimed proportionately by applying formula A x B/C. If the
packing material is separate for hank yarn and other yarn, no input
tax credit can be claimed for the packing material in respect of hank
yarn. If yarn, other than hank yarn is sent on stock transfer or
consignment basis outside A.P., the input tax credit will be
restricted by applying formula A x B/C as illustrated under sub rule
(6) of Rule 20.
The applicant shall keep a monthly VAT account and in the
VAT return, he can report consolidated figures alongwith enclosure
in Form VAT 200A every month and in Form VAT 200B every March.
2. The dealer has requested to clarify rate of tax applicable on certain
commodities and accordingly they are clarified as under:
a) Cotton seed Hulls: The applicant stated that Cotton seed hulls are
extensively used as live stock fodder. As per the decision of Hon’ble
High Court of A.P. in case of M/s. Coramandel Agro Products & Oils
Limited Vs. Commissioner of Commercial Taxes, the decision of
Sales Tax Appellate Tribunal was affirmed and held cotton seed
hulls as cattle feed.
As per Entry 3 of Schedule I to A.P.VAT Act, 2005 aqua feed,
poultry feed and cattle feed including grass, hay and straw are
exempt. Accordingly, cotton seed hulls are held as exempt from
VAT.
b) Scrap : i) Iron Scrap: Iron scrap is covered in Item 1 of Entry 71
in Schedule IV to A.P.VAT Act, 2005 and accordingly
taxable @ 4%.
ii) Gunny scrap: The gunny scrap arised from gunnies
which is covered under Entry 90 of Schedule IV to the
Act is liable to tax @ 4% and accordingly it is clarified
that the gunny scrap is also taxable @ 4%.
iii) Aluminum scrap: As per HSN codes notified by the
Govt. for Entry 7 in Schedule IV to A.P.VAT Act,
Aluminum waste and scrap are covered in HSN codes
with 4 digit code as 7602 covered in Sl.No.36 in Entry
No.27 of Schedule IV. Accordingly, it is clarified that
Aluminum scrap is taxable @ 4%.
c) Paddy husk dust (ash): As per Entry 41 in Schedule I to the Act,
Paddy husk is exempted from tax and accordingly it is clarified that
the Paddy husk dust (ash) resulted from Paddy husk is also
exempted from tax.
d) Soap stock: Soap stock is a product resulted from processing of
the vegetable oils. As per HSN codes notified by the Govt. under
Entry 67 in Schedule IV to A.P.VAT Act under the heading of
“vegetable oils – all kinds of vegetable oils including solvent oils
and coconut oil”, Vegetable oils and its fractions whether refined or
non refined but not chemically modified are assigned with a 4 digit
code to different vegetable oils. Since soap stock is the resultant
waste product during the process of obtaining refined oils and such
fraction of vegetable oil is not chemically modified it is clarified that
soap stock is taxable @ 4%.
3. Whether sales tax paid on capital goods purchased during 1.4.2004 to
31.3.2005 and installed during the same period are eligible for sales tax
relief?
As per Rule 37 to A.P.VAT Rules 2005, it is clearly mentioned
that if a VAT dealer has in stock any goods on which sales tax has
been paid under the APGST Act, 1957, that VAT dealer shall be
entitled to claim a credit of sales tax excluding turnover tax paid
under the said Act for such goods which were purchased from
1.4.2004 to 31.3.2005.
In the instant case, the VAT dealer has raised a question
relating to availability of goods in stock, as the capital goods are
installed and the eligibility of sales tax relief on such goods. In this
context, it is clarified that so long as the dealer has purchased the
eligible goods whether capital goods or otherwise and such goods
are installed during the period 1.4.2004 to 31.3.2005, sales tax paid
on such purchases is eligible for sales tax relief.

To
M/s. Sri Dhana Lakshmi Cotton & Rice Mills (P) Limited,
Ganapavaram, Chilakaluripet,
Guntur District.

Copy to the Asst. Commissioner (LTU) Guntur.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Brij Melhyd Pvt. Ltd., Punjagutta TIN No.280801900053) have

66(2)(i) of APVAT Rules, 2005 along with the application fee of Rs.1000/-.
a. Rate of tax on “Aluminium Sheets perforated” bearing HSN
Code 7606.12.00.
b. Rate of tax on Aluminium Castings bearing HSN Code
7606.20.20

i) Copy of Form-A1, (Central Excise Registration submitted
to the Central Excise Department) .showing major
excisable goods manufactured, warehoused or traded at
column No.14 (i) Aluminium Sheets perforated (ii)
Aluminium Scarap and (iii) Aluminium Castings
ii) Major excisable goods used in manufacture of Final
product (i) Aluminium Extrusion / Profile bearing HSN
Code 7604.29.90
iii) Tax invoice-cum-challan for aluminium sheets perforated
having HSN Code 7606.12.00.
4. Sri Balwant Sing, Managing Director appeared on behalf of the firm
for hearing and explained the case.
6. The applicant states that they manufacture “Aluminium
sheets perforated”, Aluminium castings, and Aluminium scrap from
the raw material viz., Aluminium extrusion / profile.
Entry 27 of the IV Schedule reads “Ferrous and non-
Ferrous metals and alloys and extrusions thereof”. The appended
HSN Code are also notified for the entry also denotes, unwrought
Aluminium, Aluminium profiles, Aluminium sheets, rods etc. These
HSN Code recorded in the application to Central Excise applicable
for registration.
The applicant states that they make the goods aluminium

sheet perforated (HSN code 7060.12.00), aluminium scrap (HSN
code 7606.00.90) and aluminium castings (HSN code 7601.20.20)
while using aluminium extrusion/profile (HSN code 7604.29.90) as
raw material. Therefore, aluminium sheet perforated and
manufactured from the raw material shown above as is covered
under HSN code 7606, rate of tax applicable is 4% under Entry 27
of the IV Shedule. If the goods manufactured and sold by them do
not fall under HSN code 7606, they are liable to tax at 12.5% under
residuary entry of V schedule.
To
M/s. Brij Melhyd Pvt.Ltd.,
412, Model House,
Punajgutta, Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT), Punjagutta Division

PROCEEDINGS OF THE

***
O R D E R:
M/s. Karachi Agencies, Hyderabad (TIN No.28290199164) have filed

an application on 26.08.2005 and sought clarification and advance ruling on
They sought clarification on rate of tax on the following:
1. Peanut butter
2. Corn flakes
3. Mango pulp (canned)
Sri Jyothi Ram Nani, Partner, appeared on behalf of the firm for
is given as under.
The applicant states that he purchases the items on which he

is seeking ruling from other dealers and sells them in the course of
his business. We have browsed the Schedules of A.P.VAT Act, 2005
and find that items are not listed in the Schedules. Therefore, in
accordance with the language in Schedule V of the A.P.VAT Act,
2005, Peanut butter, Corn flakes and Mango pulp (canned) are held
as liable to tax @ 12.5%.
To
M/s. Karachi Agencies,
Mozzamjahi Market,
M.J.Market,
Hyderabad.

Copy to the Commercial Tax Officer, N.S.Road Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. M.S.T.C. Limited, Visakhapatnam (TIN No.28820100562) have

Rs.1000/-.
Rate of tax applicable to decommissioned Submarine (for scraping).
i) Schedule of items proposed to be sold on “as-is-where-as basis”.

ii) Copy of A.P.High Court order in W.P.No.3762 of 2001
iii) Copy of assessment order issued by CTO/Dabagardens for the
assessment year 2001-02.
Sri A.Sarveswara Rao, Advocate appeared on behalf of the firm for
is given as under.
The applicant claims that he is a Government of India

enterprise and its main activity is to conduct auctions for sale of
material belonging to various Government departments / Public
sector undertakings. In pursuance of this activity, the applicant
calls for tenders from parties intending to participate in the auction.
One such transaction the applicant intends to effect is auction of
decommissioned Submarines at Visakhapatnam Naval Base. The
applicant therefore seeks to know the rate of tax applicable under
the A.P.VAT Act, 2005.
The documentary evidence i.e., Schedule of items gives
details of the material, quantity, location and other terms relating
to the auction procedure. The applicant contends that sale of
decommissioned Submarines should be treated as sale of scrap and
taxed accordingly. In support of the contention, the applicant relies
on the decision of Supreme Court in the case of State of Tamilnadu
Vs. Govindan 93 STC 185. In that case the Hon’ble Supreme Court
held that sale of condemned railway coaches by Director of
Suppliers and disposals was held as sale of scrap. Following that
decision the Bombay High Court in the case of Commissioner of
Sales Tax, Maharastra Vs. Delhi Iron & Steel Company Limited 93
STC 202 held that sale of condemned and unserviceable ships and
unserviceable cargo vessels was sale of scrap. In the circumstances
the applicant contends that sale of decommissioned Submarines by
him should be considered as falling within the scope of Entry 56 of
Schedule IV of the A.P.VAT Act, 2005. Besides the applicant also
contends that even according to Entry No.27 of Schedule IV, scrap
of ferrous and non-ferrous metals are liable to tax @ 4%. The
applicant also pressed into service an order of High Court in
W.P.No.3762 of 2001 between N.S.Ratnam and Sons Vs. M.S.T.C.,
Visakhapatnam wherein the High Court ordered the second
respondent i.e., CTO, Dabagardens, Visakhapatnam to conclude the
assessment proceedings and pending finalisation of the assessment
procedures, the first respondent namely M.S.T.C. shall release the
vessels to the Petitioner i.e., M/s. N.S.Ratnam & Sons on the
condition that the latter shall pay 4% sales tax. The applicant also
relies on the assessment order issued by CTO, Dabagardens to the
effect that the applicant was being assessed to tax on such
transaction as sale of scrap only.
documentary evidence submitted. Entry 56 of Schedule IV of the
A.P.VAT Act reads “Ships and other vessels”. In the G.O. cited
above, HSN code 8908 has been notified to cover vessels and other
floating structures for breaking up. As the applicant intends to
conduct auction of decommissioned Submarines which are meant
for breaking up and sold as scrap we hold that the transaction falls
squarely under Entry 56 of Schedule IV of the Act and therefore
liable to tax @ 4%.
To
M/s. M.S.T.C. Limited,

Subbarmireddy Complex,
Dabagardens,
Visakhapatnam.
Copy to the Commercial Tax Officer, Dabagardens Circle.

PROCEEDING OF THE
(Enft)
CCT’s Ref.No.A.R.Com/150/2006 Dt:-9-11-2006

05.
***
O R D E R:
M/s. Positive Interares, Hyderabad (TIN No.28070113100) have filed
The applicant is seeking clarification regarding Kitchen accessories,
Bathroom accessories and Wardrobe accessories.
The case was posted for hearing on 9-11-2006. Sri B.Kiran, Partner
of the firm appeared and explained the case.
APVAT Act and Rules and HSN codes notified by Government vide
G.O.Ms.No.398 Rev.(CT.II) Dept, dt.31.3.2005 and G.O.Ms.No.490
Rev.(CT.II) Dept, dt.15.4.2005 as superceded in G.O.Ms.No.1596
Rev.(CT.II) Dept, dt.27.8.2005, G.O.Ms.No.1615 Rev.(CT.II) Dept
dt.31.8.2005 and G.O.Ms.No.502 Rev (CT.II) Dept, dt.1.5.2006 and
G.O.Ms.No.656 Rev. (CT.II) Dept. dt. 6.6.2006 and G.O.Ms.No.795 Rev
(CT.II) Dept, dt.29.6.2006.
The applicant explained that the items are racks and cabinets made
of stainless steel and they are used as accessories in Kitchen, Bathroom
and for the Wardrobes and almarahs. Catalogue produced by the applicant
was examined. It is found that these are storage racks of different sizes
used in the Kitchen cabinets and as well as in the Wardrobes and
cupboards. The applicant was expressing that the item 7 in Schedule IV
dealing with all Utensils may cover these items to attract tax @ 4%.
The issue has been examined by specifically looking into the Entry 7
in the Schedule IV to the Act. It basically deals with Utensils. The word
“Utensil” is to be understood as an item which is used for cooking or
serving or eating food. The word was given an extended meaning in Entry 7
by including Pressure cookers and Pans. The items specified by the
applicant cannot be understood as Utensils.
The ruling is therefore given that the items specified by the applicant
cannot fall under Entry of Schedule IV to the Act and they clearly fall under
the Schedule V to the Act attracting tax at 12.5%.
Sd/- Sd/- Sd/-
JT.COMMISSIONER
ADDL./JT.COMMISSIONER
To
M/s. Possitive Interares,
3-5-141/a/2/3, Edenbagh Road, Ram Kote, Hyderabad.

Hyderabad.

PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Sony India (P) Ltd., Punjagutta, Hyderabad.(TIN.28710160156)

have

1. Rate of tax applicable to “Digital Still Image Video Camera”
2. Rate of tax applicable to “LCD Projector.”

1. Product literature.
2. Copy of Customs notification showing Digital Still Image Video Camera
as I.T. product.
3. Copy of judgment of Hon’ble Maharashtra Tribunal in the cases of
M/s. Kalyani Sharp Industries holding LCD Projector as I.T. product.
4. Copy of Advancing Ruling order in the case of M/s. Cannon India
Private Ltd. in respect of Digital Still Image Video Camera along with
HSN code.
IV Sri Anil Kumar Mithra, Chartered Accountant appeared for hearing

and
explained the case.

the APVAT Act and Rules and HSN Codes notified by Government
vide G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-
2005 and G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-
04-2005 as superceded in G.O.Ms.No.1615 Revenue (CT.II)
Department, Dt.31.8.2005 and G.O.Ms.No.1596 Revenue (CT.II)
Department, Dt.27.8.2005 and the ruling is given as under:
VI The applicant seeks to know the rates of tax applicable to “Digital

Still Image Video Camera” and “LCD Projector” under the AP VAT Act,
2005.
As regards, Digital Still Image Video Camera, the applicant

submitted a copy of Bill of Entry issued under Indian Customs Act,
which among other things contains HSN code 8525.40.00 as the
applicable code for the product. A copy of the sale invoice raised by
the applicant has also been furnished in support of the said fact.
But his document does not contain any HSN Code. The Applicant
also relied on Advance Ruling issued in the case of M/s. Cannon
India Private Ltd., Secunderabad holding that Digital Still Image
Video Camera attracts HSN Code 8525 and taxable @ 4%.
We have examined facts of the applicant with reference to

the
entries in the schedule IV to the AP VAT Act, 2005. Entry 39 sub
entry 15, among other things, contains Digital Still Image Video
Camera. In G.O.Ms.No.1615 Revenue (C.T.-II) Dept. dated:
31.08.2005, HSN Codes applicable to certain commodities have
been notified by the Govt. Under sub-entry15 of entry 39, the HSN
Code 8525.04.00 has been notified. This code is in agreement with
the Bill of Entry issued under the Indian Customs Act. Therefore,
the Ruling is that Digital Still Image Video Camera is liable to tax @
4% in accordance with entry 39 (15) of schedule IV to the AP VAT
Act, 2005.
As regards, the rate of tax applicable to LCD

Projector, the applicant once again placed reliance on copy of Bill of
Entry issued under the Indian Customs Act which among other
things contains HSN Code 8528.30.20. The applicant further relies
on sale invoices issued by him. But this document does not contain
any HSN code. The applicant further tries to support his case by
relying on the decision of the Hon’ble Maharashtra Sales Tax
Tribunal rendered in the case of M/s. Kalyani Sharp Industries V/s.
State of Maharashtra. The Tribunal in the said case came to the
conclusion that LCD Data Projector is an accessory of the Computer
being manufactured for the convenient use of the Computer.
We have considered the documentary evidence and

also the decision of the Tribunal relied upon by the applicant.
Entry 39 of schedule IV the A.P. VAT Act, 2005,

contains a list of I.T. products. Sub entry 28 of that entry refers to
liquid Crystal devices, Flat Panel display devices and parts thereof.
In G.O.Ms.No.1615 Revenue (. C.T.-II) Dept., dated: 31.08.2005
HSN Code for the sub entry has been notified as 9013.80.10 and its
parts as 9013.90.10.
We have considered the applicability of HSN Code to
the product in question. The HSN code available on the Bill of Entry
does not agree with the HSN Code notified by the A.P. State Govt.
Further, the decision of Maharashtra Sales Tax Tribunal was
rendered with reference to the entry under the State Act and has no
direct bearing on the classification issue raised for consideration of
this Authority. The order of the Tribunal does not contain any
findings about the HSN Code applicable to the LCD Data Projector.
Therefore, the documentary evidence and the order of the
Maharashtra Tribunal do not assist the case of the applicant for
classifying LCD Data Projector as an I.T. product. In the
circumstances the Ruling is that Colour LCD Data Projector, which is
apparently, imported by the applicant and sold within A.P. falls
outside scope of entry 39-sub entry28 of schedule IV to the AP VAT
Act, 2005. This being so Clolour LCD Data Projector is liable to tax
under schedule V to the AP VAT Act, 2005 and liable to tax @
12.5%.
Addl.Commissioner Jt.Commissioner Jt. Commissioner
NOTE: - An appeal against this proceedings can be filed before the Sales
ruling.
To
M/s. Sony India Pvt. Ltd.,
Punjagutta, Hyderabad

Copy to the Deputy Commissioner (CT) Punjagutta Division.
Copy to the Asst. Commissioner, L.T.U., Punjagutta Division.

PROCEEDINGS OF THE
*****
O R D E R:
I. M/s. The Supreme Industries, Hyderabad, (TIN.28950283920)


1. Whether Form-D can be submitted for local purchases and supply
III. G. Seetharam, Senior Sales Officer appeared for hearing and

explained the case.
V. The applicant seeks to note whether he can submit Form-D

prescribed under the CST Act in support of transactions of sales or purchase
effected to Govt. Department located within the State of A.P.
According to Sec.8 (4)(b) of CST Act read with CST (R&D)

Rules 12(1), the declaration in Form-D shall be submitted by the
selling dealer if the goods are sold to the Government not being a
registered dealer which shall be submitted to the prescribed
authority in the prescribed manner. Thus, it is clear from the
Language of the provision of the CST Act that Form-D shall be
submitted only respect of transaction of inter-state nature and
whether goods are sold to Govt. As the applicant seeks to know
whether From-D can be submitted for local purchases/sales. It has
clarified that the said Form cannot be used for transactions taking
place within the State of A.P.
ruling.
To
M/s. The Supreme Industries,
3-6-502/A, Street No.6,
Himayat Nagar, Hyderabad.

Copy to the Commercial Tax Officer, Abids Circle.

PROCEEDINGS OF THE AUTHORITY FOR CLARIFICATRION &

ADVANC RULING
(UNDER SECTION 67 OF AP VAT ACT, 2005 )
PRESENT :SRI T. YUGANDHAR REDDY, ADDL.COMMISSIONER

(CT) (VAT)
SRI T.VIVEK JOINT COMMISSIONER (CT) (VAT)
SRI K. RAGHAVAIAH, JOINT COMMISSIONER (CT)(AUDIT)
***
CCT’s Ref.No. PMT/P&L/A.R.Com./36/2005, Dt:10-05-2005
O R D E R:
M/s. Feno Plast Ltd., (Tin No.28790173604) , Park Lane,

Secunderabad, have filed an application Dt.29-04-2005 and sought for
the APVAT Act, 2005 read with rule 66 (2) (i) of the APVATc Act, 2005
along with the application fee of Rs.1000/-. The application is examined and
The applicant is seeking clarification of tax liability of items in:
1) Entry 45 of Schedule I to the APVAT ACT

2) Entry 86 of Schedule IV to the APVAT ACT
The case was posted for hearing on 07-05-2005. Sri Adibabu Vice-
President (Finance) of the firm appeared and explained the case.
1) Copy of Notification No.30/2004-CE dt.9-7-2004 as

amended by Notification No.10/2005-CE, dt.1-3-2005.
Act and Rules and HSN codes notified by the Government and the ruling is
give as under.
1 of 2
Cotton fabrics, man made fabrics and woolen fabrics under entry
45 of the 1st Schedule are the goods as mentioned in heads and
sub-heads of 1st schedule to the Additional Duties of Excise (Goods
of Special importance Act, 1957) but does not include goods where
no Additional Duties of Excise are levied under the said schedule.
That means if the goods are in the heads and sub-heads of goods
for which additional excise duty leviable, even though such levy is
exempted by a notification by the Central Excise & Customs
Department such goods would not attract sales tax. The Central
Government, vide notification referred therein, have exempted the
goods falling under heading 5903.10 and 5903.20 from levy of
additional excise duty. However, the goods that are notified under
HSN Codes 5903.10, 5903.20, 6306.11, 6306.12, 6306.19, 6306.21,
6306.22, 6306.29 are taxable @ 4% under entry 86 of the IV
schedule to APVAT ACT, provided if such goods are not included in
the notifications of exemptions from Addl. Excise Duty. Therefore,
processed textiles can not be assessed to VAT so long as textiles
are under the purview of levying Additional Excise Duty.
ADDL. COMMISSIONER JT. COMMISSIONER JT.

COMMISSIONER
Note: An appeal against this proceedings can be filed before the S.T.A.T.,
A.P.,
Hysderabad within (30) days of this ruling.
To,
M/s. Feno Plast Ltd.,
306-308, Chenoy Trade Centre,
Parklane, Secunderabad-500 003.

Hyderabad.
Copy to the Commercial Tax Officer, Circle
2 of 2

PROCEEDINGS OF THE
Sri K.Raghavaiah, Jt. Commissioner(Audit)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/423/ 2005. Dated 10 - 05-2006.
O R D E R:
I. M/s. Sri Rajyalakshmi Cement Products, Vijayawada

of Rs.1,000/-
Rate of tax applicable under the VAT Act on the manufacture and
supply of PSCC poles?
1) A copy of the articles of agreement between APSPDCL and the
applicant
2) Correspondence papers
IV. Sri T.Tirumala Rao, Authorised Representative, appeared for
G.O.Ms.No:398, Rev. (CT.II) Dept. Dated 31-03-2005 and G.O.Ms.No:490,
Rev. (CT.II) Dept. Dated 15-04-005,as superceded in G.O.Ms.No.1596,
Rev. (CT.II) Dept., dt.27-8-2005 and in G.O.Ms.No.1615, Rev. (CT.II)
Dept., dt.31-8-2005 and the ruling is given as under:
The applicant is a manufacturer and dealers in PSCC Poles. In

pursuance of the agreement with APSPDCL, Vijayawada, the
applicant was awarded an order for manufacture and supply of
different sizes PSCC poles to the Departmental PSCC Pole Centre,
Gunadala, Krishna District on turn key basis. Consequently, the
applicant seeks to know the rate of tax applicable on supply PSCC
Poles and to be charged to the APSPDCL. The issue is examined and
we make the following ruling.
Whether a particular contract is one for sale of goods or for
work and labour depends upon the main objects of the parties
found out from an overview of the terms of the contract and the
substance of the contract. Over all view of the documents of articles
of agreement between the applicant and APSPDCL, it is contract for
manufacture and for sale but not a works contract, as the main
object is the transfer and delivery of possession of the property i.e.
PSCC poles to the awarder of the order. The terms and conditions of
the agreement stipulates that the manufacture and supply of PSCC
poles on turnkey basis including all material and labour charges
along with cement and HT steel , and as such transaction in
question constitute a sale in terms of residual entry of V Schedule
until 17-8-2005 and exigible to tax @ 12.5%.
By Act 23 of 2005 dated 26th October,2005 w.e.f.18-8-2005
entry 45 was substituted as entry 45 as “Pipes of all varieties
including G.I .Pipes, C.I. Pipes, ductile pipes and PVC Pipes, RCC
and PCC pipes, their fittings thereof and cement poles”. Since the
applicant deals with PSCC poles which fall under cement poles are
liable to tax @ 4% under entry 45 of the IV Schedule
w.e.f. 18-8-2005.
.
Tax Appellate Tribunal, A.P. Hyderabad within 30 days of this ruling.
To
M/s. Sri Rajyalakshmi Cement Products, Vijayawada.
Copy to the Deputy Commissioner(CT) Vijayawada II Division.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Godavari CNSL (TIN No.28050203052) Peddapuram,
East Godavari District have filed an application dt.28.5.2005 and sought
They sought clarification on the rate of tax on the following items:
1. Cashew nut shell oil.
The applicant produced the following documents :

1. Copy of Appellate order of Appellate Deputy Commissioner,
Visakhapatnam.
2. Note on Cashew nut shell oil.
Sri M.Ramachandra Murthy, Chartered Accountant of the firm has

1 of page 2
is given as under.
Entry 67 of Schedule IV of A.P.VAT Act, 2005 reads

“Vegetable oils – all kinds of vegetable oils including solvent oils
and coconut oil”. In the G.O. cited above Entry 67 has been notified
with HSN codes for various items falling within the category of
vegetable oils. Under sub entry 9 of the HSN codes notified, other
vegetable oils have been mentioned. Considering the documentary
evidence furnished by the appellant it is held that Cashew nut shell
oil falls under entry 67 of Schedule IV of A.P.VAT Act, 2005 and
therefore attracts tax @ 4%.

To
M/s. Godavari CNSL,
D.No.21-2-3, Jaggampeta Road,
Peddapuram – 533 437.
Copy to the Commercial Tax Officer, Circle,
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Himachal Pradesh Horticultural Produce Marketing and
Processing Corporation Limited (TIN No.28390209669) Hyderabad have
Whether the applicant is eligible to opt for composition of payment
of tax under Rule 19 of A.P.VAT Rules, 2005 pertaining to loose sales of
fruit juices through the vending machines
Sri Ranjit Mehta, Branch Manager of the firm has appeared for
APVAT Act and Rules and the ruling is as under.
The applicant claims to receive Fruit juices, Juice

concentrates, Jams, Squashes and Canned fruits and other
beverages on stock transfer basis and effect 2 types of sales - i) By
way of pure trading activity and ii) sales through vending machines
located at public places such as Railway stations, Bus stand etc.
The applicant admits that sales to traders attract 12.5% VAT.

However, the applicant intends to opt for payment of VAT by way of
composition under Rule 19(5) of A.P.VAT Rules, 2005 in so far as
sale of fruit juices through the vending machines is concerned.
Therefore the point for determination is whether, in the
circumstances explained, the applicant can opt for payment of tax
by way of composition on sales claiming to be falling under sub
section (9) of Section 4 of A.P.VAT Act, 2005.
The Section 4(9) in the Act specifies sale of food or

beverages, other than alcohol, served in eating places / hotels /
restaurant or by any other name called, is liable to tax @ 12.5% on
60% of the amount charged by the VAT dealer for such supply. Sub
rule (5) of Rule 19 lays down the procedure for exercising the
option, the time and the calculation of VAT payable in accordance
with composition. The contention of the applicant is that a vending
machine broadly falls within the scope of restaurant or eating place
as the expression “whatever name called” is used in the relevant
section.
We are unable to agree with the contention of the applicant

as a vending machine does not stand on the same footing as a
restaurant or eating-place. As the word restaurant or eating place is
normally understood they are places where a person is served food
/ beverages (other than alcohol) in an enclosed space where a
customer is provided with a facility to sit and consume the food /
beverage supplied. Besides, an eating place has certain
paraphernalia that distinguishes itself from others. These normally
include furniture, lighting, decor etc. On the contrary a vending
machine is not only mobile unit but does not have enclosed space
and other trappings that make it an eating place. In a way it is no
different from buying a product across the counter or off the shelf.
Therefore we are not inclined to hold that a vending machine is

the same as restaurant or eating place and as a result sales through
vending machines cannot fall within the scope of sales effected in
restaurant etc. Therefore, the applicant is not eligible to opt for
composition on sales made through vending machines. Conversely
such sales are taxable at 12.5% on the entire sale consideration.

To
M/s. Himachal Pradesh Horticultural Produce

Marketing & Processing Corporation Limited,
6-1-130/1, Padmarao Nagar,
Secunderabad.

PROCEEDINGS OF THE
***
Dt.13.4.2005.
O R D E R:
M/s. Quick Calls Private Limited (TIN No.28570200060)
The applicant is seeking clarification on the following items :
1. Lease rental on Radio communication equipment

2. Interstate lease rentals on Radio communication equipment.
Sri Bhaskar, Accountant appeared on 8.06.2005 for personal
hearing and explained the case. According to the applicant, he is dealing in
lease of two way radio communication systems and his customers are
located within and outside the State. He is seeking ruling on tax
implications under A.P.VAT Act, 2005 for such transactions.
1 of page 3
APVAT Act and Rules and the ruling is as under.
As per Explanation IV under sub section (28) of Section 2,
the definition of ‘sale’ includes a transfer of right to use any goods
for any purpose for cash or deferred payment. The sub section (8)
of Section 4 of the Act specifies that every VAT dealer who transfers
the right to use goods taxable under the Act, shall pay tax on the
total amount realized at the rates applicable for such goods as
specified in the schedules.
A dealer becomes liable to be registered as VAT dealer.
i) if his taxable turnover in the preceding three months
exceeds Rs.10,00,000 or in the twelve preceding months
exceeds Rs.40,00,000 as per sub section (3) of Section 17
of the Act.
ii) Irrespective of the taxable turnover if ;
a) he is importing goods in the course of business from
outside the territory of India;
b) he is registered or liable to be registered under the
CST Act, 1956 or he is making purchases or sales in
the course of inter-state trader or commerce or
dispatches any goods to a place outside the state
otherwise than by way of sale.
The applicant is found to be registered as a VAT dealer
and is already holding Taxpayer Identification Number.
2 of page 3
The goods in question are covered under Entry 39 of

Schedule IV to the Act and are taxable at 4%. The tariff codes 8527
and 8529 are notified by State Govt., for the Entry 39. Therefore,
the rate of tax shall be 4% for the lease rentals received in respect
of customers located within the State.
As regards the transactions in respect of customers
located outside the State of A.P., the provisions of CST Act 1956
shall apply. Hence this Authority cannot give any ruling.

To
M/s. Quick Calls Private Limited,

IInd Floor, R.R.Towers,
Raghava North Block, Abids,
Hyderabad.
3 of page 3
PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/447/ 2005. Dated 10 -07 2006
Ref:- CCT’s.Ref.No: PMT/P&L/A.R.Com/2005, Dated 13-04-

2005.
O R D E R:
I. M/s. Hemadri Enterprises, Tadepally, (TIN.28160112612) have filed


1. Whether the applicant is eligible for deduction of purchase value
of the bottles from the resale value under VAT Act?
2. Whether old empty beer/liquor bottles purchased from
hawkers and unregistered dealers are liable to tax on purchase value?
Whether old and empty bottles are exempt from VAT?
3. Whether bottles included in the sale of liquor and beer as per the
provisions of the A.P. Excise Act as enumerated in Schedule VI amounts to
double taxation?
III The applicant submitted the following documents:
1. A detailed write up on the issues of clarifications sought.

2. Form VAT 565.
3. Copies of notice of assessment in Form VAT 305 A, asst. in Form
VAT 305.
4. Copies of the correspondence between the applicant and the CTO,
Mangalagiri
IV. Mr. Prabhakar Rao, Authorised Representative, appeared for hearing on

given as under:
VI. 1) No. He is not eligible for deduction of purchase value of

bottles from resale value under VAT Act.
2) A VAT dealer when purchases old empty bottles from

hawkers and unregistered dealer, there is no liability of tax on
purchase incidence if sells such goods to another VAT dealer in
the State. If the applicant disposes of such goods , other than , by
way of consumption or by way of sale either within the State or in
the course of interstate trade, then every VAT dealer is liable to
contingent purchase tax under clause (iii) of sub-sec.(4) of Sec. 4.
3) Sale of empty bottles are not exempt from VAT. On the other
hand such goods are liable to tax at the rate of 4% under Entry 90
of the IV Schedule.
4) It does not amount to double taxation.
ruling.
To
M/s. Hemadri Enterprises,
D.No.12-463/4,Near Toll Gate, Bypass Road,
Raja Rajeswari Nagar
Tadepalli,
Guntur Dist.

Copy to the Deputy Commissioner(CT) Guntur-I Division.
Copy to the Commercial Tax Officer ,Mangalagiri Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. CHAROEN POKCHAND (I) (P) LTD., VIZIANAGARAM, have filed


The rate of VAT on aquatic health care products such as (1) Super biotic
(2) Super P.S. (3) C-150 (4) Zymetin (5) PH fixer (6) Mutagen.

A writeup on the products dealt by the applicant.
IV. Dr.S.Balu, Assistant General Manager, appeared for hearing and

explained the case.
G.O.Ms.No.1615, Revenue (CT.II) Department Dated 31-08-2005 and the
VI. The applicant is a manufacturer of Prawn feed. They intend

to deal with feed supplements and also probiotics. Specific aquatic
health care supplements/products are (1) Super biotic, (2) Super
P.S., (3) C-150, (4) Zymetin, (5) PH fixer, (6) Mutagen.
Having regard to the nature of products dealt by the

applicant, it is found that all aquatic health care products are in the
nature of probiotics or aquatic feed supplements, which activates or
helps in growth of prawns directly or indirectly.
Thus, only aquatic feed is enumerated in entry 2 of 1st
Schedule but not aquatic feed supplements. Therefore, all feed
supplements are covered in entry 89 of IVth Schedule, liable to tax
@ 4%.
ruling.
To
M/s Charoen Pokchand (India) (P) Ltd.,
Chodavaram Village, Vizianagaram Dist.

Copy to the Deputy Commissioner(CT) Vizianagaram Division.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/347 / 2005. Dated 10-10 -2005.
O R D E R:
M/s. HENKEL LOCTITE INDIA (P) LTD.,HYDERABAD
of Rs.1,000/-

Rate of tax applicable to the following.
(i) Sellotape stationery tape
(ii) Sellotape glue stick
(iii) Sellotape craft adhesive
(iv) Sellotape stick note
(v) Sellotape white Board market (WBM) & Sellotape permanent
marker.
Mr. S. Narayana Murthy sales officer appeared for hearing and explained
the case.
APVAT Act and Rules and HSN Codes notified by the Government vide
G.O.Ms.No. 1615 Rev.(CT..II) Department dt.31.8.2005 and the ruling is
given below:
Having examined and considered nature and character of products
being dealt by the applicant, the clarification is given as under :
1) Sellotape: Stationery tape or packing tape without self adhesive are

liable to tax @ 4% under packing material of all varieties under
entry 90 of the IV Schedule.
2) Sellotape Glue Stick , Sellotape Craft adhesive and Sellotape
stick note falls under adhesive of all kinds including glue gum,
adhesive tapes, self adhesive tapes liable to tax @ 12.5% under
residual entry of the Vth Schedule.
3) Sellotape White Board marker and Sellotape permanent
marker also fall under residual entry liable to tax @ 12.5%
ruling.
To
M/s HENKEL LOCTITE INDIA (P) LTD.
HYDERABAD.

PROCEEDING OF THE


2005.
***
O R D E R:


1 of 2

JT.COMMISSIONER
To

Hyderabad.
2 of 2

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/164/2005. Dated 10-10-2005
O R D E R:
I. M/s. SAI PROTIEN FOOD INDUSTRIES, KONDAPALLY, KRISHNA DIST. have

filed an application and sought clarification and advance ruling on the following items
under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005
along with the application fee of Rs.1,000/-
II. They sought for clarification and advance ruling on classification of the product
viz., Deoiled Soya Bean Nuggetts/chunks.
1) Copies of purchase invoices

2) Copies of sale invoices
3) Copy of ledger account for 2004-05.
IV. Dr.M.V.K.Murthy,Advocate, appeared for hearing and explained the case.
V. The issue has been examined with reference to the provisions of the APVAT Act
and Rules and HSN Codes notified by Government vide G.O.Ms.No:1615,, Revenue
(CT.II) Department Dated 31-08-2005 and the ruling is given as under :
VI. The applicant states that he is a small scale industry engaged in the
process of manufacture of deoiled soya bean nuggets. Main raw material is
Deoiled/defatted soya flour purchased from M/s. Ruchi soya Industries,
Indore (MP). The applicant contends that deoiled cakes under which deoiled
cake soya flour/defatted soya flour falls is not undergoing any change either
in its character, nature, chemical properties except the change in the form of
the product. Thus the finished product manufactured by them continues to be
deoiled cake and liable to be treated as deoiled cake. In support of their
contention, they also adduced a copy of certificate issued by Sonic Research
and Application Development Centre, India, which is recognized by the
Government of India, New Delhi. The applicant is a manufacturer and availing
sales tax holiday/deferrals on the products manufactured and sold by them.
They are purchasing the raw material only from M/s. Ruchi Soya Industries
Limited and selling finished goods wholly to Ruchi Soya Industries Ltd., The
latter Company with its brand name distributes the products in the market.
The products manufactured by the applicant is excisable goods under the
head “Textured Soya Protein” with excise tariff code –2106. Whereas, the
raw materials are non excisable goods.
Having considered the nature of goods manufactured vis-à-vis raw material,

Soya Chunks/Nuggetts are described as “Textured Soya Protein” (HSN Code
2106) under broader heading of “food preparations”, are held as different
and distinct commercial products from the raw materials. Therefore, Soya
chunks/nuggets are liable to tax @ 12.5% under the residuary entry of Vth
Schedule.

NOTE:- An appeal against this proceedings can be filed before the Sales Tax Appellate
Tribunal, A.P. Hyderabad within 30 days of this ruling
To,
M/s. Sai Protien Food Industries, Kondapally, Krishna Dist
Copy to the Deputy Commissioner(CT)______________ Division.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/353 / 2005. Dated 10-10 -2005.
O R D E R:
I. M/s. Servet Feeds & Minerals (P) Limited,

Hyderabad(TINo.2950146859)have filed an application and sought
The clarification sought for is :
Whether poultry feed manufactured by the applicant out of

ingredients/raw materials which may be feed supplements for
traders/sellers is exempt from VAT in terms of entry 3 of the 1st Schedule?
Mr. Ashok Taneja Director appeared on behalf of the firm for hearing and
explained the case.

1) A write up on poultry feed manufactured by the applicant and
also on the feed supplements
2) Literature on feed and supplements
3) Copy of notice of assessment of VAT in form 305 A issued by the
CTO, Jeedimetla Circle.
APVAT Act And Rules and HSN codes notified by the Government
vide G.O.Ms.No.1615 Rev.(CT.II) Department dt.31.8.2005 and the
ruling is given below :
Section 67 (2) stipulates that no application shall be

entertained by this authority if the question raised in the
application is already pending before any officer or authority
of the Department. Since, the C.T.O. Jeedimetla has already
issued a notice of assessment of value added tax under Rule
25(5), this authority cannot interfere with the proceedings of
the Assessing Authority and accordingly no ruling is issued.
ruling.
To
M/s Servet Feeds & Minerals (P) Ltd.,
Hyderabad.
Copy to the Deputy Commissioner(CT) Hyderabad Rural Division.
Copy to the Commercial Tax Officer,Jeedimetla Circle.

PROCEEDINGS OF THE
*****
CCT’s Ref.No: /A.R.Com/ 87 / 2006. Dated 13-11 -2006.
O R D E R:
M/s. Deccan Forge & Carbides, Hyderabad (TIN.28490122689) have

Rate of tax applicable to machined forgings used for the following :
a) for Defence use, such as Pistons, Riffles
b) for Automobile sector such as Nozzle Holder forgings, Crank
shafts etc.
c) Hardware items such as Yoke forgings, Levers Locks etc.,
d) Earth moving spares such as Teeth forgings etc.,
Mr.P.Krishna Prasad, Accountant, appeared for hearing and

explained the case.
The applicant is a manufacturer of “Machined forgings.” The

applicant seeks to know the rate of tax applicable to “Machined
forgings”. The HSN Code 7326 is not notified against entry 70 of the
IVth Schedule . However, sub-entry (viii) of entry 70 includes
forgings under “Iron & Steel that is to say.” Going by the
nomenclature, all forgings, unmachined and marketed as ‘forgings’
for various end users or manufacturers would fall under the entry
70 of the IV Schedule liable to tax @ 4%. However if ‘forgings’ are
machined to the specification of a particular OEM or any other
manufacturer or trader such goods attract, the tax @ 12.5%.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Deccan Forge & Carbides,
Hyderabad.
Copy to the Commercial Tax Officer, Malkajigiri Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 31 / 2006. Dated 10 -10 -2006.

O R D E R:
M/s. Mounica Enterprises, Bhongir, Nalgonda District

of Rs.1,000/-

1) Rate of tax applicable to High Density Ammonium Nitrate
(Fertilizer Grade)-I
Mr. S.Ramakrishna, Proprietor appeared for hearing and explained

the case.
The rate of tax applicable to High Density Ammonium Nitrate

(Fertilizer Grade) with HSN Code 3102 is @ 4% under entry 19 of
the IV Schedule.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Mounica Enterprises,
Bhongir, Nalgonda Dist.

Copy to the Deputy Commissioner(CT) Nalgonda Division.
Copy to the Commercial Tax Officer, Bhongir Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 91/ 2006 Dated 10 –11- 2006.
O R D E R:
I. M/s NDT Chemical Products, 5-7-9/6, Sangeeth Nagar, Vignanpuri

Colony Road, Kukatpally, Hyderabad-72 (TIN 28970195132) have filed

The applicant is manufacturer of the following products and
sought clarification on the rate of tax applicable to them.
1) NDT Dye Penetrant.
2) NDT Developer
3) NDT Cleaner (Remover)
Copies of Tax Invoice cum Delivery challans Tax Invoices,
Brochures on their products.
IV. Sri G.Sai Prasad authorised representative of the firm
appeared in person for hearing and explained the case.

of the AP VAT Act and Rules and HSN Codes notified by the
Government vide G.O.Ms.No.398 Revenue (CT-II) Dept., dated 31-
3-2005, G.O.Ms.No.490 Revenue (CT-II) Dept., dated 15-4-2005
G.O.Ms.No.502 Revenue (CT-II) dt.1-5-2006 and G.O.Ms.No.656
Revenue (CT-II) dt.2-6-2006 and the documents produced and oral
submissions made at the time of hearing and relevant provisions of
APVAT Act, 2005 and Rules made there under and the ruling is
given as under.
In his written submissions and also at the time of hearing on
7-11-2006, the applicant has stated that all the inputs that go into
manufacturing of the above products are covered under
G.O.Ms.No.502 dated 1-5-2006 and are liable to tax at the rate of
4%. The applicant has contended that the products manufactured
by him fall under Tariff Heading No.382490.90 and the description
of the goods mentioned as “ Fluxes/Foundry Speciality and NDT
Material and Equipment”. However, the applicant could not produce
any evidence to that effect, in the form of Central Excise Invoice.
Through G.O.Ms.No.656, Revenue (CT-II), 2-6-2006 at Sub-
Entry 204 under Entry No.100, with Tariff Heading No.3824, the
commodity “prepared binders for foundry moulds or cores;
retarders used in the printing industry,” is added under Schedule-IV
of the AP VAT Act. Therefore with effect from 1-6-2006, subject to
the above mentioned products manufactured by the applicant
falling under Tariff Heading No.3824, are liable to tax @ 4%.
Sd/- Sd/- Sd/-

ruling.
To
M/s NDT Chemical Products, 5-7-9/6, Sangeeth Nagar, Vignanpuri Colony
Road, Kukatpally, Hyderabad-72
Copy to the Deputy Commissioner (CT) Hyderabad (Rural) Division.
Copy to the Commercial Tax Officer, Hydernagar Circle, Hyderabad.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 122 / 2006 Dated 10 -11 -2006.
O R D E R:
I. M/s Remi Sales and Engineering Ltd., D.No.1-4-879 ( MCH No.968)

SBI Colony, Street No.8, Bakaram, Ghandi Nahar, Hyderabad-80 (TIN
of Rs.1,000/-
II. They sought clarification on the rate of tax on the
following:
S.No. Nature of Item HSN Code/Tariff
Heading No.
I Centrigures
I. a) Clinical Centrifuges
b) General purpose centrifuge
c) Micro Centrifuge 84211999
d) Research Centrifuge
II Shakers
a) Rotary Shakers (Mini) 84798200
b) Orbital shaking incubators 84198990
c) Water Bah Shakers 84798999
III Laboratory stirrers
a) Heady duty eared stirrer
with PMDC motor
b) Medium Duty Stirrers
c) Mount all purpose stirrer 84798200
AC/DC
d) Continuous heavy duty
Ac/stirrer (flame proof)
IV. Micro Processor controlled

Refrigerated Centrifuges
a) Versatile cooling compufuge
refrigerated centrifuge.
b) Micro Processor controlled 84211999
refrigerated centrifuge.
c) Heavy Duty Refrigerated
Centrifuge
d) Cooling MIcrofuge
V. Freezers
a) Quick Freezer
b) Ultra Low Freezers 84184010
VI. Cryoprecipitate Bath

(Ultra)
a) Blood Storage Cabinet
b) Blood Collection Monitor 84183090
c) Platelet Incubator
d) Platelet Agitator
VIII. Magnetic Stirrers

a) With/without Hot Plate
b) Electro Magnetic Stirrer 84798200
c) Cyclo Mixer
IX. Donar Chair

Multipoint Scanner
Bio Mixer
Sealers
Combimix
Hand Sealers
Donar Tube Stipper
Hematron
Hematype
X. Stabilizers for Blood 90328990

Instruments
XI. Accessory Heads 84219100
The applicant has stated that the above given products are
useful in Diagnostic Centres, Blood Banks, Hospitals and
Educational Institutions for Research purpose.
Copies of purchase Invoices, Delivery challan cum tax
invoices, Stock transfer invoice copies, Tax invoice cum challan.
IV. Mr.G.Narendra Chetty (Advocate) authorised
representative of the firm appeared in person for hearing and
explained the case.
The applicant is seeking clarification on the rate of tax applicable to

Laboratory Equipment and Centrifuges including Centrifugal dryers under
what Entry they fall under the said Act.

3-2005 and G.O.Ms.No.490 Revenue (CT-II) Dept., dated 15-4-2005
as superceded in G.O.Ms.No.1596 Rev.(CT-II) Dept., dt.27-8-2005
in G.O.Ms.No.1615, Rev.(CT-II) Dept., dt.31-8-2005 and
G.O.Ms.No.502 Revenue (CT-II) Dt.1-5-2006 and G.O.Ms.No. 795
Revenue (CT-II) Dept. dt. 29.6.2006 and the documents produced
and oral submissions made at the time of hearing and relevant
provisions of APVAT Act, 2005 and Rules made there under and the
ruling is given as under.
The applicant has stated that the “Centrifuges including

Centrifugal dryers” fall under Sl.No.2 of Entry 102 under Schedule IV of
AP VAT Act and sought confirmation of the same, if it is held that the same
do not fall under the said entry, the applicant sought to know the relevant
entry for the same.
The description of the commodity at Sl.No.2 of Entry 102

reads as “Machinery, Plant or Laboratory equipment, whether or not,
electrically heated (excluding furnaces, ovens and other equipment
of heading 8514), for the treatment of materials by a process
involving a change of temperature such as heating, cooking,
roasting, distilling, rectifying, sterilizing, pasturing, steaming,
drying, evaporating, vaporizing, condensing or cooling, other than
machinery or plant of a kind used for domestic purposes
instantaneous or storage water heaters non-electric” against this
sub-entry no Central Excise Tariff Code Number is mentioned.
The HSN Codes of various items on which the rate of tax

applicable is sought to be clarified are as follows :
1) 8421.1999 5) 8418.4010
2) 8479.8200 6) 8418.3090
3) 8419.8990 7) 9032.8990
4) 8479.8999 8) 8421.9100
Though G.O.Ms.No.795 Rev.(CT-II) Dt.29-6-2006 under the

Entry 102 and 103 “ Machinery of all kinds “ and “ Tools and
Instruments “ with certain Heading Nos. and sub-Heading Nos.of Central
Excise Tariff Codes are included under IVth Schedule of APVAT Act,
2005 liable to tax @ 4%.
Out of the above HsN codes, Heading Nos.8479 and 9032 are
listed at Sl.No.42 and Sl.No.25 of Entry 102 and 103 respectively.
The rules of interpretation of HSN Codes are as follows :

1) Whenever a 4-digit code is allotted to an entry, it is to be
understood that all the 6-digit and 8-digit codes starting with those
4 digits are included in that entry.
2) Whenever a 6-digit code is allotted, all the 8-digit codes
starting with those 6-digit are included in that entry.
3) Whenever an 8-digit code is allotted, the entry is
restricted to that particular code.
Hence, the commodities with HSN code 8479.8200 and

8479.8999 fall under Sl.No.42 of Entry 102 of IV Schedule to AP VAT
Act, 2005 and are liable to tax @ 4% w.e.f. 1-7-2006. Similarly the
commodity with HSN code 9032.8990 falls under Sl.No.25 of Entry 103 of
IV Schedule to AP VAT Act, 2005 and is liable to tax @ 4% w.e.f. 1-7-
2006.
It is further clarified that, going by the above rules of

interpretation of HSN Codes, all the other items on which
clarification is sought are liable to tax @ 12.5% under Schedule V of
AP VAT Act, 2005.
Sd/- Sd/- Sd/-

ruling.
To
M/s Remi sales and Engineering Ltd.,
D.No.1-4-879 (MCH No.968) SBI Colony, Street No.8,
Bakaram, Ghandi Nahar, Hyderabad-80.
.
Copy to the Commercial Tax Officer, Ashok Nagar Circle, Hyderabad.
PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 148/ 2006 Dated 10 -11 -2006.
O R D E R:
I. M/s T.K.M.Pharma, 1-9-1126, Azamabad, Hyderabad (TIN

of Rs.1,000/-

The applicant sought clarification on the rate of tax
applicable to Surgical Spirit, which is manufactured by them.
III. The applicant has produced Central Excise Invoice for
removal of Excisable goods, wherein surgical spirit is shown with
C.E.T.S.H.No.2207.20.00 and also filed copies of Central Excise
Returns.
IV. Mr.N.Surender, Marketing Manager appeared in person

3-2005, G.O.Ms.No.490 Revenue (CT-II) Dept., dated 15-4-2005 as
superceded in G.O.Ms.No.1596 Rev.(CT-II) Dept., dt.27-8-2005 in
G.O.Ms.No.1615, Rev.(CT-II) Dept., dt.31-8-2005 and
G.O.Ms.No.502 Revenue (CT-II) Dt.1-5-2006 and the documents
produced and oral submissions made at the time of hearing and
relevant provisions of APVAT Act, 2005 and Rules made there under
and the ruling is given as under.
Through G.O.Ms.No.502 Revenue (CT-II) Department dated
1-5-2006 w.e.f. 1-5-2006 under sub-entry 6 of Entry 100 to the
Schedule IV of the APVAT Act, 2005, “Denatured ethyl alcohol of
any strength” is added with C.E.T. sub-heading No.2207.20. Since
the product surgical spirit manufactured by the applicant falls under
C.E.T.S.H.N.2207-20-20 with effect from 1-5-2006 the rate of tax
applicable to it is 4%.
Sd/- Sd/- Sd/-

NOTE:- An appeal against this proceedings can be filed before the

Sales Tax Appellate Tribunal, A.P. Hyderabad within 30 days of this ruling.
To
M/s, T.K.M.Pharma, 1-9-1126, Azamabad, Hyderabad.
Copy to the Commercial Tax Officer, Ashok Nagar Circle, Hyderabad.
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Printers Den Packaging, Balanagar, Hyderabad have
filed aN application dt.29.3.2005 and sought clarification and advance
Rs.1000/-.
Whether seals and wads manufactured by the applicant fall under Entry
90 of Schedule IV and attract 4% rate of tax.
The applicant filed the following documents:
1. Copy of certificate under Section 5B of APGST Act.
2. Copies of sale invoice raised by the applicant himself.
1 of page 2
the ruling is given as under.
In terms of the G.O’s cited above Stoppers, caps and lids
(including crown corks, screw caps and pouring stoppers), capsules
for bottles, threaded bungs, bung covers, seals and other packing
accessories of base metal fall under Entry 90 of Schedule IV and
covered under HSN code 8309. Hence the rate of tax applicable is
4%.

To
M/s. Printers Den Packaging,

B-26, Technocrats, Industrial Estate,
Balanagar, Hyderabad – 500 037.

PROCEEDINGS OF THE
(Under Section 67 of APVAT Act,2005)

Sri T. Vivek, Jt. Commissioner (VAT)
***

Dt.13.4.2005.
O R D E R:
M/s. Vijaysri Camphor Industries, Shaikpet, , Hyderabad have filed

an application dt.20-04-2005 and sought clarification and advance ruling
under Section 67 of the APVAT Act,2005 read with Rule 66(2)(i) of APVAT
They sought clarification on the following issues.
Whether Camphor and Camphor tablets are liable to tax at 4%.
1. Copy of excise invoice No.0174 Dt.28.4.21005 of Saptagir Camphor

Limited, Ananthapur.
Sri P.Nayanakar, Proprietor appeared for hearing on 7-5-2005 and
explained the case.
The issue and the document has been examined with reference to
Document submitted contains excise tariff sub heading
No.2914.21.20. As per G.O.Ms.No.398 dt.31.3.05 & G.O.Ms.No.490
dt.15.4.05, HSN code 2914 is notified as covering various items that
attract tax rate of 4%. The product in question falling under HSN
code 2914 is therefore liable to tax @ 4%.
To
M/s. Vijasri Camphor Industries,

D.No.8-1-40/185, Shaikpet,
Hyderabad.
Copy to the Commercial Tax Officer, Mehdipatnam Circle, Hyderabad.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/177 / 2005 Dated 11-07-2005
***
O R D E R:
M/s. K.V.S.INDUSTRIES (TIN.28340114546) SECUNDERABAD have

Rs.1,000/-
To clarify the rate of tax on Industrial rubber components
manufactured and sold for as fittings and parts of hand pumps.
Mr. Satish Kumar, Partner along with P.L. Narasimham, Advocate,
APVAT Act and Rules and (HSN Codes notified by Government vide
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005 and) the
They are manufacturers of Industrial Rubber Components
and claimed as used in hand pumps. In view of the end-use, applicant
contends that the product manufactured by him treated as parts of hand
pump. The claim is examined. End-use criterion cannot be applied to
classify goods is an established rule in classification of commodity.
Therefore, rubber components cannot be treated as parts of hand pump. As
the item is not enumerated in any schedules it is held as falling within the
scope of Schedule-V. Therefore, the Rubber components manufactured by
the applicant are liable to tax @ 12.5%.

Tax
Appellate Tribunal, A.P. Hyderabad within 30 days of this ruling.
To
M/s. _K.V.S. INDUSTRIES,
7-3-163, Ghasmandi,
SECUNDERABAD – 500 003.


PROCEEDINGS OF THE

*****
***
O R D E R:
M/s. _MADHU ENTERPRISES, (TIN.28720137490)

SECUNDERABAD. Have filed an application Dated 22-6-2005 and sought
Whether bottles purchased from hawkers and unregistered dealers
of. A.P. and sold to liquor and beer manufacturers amounts to taxable first
sales ?
Ravi Ellendula, Tax Consultant appeared on behalf of the firm for hearing
A VAT dealer on sale of the goods, has to issue a ‘tax invoice’
to another VAT dealer. Once, he issues a tax invoice on the sale
of ‘glass bottles’, such transactions are liable to VAT @ 4%
under entry 90 of the IVth schedule. The buyer, if VAT dealer, is
eligible for input tax credit on such purchases. Hence, sales of
used glass bottles made to liquor/beer manufacturers are liable
to tax @ 4%.

Tax
To
M/s. _Madhu Enterprises,
Secunderabad.
Copy to the Deputy Commissioner(CT) Begumpet Division.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Ashwini Homeo Pharmacy,(TIN No. 28560176069) Hyderabad


Whether the commodity Ashwini Homeo Arnica Hair Oil is a drug/medicine
?

a) Copy of Chapter 30 – Pharmaceutical products.
b) Copies of invoices issued by the firm
c) Copies of Form ER-3 U/Central Excise Rules
d) Copy of Form 25-C issued by Director, Indian Medicine.
e) Copy of the proceedings issued by Jt.Commissioner, Customs &
Central Excise, dt.2.11.2004.
IV. Sri B.Ch.V.Subba Rao, Proprietor has, appeared for hearing and
explained the case.
VI. For a commodity to fall under “Drugs & Medicines”, it must satisfy
the definition laid down in Section 3 of the Drugs & Cosmetics Act, 1940.
Mere registration under Section 3(b) of the Drugs & Cosmetics
Act,1940 does not make a product eligible for classification as drugs and
medicines.
Entry 88 of the IVth Sche4dule of A.P.VAT Act, 2005 reads as follows :
“ Drugs & Medicines, whether patent or proprietory, as defined in Section 3

of the Drugs & Cosmetics Act,1940, but not including --- (a) Medicated
goods (b) products capable of being used as cosmetics and toilet
preparations including toothpaste, tooth powders, cosmetics, toilet articles
and soaps (c) mosquito repellants in any form.”
By applying the test of common parlance, it is not a drug or medicine, as it

is identified in the market as a specialized and branded hair oil. Secondly,
as to the curative function of the product, there is no authoritative proof
available. Thirdly, the commodity is sold /available across the counters of
general stores without any prescription from medical practioners.
Even assuming that the commodity is a “medicated goods”, it is

excluded from the Entry 88 of the IVth Schedule of the A.P.VAT Act under
clause (a).
A similar issue was decided by the STAT in the case of Arnica Hair
Oil (T.A.No.451/91,dt.24-5-98) which was held as falling either under
“cosmetics” or “toilet preparation” but not under “drugs and medicine.”
Following the enunciation of entry 88 read with clauses and

the test of common parlance, hair oil, traded as “Ashwini homeo
hair oil” can not be considered as a drug and medicine, and
therefore, automatically, fits into the residual entries of Vth
schedule liable to tax @ 12.5%.
ruling.
To
M/s. Ashwini Homeo Pharmacy,
5-283, H.P. Road,
Moosapet, Hyderabad.
Copy submitted to the Commissioner of Commercial Taxes,

Copy to the Commercial Tax Officer, Fathenagar Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Narayana Educational Society, Nellore have filed an
application and sought clarification and advance ruling on the
following items under Section 67 of APVAT Act, 2005 read with
Rule 66(2)(i) of APVAT Rules, 2005 along with the application fee
of Rs.1,000/-

1) Whether their educational institute, which is running a hostel is
liable to register under APVAT
2) If the hostel is maintained by the students themselves is it liable

to register and pay VAT
3) Whether G.O.Ms.No.1036 (CT.II) dated. 20-10-1989 issued
under the APGST Act is applicable to the provisions of the APVAT
Act?
Sri R.V.Seshaiah Naidu, Advocate, appeared for hearing and explained the
case.
Act and Rules and (HSN Codes notified by Government vide
G.O.Ms.No:1615, Revenue (CT.II) Department and the ruling is given as
under:
The applicant, an Educational Society, in Nellore district,runs educational

institutions and supplies food to the boarders . For providing
accommodation and food, the applicant collects money from the resident
students. The applicant seeks for an advance ruling on three issues which
are clarified hereunder :
1)Whether the educational institute, which is running a hostel is

liable to regiter under APVAT.
Explanation V to Sec.2(28), prescribes, sale of goods includes the

supply, by way of or as part of any service or in any manner
whatsoever, of goods, being food or other article for human
consumption------------- such supply of any goods shall be deemed
to be sale of these goods ----------------Therefore, supply of food
and beverages in the hostels by the residential college is liable to
VAT. The liability of tax is also confirmed by the STAT under the
APGST Act. Every dealer, who is liable to be registered under sec.17
of the APVAT Act shall get registered as per the relevant
provisions..
2)If the hostel is maintained by the students themselves is it liable

to register and pay VAT?
In view of the amendment to Article 366 in sub-clause (f) of clause (29A)

of the Constitution the clause (b) of sub-section 10 of sec.2 of the APVAT
Act 2005 also prescribes any association which distributes goods to its
members, any incorporated body or unincorporated body also liable to tax.
Therefore, supply of food and refreshments to the boarders by an
unincorporated body or association or committee would be subject to tax by
reason of Sec.2 (10)(b) of the APVAT Act which provision is fully in
conformity with the sub-clause (f) of clause 29(A) in Art.366 of the
Constitution.
3)Whether G.O.Ms.No.1036 (CT.II) dated. 20-10-1989 issued under the

APGST APGST Act is applicable to the provisions of the APVAT Act?
The APGST Act is repealed with effect from 31.3.2005 and all the G.Os.
issued there under the APGST Act becomes redundant and not applicable.
ruling.
ToM/s. Narayana Educational Society, Nellore.

Copy to the Deputy Commissioner(CT) Nellore-.Division
PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Ratnam Residential Junior College and High School, Nellore

have filed an application and sought clarification and advance ruling on
thefollowing items under Section 67 of APVAT Act, 2005 read with Rule
1) Whether their educational institute, which is running a hostel is liable to
register under APVAT
4) If the hostel is maintained by the students themselves is it liable
to register and pay VAT
5) Whether G.O.Ms.No.1036 (CT.II) dated. 20-10-1989 issued
under the APGST Act is applicable to the provisions of the APVAT
Act?
Sri R.V.Seshaiah Naidu, Advocate, appeared for hearing and explained the
case.
Act and Rules and HSN Codes notified by Government vide
G.O.Ms.No:1615, Revenue (CT.II) Department and the ruling is given as
under:
The applicant an educational society in Nellore district, runs
educational institutions and supplies food to the boarders.. For providing
accommodation and food, the applicant collects money from the resident
students. The applicant seeks for an advance ruling on three issues which
are clarified hereunder.
1) Whether their educational institute, which is running a hostel is

liable to register under APVAT.
Explanation V to Sec.2(28), prescribes, sale of goods includes the

supply, by way of or as part of any service or in any manner
whatsoever, of goods, being food or other article for human
consumption…………….. such supply of any goods shall be deemed
to be sale of these goods …………Therefore, supply of food and
beverages in the hostels by the residential college is liable to VAT
The liability of tax is also confirmed by the STAT under the APGST
Act. Every dealer, who is liable to be registered under sec.17 of the
APVAT Act shall get registered as per the relevant provisions..
2) If the hostel is maintained by the studens themselves is it liable to

register and pay VAT?
In view of the amendment to Article 366 in sub-clause (f) of clause (29A)

of the Constitution,the clause (b) of sub-section 10 of sec.2 of the APVAT
Act 2005 also prescribes any association which distributes goods to its
members, any incorporated body or unincorporated body also liable to tax.
Therefore, supply of food and refreshments to the boarders by an
unincorporated body or association or committee would be subject to tax by
reason of Sec.2 (10)(b) of the APVAT Act which provision is fully in
conformity with the sub-clause (f) of clause 29(A) in Art.366 of the
Constitution.
3) Whether G.O.Ms.No.1036 (CT.II) dated 20-10-1989 issued

under the APGST Act is applicable to the provisions of the
APVAT Act?
The APGST Act is repealed with effect from 31.3.2005 and all the G.Os.
issued there under the APGST Act becomes redundant and not applicable.
ruling.
To
M/s. Ratnam Residential Jr.College and High School
Nellore.
Copy to the Deputy Commissioner(CT) Nellore Division
PROCEEDINGS OF THE

***
O R D E R:
M/s. Cadbury India Limited, (TIN No.28890210202), Gavaravaram,

Eluru have filed an application dt.02-05-2005 and sought clarification and
advance ruling on the following items under Section 67 of the APVAT
Act,2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with the
Whether Entry 18 of Schedule IV includes Cocoa Beans.
The case was posted for hearing on 07-05-2005. Sri P. Koteswara

Rao, Depot Manager appeared on behalf of the company and explained the
case.
G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31.3.2005 and
is given as under.
Entry 18 of Schedule IV reads “Coffee Beans and Seeds,

Cocoa pod, Green Tea Leaf and Chicory”.
1 of 2
The applicant claims that Cocoa pod is not a merchandible

commodity. The Cocoa beans are sold by farmers after they are
extracted from the pod. The beans are said to be covered with the
pulp which induces fermentation and once the fermentation is over
the beans are allowed to dry naturally or artificially. The applicant
claims to purchase only beans and not pod.
In the circumstances explained, it is held that Cocoa beans

fall within the scope of the entry 18 and liable to tax @ 4%.
To
M/s. Cadbury India Limited,

8-144, New Ashok Nagar,
Gavaravaram,
Eluru-534 003.
Copy submitted to the Deputy Commissioner (CT), Division.
2 of 2
PROCEEDINGS OF THE

***
O R D E R:
M/s. Micron Electricals, (TIN No.28110211877), S.P. Road,

Begumpet, Hyderabad have filed an application dt.05-05-2005 and sought
the APVAT Act,2005 read with Rule 66(2)(i) of APVAT Rules,2005 along
Can a works contractor opting to pay tax by way of composition,
purchase electrical items from outside the state for use in the execution of
electrical works contract.
The case was posted for hearing on 10-05-2005. Sri M.S. Manohar,
Accounts Manager appeared on behalf of the company and explained the
case.
The matter has been examined with reference to the provisions of
the APVAT Act and Rules and the ruling is given as under.
A VAT dealer can purchase goods from outside the State
against ‘C’ Form and use the same in the execution of works
contract which is under composition.
To
M/s. Micron Electricals,

Plot No.04, Jabbar Complex,
Municipal No: 1-11-252/A/4,
S.P.Road, Begumpet,
Hyderabad-500 016.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Modern Arc Welding Works, (TIN No.28730192909)
Gudiwada, Vijayawada have filed an application dt.06.5.2005 and sought
1. Tractor drawn trailors
2. Tractor drawn implements and Farm machinery run with the help
of Tractor engine power.
The following documents have been submitted by the applicant:

Product literature
1 of page 3
Sri K.Sudhakar, Manager appeared for hearing on 30-5-2005 and

explained the case.
is given as under:
Entry 63 of Schedule IV reads “Tractors, threshers,
harvesters and attachments and parts thereof”. In G.O.Ms.No.398,
Revenue (CT.II) Department, Dt.31-03-2005 and G.O.Ms.No.490,
Revenue (CT.II) Department, Dt.15-04-2005, the HSN codes
applicable to Tractors, parts of tractors and other items have been
notified. The nomenclature used under Entry 63 refers to
attachments thereof relating to Tractors. The trailors of Tractors by
all means could be interpreted as attachments. Therefore the
Tractor trailers will fall under Entry 63 of IV th Schedule to A.P.VAT
Act, 2005 taxable @ 4%.
2 of page 3
As regards item 2, the list of tractor drawn implements

etc., code No.8433.59.00 refers to ‘other’. Chapter heading 8433
lists various types of harvesting or threshing machinery. Thus read
together the items on which the applicant is seeking clarification
can be understood as falling under the category of ‘other’.
Therefore, they are liable to tax @ 4%.

To
M/s. Modern Arc Welding Works,

D.No.16/256, Gudiwada,
Copy to the Commercial Tax Officer, Gudiwada Circle, Vijayawada.

3 of page 3

PROCEEDINGS OF THE

***
O R D E R:
M/s. International Instruments Industries, (TIN No.28240172135),

R.P. Road, Secunderabad have filed an application dt.25-04-2005 and
67 of the APVAT Act,2005 read with Rule 66(2)(i) of APVAT Rules,2005
To clarify the rate of tax on Cathode Ray Oscilloscopes, Spectrum
Analyses, Cross-talk meters, Grain Measuring Instruments, Distortion
Factor Meters, Psophometers, Network and Logic Analyzer and Signal
Analyzer falling under HSN Code 9030.
The case was posted for hearing on 06-05-2005. Sri Deepak
Bhansali, Proprietor appeared and explained the case.
the APVAT Act and Rules and HSN Codes notified by Government vide
is given as under.
All the items falling under HSN Code 9030 are liable to tax @
4% as per Entry 39 of Schedule IV of APVAT Act,2005.
To
M/s. International Instruments Industries,

5-1-38, R.P. Road, Near Railway Bridge,

PROCEEDINGS OF THE
***
O R D E R:
M/s. V-Guard Industries Private Limited, (TIN No.28580204554),

Mansoorabad, GSI Post, Hyderabad have filed an application dt.29-04-2005
Section 67 of the APVAT Act,2005 read with Rule 66(2)(i) of APVAT
To clarify the rate of tax on PVC Insulated Cable .
The case was posted for hearing on 06-05-2005. Sri G. Madhu
Sudhan, Senior Officer (Accounts) appeared on behalf of the company and
explained the case.
is given as under.
PVC Insulated Cables with HSN Code 8544.59.30 falling under
Entry 38 of Schedule IV are taxable @ 4%.
To

Plot No.24 & 25, Sri Lakshmi Nagar Colony,
Mansoorabad, G.S.I. Post,
Hyderabad-500 068.
Copy to the Deputy Commissioner (CT), Saroornagar Division.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Vamsi Art Printers Private Ltd., (TIN No.28230186750), Red
Hills, Hyderabad have filed an application dt.28-04-2005 and sought
1. Whether books, periodicals and manuals are exempted under
APVAT Act,2005.
2. Whether tax is applicable for pure labour charges (material
supplied by the contractee).
3. What is the procedure to be adopted to pay tax under Sub-rule
(1) of Rule 17 of APVAT Rules,2005.
The case was posted for hearing on 06-05-2005. Sri Sai, Accountant
appeared on behalf of the company and explained the case.
the APVAT Act and Rules and the following ruling is given as under.
1. Printed books, periodicals and journals are exempted from
payment of tax as per Entry 5 of Schedule I of APVAT
Act,2005 in the hands of publishers and sellers. The dealers
executing works contracts for printing such items on behalf
of publishers are liable to tax @ 4%.
2. Pure labour charges are not taxable under APVAT Act.

However, any transfer of material will be liable to tax as per
the rates applicable to the goods as per the Schedules of
APVAT Act,2005.
3. As per Sub-rule (1) of Rule 17 of APVAT Rules, tax is to be

paid on the value of the goods at the time of incorporation,
used in works contract. The dealer can also claim input tax
credit for 90% of tax paid on purchases of inputs used in
such works which are outside composition.
To
M/s. Vamsi Art Pinters Private Limited,
11-6-872, Red Hills,
Hyderabad-500 004.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 19/ 2006 Dated 12-6-2006.
O R D E R:
I. M/s Uni Fab Engineering Works, #537, B.N.Reddy Nagar, Near

Ganesh Temple, Charlapally, Hyderabad (TIN 28220133465) have filed

Whether the dealers are eligible to claim input tax credit on
the main raw-material ie., M.S.Sheets supplied by the contractees.
Copies of Sale Invoice, Work Order, MOU with Contractees
etc.
III. Sri R.S.Subba Rao, Accountant of the firm appeared in person
IV. The applicant is executing works contracts for the

manufacture of STD, ISD, PCO and Coin Box Machines.
The applicant wanted clarification on as to whether they are eligible

to claim input tax credit on the main raw-material ie., M.S.Sheets
which is supplied by their contractees..

and the documents produced and oral submissions made at the time
of hearing and relevant provisions of APVAT Act, 2005 and Rules
made there under and the ruling is given as under.
As seen from the copies of agreements ie., Memorandum of
Understanding, entered into by the applicant with their contractees
it is noticed that the contractee is supplying the CRCA Sheets ( Iron
& Steel) to the applicant and using such sheets as main raw-
material. The applicant is manufacturing cabinets of given
specifications and receiving amount towards the work done. Under
these circumstances, there is no transfer of property in CRCA
Sheets by way of sale through a tax invoice from the contractee to
the applicant and hence the question of claiming input tax credit by
the applicant does not arise. Hence it is clarified accordingly.
ruling.
To
M/s Uni Fab Engineering Works, #537, B.N.Reddy Nagar, Near Ganesh
Temple, Charlapally, Hyderabad.
Copy to the Deputy Commissioner (CT) Hyderabad Saroor Nagar Division.
Copy to the Commercial Tax Officer, Nacharam Circle, Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Varada Sathi Raju, Nellapalli, East Godavari Distrist (TIN

The applicability of Section 4(4) of the A.P.VAT Act to purchase of
Paddy by the applicant on behalf of and for the purpose of principals at
Yanam and despatched to them.
Sri V.Satti Raju, Proprietor appeared on behalf of the firm for

1. Copy of Agricultural Market Committee depicting payment of

licence fee.
2. Copy of Waybill issued by the applicant
3. Copy of sale patti issued by the applicant
4. Copy of purchase order issued by the alleged principal
The applicant claims to purchase Paddy on behalf of and for

the purpose of principals at Yanam and claims to despatch goods to
them. The applicant is under the impression that the transaction is
not liable to purchase tax under Section 4(4) of the A.P.VAT Act for
the reasons stated as under :
i) that the purchase transaction is of interstate nature and falls
within the scope of Section 5(a) of A.P.VAT Act which bars
imposition of tax on transactions taking place outside the
State of A.P.
ii) that the transaction of buying and sending goods immediately
to a place outside the State of A.P. , are not two independent
events but on the contrary is a single transaction in the nature
of interstate purchase and its movement.
The applicant also relies on the decision of Supreme Court in

the case of Bakhtawar Lal Kailash Chand Arhti (87 STC 196).
We have examined the contents of the applicant, perused the

documents and also heard the applicant. According to Section 4(4)
of A.P.VAT Act, purchase tax liability arises in certain specific
circumstances stated therein. The words “if after purchase” used in
the sub section are very significant because the initial purchase and
subsequent disposal must be separable to attract the liability to tax.
The facts of the applicant as stated by him are that Paddy is
purchased on behalf and for the purpose of principals who are
located outside the State and that the applicant claims to despatch
the goods immediately to the alleged principal. If this be so the
transaction is one in the nature of interstate purchase and as such
may not attract provisions of Section 4(4) of A.P.VAT Act. In the
circumstances stated by the applicant, provisions of Section 5 also
apply to the transaction. Further, if the applicant engages himself in
the business of buying Paddy on behalf and for the purpose of non-
resident principals and effects movement of such goods to the
principal outside the state, the ratio of the decision of Supreme
Court relied on by the applicant may also apply to the applicant.
However, the above view expressed by us does not pre-empt

an enquiry or examination as to the veracity of the transaction
effected by the applicant by any officer duly authorized under the
Act. In otherwords, this ruling does not place an embargo on
enquiry or scrutiny of the claim made by the applicant regarding
non-exigibility of purchase tax under section 4(4) of the Act and
further action in pursuance of the findings if and when taken up by
the authorities of the department.
Accordingly the application is disposed of.
To
M/s. Varada Sathi Raju,
3-46, Neelapalli,
East Godavari District – 533 464.
Copy to the Commercial Tax Officer, Jagannaikpur Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/424 / 2005. Dated 12 -12 -2005.

O R D E R:
M/s. R.K. Industries, I.D.A. Kattedan, Hyderabad registered dealers

U/VAT have filed an application and sought clarification and advance ruling
on the following items under Section 67 of APVAT Act, 2005. The
application is examined and found to be in order. Hence, admitted.
The clarification sought for is rate of tax on the following commodities.

1) TPU Elastic bands
2) TPU Films and tapes and tubes
3) TPU Master batch.
Mr. Shantilal K. Shah Manager appeared on behalf of the firm for

hearing
The applicant submitted certain samples of the commodities as

stated above.
APVAT Act and Rules and HSN codes notified by the Government vide
G.O.Ms.No.1615 Rev.(CT.II) Department dt.31-8-2005 and the ruling is
given below :
The applicant deals in articles of Thermo Poly

Urethene. The applicant manufactures TPU articles using plastic
resins as the raw material. Having examined the nature of raw
materials and the finished articles of TPU and having regard to the
common parlance of the articles, it is observed that, all three
articles do fall under the residuary entry of Schedule V liable to tax
@ 12.5%.

ruling.
To
M/s. R.K.Industries,
Hyderabad.

Copy to the Commercial Tax Officer, Rajendranagar Circle.

PROCEEDINGS OF THE

Sri.T.Vivek, Jt.Commissioner(VAT)
*****
O R D E R:
M/s. Laser Dot Limited,(TIN.28110231277), Barkatpura, Hyderabad

have filed an application dated 27-04-2005 and sought clarification and
Advance Ruling on the following items under Section 67 of APVAT Act,
2005 read with Rule(62)(i) of APVAT Rules, 2005 along with the
application fee of Rs.1000/-.The application is examined and found in
1. Whether scanning done on high resolution drum scanner as

per the instructions of the customer involving technical skill
and copied into a CD constitutes a taxable sale under the
provisions of APVAT Act?
2. Whether image manipulation one from the CD given by the

customer for editing and image manipulation and conversion into
a CD for the final output or converted into a film or Thermal Plate
constitutes a sale or a job work under the provisions of APVAT
Act.
The case was posted for hearing on 30-04-2005, Sri.P.Raghava

Raju Managing Director of the firm appeared on behalf of the
Company and explained as under:
They have two types of customers i.e., VAT registered customers
and Non-VAT customers. They have also mentioned that about 45-
50% of the cost involved is of material used in the work and in so
far as VAT registered customers are concerned, there is no difficulty
in charging and paying taxes instead of seeking treatment of the
transactions as job work. In respect of the transactions done for
Non-VAT dealers, he wanted a clarification whether composition can
be opted specially for all the transactions so that tax @4% on 50%
of the consideration can be paid without claiming the benefit of input
tax credit.
After hearing the applicant, the ruling is given as under:
1. The application can opt for composition in respect of

specific contracts and pay tax @4% on 50% of the
consideration charged. Therefore, he can opt for
composition in respect of all contracts executed for Non-
VAT customers by filing an application in Form VAT 250.
He will not be eligible for input tax credit for these
contracts.
2. In respect of transactions done for VAT registered
customers, he can issue tax invoice for the value of the
material at the time of incorporation and charge the tax
rates applicable i.e., 4% or 12.5%. The inputs specifically
used for these contracts outside composition and eligible
for the benefit of input tax credit to the extent of 90% of
the total input tax. He should, however, comply with the
provisions of Rule 17(1) of the APVAT Rules, 2005.
3. The option for composition can be stated on application in
Form VAT 250 for all Non-VAT dealers customers.
ruling.
To
M/s Laser Dot Limited,
3-4-480/3,Barkatpura,
Hyderabad-500027..

Copy to the Commercial Tax Officer,Barkatpura Circle.

PROCEEDINGS OF THE

***

Dt.13.4.2005.
O R D E R:
M/s. A.F.Scrap Centre, Mahaboobgunj, Hyderabad have filed an

application dt.5-05-2005 and sought clarification and advance ruling on the
following items under Section 67 of the APVAT Act,2005 read with Rule
Liability to tax on purchases of Iron & Steel scrap / unserviceable

vehicles (buses) from APSTRC and also Tin scrap and Alluminium scrap
purchased in auction conducted by APSRTC
1. Copy of Bangalore Metropolitan Transport Corporation
No.BMTC:CS:SCRAP: 04-05 Dt.13.4.2005 showing tax @ 4% on sale
of scrap on Leyland bus and Tata bus.
2. Copy of auction form of APSRTC, Nellore Division, A.P. dt.5.5.2005
showing details of vehicles alongwith Rc.No. with conditions of
auction.
Sri Abdul Azeez, Proprietor, appeared on 7-5-2005 and explained

the case.
APVAT Act and Rules, documents submitted and HSN Codes notified by
Documents submitted by the applicant do not relate to the
applicant firm, though they indicate that scraped buses have been
sold by BMTC. Copy of APSRTC tender form, however, contains
details of auction proposed to be held by the Nellore zone
describing the vehicles as unserviceable vehicle without
registration certificate except vehicle mentioned at Sl.No.1 which is
described as ‘least service vehicle’ that would be sold alongwith
registration. The point for consideration is whether unserviceable
vehicle (buses) and tin scrap and alluminium scrap sold by APSRTC
can be classified as Iron and Steel and liable to tax at 4%. As per
HSN codes notified in G.O.Ms.No.398 Rev. (CT.II) Dept. dt.31.3.05 &
G.O.Ms.No.490 Rev. (CT.II) Dept. dt.15.4.05 by the Government, Tin
waste and scrap falls under Entry 8002. Aluminum, waste and scrap
falls under HSN codes 7602. As the unserviceable buses are sold
without Registration Certificate it can be construed that they have
mere scrap value and have to be treated as such. Accordingly,
unserviceable scraped buses are liable to tax at 4% when sold
without R.C. In case buses are sold by APSRTC alongwith
Registration Certificate they can be construed as sale of old buses
and attract tax rate of 12.5%.
To
M/s. A.F.Scrap Centre,

D.No.15-9-510, Mahboobgunj,
Hyderabad-500 012.
Copy to the Commercial Tax Officer, Gowliguda Circle, Hyderabad

PROCEEDINGS OF THE

***
Ref:-1.CCT’s
Ref.No.PMT/P&L/A.R.Com/2005,Dt.13.4.05.
2. CCT’s Ref.No.PMT/P&L/A.R.Com/55/2005,
Dt. 13.5.2005.
***
O R D E R:
Whereas M/s. Daughters of St.Paul, S.P.Road, Secunderabad

filed an application on dt.7.5.2005 and sought clarification and advance
ruling under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of
APVAT Rules, 2005 and among other things, sought clarification on the rate
of tax applicable to Communion items, Cassettes, CDs and VCDs containing
religious songs and life of saints and holy persons and sale of greeting cards
and whereas ruling was issued holding communion items as liable to tax @
12.5% and whereas no ruling was issued on Cassettes, CDs, VCDs etc., and
greeting cards inadvertently and the applicant having brought the same to
the notice of this Authority with explanatory notes on the above said items
the following ruling is given :
1 of page 3
a. Communion items : The applicant states that these
items are made from wheat, milk and distributed freely
to all devotees in the Church and stands on the same
footing as Prasadam and therefore eligible for
exemption in terms of Entry 37 of Schedule I of
A.P.VAT Act, 2005. In light of the explanation provided
by the applicant, it is held that communion items are
exempt.
b. Audio visual products i.e., Casettes, CDs and VCDs: In

the G.O.Ms.No.398, Revenue (CT.II) Department,
Dt.31-03-2005 and G.O.Ms.No.490, Revenue (CT.II)
Department, Dt.15-04-2005, the Government have
notified certain I.T.products as falling under Entry 39
of Schedule IV of A.P.VAT Act, 2005. Recorded Audio
and Video cassettes sold by the applicant fall under the
broader category of I.T. products. As they are notified
as falling under HSN code 8524 they attract tax @ 4%.
c. Greeting cards sold by the applicant are held as liable

to tax @ 4% in terms of entry 47 of Schedule IV of the
Act and HSN Codes notified under heading 4909 in the
G.Os cited above.
2 of page 3
This order should be read as part of the order issued earlier in the
reference 2nd cited above.
To
M/s. Daughters of St.Paul,

D.No.9-1-79/A, Sardar Patel Road,
Copy to the Commercial Tax Officer, Begumpet Circle, Hyderabad.
3 of page 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Deltek Power Links, (TIN No.28240145945) Begumpet,
Hyderabad have filed a application dt.03.5.2005 and sought clarification
They sought clarification on rate of tax on the following
items:
1. Servo Voltage stabilizers (in all range capacities)
2. Step down transformers, Variable transformers
3. Invertors and UPS
4. Batteries
5. Accessories of all above products
The applicant is a manufacturer of the above said items.
Sri Y.Vijaya Krishna, Director appeared for hearing on 10-5-2005

is given as under.
Items at Sl.No.1 to 3 and their parts and accessories
(Sl.No.5) fall under chapter heading 8504 of HSN code and under
Entry 39 of Schedule IV of A.P.VAT Act, 2005 are taxable @ 4% and
Item 4 Batteries is liable to tax at 12.5%.
To
M/s. Deltek Power Links,

611A, 5th Floor, Shanthi Bagh Apartments,
Greenlands, Begumpet,
Hyderabad.
Copy to the Commercial Tax Officer, Sanathnagar circle, Hyderabad.
Copy submitted to the Deputy Commissioner (CT), Panjagutta Division.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Jain Steel House, (TIN No.28180193283) Feel Khana,
Hyderabad have filed a application dt.27.4.2005 and sought clarification

1. Stainless steel utensils and articles – Rate of tax
2. Clarification on Item 70 & 73 of Entry 27 to the Schedule IV of

AP.VAT Act as per the HSN codes.
Sri Ashok Shah, Proprietor appeared for hearing on 30-4-2005 and

explained the case.
1 of page 2
is given as under.
Stainless Steel utensils and articles are covered by HSN Code
7323.93.90. And all other utensils (other than notified at Sl.No.67,
68, 69, 71, 72, 74, 75 & 76) are covered by HSN Code
No.7323.99.20.
Thus, items mentioned at Sl.No.70 & 73 are also liable to tax
@ 4%.

To
M/s. Jain Steel House,

15-8-506/507, Feel Khana,
Hyderabad.
Copy to the Commercial Tax Officer, Begum Bazaar Circle, Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Manaksia Limited, (TIN No.28450192401) Sunder
Nagar, Hyderabad have filed a application dt.30.4.2005 and sought
1. Repellants for insect such as flies, mosquitoes – HSN Code and rate
of tax applicable.

1. Sale invoice issued by the applicant
2. Copy of tax invoice – cum – excise invoice.
1 of page 2
Sri Kuber, General Manager, Finance appeared for hearing on 7-5-

Repellant for insects such as Flies, Mosquito are covered by
HSN Code No.3808.10.91 notified by Government in the G.Os cited
above. Thus they fall under Rule 20 of IVth Schedule. Hence liable
to tax @ 4%.

To
M/s. Manaksia Limited,

38, Sunder Nagar,
Hyderabad.
Copy to the Commercial Tax Officer, Sanathnagar Circle, Hyderabad.

PROCEEDING OF THE


***
O R D E R:
M/S Sachdev Overseas., (TIN No.28350169383), 1192,

Macheodguda (Behind M.G.Road), Secunderabad have filed an application
on
4-5-2005 and sought clarification and Advance Ruling on the following
items under Section 67 of the APVAT Act, 2005. They also enclosed an
application fees of Rs.1000/-. The application is examined and found in
The issue on which clarification sought is whether imported
articles for physical and general exercise and fitness equipments like
Motorized Treadmill, Air Bikes, Massager, Horse rider, Rowing Machine etc.
fall under Entry 60 of the IVth Schedule ?
The case was posted for hearing on 7-5-2005 Sri
Y.N.Sachdev, Partner of the firm appeared on behalf of the firm and
presented this case. He also submitted evidence of Customs Tariff
classification on such goods as falling under HSN Code No.9506.
The issue raised by the applicant is examined with reference
to the provisions of the AP VAT Act and Rules and HSN Codes notified by
Government vide G.O.M.No.398, Revenue (CT-II) Department, dt.31-3-
2005 and G.O.Ms.No.490, Revenue (CT-II) Department, dt.15-4-2005 and
Articles and Equipments for physical and general
exercise falling under HSN Code No.9506 will fall under Entry No.60
Sports Goods and taxable @ 4%.
JT.COMMISSIONER
To
M/s SACHDEV OVERSEAS.,
1191, Macleodguda,
M.G.Road,
SECUNDERABAD.
Hyderabad.
Copy to the Commercial Tax Officer.

PROCEEDINGS OF THE

***
Ref:-1.CCT’s
Ref.No.PMT/P&L/A.R.Com/2005,Dt.13.4.05.
2. CCT’s Ref.No.PMT/P&L/A.R.Com/56/2005,
Dt.13.5.2005.
***
O R D E R:
Whereas M/s. Trailor Springs, Industrial Estate, Vijayawada

Rules, 2005, among other things, the rate of tax applicable to Tractor
trailors, and whereas ruling on the issue was not given inadvertently and
the applicant having brought it to the notice of the Authority the following
ruling is given.
1 of page 2
Entry 63 of Schedule IV reads “Tractors, threshers,
harvesters and attachments and parts thereof”. In G.O.Ms.No.398, Revenue
(CT.II) Department, Dt.31-03-2005 and G.O.Ms.No.490, Revenue (CT.II)
Department, Dt.15-04-2005, the HSN codes applicable to Tractors, parts of
tractors and other items have been notified. The applicant however urges
that Tractor trailors be declared as falling under 8433.59.00.
The nomenclature used under Entry No.63 refers to
attachments thereof relating to Tractors. The trailors of Tractors by all
means could be interpreted as attachments. Therefore, the tractor trailers
will fall under Entry No.63 of Schedule IV of A.P.VAT Act, 2005 taxable @
4%.
This order should be read as part of the order issued earlier
in the reference 2nd cited above.

To
M/s. Trailor Springs,
P.D.12, Near Farm Steel, Industrial Estate,
Vijayawada-520 007.
Copy to the Deputy Commissioner (CT), Vijayawada-I Division.
Copy to the Commercial Tax Officer, Autonagar, Hyderabad.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. A.J.Stationery Private Limited, (TIN No.28460171481)
Gandhi Nagar, Hyderabad have filed a application dt.29.4.2005 and sought
1. They sought clarification on rate of tax applicable to Office files and

Folders.
Sri A.Harinath, Branch Manager appeared for hearing on 10-5-2005

is given as under.
Entry 25 of Schedule IV of A.P.VAT Act reads as under:
“Exercise Note books including Graph books and laboratory
note books, Office stationery including computer stationery,
Writing pads and Account Ledgers”.
Folders and File covers fall under Chapter heading
4820 and specified at 4820.30.00. As the chapter heading 4820 has
been notified in the above mentioned G.O’s., Folders and file covers
sold by the applicant are held as liable to tax at 4%.

To
M/s. A.J.Stationery Private Limited,

1-1-746/A, Gandhi Nagar,
Near Narmada Hospital,
Hyderabad.
Copy to the Commercial Tax Officer, Gandhi Nagar Circle, Hyderabad.

PROCEEDINGS OF THE

***

Dt.13.4.2005.
O R D E R:
M/s. Daughters of St. Paul, Sardar Patel Road, Secunderabad have
filed an application dt.7-05-2005 and sought clarification and advance
ruling under Section 67 of the APVAT Act,2005 read with Rule 66(2)(i) of
The applicant claims that it is a non-profitable religious institution
rendering service to society and as part of their work they sell
1. Books 5. Holywater containers
2. Mass vestments 6. Communion items
3. Religious vessels 7. Holy prictures
4. Candles and Incense Thuribles 8. Religious statutes and
9. Rosaries & holy medals
and sought clarification on the rate of tax applicable to the items.
Without prejudice to the applicability of rate of tax, the applicant

claims continuation of sales tax exemption given under the APGST Act,
1957.
1. Copy of CCT’s Ref.No.AI(1)/254/2003, Dt.16.3.2005 read with Govt.

Memo.No.5058/CT.II(1)/2003-2, Dt.20.1.2005.
Sister Celine, President appeared for hearing on 7-5-2005 and
explained the case.
APVAT Act and Rules, HSN codes notified by Government vide
G.O.Ms.No.398, Revenue (CT.II) Department, DT.31.3.2005 and
is given as under documents submitted and the ruling is given as under.
In terms of provisions contained in A.P.VAT Act & Rules,
there is no automatic continuation of exemptions given under the
APGST Act, 1957. Since the dealer is duly registered under A.P.VAT
Act holding TIN, the liability for payment of VAT is beyond dispute.
Section 15 of the Act gives power to the State Govt. to grant refund
in certain circumstances. The applicant may explore this option.
The applicability of rate of tax on items sold by the applicant

is as under :
1. Mass vestments: They can be considered as readymade garments

and held liable to tax @ 4% (as per HSN code 6101)
2. Religious vessels: If the vessels are made of aluminum or steel or
enamelled utensils of iron and steel they fall under Entry 7 of
Schedule IV and liable to tax at 4%. Any other type of utensils is
also liable to tax at 4%.
3. Candles: 12.5%
4. Incense thruribles: @ 4% (as per HSN code 3307.41)
5. Holy water containers: 12.5%
6. Communion items: 12.5%
7. Holy pictures: 12.5%
8. Religious statues: 12.5%
9. Rosaries and holy medals: 12.5%
To
M/s. Daughters of St. Paul,

D.No.9-1-79/A, Sardar Patel Road ,
Copy to the Commercial Tax Officer, Hyderabad.

PROCEEDING OF THE

CCT’s Ref.No.PMT/P&L/A.R.Com/ 47 /2005 Dated 13-5-2005
Ref.CCT’S REF.NO.PMT/P&L/A.R.COM/2005, DATED 13 -4-2005
***
O R D E R:
M/S Gogi Engineering Company, (TIN No.28730131314),

2002/26, Lala Temple Complex, Ranigunj, Secunderabad have filed an
application on 3-5-2005 and sought clarification and Advance Ruling on the
following items under Section 67 of the APVAT Act, 2005. They also
enclosed application fees of Rs.1000/-. The application is examined and
They sought clarification on the following: Whether the

Winding Wire made of copper for submersible motors with HSN Code
8544.90.11.90, PVC Insulated Flat Cable with HSN Code 8544.90 are
taxable @ 4% or 12.5%
The case was posted for hearing on 6-5-2005 Sri

Gangakhadkar authorized signatory appeared on behalf of the firm and
presented the case and explained.
The issue is examined with reference to the provisions of the AP VAT

Act and Rules and HSN Codes notified by Government vide G.O.M.No.398,
Revenue (CT-II) Department, dt.31-3-2005 and G.O.Ms.No.490, Revenue
(CT-II) Department, dt.15-4-2005 and the ruling is given as under.
The goods Winding wire made of copper for

submersible motors covered by HSN code 8544.90 11.90 and PVC
Insulated Flat Cable covered by HSN Code 8544.90 are taxable
under Entry No.39 of the APVAT Act, 2005 @ 4%.
JT.COMMISSIONER
To
M/s Gogi Engineering Company,
2002/26, Lala Temple Complex,
Ranigunj,
SECUNDERABAD.

Hyderabad.
Division.

PROCEEDINGS OF THE

***

O R D E R:
M/s. Karuna Pharma (P) Ltd., (TIN No.28350151244), Kavadiguda,

1. Whether the TOT dealer who has paid VAT on his purchases can
collect the same along with TOT payable on his sales.
2. Whether an un-registered dealer who has paid VAT on his purchases
can collect the same on his sales made to consumers.
The case was posted for hearing on 07-05-2005. Sri Ramesh

Chandra Gupta appeared on behalf of the Company and explained the case.
A copy of CCT’s Circular issued in 1985 (CCT’s Ref.A3/3009/83, Dt: 1-8-
1985) was also produced.
The matter has been examined with reference to Section 57(3) of
the APVAT Act, 2005 and the provisions of Drug Price Control Order 1979.
There is a clear provision in Drug Price Control Order, a Central

enactment that all local taxes can be charged and collected over and above
MRP.
It is, therefore, clarified as under:
Any dealer who is required to collect separately any amount

of tax under the provisions of any other Law in force, can collect the
tax paid by him on his purchases and in addition can also collect the
turnover tax (TOT) payable by him on his sales. An unregistered
dealer (below Rs.5 lakhs turnover threshold) can collect VAT paid
on purchases by him from his customers.
To
M/s. Karuna Pharma Pvt. Ltd.,

6-6-33/G/31 & 32, Sri Gayatri Apartments,
Kavadiguda, Secunderabad-500 080.

PROCEEDINGS OF THE

***

Dt.13.4.2005.
O R D E R:
M/s. Trailor Springs, Industrial Estate, Vijayawada have filed an

application dt.4-05-2005 and sought clarification and advance ruling under
The applicant claims to be manufacturer of leaf springs for tractor
trailors and seeks ruling regarding rate of tax, applicable to sale of leaf
springs.
Sri T.Vinod Babu, Executive Partner, appeared for hearing on 7-5-

is given as under.
Entry 63 of Schedule IV of A.P.VAT Act, 2005 reads as under:
Entry 63: “Tractors, Threshers, Harvestors and attachments and
parts thereof”.
Leaf springs meant for tractor trailors fall under HSN Code
8433.59.00 and other parts fall under HSN code 8433.90.00 of
Schedule IV.
Thus both the above items are liable to tax @ 4%.

To
M/s. Trailor Springs,

P.D.12, Near Farm Steel,
Industrial Estate,
Vijayawada-520 007.
Copy submitted to the Commissioner of Commercial Taxes ,A.P.,

Hyderabad.
Copy to the Deputy Commissioner (CT), Vijayawada-I Division.
Copy to the Commercial Tax Officer, Autonagar circle.

PROCEEDING OF THE

CCT’s Ref.No.PMT/P&L/A.R.Com/25 /2005 Dated 13-5-2005
***
O R D E R:
M/S Vishnu Products., (TIN No.28260168513), 11-46-15A,

Kanurivari Street, Near Kothagulla, Vijayawada have represented through
their application dated 23-4-2005 and sought clarification and Advance
Ruling on the following items under Section 67 of the APVAT Act, 2005.
They also enclosed an application fees of Rs.1000/-. The application is
The issue on which clarification sought is whether Camphor
Tablets and Camphor Lumpy converted from Camphor attract 4% tax ? Sri
K.Suryanararyana Gupta has appeared on 7-5-2005. He presented his case
and also specified that the Central Excise HSN Code for such good is
No.2914.
The issue raised by the firm is examined with reference to

the provisions of the AP VAT Act and Rules and HSN Codes notified by
Camphor Tablets and Camphor Lumpy made out of
Camphor will fall under Bulk Drugs under Entry No.16 of the IVth
Schedule as the HSN Code of the goods is 2914 and taxable @ 4%.
JT.COMMISSIONER
To
Sri K.Suryanarayana Gupta,
M/s Vishnu Products,
11-46-15A, Kanurivari Street,
Near Kothagulla,
VIJAYAWADA – 01.

Hyderabad.

PROCEEDINGS OF THE

***

Dt.13.4.2005.
O R D E R:
M/s. Weitex India Limited, 1-3-176/35/22/26, Gandhi Nagar,

and advance ruling on the following items under Section 67 of the APVAT

(i) Mechanical Weigh Bridges, Weighing systems, Weighing
machines
(ii) Electronics weigh scales, Weighing systems, Weighing machines
(iii) Electronics printers, key board, Load cells
(iv) Conversion kit

1. Product literature ;
2. Sale invoice issued by the applicant after 1.4.05 showing VAT at
12.5% ;
3. Copies of components purchased from dealers within A.P. in the
month of
April 2005 and
4. Copies of sale invoice issued by the applicant in the year 2003 -
2004.
Sri B.R.Mani Prasad, Manager (Engg) appeared for hearing on 26-4-

is given as under.
The purchase documents filed by the applicant, some of

which are from local dealers, show VAT charged at 4%. Apparently,
these items are either electrical or electronic in nature. Some
purchases are sourced from outside A.P. also where CST at 4% is
charged. On the sale invoice, the applicant had charged 12.5% VAT.
Under the APGST Act, the applicant had charged tax at 4% on some
electronic items and at 8% on mechanical items. The items on
which ruling is sought are not notified with HSN code in the above
mentioned G.Os. The applicant has not furnished any evidence of
excise tariff applicable to the products sold by him. In the
circumstances, it is held that the items on which ruling is sought
are liable to tax at 12.5%.
To
M/s. Weitex India Limited,

D.No.1-3-176/35/22/26, Bhagyalaxmi Nagar, Kavadiguda,
Gandhi Nagar,
Hyerabad-80.
Copy to the Commercial Tax Officer, , Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Pawan Power & Telecom Limited, (TIN No.28360100739)
They sought clarification on rate of tax on the following :
1) Flexible cables
2) Power & Control cables (PVC cables / XLPE Cables)
3) Mining cables
4) Aerial bunched cables
5) ACSR Conductor (Aluminum conductor steel reinforced)
6) AA Conductor (All Aluminum conductor)
7) AAA Conductor (All Aluminum alloy conductor)
Sri Pawan Lakhotia, Director of the firm has appeared for hearing on
8-6-2005 and explained about the nature of goods being supplied by him.
He was asked to produce documentary evidence regarding excise codes
(HSN codes) applicable to his products. Copies of four different invoices
raised by him containing excise codes were filed by him. They are as under
:
S.No. Invoice No./Date Item Tariff code
1 32/6.5.05 PVC Sheathed 8544.19.90
Armored castles with
AC conductor & PVC
insulated flexible
copper castles.
2 410/16.3.05 All Aluminium Alloy 7614.90
Conductor
3 436/29.3.05 HDPE Insulated AB 8544.90
cables with Aluminium
/ Aluminum Alloy
conductor
4 425/28.3.05 PVC mining cable 8544.90
The issue is examined with reference to the entries in the Schedule

IV to the A.P.VAT Act, 2005 and the HSN codes notified by Government
vide G.O. A ruling already given on a similar matter in the case of M/s.
Anam Electrical Manufacturing Company, Kadiam, East Godavari District
vide A.Com/84/2005 Dt.21.5.2005 is also taken into consideration and the
ruling in this case is given as under :
Entry 38 of Schedule IV deals with industrial cables
and Tariff Code basically is meant for Insulated wire, Cable and
other insulated electric conductors.
Similarly, the entry 27 of Schedule IV deals with items
of Aluminum and the tariff codes 7604 and 7605 are notified by
Government covering Aluminum bars, rods and profiles and
Aluminum wire respectively. Under tariff code 7604.29.10 Hand
drawn bare aluminum conductors’ steel reinforced (ACSR) is
covered.
As seen from copies of the invoices submitted, three
items are shown as covered by Tariff code 8544 whereas one item
is shown as covered under tariff code 7614 which deals with
“Stranded wire, cables of aluminum, not electricity insulated.
In so far as items covered under Tariff code 8544 are
concerned, the rate of tax shall be @ 4% and if tariff code 7614.90
applies to any item dealt by the applicant, it shall attract tax @
12.5% since it is not notified in HSN codes under 4% (Schedule IV).
In case, the item falls under tariff code 7604, the tax rate shall be
4% as notified in HSN codes.

To
M/s. Pawan Power & Telecom Limited,

204, Ashoka Plaza, 10-1-126,
Masab Tank, Hyderabad – 500 028.
Copy to the Commercial Tax Officer, Khairatabad Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. K.K.Rao Engineering Works Private Limited, Hyderabad (TIN

Rate of tax applicable to Electrical Transformers.

Sri M.Ramakrishna, Finance Manager appeared on behalf of the firm
is given as under:
The Government in G.O.Ms.No.1615 Revenue (CT.II)
Department dt.31.8.2005 issued in supercession of the G.Os cited
above and notified to come into effect from 1.9.2005 G.Os have
specified HSN codes applicable to items in Schedule I and Schedule
IV of the A.P.VAT Act, 2005. In the said list Electrical Transformers
have ‘not’ been notified. Therefore, in terms of the language of
Schedule V of the A.P.VAT Act, 2005 Electrical Transformers are
liable to tax @ 12.5% on and from 1.9.2005.
To
M/s. K.K.Rao Engineering Works Private Limited,

581/1,
IDA, Uppal, Hyderabad – 39.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Ramakrishna Industries, Hyderabad (TIN No.28080118176)

of Rs.1000/-.

is given as under:
above and notified to come into effect from 1.9.2005 G.Os have
specified HSN codes applicable to items in Schedule I and Schedule
IV of the A.P.VAT Act, 2005. In the said list Electrical Transformers
have ‘not’ been notified. Therefore, in terms of the language of
Schedule V of the A.P.VAT Act, 2005 Electrical Transformers are
liable to tax @ 12.5% on and from 1.9.2005.

To
M/s. Ramakrishna Industries,

Plot No.581/1/A,

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Ramakrishna Transformers, Hyderabad (TIN No.28340203301)

of Rs.1000/-.

is given as under:
above and notified to come into effect from 1.9.2005 have specified
HSN codes applicable to items in Schedule I and Schedule IV of the
A.P.VAT Act, 2005. In the said list Electrical Transformers have ‘not’
been notified. Therefore, in terms of the language of Schedule V of
the A.P.VAT Act, 2005 Electrical Transformers are liable to tax @
12.5% on and from 1.9.2005.
To
M/s. Ramakrishna Transformers,

Plot No.582,

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Taj G.V.K.Hotels Limited, Hyderabad (TIN No.28270128581)

have filed an application on 4.08.2005 and sought clarification and advance
Rs.1000/-.
Whether they are eligible for input tax credit on all their purchases
from A.P.VAT dealers for use in their business.

i) Note on business
ii) List of items purchased
Sri M.Ramachandra Murthy, Chartered Accountant appeared on
The applicant claims that he is a dealer engaged in the
business of running a Five Star hotel where food and beverages are
supplied to guests and that the applicant is paying VAT on turnover
relating to sales effected in Restaurants. Apart from sales in the
restaurants, the applicant also claims to supply food to the guests
who stay in the applicant’s hotel rooms and also pays VAT on such
room sales. Besides the applicant also claims to supply food in the
Banquet halls, which is a part of the hotel. Thus, the applicant
states that supply of food is an integral part of his business of
running a hotel and therefore be declared eligible for input tax
credit on the expenditure / capital items purchased for the hotel as
a whole. In other words the applicant contends that he is primarily
into the business of running a hotel that consists of lodging and
boarding and that both are integral and that he should be treated as
a hotel for all purposes as there is no restaurant business without
lodging division. The applicant further contends that according to
Section 13 of A.P.VAT Act, input tax credit shall be allowed to the
VAT dealer for the tax charged in respect of all purchases of taxable
goods, if such goods are meant for use in the business of a VAT
dealer. Therefore, the applicant seeks a ruling to the effect that he
is justly eligible for input tax credit on the purchases made for use
in the entire business of running the hotel.
We have heard the Authorized Representative and examined

the contents in the documents submitted. It is asserted by the
applicant that the identity of his business is mainly due to the Five
Star accommodation provided by the applicant and that the
applicant is not known by the restaurant business. According to him
the restaurant business is an adjunct to the main business of
running the hotel and the applicant claims food is also supplied to
the guests staying in the rooms though at a higher price.
Apparently the applicant has certain inputs that are common for
running both the divisions namely restaurant and hotel.
The inputs that go into the hotel business, are primarily

meant to provide amenities to the guests for their stay. There are
no inputs that can probably result in a taxable transaction.
Providing amenities for comfortable stay of the guests is recognized
as service and such service falls outside the scope of the provision
of A.P.VAT Act, 2005. Therefore, when such transaction is not
amenable to tax under the Act it does not qualify as output as
defined in the Act. As a logical corollary such output does not
attract any output tax. Therefore, when an output, is not a taxable
sale transaction, a VAT dealer is disentitled to claim credit of tax
paid on inputs used therein. The applicant however claims eligibility
of input tax on all the inputs which go into the so called business of
running a hotel and claims the entire activity as business and credit
on the input tax. For the reasons stated above, we are unable to
agree with the view of the applicant. We hold that the applicant is
eligible for input credit only to the extent of purchases (inputs)
relating to the taxable sales (output). In order to arrive at the input
tax credit that the applicant is eligible for, he may follow specific
inputs for taxable outputs and in respect of common inputs, a
proportionate method. As seen from the annual report and
statements of capital / revenue purchases, the applicant has
derived a major part of revenue from room tariff. Therefore while
preferring the claim for input tax credit the applicant may take into
consideration the proportion of revenue earned between taxable
and non-taxable transactions in respect of common inputs and
accordingly arrive at the input tax credit that he can claim.
To
M/s. Taj G.V.K.Hotels & Resorts Limited,
Taj Krishna, 6-3-249/10, Road No.1,
Banjara Hills, Hyderabad – 500 034.

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. EPE PROCESS FILTERS & ACCUMULATORS PVT.LTD.

SECUNDERABAD(TIN.28740212632) have filed an application and sought

(1) Whether VAT paid to a Hotel (Having TIN) eligible for input tax
credit.
(2) Whether Government Departments can deduct TDS from the
amounts payable to applicant for sale of goods.
III. Mr.Chitrasen Sahakar, Administrative Officer, appeared for hearing

VI. The issues raised by the applicant are examined with

reference to the provisions of the APVAT Act and held that :
(1) The applicant is not eligible to claim ITC on the

bills/amount paid to a hotelier for get-together of the
staff. Only “goods purchased for use in business” are
alone eligible for ITC. Rule 20(2) (d) stipulates that
goods purchased and used for personal consumption
are not eligible for input tax credit.
(2) If the applicant effected sale of goods to any

Government Department, there cannot be a TDS from
the amounts due to the applicant. If the applicant,
executed any works contract to the Government
Department, then TDS would be made as per the
provisions of the APVAT Act @ 4%.

ruling.
To
M/s. EPE Process Filters and Accumulatirs (P) Ltd.,
Secunderabad.


PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. EXCEL ENGINEERING INDUSTRIES, IDA. KUKATPALLY,

HYDERABAD(TIN.28970202019) have filed an application and sought

As to whether they are eligible to obtain and use way bills for the job work
undertaken by them on behalf of M/s. Aquamall Water Solutions Ltd?

Purchase Order copies of Aquamall Water Solutions Ltd.
IV. Sri K. Subba Rao, Managing Partner , appeared for hearing and
explained the case.
APVAT Act the ruling is given as under:
VI. The applicant is undertaking job work through various un-

registered dealers on behalf of M/s. Aquamall Water Solutions Ltd.,
They were registered under the APGST and later under APVAT Act
also. However, their TIN was cancelled by Registering Authority in
the month of July.
The issue put forth by the applicant is examined with reference to

provisions of the Act, and held that according to Rule 55 every
‘dealer’ or any person who carries on the business of buying /
selling ….. including a VAT dealer and TOT dealer, who consigns
goods by a goods vehicle is liable to make out a way bill in form X
or Form 600. Therefore, as the applicant is not a dealer, he is not
eligible to issue a way bill and more so to obtain a way bill from the
Department.
ruling.
To
M/s. Excel Engineering Industries,
IDA, Kukatpally, Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Pramod Enterprises, Secunderabad(TIN.28260222154) have


Clarification of rate of tax on (1) Drill Steels (rods) (HSN Code 820700) (2)
RH 658 5L Jack Hammer (Rock drills & Pneumatic tools) (HSN Code –
84671110) (3) Clamps & Couplings (HSN Code 730700)

1) Literature of various products dealt by the applicant.
2) Evidence showing the HSN Codes.
IV. Mr. Subba Raju, Accountant , appeared for hearing and explained the
case.
VI. The applicant is an authorized dealer of M/s. Atlas Copco

Ltd., They mostly buy and sell construction tools, Hydraulic
breakers, rock drills and other tools. The specific clarification
sought for by them on the commodities referred supra is examined
with reference to the Act, Schedules and HSN Codes notified in
G.O.Ms.No. 1615 Rev.(CT.II) Department Dt. 31-8-2005 and earlier
G.Os. referred therein.
The commodities viz., drill steels (rods) with HSN Code

820700 and rock drills and pneumatic tools with HSN Code 846700
do not fall under any entry of IVth schedule to the APVAT Act.
Therefore, all three commodities are liable to VAT @ 12.5%.
ruling.
To
M/s. Pramod Enterprises, Secunderabad.


PROCEEDINGS OF THE

*****
O R D E R:
M/s. Deccan Forge & Carbides, Hyderabad (TIN.28490122689) have

Rate of tax applicable to machined forgings used for the following :
e) for Defence use, such as Pistons, Riffles
f) for Automobile sector such as Nozzle Holder forgings, Crank
shafts etc.
g) Hardware items such as Yoke forgings, Levers Locks etc.,
h) Earth moving spares such as Teeth forgings etc.,
Mr.P.Krishna Prasad, Accountant, appeared for hearing and

explained the case.
The applicant is a manufacturer of “Machined forgings.” The

applicant seeks to know the rate of tax applicable to “Machined
forgings”. The HSN Code 7326 is not notified against entry 70 of the
IVth Schedule . However, sub-entry (viii) of entry 70 includes
forgings under “Iron & Steel that is to say.” Going by the
nomenclature, all forgings, unmachined and marketed as ‘forgings’
for various end users or manufacturers would fall under the entry
70 of the IV Schedule liable to tax @ 4%. However if ‘forgings’ are
machined to the specification of a particular OEM or any other
manufacturer or trader such goods attract, the tax @ 12.5%.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Deccan Forge & Carbides,
Hyderabad.
Copy to the Commercial Tax Officer, Malkajigiri Circle.

PROCEEDINGS OF THE

Sri.P. Satyanarayana Reddy, Jt.Commissioner (Enft.)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/113/ 2006. Dated 13-11- 2006.

O R D E R:
I. M/s. Jindal Photo Limited (TIN.28220203693) have filed an

i) Rate of tax on computer Radiography System & Medical dry
Laser camera with standard accessories like cassettes and
image plates for above system.
ii) Rate of tax on Digital Photographic Processing and Printing
Machines.
Broachers of the products explaining their utility in case of (i)
Radiography machines (ii) copies of invoices in case of photographic
machinery.
IV. Mr. D.K. Singh, Branch Manager, appeared for hearing on 02-11-06
G.O.Ms.No:398, Revenue (CT.II) Dept. dated 31-03-2005 and
G.O.Ms.No:490, Revenue (CT.II) Dept. dated 15-04-2005 as superceded in
G.O.Ms.No.1596, Revenue (CT-II) Dept.,dt. 27-08-2005;
in G.O.Ms.No.1615, Revenue (CT-II) Dept. dt.31-08-2005 and in
G.O.Ms.No.795
dt.29-06-2006 w.e.f. 01-07-2006 and the ruling is given as under:
VI Since the apparatus Computer Radiography System and

Medical Dry Laser Camera are used in hospital and Diagnostic
Centres for digital X-ray films by the Doctors and the Radiologist,
these items come under the entry 111 of “Medical
Equipments/Devices/implants”, Schedule IV to the A.P.VAT Act,
added vide G.O.Ms.No.795, dated 29-06-2006 w.e.f. 01-07-2006.
Further in the same notification the radiography or radiotheraphy
apparatus X-ray tubes and other e-ray generators are notified
under Tools and Instruments vide Sub entry 18 of entry 103 to
Schedule IV of A.P.VAT Act with HSN code 9022. The HSN Code
9022 includes goods like x-ray generators and apparatus both
portable & non portable, x-ray tubes, x-ray volves including parts
and accessories etc.
Hence the goods in question fall under either sub entry 18 of
entry 103 or under entry 111 of IV Schedule and are liable to tax at
the rate of 4% w.e.f. 1-7-2006. Machinery for Photography is
notified as sub entry 49 of entry 102 under the heading Machinery
of all kinds in IV Schedule to APVAT Act. Hene it is clarified that
machinery used for photography is liable to tax at the rate of 4%
vide G.O.Ms.No.795, dated 29-06-2006 w.e.f. 01-07-2006.

ruling.
To
M/s. Jindal Photo Limited
Padmarao Nagar,
Secunderabad.


PROCEEDINGS OF THE

*****

O R D E R:
M/s. K.V.R. Forgings Limited, Kakinada (TIN.28600100246) have

Rate of Tax applicable to Forgings
Copies of invoices of K.V.R.Forgings Ltd., Kakinada.
Sri M.Ramachandra Murthy, Proprietor appeared for hearing and

explained the case.
The applicant seeks to know the rate of tax applicable to

forgings with HSN Code 7326 used for automobiles. The forgings
with HSN Code 7326 for automobiles are not notified in any other
schedules of AP VT Act,2005. The copies of invoices produced are
verified and found that the applicant is dealing with ‘forgings’
unfinished motor vehicle parts such as--
1) Leyland gear box , coupling flange (round ).
2) Center Coupling Flange Leyland 2516-3516 Super
Tusker/Taurus.
3) Leyland vertical Stub Ball Yoke 3”.
As the forgings are unfinished and only machined wherein the
buyers make further process to be used as automobile parts, going
on by the nature of the forgings and on the nomenclature
enumerated in sub-entry of VIII of Entry 70 of the IV schedule, we
hold “forgings” unfinished of Iron and Steel falling under Entry 70
liable to tax @ 4%.
Sd/- Sd/- Sd/-

Tax Appellate
Tribunal, A.P. Hyderabad within 30 days of this ruling.
To
M/s. K.V.R. Forgings Limited,
Kakinada.
Copy to the Deputy Commissioner(CT) Kakinada Division.
Copy to the Commercial Tax Officer, Kakinada Circle.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Lokesh Machines Limited, Hyderabad have filed an application
and sought clarification and Advance Ruling under Section 67 of the APVAT
The applicant is seeking clarification regarding computation of ‘sale
price’ under the provisions of CST Act particularly with regard to Excise
duty component on assessable value for the purpose of levying CST.
The case was posted for hearing on 9-11-2006. Sri Y.Sudhakar
Reddy, Finance Manager of the firm appeared and explained the case.
(CT.II) Dept, dt.29.6.2006.
The applicant explained that certain items are received from their
customers like M/s. Ashok Leyland and he is doing the conversion work and
reconditioning and in the process some material is also used. It was
explained that excise duty is payable on the basis of assessable value which
also includes the value of the material received from the customers. It was
stated that CST is being calculated on the conversion charges and by
adding excise duty on the assessable value.
The issue falls under the provisions of CST Act. Sub section (2) of
Section 9 of CST Act specifies that the authorities for various procedures of
assessment, collection and enforcement of payment of tax shall be the
authorities of the appropriate State and the provisions relating to the
General Sales Tax Act of that State shall be applicable. Apart from
assessment, appeals and revisions, the sub section also uses the words
‘Reviews and References’. Taking this as the basis, the following
clarification is issued :
Sale price as defined under CST Act means the amount payable to a
dealer as consideration for the sale of any goods less any sum allowed as
cash discount but inclusive of any sum charged for anything done by the
dealer in respect of the goods at the time of or before the delivery thereof
other than the cost of freight or delivery or the cost of installation where
such cost is separately charged. The definition of ‘turnover’ under CST Act
means that the aggregate of sale price received and receivable by him in
respect of sales of any goods in the course of interstate trade. It is found
that the excise duty charged is not mentioned as an amount to be deducted
from the sale price. There are already settled case laws regarding the
excise duty paid or payable in the hands of the selling dealer becoming part
of the turnover. It is therefore necessary that excise duty paid by the
selling dealer is included as part of the sale price and CST is calculated on
such turnover.
Sd/- Sd/- Sd/-
JT.COMMISSIONER
To
M/s. Lokesh Machines Limited,
B-29, EEIE, Stage II, Balanagar, Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT),Hyderabad (Rural) Division.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Venkateswara Electricals & Engineering Corporation,
Secunderabad (TIN No.28170166382) have filed an application and sought
admitted.
The applicant is seeking on the tax rates applicable to the following
items:
Sl.No. HSN Code Description
1 9028-3010 Digital KWH meter Electricity meters
2 9028-3010 Digital KW/PF meter -do-
3 9030-3910 Digital VAF meter Ammeters, Volt meters &
walt meters
4 9030-3910 Digital 3PH Ammeter -do-
5 9030-3910 Digital 1PH Ammeter -do-
6 9030-3910 Digital 1PH Volt meter -do-
7 9030-3910 Digital 3PH Volt meter -do-
8 9028-3010 Digital KWP meter Electricity melters
9 9030-3910 Digital frequency meter Ammeters, Volt meters &
Walt meters
10 85040000 ATV31 HU 55NYA AC Electrical transformers
Drive
11 85371000 PLCs Boards, Panels, Consoles
etc.
The case was posted for hearing on 9-11-2006. Sri

D.V.S.R.S.Sastry, Senior Accountant of the firm appeared and explained the
case.
(CT.II) Dept, dt.29.6.2006.
The issue has been examined with reference to the entries and the
HSN codes notified. It is found that Government have notified certain items
of Tools and instruments that is to say under Entry 102 in Schedule IV to
the Act by G.O.Ms.No.795 dt.29.6.2006. At Sl.No.23 sub item with HSN
code 9030 is also included. The applicant has furnished various HSN codes
for the items on which clarification is sought. It is found that except items
at Sl.Nos 1, 2, 8, 10 and 11 having HSN codes 9028.30.10, 8504.00.00 and
8537.10.00, all other items are found to have been notified.
The ruling is therefore given that items with HSN codes 9028.30.10,
with HSN codes 8504 and 8537.10 are not included in 4% category. They
will attract 12.5% tax whereas other items with HSN code falling under
9030 will attract tax @ 4%.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Venkateswara Electricals & Engineering Corporation,
C-15, Bharani Complex, Minister Road, Secunderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT),Begumpet Division.
Copy to the Commercial Tax Officer, M.G.Road Circle.

PROCEEDINGS OF THE

***

O R D E R:
M/s. Micron Electricals, (TIN No.28110211877), S.P. Road,

Begumpet, Hyderabad have filed an application dt.05-05-2005 and sought
Can a works contractor opting to pay tax by way of composition,
purchase electrical items from outside the state for use in the execution of
electrical works contract.
The case was posted for hearing on 10-05-2005. Sri M.S. Manohar,
Accounts Manager appeared on behalf of the company and explained the
case.
the APVAT Act and Rules and the ruling is given as under.
A VAT dealer can purchase goods from outside the State
against ‘C’ Form and use the same in the execution of works
contract which is under composition.
To
M/s. Micron Electricals,

Plot No.04, Jabbar Complex,
Municipal No: 1-11-252/A/4,
S.P.Road, Begumpet,
Hyderabad-500 016.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Bhartia Industries Limited, Begumpet, Hyderabad have

1. Three phase DOL Motor starters upto 25 HP
2. Three phase Star Delta starters upto 50 HP
3. Single phase DOL starters upto 5 HP
4. Three phase & single phase submersible pump starters upto 50
HP.

Copies of excise invoice issued by the manufacturer unit located at
Faridabad.
Sri G.Muthu Kumar, Branch Manager on behalf of the firm has
is given as under.
Under Entry 39 of Schedule IV of A.P.VAT Act, 2005, various
products falling under that entry have been notified alongwith HSN
codes applicable to them. At Sl.No.21 of the notified entry Switches,
Connectors and Relays etc., have been notified as falling under HSN
code 8536. Under that code Motor starters are mentioned at
8536.90.10. The excise invoice submitted by the applicant in
support of the applicable code also refers to the same chapter sub
heading number. Therefore, it is held that the items on which
clarification is sought, attract tax rate of 4%.

To
M/s. Bhartia Industries Limited,
210, Prajay Corporate House,
1-10-63 & 64, Chikoti Gardens, Begumpet, Hyderabad – 16.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Lanco Industries Limited, Chittoor (TIN No.28350102841) have

Rs.1000/-.

i) Eligibility of input tax credit on Light Diesel Oil used for
manufacturing.
ii) Necessity of issuing advance waybills under the A.P.VAT Act.
They submitted the following documents :

Process chart for manufacture alongwith a note on the
manufacturing of Pig iron.
Sri G.D.Saini, General Manager (Finance) appeared on behalf of the

The applicant claims that he is using Light Diesel Oil in the Annealing
Furnace for manufacturing D.I.Pipes. He states that LDO is purchased from
Indian Oil Corporation Limited, Visakhapatnam and that prior to
introduction of VAT tax @ 4% was paid under the APGST Act by issuing
Form G. After introduction of the A.P.VAT Act, the applicant states that he
is required to pay tax @ 21.33% as the facility of G-Form stood withdrawn
due to repeal of the APGST Act. The applicant is under the belief that input
tax credit is available to him on the LDO used for manufacturing D.I.Pipes
in terms of the language in Rule 20(2)(b) of the A.P.VAT Rules. The
applicant also further adds that he is eligible to buy LDO from outside the
state by issuing Form-C and in that case the rate of tax applicable would be
4% only. In the circumstances the applicant feels that unless he is allowed
to take input tax credit he will be forced to purchase LDO from outside the
state. In support of the contention that the applicant is eligible for input tax
credit he submitted process flow chart.
We have heard the applicant and also perused the process
chart for manufacture. The LDO purchased by the applicant is used
to heat the Annealing furnace through which the D.I.Pipes
manufactured by the applicant are passed through to obtain
ductability. Thus LDO is used not as a consumable in the process of
manufacture of D.I.Pipes but used as fuel for generating heat in the
Annealing furnace. While we are in the agreement with the plea of
the applicant that LDO is not used for producing power through the
captive power plant of the applicant we are unable to agree with
the applicant’s plea to treat LDO as a consumable in the
manufacturing process. Rule 20(2)(b) specifies fuels used for
automobiles or for captive power generation or used in power
plants as an item not eligible for input tax credit. The word ‘fuels’ is
used to mean all products which broadly answer the description of
similar items under Schedule VI of the A.P.VAT Act. Among other
things this Schedule contains entry “Diesel oil” at Sl.No.5. Light
Diesel Oil (LDO) is also understood as falling under the entry.
According to Section 13(1) input tax credit shall not be allowed in
respect of tax paid on purchase of goods specified in Schedule VI.
Therefore, we are not inclined to agree with the plea of the
applicant that LDO is eligible for input tax credit. Accordingly, we
hold that the applicant is ‘not’ eligible to claim input tax credit in
respect of tax paid on purchase of LDO.
As regards necessity of issuing advance waybills for purchase

of items like steel scrap etc., the applicant is advised to follow the
notifications issued by the Commissioner of Commercial Taxes
under Rule 55(2) of A.P.VAT Rules, 2005 from time to time. If the
item the applicant intends to purchase is included in the said
notifications, the applicant is required to issue advance waybills.
To
M/s. Lanco Industries Limited,

Rachagunneri – 517 641,
Srikalahasthi Mandal,
Chittoor District, A.P.
Hyderabad.
Copy to the Deputy Commissioner (CT), Chittoor Division

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Maheswari Marketing, Hyderabad (TIN

The rate of tax applicable to unbranded Broom Sticks.
Sri R.S.Mundra, Manager on behalf of the firm has appeared for

is given as under.
The applicant claims to purchase Broom sticks from the State
of Meghalaya and after receiving the same assemble the sticks and
pack them into plastic pipes / nylon strands and also brand the
product with names such as Miracle, Chandi, Telangana etc. The
applicant further states that they have neither registered the above
names under the Trades and Merchandise Marks Act, nor is the
applicant owner of the above names and further states that any
manufacturer can also use that name and as such the applicant
does not have any control over the use of the same name by others.
In the circumstances the applicant is under the impression that the
goods are eligible for exemption in terms of Entry 43 of the Ist
Schedule of the A.P.VAT Act, 2005.
Entry 43 of the Ist Schedule refers to unbranded broom

sticks. As the applicant manufactures Broom sticks which carry the
brand name, the product in question falls outside the scope of the
entry. It is immaterial whether the applicant choses or not to
proceed against any other person who uses the same brand name.
Suffice it, if the applicant has put the brand name to the product
and sold it in the market. That would make the product a branded
one and takes it out of the purview of the said entry. In the
circumstances, it is held that the item on which clarification is
sought is liable to tax @ 12.5%, in accordance with the language in
Schedule V of the A.P.VAT Act, 2005.
To
M/s. Maheswari Marketing,

Survey No.72, Plot No.2, Police Lines
Rasoolpura,


PROCEEDINGS OF THE

***
O R D E R:
M/s. Dhana Lakshmi Enterprises (P) Limited, Nellore (TIN

Plea for reduction of rate of tax on Calcium Carbide.
Sri A.S.Ram, Managing Partner appeared on behalf of the firm for
The applicant claims that he is a small scale industry
manufacturing Calcium carbide using lime shell, charcoal and
carbon paste and that the applicant is paying 4% tax on these items
and that the finished product namely Calcium carbide is attracting
12.5%. The applicant further states that in the neighboring states
of Kerala and Karnataka tax on Calcium carbide is levied @ 4% and
further the same rate of tax is applied in the case of interstate sales
covered by Form-C. In the circumstances the applicant seeks
modification of rate of tax from 12.5% to 4% for the survival of the
industry.
We have heard the representative and also considered the
plea. The scope and ambit of this authority is clearly laid down in
Section 67 of A.P.VAT Act, 2005 read with Rule 66(2)(i) of A.P.VAT
Rules, 2005. According to these provisions, this Authority can only
clarify and issue a ruling on matters falling squarely within the
ambit of the Act. Clearly the plea of the applicant is for reduction of
tax, which falls outside the purview of this Authority. In the
circumstances we are unable to issue a clarification or ruling as it
falls outside the ambit of the Act.
Accordingly this application is disposed of.

To
M/s. Dhanalakshmi Enterprises (P) Limited,
Ward No.3, Srikalahastri Road, Mannarpolur, Sullurpeta – 524 121
NELLORE DIST., A.P.
Hyderabad.
Copy to the Deputy Commissioner (CT), Nellore Division

PROCEEDINGS OF THE

***
O R D E R:
M/s. Laxminarayan Srikishan, Tandur (TIN No.28290108178) have

Rs.1000/-.
Tax liability in buying agency transactions on behalf of resident

principals within the state.
Sri Rajesh Soni, Manager appeared on behalf of the firm for hearing
As per Section 17(5)(e) of the A.P.VAT Act, 2005 registration
liability is created only on the agent acting on behalf of Non-
resident principal. An agent of resident principal has no obligation
to pay any tax unless such agent has taxable transactions of his
own. An agent of resident principal cannot claim input tax credit for
transactions made on behalf of the said principal.
The agent of resident principal has an obligation to inform
the tax department and the principal in case transactions of the
said principals in his account exceeds the threshold limit of Rs.40
lakhs prescribed under A.P.VAT Act, 2005. Rule 34(2)(a) also
prescribes proforma (Form VAT 522) in which agent of a resident
principal should maintain the accounts.
The resident principal can also authorize his agent to issue
invoices on his behalf. Rule 34(2)(b)(c) prescribes Form VAT 522A
which can be used for this purpose.
To
M/s. Laxminarayan Srikishan
General Merchants Commission Agents,
6-6-105, Main Rod,
TANDUR.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Asian Barrels Private Limited, Hyderabad (TIN

of Rs.1000/-.
Rate of tax applicable to M.S.Drums and M.S.Barrels of various

capacities

i) Copies of sale invoices issued by the applicant and
ii) Copies of purchase invoices showing purchase of C.R.Sheets /
Coil / Strips and other materials.
4. Sri Kamalesh Agarwal, Managing Director appeared on behalf of the
6. The applicant claims to be a manufacturer of M.S.Round

barrels of various capacities and effects sale of the same and seeks
to know the rate of tax applicable to the items.
documentary evidence. Entry 90 of Schedule IV of the A.P.VAT Act,
2005 reads “All kinds of packing material including hessain cloth
and jute twine but excluding storage tanks made of any materials”.
In G.O.Ms.No.1615 dt.31.8.2005, HSN codes applicable to
entries in certain schedules have been notified. The notification
contains Entry 90 of Schedule IV wherein description of various
kinds of packing material falling under that entry have also been
notified. At Sl.No.13 under that entry mention has been made of
‘Tanks and similar containers made of Iron and steel not exceeding
300 litres as attracting HSN code 7309. The applicant claims that he
manufactures M.S.Drums and M.S.Barrels of capacity ranging
between 20 litres to 205 litres and as the description of the item is
in conformity with the language of Entry 90, we hold that M.S.
drums and M.S. barrels manufactured by the applicant and not
exceeding capacity of 300 litres are liable to tax @ 4%.
To
M/s. Asian Barrels Private Limited,

No.97 IDA, Kattendan,

Hyderabad.
Copy to the Commercial Tax Officer, Rajendra Nagar Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Madhu Engineering Works, Hyderabad (TIN No.28570158835)

Rate of tax applicable to Fittings of hose pipes.

Product literature
4. Sri Y.Subhagiri Rao, Managing Partner appeared on behalf of the
6. The applicant claims to be a manufacturer of Fittings that are
used with Hoses and Pipes and submitted Product literature seeking
a Ruling regarding rate of tax. The applicant seeks to know the rate
of tax applicable in the light of amendment made to Entry 33 in
Schedule IV of the A.P.VAT Act, 2005.
documentary evidence. Entry 33 of Schedule IV of A.P.VAT Act prior
to the amendment reads ‘Hose pipes’. The entry has been amended
in G.O.Ms.No.1564 dt.17.8.2005 to read “Hose pipes and fittings
thereof”. In view of the amendment to the entry, fittings of hose
pipes also fall under the same entry and therefore liable to tax @
4%.
To
M/s. Madhu Engineering Works,
Plot No.10, IDA, Uppal,

Hyderabad.

PROCEEDINGS OF THE
***
O R D E R:
1. M/s. Surgitek, Abids, Hyderabad (TIN No.28110123219) have filed

i) Baloon wedge pressure catheters

ii) Berman angiographic balloon catherters
iii) Bipolar pacing catheters
iv) Intra aortic balloon catheters
v) Single lumen central venous catheters
vi) Double lumen central venous catheters
vii) Triple lumen central venous catheters
viii) Quad Lumen central venous catheters
ix) Mac two lumen central venous access device
x) Two lumen hemodialysis catheters
xi) Percutaneous sheath introducer used for insertion of catheter
xii) Radial artery catheter
xiii) Pulmanary artery castheter
xiv) Epidural catheter

i) Copies of bill of entry for home consumption issued under
Customs regulations and
ii) Copies of purchases made from dealers outside A.P.
4. Sri Avinash Rajan, Sales Manager appeared on behalf of the firm for
6. The applicant claims to be a dealer in surgical catheters and
disposables. The applicant is under the impression that catheters of
various types are liable to VAT @ 4% as per G.O.Ms.No.1564 Rev.
(CT.II) Dept, dt.17.8.2005. The applicant seeks a ruling regarding
the rate of tax applicable to surgical catheters.
documentary evidence. The applicant is purchasing certain types of
catheters from dealers situated outside A.P. and is also importing
from other countries. The HSN code available on the bill of entry is
9018.39.20.
Entry 88 as amended in G.O.Ms.No.1564 dt.17.8.2005 reads
“Drugs and medicines whether patent or proprietory, as defined in
clauses (i), (ii) and (iii) of Section 3(b) of Drugs and Cosmetics Act,
1940 including hypodermic syringes, hypodermic needles, catguts,
sutures, surgical cotton, dressings, plasters, catheters, cannulae,
bandages and similar articles”.
As per the language of the entry catheters are liable to tax @
4% and the HSN code applicable 9018.39 has also been notified
under sub entry (17) of the same entry in G.O.Ms.No.1615
dt.31.8.2005. Therefore, we hold that catheters of different types
To
M/s. Surgitek,
5-8-518 /14R-16 & 17,
Jagdish Market, Abids,

Hyderabad.
Copy to the Commercial Tax Officer, M.J.Market Circle
PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/ 149/ 2006. Dated :14 -11-2006.
O R D E R:
I. M/s. Ultramarine & Pigments Limited (TIN.28380150467) have filed

Whether the product “Ultra marine Blue (Pigment) falls under HSN
Code 3206.41.00 which attract tax @ 4% as an Industrial input as referred
in G.O.Ms.NO.502, dt.1-5-06.
Copies of Commercial sales invoices
IV. Mr. T.S.V. Diwakar, advocate, Authorized Representative, appeared
superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept. dt.27.08.2005,
G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005 and
G.O.Ms.No.502, Revenue (CT-II) Dept. dt. 1-5-2006 w.e.f . 1-5-2006.
G.O.Ms.No.656, Revenue (CT-II), Dept. dt. 2.06.2006 G.O.Ms.No.795,
Revenue (CT-II), Dept. dt.29.06.2006 and the ruling is given as under:
VI The applicant produced copies of invoices containing the
description
“ Ultramarine Blue” and showing relevant HSN code as 3206.41.00.
This item of HSN code are not notified by Government as falling
under 4%.
The ruling therefore is given that, the item “Ultramarine
Blue” with HSN code 3206.41.00 will attract tax @ 12.5%.
Sd/- Sd/- Sd/-

Addl./ Jt./ Commissioner
ruling.
To
M/s. Ultramarine & Pigments Limited,
8-416/1,
Bana Thopu,
Chittoor Dist.

Copy to the Deputy Commissioner (CT) Chittoor Division.
Copy to the Commercial Tax Officer, _Chittoo-II Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Javick Impex (P) Limited, Secunderabad(TIN.28470235533)

of Rs.1,000/-

Whether production of customs clearance certificate prescribed in
Rule 35(6)(a)(ii) is mandatory or similar evidence is suffice.

1) Extract of Chapter XI of Customs Act as Annexure-I
2) Extract of Notification of Post parcels
IV. Mr. M.R.C.J. Karira, Managing Director, appeared for hearing and
explained the case.
VI. The applicant is a registered VAT dealer and also exporter of
cell phones. The applicant purchases cell phones from local
registered VAT dealers and exports the same goods u/s.5(1) of the
CST Act to other countries. Since, all his sales are zero rated VAT
paid on the purchase of cell phones within the state of A.P. has
become excess input tax credit eligible for refund on monthly basis
u/s.38. The applicant appears to have claimed refund of excess
input tax credit and furnished required documents as provided
U/R.35(6) except “copy of the Customs Clearance Certificate”
Since, the applicant could not produce such certificate, the C.T.O.
rejected the claim. We have examined the issue and the
circumstances surrounding it. Since the claim had been rejected by
the Assessing authority, the applicant may pursue remedies as
provided in the A.P.VAT Act, 2005, other than Advance ruling. As
per Section 67(2)(i) of A.P.VAT Act, 2005 “No application shall be
before any officer or authority of the department or Appellate
Tribunal or any Court”.

ruling.
To
M/s. Javick Impex (P) Limited,
Plot No.26, Road No.1, Balarai Society,
Mahendra Hills, Secunderabad – 500 026.


PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/490/2005 DT. 15 -02-2006
O R D E R:
1. M/s. Putta Traders, Kadapa District (TIN No.28160255590) have

Rate of tax applicable to Diancha Seed (Jeeligalu).

iv) Certificate issued by Mandal Agriculture Officer, Kazipet
Mandal, Kadapa.
v) Decision of Hon’ble Supreme Court in Commissioner of
Sales Tax, UP., Vs. Rama Chandra Asha Ram.
4. Sri G.N. Chetty, Advocate appeared on behalf of the firm for hearing
6. The applicant is presently doing business in Fertilizers, Pesticides
and Oil cakes and intends to purchase Diancha seed (Jeeligalu) from
outside the State and also from within the State and sell both within and
outside the State. The applicant states that the said Diancha seed is used
for sowing purpose which when grown is used as green manure. The
applicant further states that the green manure is fed to cattle and would be
considered as cattle feed in the light of decision of Supreme Court of India
in the case of Commissioner of Sales Tax Vs. Rama Chandra Asha Ram.
Alternatively, the applicant submits that the commodity namely Diancha
seed would fall under Entry 44 of Schedule I of the A.P.VAT Act as the seed
is meant for sowing and exempt from tax.
We have heard the authorized representative and also
considered the decision of Supreme Court pressed into service by
the representative of the applicant. The Hon’ble Supreme Court
examined the question whether damaged wheat purchased by the
respondent dealer which is subjected to certain process before
being sold as cattle fodder and observed that in a generic sense the
expression cattle fodder is inclusive of everything that is fed to
cattle including damaged wheat.
We have also perused the certificate issued by Mandal
Agricultural Officer, Kazipet Mandal, Kadapa to the effect that
Diancha seed is being used for green manure sowing purpose only.
Entry 44 of Schedule I of the A.P.VAT Act, 2005 reads “Seeds for
sowing and gardening purpose”. We are inclined to classify Diancha
seed (Jeeligalu) as a seed meant for sowing purpose regardless of
the end use of the said commodity because what is intended to be
purchased and sold by the applicant is the seed for sowing and not
the green manure produced by using the seed. Viewed in this angle
the Supreme Court’s decision relied on by the applicant is of no
assistance. Therefore the ruling is that Diancha seed (Jeeligalu)
falls under Entry 44 of Schedule I to the A.P.VAT Act, 2005.
To
M/s. Putta Traders,
D.No.2/63, Kazjpet – 516 203.

Hyderabad.
Copy to the Deputy Commissioner (CT), Kadapa Division
Copy to the Commercial Tax Officer, Kazipet Circle.

PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Vinayaka Cattle Feed, Proddatur, (TIN.28344048090) have filed

an application, dated. 12-1-2006 for ification and advance ruling on the
II. They sought clarification on the Rate of tax applicable to the cattle
feed cake
1) Copy of Notification of Vat Registration
2) Copy of Vat Registration Certificate
Sri G.N.Setty, Advocate, appeared on behalf of the firm for hearing on 21-
1-2006 explained the case.
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005 and)the
M/s. Vinayaka Cattle Feeds, requests that they are going to sell
cattle feed cake and cattle feed within the state and on interstate trade.
The ingredients i.e., GN.Cake, Shell Grit, Mineral Mixer Powder and Rice
Bran are used for manufacturing of Cattle Feed by using machinery power.
Now , they request for clarification that Cattle Feed is exempted from tax as
per entry 3 of Schedule I of AP VAT Act or liable to be taxed.
We have heard the authorized representative and examined

the provisions of the Act. By entry (3) of Schedule I of AP VAT Act,
sales of “Aqua feed, Poultry Feed and Cattle Feed including grass,
hay and straw” are exempt from tax under Section 7 of APVAT Act.
Though the ingredients that intends to be purchased by the
applicant such as, GN Cake, Mineral Mixture Powder, Rice Bran are
taxable under respective schedule of IV schedule, if the applicants
manufactures Cattle Feed that falls under Entry (3) and sells then
such cattle feed is exempted. However, if purchase and sell
G.N.cake and other oiled or deoiled cakes, enumerated under entry
87 of the IV th schedule, are liable to tax. @ 4%.

ruling.
To
M/s. Vinayaka Cattle Feeds,
Proddutur, Kadapa Dist.A.P.
Copy to the Deputy Commissioner(CT) Kadapa Division.
Copy to the Commercial Tax Officer Proddatur Circle.
Dealer which is subjected to certain process before being sold as

cattle fodder and observed that in a generic sense the expression
cattle fodder is inclusive of everything that is feed to cattle
including damaged wheat
.
We have also perused the certificate issued by Mandal

Agricultural Officer, Kazipet, Kadapa to the effect that Diancha seed
is being used for green manure sowing purpose only. Entry 44 of
Schedule I of the AP.VAT Act,2005 reads “Seeds for sowing and
gardening purpose” . We are inclined to classify Diancha seed
(Jeeligalu) as a seed meant for sowing purpose regardless of the
end use of the said commodity because what is intended to be
purchased and sold by the applicant is the seed for sowing and not
the green manure produced by using the seed. Viewed in this angle
the Supreme Court’s decision relied on by the applicant is of no
assistance. Therefore, the ru;ing is that Diancha seed (Jeeligalu)
falls under Entry 44 of Schedule I to the A.P.VAT Act,2005.
Sir,
There is a Seed Certification Agency, which is competent to issue a

certificate. M.A.O. has got no authority to issue. Hence, we may please
insist upon certificate from A.P.Seeds Corporation Limited Certificate.
Addl.Commissioner Joint Commissioner Joint Commissioner
Note: An appeal against the proceedings can be filed before the Sales Tax
Appellate Tribunal,. A.P., Hyderabad within 30 days of this ruling.
To,
M/s. Putta Traders,

D.No.2/63, Kaqzipet-516203.
Hyderabad.
Copy to the Deputy Commissioner (CT), Kadapa Division,]
Copy to the Commercial Tax Officer, Kazipet Circle.

PROCEEDING OF THE

CCT’s Ref.No.PMT/P&L/A.R.Com/26 /2005 Dated -5-2005
***
O R D E R:
M/S BALAJI ELECTRONICS.,(TIN No.28190115812), 1-8-488,

Chikkadpally, Hyderabad have filed an application on 20-4-2005 seeking
the APVAT Act, 2005. They also enclosed an application fees of Rs.1000/-.
The clarification sought is :
1) Rate of tax under AP VAT Act on Voltage Stabiliers having HSN Code
8504.
2) Rate of tax under AP VAT Act on Audio Cassettes, Pre-recorded,
Compact Disc, (CD Audio) VCD (Video-CDs), Digital Video Disc
(DVD)
They also furnished the HSN Code for Audio Cassettes and CDs as
8523.
The case was posted for hearing on 7-5-2005 and Sri

Brijkishor appeared on behalf of the firm and presented the case.
The issue raised by the firm is examined with reference to
the provisions of the AP VAT Act and Rules and HSN Codes notified by
Voltage Stabilizers with HSN Code 8504 and Audio
Cassettes, Pre-recorded, CDs, VCDs and DVDs covered under HSN
Code 8523 they fall under I.T Products of Entry No.39 of the IVth
Schedule and taxable @ 4%.
JT.COMMISSIONER
To
M/s Balaji Electronics,
1-8-488, Chikkadpally,
HYDERABAD.

Hyderabad.
Division.
PROCEEDINGS OF THE

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O R D E R:
M/s. Accurate Transformers Limited, Hyderabad have filed an

application Dated 02-7-2005 and sought clarification and advance ruling on
To clarify the rate of tax for transformers –
a) If the rate of VAT is 4% then what is the rate of tax under entry
tax Act.
b) G.O.Ms.No.955 dt.11-5-2005 stipulates the rate of tax under entry tax
as @ 12.5%; then what is to be followed ?
i. A copy of the G.O.Ms.No. 955, dt.11-5-2005
ii. Extract of Sec.3 of the A.P.tax on Entry of Goods into
local Areas Act, 2001.
Sri K.Hanumantha Rao, Authorised Representative on behalf of the
firm appeared for hearing on 12-7-2005 and explained the case.
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005
and) the ruling is given as under:
The goods covered under HSN code 8504 are notified in the
said G.Os. referred above under item 39 of the IVth Schedule and
hence liable to tax @ 4%. The rate of tax notified in the A.P. tax on
entry of goods vide G.O.Ms.No.955, dt.11.5.2005 is issued under the
said Act. This authority is empowered to clarify the issues relating
to the APVAT Act. Since the issue raised is outside the purview of
this authority, a suitable clarification may be sought for from the
concerned authority.
The rate of tax under VAT may undergo a change if the HSN
codes are modified in future.

Tax
To
M/s. Accurate Transformers Ltd.,
Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Masqati Dairy Products, Hyderabad (TIN

1. Whether separated milk, which contains upto 80% fat, is taxable.
2. The rate of tax applicable to Ghee
3. The rate of tax applicable to Sweet flavoured milk
4. The rate of tax applicable to Paneer

Copies of sale invoices of Ghee and Cream.
Sri Sultana Masqati, Managing Partner on behalf of the firm has

is given as under.
1. The applicant claims to be an exclusive dealer of Milk and
Milk products and owns Milk processing unit. The applicant also
claims to purchase milk and effect sales of milk and its various
products. The applicant further states that pure milk contains milk
and fat and adds that Milk and separated milk are exempted
according to Entry 11 and 16 respectively of Schedule I. However,
the applicant contends that owing to the process of separation of
fat from milk, varying percentages of fat is derived which is highly
perishable and seeks to know whether such fat is taxable. In the
course of hearing, the applicant contended that such milk fat whose
fat content varies from 10-80% falls squarely within the meaning of
separated milk under Entry 11 of Schedule I of A.P.VAT Act, 2005.
We have considered the contention. On perusal of the

documentary evidence furnished by the applicant it is revealed that
the word ‘cream’ is depicted on the invoice. This is otherwise
known as ‘fresh cream’ in the market. The product-cream or fresh
cream is a distinct commercial commodity and is known as such in
the market. Its usage is also quite different from milk. Therefore,
the contention of the applicant that it is milk with varying fat
content is untenable. In the circumstances, we hold that ‘cream’
derived out of processing milk is a separate commercial commodity
and cannot be equated with ‘separated milk’. In terms of the
language in the Schedule V of A.P.VAT Act, it is liable to tax @
12.5%.
2. Entry 66 of Schedule IV of the Act reads, “Vanaspathi,

Hydrogenated vegetable oil”. The applicant contends that Ghee,
which comes from pure milk, is also a kind of Oil that comes from
Milk and seeks to know whether it is taxable or not.
Vanaspathi, the hydrogenated vegetable oil is a

conglomeration of various vegetable oils and is sold in the market
as a distinct commercial commodity from other vegetable oils
(Entry 67). Whereas, Ghee (an animal product) is identified as a
distinct product from Vanaspathi or Vegetable oil and as such it is
not enumerated in any of the entries in the Schedules and falls, by
default, in Vth Schedule liable to tax @ 12.5%.
3. Entry 11 of Schedule I of the Act reads “Curd, Lassi, Butter

Milk and separated milk”. The applicant contends that flavoured
milk which merely contains Sugar and flavours is no different from
Lassi which also contains Sugar and flavours and seeks to know
whether flavoured milk can also be considered as falling within the
scope of the entry. We are unable to agree with the interpretation
of the applicant. Flavoured milk is a distinct commercial commodity
having characteristics distinguishable from Lassi. Merely because
Lassi also contains Sugar and flavour it cannot be equated with
flavoured milk. Further, Curd, Lassi and Buttermilk are all different
from Milk and they are distinct commodities. One cannot be equated
with the other, even if ingredients such as Sugar and flavour are
common in both the products. Their identity and usage being
different they have to be understood as different products.
Therefore, we hold that flavoured milk is outside the scope of Entry
11 and in accordance with the language in Schedule V of the Act,
flavoured milk is liable to tax @ 12.5%.
4. The applicant contends that Paneer is derived by adding a
small percentage of acidic acid to the milk and seeks to know the
rate of tax on this item. The applicant also contends that this item is
highly perishable.
We have browsed through the Schedules in the Act and found
that the Schedules do not contain the item Paneer. Therefore, in
terms of the language under Schedule V, it is held as liable to tax @
12.5%.
To
M/s. Masqati Dairy Products,

H.No.22-4-470, Kotla Alijah,
Hyderabad.
Copy to the Commercial Tax Officer, Charminar Circle.

PROCEEDINGS OF THE

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O R D E R:
I. M/s. Anchor Electronics & Electricals (P) Limited, Ramkote,

Hyderabad (TIN.2890201977 ) have filed an application and sought
II. They sought clarification on the rate of tax on :

(i) Switches, Connectors and relays for upto 5 AMPS of Voltage
not exceeding 250 volts and Electronic fuses.
(ii) Door Bells, Extension cords, distribution bonds.

(i) Form 570
IV. Sri G.Laxman Rao, Sales Tax Practitioner, appeared for hearing and
explained the case.
VI. Having examined the nature of goods dealt by the applicant

and in view of revised notification of HSN codes notified by the
Government vide G.O.Ms.No.1615 Rev.(CT.II) Department dated
31.8.2005, all items enumerated above are liable to tax @ 12.5%
under residuary entry of Vth Schedule.
ruling.
To
M/s. Anchor Electronics & Electricals 1(P) Limited,
Ramkote, Hyderabad.


PROCEEDINGS OF THE

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O R D E R:
M/s. Bambino Agro Industries Limited, Hyderabad

APVAT Act, 2005 read with Rule 66(2) (i) of APVAT Rules, 2005 along with
Classification of Vermicelli under the APVAT Act
A copy of the order of the High Court dt.12-8-1987 in W.P.No.10832
of 1987.
Mr.M.Ramachandra Murthy, Authorised Representative appeared for
The statement of arguments placed before this authority at the time
of personal hearing is carefully examined and held as hereunder:
Prior to 1-4-2005, Entry 60 of the 1st schedule to APGST Act, 1957,
dealt with Maida, Atta, Ravva and Wheat Bran. There was a dispute
between the Department and the Trade about classification of Vermicelli.
The view of the Department was Vermicelli would fall under Entry 129 A of
the APGST Act as against the view of the trade as Maida, under Entry 60 of
the 1st schedule. This dispute was ultimately resolved by the Honourable
High Court of A.P., in Jaya Foods case holding that Vermicelli is nothing but
Maida, under Entry 60 of the 1st Schedule in the absence of specific entry
for Vermicelli.
Subsequent to the judgment of the Hon’ble High Court, Vermicelli by
name was specifically inserted into entry 129 B of the 1st schedule to APGST
Act by G.O. Ms.No.114, dt.14-4-1990.
With effect from 1-4-2005, VAT Act has come into existence
replacing the APGST Act, 1957. Entry 28 of the IV Schedule of the VAT Act
deals with, Flour, Atta, Maida, Suji, Besan and Ravva. There is no specific
entry for vermicelli is any of the schedules to the APVAT Act 2005. The
judgment of A.P.High Court is exactly for a similar situations where there
was no specific entry under APGST Act,2005, and it was held by High Court
it is only “Maida” Therefore Vermicelli falls under Entry 28 of Schedule IV to
APVAT Act,2005.
The ruling is therefore given that “Vermicelli” shall attract
tax @ 4%.

ruling.
To
M/s. Bambino Agro Industries Limited,
Hyderabad.
Copy submitted to the Commissioner of Commercial Taxes,A.P., Hyderabad


PROCEEDINGS OF THE

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O R D E R:
I. M/s. Belman Hotels (P) Limited, Lakdikapul, Hyderabad (TIN.

of Rs.1,000/-

Whether different divisions like – meals, tiffins, banquet hall, Bansuri
(restaurant a/c) and Raga bar and restaurant can be treated separately for
VAT or as one entity.
III. Sri R.S.R.Anjaneyulu, Accounts Manager appeared for hearing and

explained the case.
G.O.Ms.No.1615 Revenue (CT.II) Department dated 31-8-2005 and the
ruling is give below :
V. The applicant is a registered dealer under the Companies

Act and also registered under the APVAT Act as M/s. Belman Hotels
(P) Limited. They sought for clarification whether they could obtain
two registrations.
Having examined their representation, it is clarified that one

registered company under the Companies Act is one legal entity and
as such they can not register separately for each division of
businesses under the APVAT Act.
ruling.
To,
M/s. Belman Hotels (P) Limited,

Lakdikapul,
Hyderabad.


PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Control & Schematics Limited, Himayatnagar, Hyderabad

of Rs.1,000/-

Whether control panels used in Thermal Power Station and Mini and
Micro Electrical Power Stations fall under entry 53 of IV Schedule ?
(i) Form 570
IV. Sri A.V.Murthy, General Manager appeared for hearing and

explained the case.
G.O.Ms.No.1615 Rev.(CT.II) Dept, dt.31.8.2005 and the ruling is given as
under:
VI. The applicant is a manufacturer of control panels which are

used in thermal power stations and mini and micro electric power
stations. Having examined the nature of goods and their common
parlance in the Commercial circles, it is clarified that control panels
irrespective of their end use, do not fall under entry 53 of IVth
Schedule, but liable to tax @ 12.5% under the residuary entry of
Vth Schedule.

ruling.
To
M/s. Controls and Schematics Limited,

3-6-584/G, Himayatnagar,
Hyderabad-500029.


PROCEEDINGS OF THE

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O R D E R:
I. M/s. Indo Asian Fuse Gear Limited, Karkana,Secunderabad, (TIN

of Rs.1,000/-

Rate of tax for
(1) CFL Lamps
(2) Miniature Circuit Breakers
(3) MCC Bs
(4) RCC Bs
(5) HRC Fuses
(6) TE Switches
(7) Rewikable Switch
(8) Distribution Boards
(i) Form 570
(ii) Form 565 (Form of Authorisation)
(iii) Copy of CCT’s Ref No.PMT/P&L/A.R.Com/204/2005,
dt.7.7.05. .
IV. Sri M.Ramachandra Murthy,C.A., appeared for hearing and explained

the case.
G.O.Ms.No1615, Revenue (CT.II) Department Dated 31-08-2005 and the
VI. Consequent to revised notification of HSN Codes by the

Government vide G.O.Ms.No.1615 Revenue (CT.II) Department
dt.31.8.2005, all goods / items enumerated above attract VAT @
12.5% under residuary entry of Vth Schedule.
ruling.
To
M/s. Indo Asian Fuse Gear Ltd.,
Plot No.43, Asbestos Staff Colony,
Karkana, Secunderabad – 500 003

PROCEEDINGS OF THE

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O R D E R:
M/s. University of Hyderabad, Hyderabad have filed an application

on 9.08.2005 and sought clarification and advance ruling on the following

i) The VAT rate to be deducted at source from the work bills of the
contractors
ii) Whether VAT should be deducted if the work involves only labour
iii) Whether VAT to be deducted from work bills where the gross
amount is below Rs.5000/-
iv) What is the VAT rate in case the contractor does not furnish TIN
number
v) Whether N-Form facility as provided in G.O.Ms.No.26 Rev. Dept.
dt.13.1.2000 is available under the A.P.VAT Act.
Sri Arjun Kumar, Deputy Finance Officer, appeared on behalf of the

i) The applicant states that he awards contracts to execute
works and seeks to know the rate of tax to be deducted at source
while making payments to the Contractors. It is clarified that the
applicant being an agency other than State Govt. is required to
deduct tax at source @ 2% on the amount payable to the contractor
as it stood up to the promulgation of the Ordinance No.38
dt.29.8.2005. The Govt. have promulgated the Ordinance No.38
dt.29.8.2005 amending certain provisions of the Act and among
other things sub section (4) of Section 22 has also been amended.
According to the amended provision the tax deduction at source has
been raised to 4% wef. 29.8.2005. Therefore the applicant is
advised to deduct tax @ 4% and wef. 29.8.2005.
ii) The applicant seeks to know whether VAT should be deducted
if the work involves labour only. It is clarified that there is no tax
liability if the work involves purely labour and no goods are
involved.
iii) The question whether the applicant should deduct tax even
where the gross amount is below Rs.5000 or Rs.10,000 it is clarified
that if the contractor is registered as a VAT dealer, tax at source
must be deducted at the rate as clarified above. If the contractor is
not registered as a VAT dealer no deduction at source shall be
made.
iv) It is clarified that Section 17(g) of A.P.VAT Act lays down
certain circumstances in which a dealer who executes works is
required to register himself. This section obligates the works
contractor to register himself compulsorily regardless of turnover
threshold if he opts to pay tax by way of composition. The applicant
is advised to insist on furnishing of Registration number by the
Contractor.
v) As regard the facility of Form-N available under the APGST Act, it
is clarified that the G.Os issued under the said Act stand cancelled
as the said Act has been repealed with the introduction of VAT Act.
Therefore the facility of Form-N is not available to the applicant.
To
M/s. Deputy Finance Officer,
University of Hyderabad,
Central University P.O.,

Hyderabad.

PROCEEDINGS OF THE

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O R D E R:
I. M/s. Photon Energy Systems

Limited,IDA,Bollaram,(TIN.28190168192) have filed an application and
67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along
with the application fee of Rs.1,000/-
1) Whether spare parts of Renewable energy devices can be
charged to VAT @ 4%
2) Whether in addition to Form 213, is there any form to furnish
incorporating ‘any mistakes’ occurred in filing of VAT 200?
3) Whether job work charges paid to other parties can be shown as
exempted/non-creditable purchases in VAT 200.
4) Can they include clearing and forwarding, transportation,
customs duty paid in non-creditable purchases in VAT 200?

1) A copy of delivery challan cum invoice.
2) Catalogue of their products.
IV. Sri K.Venuprasad, Manager (Accounts) appeared for hearing and

explained the case.
VI. The applicant deals in renewable energy devices.
Clarification and advance ruling is given on the points raised by
them as at prepage.
(1) Spare parts of renewable energy devices are taxable @
4% under entry 53 of the IVth Schedule
(2) Rule 23(6)(a) prescribes filing of form VAT 213 if VAT
dealer finds any omission or incorrect information therein.
However, the applicant may also furnish an appendix or
additional sheet f the form prescribed is not sufficient.
(3) Job work charges paid to the job worker would not fall
within ‘purchase price’
(4) Clearing and forwarding charges, transportation
charges and customs duty paid on the import / purchase of
goods would form part of purchase price as per sub-sec.25 of
sec.2 and explanation II appended to it.

ruling.
To
M/s. PHOTON Energy Systems Limited, IDA, Bollaram.
Copy to the Deputy Commissioner(CT) Nizamabad Division.
Copy to the Commercial Tax Officer, Medak Circle.

PROCEEDINGS OF THE

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O R D E R:
I. M/s. Pooja Marketting, Secunderabad(TIN.28280118040) have filed


(1) Rate of tax on Plastic labeler for marking information like price
code No. etc.
(2) Self Adhesive labels printed/plain – stickers etc.
(3) Electronic weighing scale
(4) Batteries for Industries/Automotive Batteries

(1) Form 570
(2) Catelogue of Hand held labeller
(3) Sample Label Scrips plain and printed
Sri M. Arunachalam, Assistant Manager on behalf of the firm, appeared for

. The issue has been examined with reference to the provisions
of the APVAT Act and Rules and HSN Codes notified by Government
vide G.O.Ms.No1615, Revenue (CT.II) Department Dated 31-08-
2005 and the ruling is given as under:
Having examined the nature of goods and their common
parlance in Commercial circles, clarification is given below:
(1) Plastic labeler @ 12.5% under residuary entry of Vth Schedule
(2) Self adhesive labels @ 4% under entry 90 of IVth
Schedule
printed
(3) Electronic weighing scale @ 12.5% under residuary entry
of Vth Schedule
(5)Batteries for Industries/ @ 12.5% under residuary entry
of Vth Schedule
Automobile batteries
ruling.
To
M/s Pooja Marketing,
No.14, III Floor,
Srenath Commercial Complex,
1-1-58/8/38, Sarijini Devi Road, Secunderabad-500003

Copy to the Deputy Commissioner(CT) Begumpet Division, Division.
Copy to the Commercial Tax Officer, S.D.Road Circle.

PROCEEDINGS OF THE

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O R D E R:
I. M/s. Ramesh Auto Industries Private Limited,

IDA,Kondapally(TIN.28140188596)

Rate of tax on –
(1) Mechanical Jacks
(2) Jack Rods
(3) Wheel Spanners

(1) Form 570
(2) Authorisation letter, authorizing Sri M.Nageswara Rao, General
Manager.
IV. Sri M.Nageswara Rao, General Manager appeared for hearing and
explained the case.
G.O.Ms.No1615, Revenue (CT.II) Department Dated 31-08-2005 and the
VI. The applicants are manufacturers of (1) Mechanical Jacks,

(2) Jack rods, (3) Wheel Spanners. They are also registered under
the Central Excise Department as the goods made by them attract
excise duty. They also quoted the HSN Codes applicable to
Mechanical Jacks as 84254100 and Jack rods as 73089090
Having examined the nature of the goods and HSN codes

notified by the Government of Andhra Pradesh vide G.O.Ms.No.1615
Rev.(CT.II) Department dated 31.8.2005, it is clarified that all the
items manufactured and sold by the applicant attract VAT @ 12.5%
under the residuary entry of Vth Schedule.
ruling.
To
M/s. Ramesh Auto Industries Private Limited,
I.D.A., Kondapally.


PROCEEDINGS OF THE

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O R D E R:
I. M/s. Robo Silicon Limited, Hyderabad (TIN NO. 28090293778) have

filed an application Dated 6.9 2005 and sought clarification and advance
ruling on thefollowing items under Section 67 of APVAT Act, 2005 read with
Rs.1,000/-

Rate of tax on (1) Sand, manufactured from stone and (2) Sand.

Notification of the Government G.O.Ms.No.1564 Rev.(CT.II) Rev.Dept.,
dated 17-8-2005.
IV. Sri C.V.Subba Rao, Managing Director, appeared for hearing on 13-9-
APVAT Act and Rules and G.O.Ms.No.1615 Rev.(CT.II) Department dt.31-8-
2005 and the ruling is given below :
VI. The applicant states that he manufactures stone chips and sand from
stone. In the G.O.Ms.No.1564 issued by the Government of A.P., entry
92,of IVth Schedule enumerates “river sand and grit and stone chips”,
taxable @ 4%. He contends that manufacturing process of sand by them is
synonymous with that of river sand and the end use is also similar to sand.
The State Government have banned excavation and quarrying of river sand
and A.P.State Government also issued a G.O. in No.195 dt.5.8.2004 for
encouraging ‘ stone sand’ as a priority industry Thus, they requested to
clarify the “stone sand” manufactured by crushing the stone boulders chips
into powder and graded as ‘stone sand’, still qualify for inclusion in entry 92
of the IVth Schedule or not.
Having examined the facts on the application and manufacture of

the product, and its nature and following the test of common
parlance, it is held that ‘chips’ in the entry 92 of the IVth Schedule
encompases powder form of chips i.e. ‘stone sand’ liable to 4%
w.e.f. 18-8-2005.
ruling.
To
M/s. Robo Silicon Limited, Hyderabad..

PROCEEDINGS OF THE

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O R D E R:
I. M/s. Rupanagudi Power Systems (P) Ltd.,Hyderabad (TIN NO

28060255949) have filed an application Dated 3.9 2005 and sought
clarification and advance ruling on thefollowing items under Section 67 of

Rate of tax on (1) Electronic Voltage Stabilizers / Servo Stabilizers
(2) Emergency lights
(3) Toroidal transformers and current transformers
(4) UPS
N.M. Subhan, Production Manager,appeared for hearing and explained the

case.
G.O.Ms.No.1615 Rev.(CT.II) Department dated 31-8-2005 and the ruling is
given below :
The Government, vide G.O.cited above have notified certain items

included under Schedule I and IV of the Act with revised HSN Codes
and their applicability. As per the revised notification, HSN Codes
for items viz., (1) electronic/servo voltage stabilizers (2)
emergency lights (3) toroidal /current transformers are denotified
against entry 39 of the IVth Schedule and therefore all items at
Sl.No.(1) to (3) are liable to VAT @ 12.5% from the date of
notification.
However, UPS and their parts are liable to tax @ 4% under
sub-entry (7) of entry 39 of IVth Schedule.
ruling.
To
M/s. Rupanagudi Power Systems (P) Limited,
Hyderabad.

PROCEEDINGS OF THE

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O R D E R:
M/s. S.L.Trading Company, Hyderabad (TIN.28410154637) have

Rs.1,000/-
With regard to the rate of VAT applicable on Polyster clear film and
“Trump” synthetic visiting cards
1. Copies of invoices of the supplying dealers.
2. Copies of sale invoices issued by the applicant for the goods sold.
Sri T.Loknath, Proprietor, appeared for hearing on 13-9-2005 and
explained the case.
The applicant sought for clarification of rate of tax on two
products referred herein.
(1) Polyster Clear Film-- They purchased Polyster clear film
from M/s Garware Polyster Limited, Aurangabad and the invoices
issued by them reveals that goods are covered under HSN Code
3920. The applicant resold the goods without any process or
modification. Since the HSN Code 3920 is appended to entry 90 of
the IV th Schedule, the product under clarification attracts VAT @
4%.
(2) However, in the second case the applicant purchases

synthetic paper from the dealers of outside the state and makes
into visiting cards with their brand name “ Trump” –Trump
synthetic visiting cards. Eventhough, the raw material purchased
falls under HSN Code 3920, by process and value addition ‘visiting
cards’ of standard size are made and sold through the invoices
issued by the applicant. Therefore such goods cannot assume the
nature and character of paper of all kinds but unique and specific
finished goods of altogether different nature liable to VAT @ 12.5%
under V th Schedule.

ruling.
To
M/s. S.L.Trading Company,
Hyderabad.


PROCEEDINGS OF THE

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O R D E R:
I. M/s. Sanghvi Corporation, Hyderabad (TIN NO. 28920168394) have

Rate of VAT applicable on office stationery and other items.
III. The applicant submitted the following documents.

Brochures and literature for variousitems.
IV. Mr. Basheer Ahmed, Manager, appeared for hearing and explained the
case.
G.O.Ms.No.1615 Revenue (CT.II) Department dated 31-8-2005 and the
1) Office stationery including computer stationery.

HSN Code 4820 is notified against entry 25 of IVth Schedule which
encompasses items viz., account books, registers, note books, order books,
receipt books, letter pads, exercise books, blotting pads, binders, folders,
file covers, manifold business forms and other forms and other articles of
stationery. As such, computer stationery does not fall under this
entry. The items enumerated supra attract 4% under entry 25 of
the IVth Schedule.
2) Paper of all kinds : Entry 44 reads “ Paper of all kinds and News Print”.
HSN Codes from4801 to 4817 are notified against the said entry.
Therefore, thermal paper and glossy paper would fall under entry
44 liable to tax @ 4%.
3)Diary: Entry 47 refers to printed material like diaries. Therefore, it

attracts 4%.
4)Printing Ink: Under entry 48 of IVth Schedule, HSN Code 3215 is notified.
It attracts 4%.
5) Writing Instruments: Under entry 68, HSN Codes 9608, and 9609(
except 9609.90.10) are notified. Entry 68 has been substituted by a
G.O.Ms.No.1564 Rev.(CT.II) Dept. dated 17-8-2005, which reads as
“writing instruments”, writing ink, geometry boxes, colour boxes,
pencil sharpeners and erasors. Therefore, all these items attract @
4%.
6) Self adhesive stickers : Under entry 90 of the IVth Schedule, HSN

Code 3919 is notified which covers – self adhesive plates, sheets
etc.,
cellulose adhesive tapes, roll packs etc. which are liable to tax @ 4%.
7) Paste & Gum & Scissors : These items are not enumerated in any of the
entries of Schedule IV. Therefore, these items are liable to tax @
12.5% under residual entry of Vth Schedule.
ruling.
To
M/s. Sanghvi CorporationKing Koti Road, Hyderabad.,
Copy to the Deputy Commissioner(CT) Secunderabad.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/323/2005. Dated 15-9-2005

O R D E R:
I. M/s. Sri Srinivasa Medical Agencies, Hyderabad(TIN.28510115284)


VAT rate applicable to (1) Disposable syringes and needles (2) Scalp
Vein sets, (3) Crape bandages,(4) Rehabilitation aids like abdominal belts,
L.S.belts, Collars etc.,

A copy of the invoices issued by Hindustan Syringes and Medical Devices
Limited.
IV. Mr. T. Mohan, Partner appeared for hearing and explained the case.
VI. The applicant deals in disposable syringes and needles and

similar goods. He sought for clarification and advance ruling for the
rate of VAT applicable to the goods enumerated above.
(1) Disposable syringes and needles : @ 4% u/e. 88 of IVth

schedule.
(2) Scalp vein sets -do-
(3) Crape bandages -do-
(4) Rehabilitation aids like abdominal : @ 12.5% u/residuary entry
of
belts, L.S.belts, collars etc. Vth Schedule
ruling.
To
M/s Sri Srinivasa Medical Agencies,
Hyderabad.


PROCEEDINGS OF THE

***
O R D E R:
M/s. University of Hyderabad, Hyderabad have filed an application

on 9.08.2005 and sought clarification and advance ruling on the following

vi) The VAT rate to be deducted at source from the work bills of the
contractors
vii) Whether VAT should be deducted if the work involves only labour
viii) Whether VAT to be deducted from work bills where the gross
amount is below Rs.5000/-
ix) What is the VAT rate in case the contractor does not furnish TIN
number
x) Whether N-Form facility as provided in G.O.Ms.No.26 Rev. Dept.
dt.13.1.2000 is available under the A.P.VAT Act.
Sri Arjun Kumar, Deputy Finance Officer, appeared on behalf of the

i) The applicant states that he awards contracts to execute
works and seeks to know the rate of tax to be deducted at source
while making payments to the Contractors. It is clarified that the
applicant being an agency other than State Govt. is required to
deduct tax at source @ 2% on the amount payable to the contractor
as it stood up to the promulgation of the Ordinance No.38
dt.29.8.2005. The Govt. have promulgated the Ordinance No.38
dt.29.8.2005 amending certain provisions of the Act and among
other things sub section (4) of Section 22 has also been amended.
According to the amended provision the tax deduction at source has
been raised to 4% wef. 29.8.2005. Therefore the applicant is
advised to deduct tax @ 4% and wef. 29.8.2005.
ii) The applicant seeks to know whether VAT should be deducted
if the work involves labour only. It is clarified that there is no tax
liability if the work involves purely labour and no goods are
involved.
iii) The question whether the applicant should deduct tax even
where the gross amount is below Rs.5000 or Rs.10,000 it is clarified
that if the contractor is registered as a VAT dealer, tax at source
must be deducted at the rate as clarified above. If the contractor is
not registered as a VAT dealer no deduction at source shall be
made.
iv) It is clarified that Section 17(g) of A.P.VAT Act lays down
certain circumstances in which a dealer who executes works is
required to register himself. This section obligates the works
contractor to register himself compulsorily regardless of turnover
threshold if he opts to pay tax by way of composition. The applicant
is advised to insist on furnishing of Registration number by the
Contractor.
v) As regard the facility of Form-N available under the APGST Act, it
is clarified that the G.Os issued under the said Act stand cancelled
as the said Act has been repealed with the introduction of VAT Act.
Therefore the facility of Form-N is not available to the applicant.
To
M/s. Deputy Finance Officer,
University of Hyderabad,
Central University P.O.,

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. TECHNICAL TRADE LINKS (P) LTD.,. SECUNDERABAD

(TIN.NO.28850131310) have filed an application and sought clarification
2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the
II. They sought clarification on the rate of tax applicable on the

following goods.
1) Power analysis (9030 3910)

2) Calibrator (9030.3990)
3) Digital multimeter (9030.3100)
4) Thermometer (9025-1910)
5) Video Security Camera(9006.5390)
6) Viscometers (9027.8010)
7) Spectro Photometers (9027.9090)
8) Surface Tensiometer (9027.8030)
9) Viscometer parts (9027.3020)
10) Microtoners (9027.9010)
11) Refractometer (9027.5020)
12) Polarimeter (9027.9010)]
13) Circulators (9032.8910)
14) Hydrogen Pumps (8413.2000)
15)Pressure Module (9026.2000)
16) Freezers (8418.3010)
Digital still image video camera (8525.4000)

Copies of shipping invoices.
IV. Mr. B.Shanker, appeared for hearing and explained the case.
VI. The applicant deals in import and in interstate purchase of

comprehension measurement/testing /laboratory equipment. They
sought for clarification and advance ruling on the rate of tax
applicable to the items enumerated above. Having examined the
nature of goods and their common parlance in commercial circles,
vis-à-vis due verification with the HSN Codes notified, it is held that
all testing / measuring and laboratory equipment as enumerated as
specified at Sl.Nos.1 to 16 are liable to tax @ 12.5ˆunder the
residuary entry of Vth Schedule. However, Digital still image Video
cameras covered by HSN Code 8525.4000 are enumerated at sub-
item 15 of entry 39 to the IVth Schedule, thereby liable to tax @
4%.
ruling.
To
M/s. Technical Trade Links (P) Ltd.,

Secunderabad.


PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Arihant Enterprises, Hyderabad (TIN.28160214947) have filed


Rate of VAT applicable on –
1) Office and school writing pads
2) School, examination pads with metal clip fitting
3) School examination pads with laminate and clip fitting.
III. Mr.Mahender Jain, Proprietor, appeared for hearing and explained

the case.
G.O.Ms.No.1564 Rev.(CT.II) dt.17-8-2005.the ruling is given as under:
V. The applicant states that they are dealers in ‘writing pads’,
mostly used by school children. They also produced ‘samples’ for
our perusal at the time of personal hearings. Samples are perused
and examined.
Having regard to the nature and character of goods and
enunciation in entry 25 and 68 of IVth schedule, the following
clarification is issued . Entry 25 – deals with exercise note books,
note books, graph books , office stationery, computer stationery
writing pads and account ledgers. All the commodities included are
made of ‘paper’ and they are either in book / note book form or
loose paper form. Therefore, ‘writing pad’ – implies letter pad,
chiseling pad , note book pad etc., but not cardboard. Pad fitted
with metal clip used by the students. Further, entry 68 – ‘writing
instruments’ is substituted by G.O.M.No.1564 Rev.(CT.II) dt.17-8-
2005 as writing instruments, writing ink, geometry boxes, colour
boxes, pencil sharpeners and erasers”. Thus, on examining these
two entries, it is clear that “writing pads made of card board fitted
with clip” and the three types of boards described by the applicant,
do not find place in either of the two entries. Further, following the
doctrine of ‘nociter a sociis’, writing pads made of ‘hard card board’
and fixed with clips would not fall under four percent category of
IVth schedule. Therefore, such goods are liable to VAT @ 12.5%.
ruling.
To
M/s. Arihant Enterprises, Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Gem Oxides (P) Ltd., Hyderabad(TIN.28610205135) have filed


Whether the VAT paid on furnace oil is eligible for input tax credit or not.

Write up on the process of Zinc Oxide.
IV. Sri Subramanyam Chetty, Authorised Representative, appeared for
VI. The applicant is a manufacturer of Zinc Oxide. In the process

of manufacturing Zinc Oxide, the applicant purchases furnace oil to
melt and vaporize zinc metal. The furnace oil is purchased from
other VAT registered dealers. The point for clarification is whether
furnace oil purchased and used in the manufacturing of zinc oxide is
eligible for ITC or not.
VAT paid on the purchase of furnace oil used in the manufacturing

of zinc oxide is eligible for ITC since the ineligible items do not
include furnace oil. Hence, the applicant is eligible to claim ITC on
the VAT paid on purchases of furnace oil so long as it is not used for
power generation.
ruling.
To
M/s. Gem Oxides (P) Ltd.,
Hyderabad.
Copy submitted to the Commissioner of Commercial Taxes, Hyderabad


PROCEEDINGS OF THE
*****
O R D E R:
M/s. Standard Electronics, Vijayawada (TIN.98940192223) have

They sought clarification on the rate of tax on the following
goods/items.
1) Amplifier
2) Amplifier sets (P.A. systems) (Mike sets)
3) Cassette player
4) C.D.Player Audio
5) Compact disc changer
6) Mini Disc player
7) Digital reverberators
8) Electronics Public Equipment
9) Head Phones
10) Micro phones
11) Loud speakers
12) Sound recorders /sound recording docks
13) Wireless microphones.

1.Copies of invoices issued by M/s. Ahuja Radios, New Delhi in
favour of
Mecotronics, Abids Road, Hyderabad.
2. Copies of invoices issued by M/s. Mecotronics, Hyderabad.
Sri Sk.Jeelani Basha, authorised representative on behalf of the firm,

appeared for hearing and explained the case.
Revenue (CT.II) Department Dated 15-04-2005 and the ruling is given as
under: .
The purchase invoices furnished by the dealers from their suppliers, show
that the goods – public address equipment/system are covered by HSN
Code 8518. The Government vide G.Os. referred above also notified under
entry 39 of the IVth Schedule certain I.T.products with HSN Codes. Sub-
item 10 of entry 39 to IVth Schedule enumerates the following
“Microphones, Multimedia speakers, Head Phones, Earphones and combined
microphone speaker sets and their parts”.
However, the invoices issued by M/s. Mecotronics, do not depict the

HSN Code 8518 and as such they charged VAT 12.5% on the sales of Mega
Am 21S, speakers, Amp TZA 4000 Em, AMP SSA 100 M, DRI AU 40, MIC
AUD 54 etc.,
All sound transmitting equipment like loud speakers, head phones, ear
phones etc., do not fall under the nomenclature of the I.T. products. In
common parlance also sound transmitting equipment and parts thereof are
distinct and different from the I.T.products. Hence, all such goods fall under
residual entry liable to VAT @12.5%. The items listed at Sl.Nos. 3 to 6 Viz.,
Cassette Player, C.D.Player (Audio), Mini disc player, Compact disc
recording apparatus, and mini disc player, are not covered under HSN Code
8520. This code is notified for sub-item 11 of Entry 39 of Schedule IV. The
items covered under the code 8520 are basically magnetic tape recorders
and other sound recording apparatus. Therefore, they are liable to tax @
12.5% under Schedule V to the Act.
ruling.
To
M/s. Standard Electronics,
Vijayawada.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Zuari Cement Limited, Hyderabad (TIN No.28030153712) have

i) Clarification regarding meaning of words “over and above base

turnover” in respect of units availing deferment on expansion.
ii) Whether the words ‘over and above base turnover’ are with
reference to entire company’s operations including stock transfer
sales / consignment sale / CST sale.
iii) Whether changes made to Final Eligibility Certificate are

prospective or retrospective in effect.

i) Copy of Commissioner of Industries
Lr.No.30/3/9/0846/0846/ID, Dt.5.8.2005
ii) Copy of revised Final Eligibility Certificate for sales tax
deferment issued in the name of the applicant.
iii) Working sheet showing deferment eligibility based on
turnover.
4. Sri M.R.C.Murthy, authorised representative appeared on behalf of
The applicant claims to be a manufacturer of cement availing

the benefit of deferment on expansion and seeks to know whether
the meaning of words ‘over and above base turnover’ is with
reference to company’s operations including stock transfer,
consignment sales, CST sales of cement and clinker or whether it is
confined only to sales within A.P. Further, the applicant would also
like to know whether the changes made to Final Eligibility
Certificate will have prospective or retrospective effect.
question. The issue raised in the application pertains to various
types of incentives issued under a scheme known as Target 2000
which is primarily meant for promoting industrial development in
the State. As such the said scheme does not form part of the
A.P.VAT Act, 2005. Section 67 of the Act refers to the scope of the
Authority for Advance Ruling. The Authority can address issues
which form part of the Act and its implementation. As the scheme
and its procedures of implementation fall outside the scope of the
Act, we are unable to issue a ruling. Likewise, we also feel that this
Authority cannot issue a ruling interpreting the effect of changes
made to the Final Eligibility Certificate issued to the applicant under
the said scheme. Accordingly this application is disposed of.
To
M/s. Zuari Cement Limited,
Krishna Nagar – 516 311
Yerraguntla,
Kadapa District.

Hyderabad.
Copy to the Asst. Commissioner (CT) LTU, Kadapa Division.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. SAI SOWMYA PRODUCTS, HYDERABAD (TIN.28410103518)

of Rs.1,000/-

The rate of tax applicable on the following goods.
1. Electrical Transformer (Application for control circuits)
2. Voltage Stabilizers
3. Electrical Inverter
4. Battery charges
5. Electronic Ballasts for tubes
6. Uninterupted power supplies
7. Electrical control panel
The applicants submitted the following documents :

Copies of invoice cum delivery challan for electronic stabilizers.
Sri B.Parameswara Rao, Managing Partner appeared for hearing on
The applicant contends that the items enumerated supra fall under HSN
Code 8504, which reads as Electrical transformers static converters and
inductors. On verification it is found the following items are enlisted in the
Chapter 85.
1. Electrical Transformers : 8504

2. Voltage Stabilizers : 8540-4040
3. Electric Inverter : 8504-4010
4. Battery charges : 8540-4030
5. Electric ballast for tubes : 8504-10
Since, the HSN code 8504 is notified under entry 39 of the IVth
Schedule, all the above noted items are liable to VAT @ 4% upto 26-8-
2005.
Consequent to the issue of orders by the Government in

G.O.Ms.No.1596 Rev.(CT.II) Dept., dt.27.8.2005 wherein the chapter 8504
has been deleted from the items of I.T. products, all the items at Sl.No.1 to
5 are liable to VAT @ 12.5% w.e.f. 27.8.2005. However, uninterrupted
power supply (UPS) and their parts continue to be liable to tax @ 4% from
1-4-2005 under Entry 39 of the IVth Schedule.
Electrical Control Panel falling under HSN code 8537.10 has not been
notified and as such would not fall under the Entry 39 of the IVth Schedule
and continues to be liable to VAT @ 12.5% from 1-4-2005.
ruling.
To
M/s. SAI SOWMYA PRODUICTS,
HYDERABAD.

Copy to the Deputy Commissioner(CT), Hyderabad (Rural) Division.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Hotel Kamal Private Limited, (TIN No.28750242637)
S.D.Road, Hyderabad have filed an application dt.10.5.2005 and sought
1. VAT rate to be charged to customers on the total billing
2. Whether the applicant is entitled to opt for composition.
Sri V.K.Batra, Finance Manager appeared for hearing on 13-5-2005

1 of page 2
The issues have been examined with reference to the provisions of

the APVAT Act and Rules.
As stated in the application, the applicant is a Bar and
Restaurant. As per Section 4 (9), a VAT dealer who runs Restaurant
and serves food and drink (other than Liquor) only can opt for
composition and can charge tax @ 12.5% on 60% of the total
amount of the bill. The applicant being a Bar & Restaurant is not
entitled to opt for composition. Therefore he should charge 12.5%
VAT on the total value of supplies of food and drink (other than
liquor).

To
M/s. Hotel Kamal Private Limited,

9-1-167/168, S.D.Road,
Copy to the Commercial Tax Officer, S.D.Road Circle, Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Mahavir Enterprises, (TIN No.28850194457)
Bogulkunta, Hyderabad have filed an application dt.10.5.2005 and sought
They sought clarification on the rate of tax applicable to the
following items.
1. Casseroles
2. Water Bottles
3. Containers, plates, cups, soup bowls, spoons, serving trays etc.
made of plastic
4. Tiffin containers
5. Plastic tubs / buckets / containers
6. Flasks
The following documents have been submitted by the applicant:

• Product literature
1 of page 2
Sri K.Ramanujachari, Assistant General Manager, appeared for

hearing on 13-5-2005 and explained the case stating that the items in
question he classified as packing material.
The items on which clarification is sought for by the applicant
do not answer the description of packing material. Therefore, the
HSN codes notified in the above G.Os are not applicable. Hence the
items mentioned above at Sl.No. 1 to 6 are liable to tax @ 12.5%.

To
M/s. Mahaveer Enterprises (I) Private Limited,
Dharod House, 4-1-896/A, Bogulkunta,
Hyderabad.

2 of page 2

PROCEEDING OF THE

***
O R D E R:
M/S Modern Instruments Company, (TIN No.28290113028)

Palace Hotel Building, Nampally, Station Road, Hyderabad have filed an
application dt.10-5-2005 and sought clarification and Advance Ruling on the
following items under Section 67 of the APVAT Act, 2005 read with Rule
They sought for clarification on the following :
1) Whether Medical Devices and Equipments are taxable at 4%
under VAT ?
2) Whether G.O.Ms.No.370 Rev, dt.1.6.2000 specifying the goods
with reference to HSN code Nos. is valid ?
3) For the Entry Serial No.2 of AP VAT Act whether the goods
notified as “ Aids & Implements used by Handicapped persons “
issued in G.O.Ms.No.919 dt.8-11-2003 are valid ?
4) Whether artificial limbs, components & rehabilitation aids are
exempted in VAT Act ?
5) What is the rate of tax under VAT Act on Hearing Aids and Solar
Products/Accessories.
The case was posted for hearing on 12-5-2005. Sri G.C.Jeet,
Proprietor of the firm appeared on behalf of the firm and presented the
case. The issues raised by the firm have been examined with
reference to the provisions of the AP VAT Act and Rules and HSN Codes
notified by Government vide G.O.M.No.398, Revenue (CT-II) Department,
dt.31-3-2005 and G.O.Ms.No.490, Revenue (CT-II) Department, dt.15-4-
2005 and the ruling is given as under.
1) Medical Devices and Equipments are taxable @ 12.5%
2) The list of HSN Codes 9018, 9021, 9022, 9033, 9027, 8434
which are notified under G.O.M.No.370 Rev.(CT-II), dt.1-6-2000 are
not valid and relevant under AP VAT Act.
1) The “Aids and Implements” used by Handicapped persons

are notified at Sl. No.2 against Entry 2 to the Ist Schedule read with
HSN codes notified against such entry by the Government vide
G.O.M.No.398, Revenue (CT-II) Department, dt.31-3-2005 and
G.O.Ms.No.490, Revenue (CT-II) Department, dt.15-4-2005 which
would alone fall under Entry 2 of the 1st schedule, liable for
exemption. Other goods not falling under the HSN codes notified
against the Entry 2 of Ist Schedule are taxable @ 12.5% under Vth
Schedule. By G.O.Ms.No.919, Dt.8.11.2004 the Govt., exempted sale
of appliances mentioned in the Annexure enclosed to the said G.O.
for use by the physically handicapped and mentally retorted
persons from the levy of sales tax under the APGST Act. Whereas
there is no specific and exclusive list notified with reference to
Entry 2 of the Ist Schedule except the relevant HSN codes notified
by the Government.
2) The G.O.Ms.No.776 Rev (CT-II) dt.9-7-1985 issued under
APGST Act exempting from payment of sales tax on the goods
manufactured by M/s Artificial Limbs Manufacturing Corporation of
India is no more valid.
5) The hearing aids falling under HSN code 9021.40 are

exempted in terms of G.O.Ms.No.398 & 490. Solar product /
accessories are not covered under Entry 2 of Ist Schedule of the
A.P.VAT Act. Hence, they are liable to tax @ 12.5%.
JT.COMMISSIONER
To
M/s Modern Instruments Company,
5-4-455/2, Palace Hotel Building, Nampally, Station Road,
Hyderabad.

Hyderabad.

Division.

PROCEEDINGS OF THE
***
Dt.13.4.2005.
O R D E R:
M/s. Ramky Infrastructure Limited, (TIN No.28320469384)
Somajiguda, Hyderabad have filed an application dt.10.5.2005 and sought
When a contractor executing works contracts with Govt. Dept. and Local
bodies awards such works contract to another sub contractor on back to
back basis, whether both contractor and sub contractors are liable to
TDS @ 4% of 50% of total consideration and whether Form 501
received from the contractor can be endorsed to in favour of the sub
contractor.
Sri N.S.Murthy, Senior Manager appeared for hearing on 13-5-

of the APVAT Act and Rules and the ruling is given as under.
1 of page 2
There is no concept of contractor and sub contractor being
separately treated under the A.P.VAT Act. Whether one is a
principal contractor or sub contractor, the VAT dealer contractor
becomes liable to tax once he falls in the category of works
contractors. If such contractor executes works to the Govt.
contractee or local body contractee, such contractor is expected to
file Form VAT 501 certified by the contractee together with the VAT
200 otherwise he is liable to pay tax. Rule 17(3)(g) stipulates that
where the contractor VAT dealer awards any portion of his contract
to a sub-contractor, such contractor shall not be eligible for any
deduction relating to the value of the sub-contract. The sub
contractor, if he is a VAT dealer, in such a case he may either opt
for composition under clause (c) of Sub section 7 of Section 4 or
pay tax under clause (a) of sub section (7) of Section 4.

To
M/s. Ramky Infrastructure Limited,
6-3-1089/6/10, Ist Floor,
Gulmohar Avenue, Raj Bhavan Road,

2 of page 2

PROCEEDING OF THE

***
O R D E R:
M/s Solix Technologies Ltd., Tarnaka, Secunderabad have

filed an application on 9-5-2005 and sought clarification and Advance Ruling
on the following items under Section 67 of the APVAT Act, 2005. They also
enclosed application fees of Rs.1000/-. The application is examined and
The case was posted for hearing on 12-5-2005 at 4 P.M. Sri
T.M.Rao, Director of the firm appeared on behalf of the firm and presented
the case. The issues represented by the dealers are examined with
Page 1 of 2
The clarification sought for is whether ‘ computer developed

software products” and “ Consultancy Service” are taxable under the AP
VAT Act or not ?
On careful examination of the issue with reference to the documents

furnished and as per the provisions of the AP VAT Act and Rules, the ruling
is given as under:
AP VAT Act, 2005 specifies under Entry 39 (14) of the

IV schedule IT products (with HSN code) that is to say – IT
software on any media (8524) is taxable @ 4%.
Further, the AP VAT Act, provided for levy of tax on IT

products including “ IT software on any media” irrespective of
whether it is customized or not.
Therefore sale of IT software on any media is taxable

@ 4% under sub item (14) of Entry 39 of Schedule IV to A.P.VAT
Act, 2005. The “consultancy service” which is in the form of
services are not liable to sales tax.
JT.COMMISSIONER
To
M/s Solix Technologies Ltd.,
Lane No.13, Street No.14, Tarnaka,
Secunderabad –17.

Hyderabad.
Division.
Page 2 of 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Swastik Mirch Stores, (TIN No.28940109385) Begum
Bazaar, Hyderabad have filed an application dt.11.5.2005 and sought
1. where sale bills are inclusive of VAT, whether the buying VAT
dealer is eligible to claim input tax credit.
2. Rate of tax on spices and masalas like Garam masalas, Sambar
masala, Pulav Biryani masala used in preparation of food.
Sri Harakh Chand Savla, Manager appeared for hearing on 13-5-
1 of page 2

is given as under.
1. A buying VAT dealer is eligible to claim input tax credit even
if a tax invoice issued by selling dealer is inclusive of VAT.
The VAT included in the tax invoice can be arrived by
applying tax fraction or r
-----
r + 100
to the sale price. The amount so arrived is the input tax that
can be claimed by the purchasing VAT dealer.
2. As per the G.O’s cited above spices of all varieties and forms
falling under Entry 59 of Schedule IV of A.P.VAT Act & Rules
2005 have been notified as falling under different chapter
headings of HSN code. Other spices have been notified as
falling under 0910.99. Therefore, spices and masalas are
liable to tax at 4%.

To
M/s. Swastik Mirch Stores,

15-6-519, Begum Bazaar,

Copy to the Commercial Tax Officer, Afzal Gunj, Hyderabad.
2 of page 2
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Venkata Ramana Laminations Private Limited, (TIN
The applicant claims to be manufacturer of Plastic disposal items such

as Glasses, Cups, Plates, Spoons, Forks etc., which are used for
domestic purposes /at events / functions to serve food and beverages.
According to him the item falls under Entry 90 of Schedule IV of the Act
and seeks confirmation of rate of tax applicable.
Sri P.Ramdas, Managing Director of the firm has appeared for

1 of page 2
1) Notification of Government of Karnataka indicating the
applicability of 4% tax.
2) Invoice cum challan issued under Central Excise Regulations
indicating tariff sub heading No.3923.90.90.
is given as under.
Entry 90 of Schedule IV of A.P.VAT Act refers to all kinds of
packing material. In the G.Os mentioned HSN codes applicable to
various items under this entry have been notified.
Among other things HSN code 3923 has also been notified at
Sl.No.4 under that entry. Further as seen from the excise challan /
invoice, the applicant is removing the goods on which clarification
is sought under the same tariff sub heading. Therefore, it is held
that the items on which clarification is sought are liable to tax @
4%.

To
M/s. Venkata Ramana Laminations Private Limited,
No.1-10-122/19, Ashok Nagar,Hyderabad – 500 020.

Copy to the Commercial Tax Officer, Circle, 2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Mangalam Timber Products Limited (TIN
1. Whether a Waybill is required for transporting exempted goods

(Firewood)
2. Whether exempted goods i.e., Firewood purchased from farmers
and stock transfer to their factory situated outside the State can
be subjected to purchase tax under sub section (4) of Section 4
of APVAT Act, if they are purchased from unregistered dealers in
the State to their factory to manufacture finished goods i.e., MDF
boards and if so, the rate of tax and the entry in the schedule
applicable.
Sri T.Nageswara Rao, Asst. Officer (Accounts) appeared on
16.06.2005 for personal hearing and explained the case.
is given as under.
According to the applicant, they purchase Firewood from
farmers which is normallly non-fruit bearing Mango and Cashew
trees and this is converted into MDF Boards in their factory in
Orissa. It was explained further that checkpost authorities have
detained consignment and collected tax of Rs.3000 and C.Fees of
Rs.500 on the pretext that valid waybill is not accompanying the
goods.
After carefully examining the facts of the case and the entries
relating to Firewood and Casurina & Eucalyptus poles in the
Schedules to the Act, the following ruling is given :
1. Firewood is exempted as per Entry 14 of Schedule I to the
Act. Firewood, as understood in the general parlance is cut in
odd sizes and shapes and it does not have high commercial
value like teak logs and sizes or any other valuable wood
used for furniture. It does not also generally include poles of
Bamboo, Casurina, Eucalyptus etc., which are used for
construction or paper industry. It is generally sold by weight
and by physical appearance, one can make out, because of
odd pieces and low value wood, whether it is firewood or not.
After this test is made, it is immaterial whether it is used
finally as Firewood or for other purposes.
2. Firewood is exempt under the provisions of the Act and
therefore, no tax can be levied under sub section (4) of
Section 4 of the Act. The question of rate therefore does not
arise.
3. As regards the requirement of waybill for transportation
of Firewood, the Rule 55(1) clearly stipulates that waybill is
not necessary for exempt goods.
To
M/s. Mangalam Timber Products Limited

3-4-494, Barkatpura,
Maa Gayatri Plaza,
Flat No.401, Hyderabad – 500 027.
Copy to the Commercial Tax Officer, Special Commodities Circle

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Esennar Transformers (P) Limited, Medak (TIN

The rate of tax applicable on Electrical Transformers upto 20000 KVA.

Copies of invoice-cum-challan issued by the applicant under Central
Excise Rules.
Sri A.Sridhar Reddy, Managing Director on behalf of the firm has

is given as under.
In the G.Os cited above the HSN code applicable to various
products under Entry 39 of IV Schedule of the Act have been
notified. At Sl.No.7, HSN code 8504 that refers to Electrical
transformers has also been notified. Under this code Transformers
of various capacities have been mentioned. Invoice-cum-challan
issued under Excise Rules by the applicant also contains HSN code
8504. Therefore, it is held that the rate of tax applicable to
Electrical transformers is 4% as per Entry 39 of Schedule IV of the
Act.
To
M/s. Esennar Tranformers Private Limited,

D-6, IDA Pashamailaram,
Medak District - 502 307.

Copy to the Commercial Tax Officer, Sangareddy Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Gland Pharma Limited, Hyderabad (TIN

Whether Light Diesal Oil used in Boilers and Vapour absorption
machine for production purpose is eligible for input tax credit.
Copy of invoice issued by Hindustan Petroleum Corporation Limited.
Sri B.S.N.Raju, Manager (Accounts), of the firm has appeared for
The applicant claims to be engaged in manufacturing of

Pharmaceutical Formulations and that he uses Light Diesel Oil in
the boilers and Vapour absorption machine for production purposes.
The applicant further states that he is required to maintain different
levels of temperatures in the process of production of drugs and
medicines for which Light Diesel Oil is used in the boilers. In the
circumstances he seeks to know whether he is eligible to avail input
tax credit on purchase of Light Diesel Oil from VAT dealers within
A.P.
Copy of sale invoice of Hindustan Petroleum Corporation

Limited indicates that the company had charged VAT rate as
specified in the Schedule VI of the Act.
In the Schedule VI of the Act, Diesel Oil is mentioned at Entry

5. As per sub section (1) of Section 13 of A.P.VAT Act, no input tax
credit shall be allowed in respect of tax paid on the purchase of
goods specified in Schedule VI. Thus, read together purchase of
Light Diesel Oil which is a product listed in Schedule VI of the Act is
an item on which the applicant is not eligible to claim input tax
credit. Therefore, the ruling is that the applicant is not eligible to
avail input tax credit on purchase of Light Diesel Oil.
To
M/s. Gland Pharma Limited,
Ameerpet,
Hyderabad.
Copy to the Commercial Tax Officer, Panjagutta Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Godavari Clay (Mines), Bommuru, Rajahmundry (TIN

Rate of tax applicable to Fire clay extracted from the Mines.

1. Copy of tax invoice depicting sales of Fire clay by VAT dealers registered
within A.P.
2. Copy of transport permit issed by Mines & Geology Department, Govt. of
A.P.
Sri V.S.Sivaram, Authorised Representative appeared on behalf of

is given as under.
According to the applicant Fire clay is extracted from the
Mines that are taken on lease from the State Govt., and sold by the
applicant. The applicant is of the view that the item being a natural
mineral falls under Entry 43 of Schedule IV of the Act and seeks a
confirmation to this effect. We have examined the contents of the
application and the documentary evidence furnished. Entry 43 of
Schedule IV refers to “Ores & Minerals”. The department of Mines &
Geology while issuing the transport permit has described the item
as a mineral. The applicant claims to sell the mineral in its natural
state. Therefore, we are inclined to hold that Fire caly falls under
Entry 43 of Schedule IV of the Act and accordingly attracts a tax
rate of 4%.
To
M/s. Godavari Clay (Mines),
Bommuru,
Rajahmundry Rural.

Copy to the Commercial Tax Officer, Alcot Garden Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Mayuri Film Distributors, Ramoji Film City, Hyderabad (TIN

1. Pre-recorded Audio Cassette
2. Pre-recorded Audio C.Ds
3. Publicity Wall Posters
Sri Ch.Sreenivasa Rao, Assistant Manager (Accounts) appeared on

is given as under.
In the G.Os cited above, the HSN codes for I.T.products under
Entry 39 of Schedule IV of the A.P.VAT Act, 2005 have been
notified. At Sl.No.14 under the entry HSN code 8524 is mentioned.
The excise tariff 8524, among other things, contains Pre-reocorded
Audio Compact Discs and also Audio Cassettes. As the chapter code
8524 has been notified, all items falling under that chapter are
squarely covered under the code and the Entry 39 of the Schedule
IV. Therefore, Pre-recorded Audio Cassettes and Pre-recorded
Audio Compact Discs are held as liable to tax @ 4%.
As regards Item-3 i.e., Publicity wall posters, it is seen from

Entry 47 of Schedule IV that printed material like Diary, Calendar
etc., are mentioned in the G.Os cited above. The HSN codes
applicable under Entry 47 have been notified. Among other things,
HSN code 4911 has also been notified at Sl.No.6 under the entry.
Under chapter 4911 printed posters are mentioned at 4911.10.10.
Therefore, it is held that printed wall posters squarely fall under the
Entry 47 of Schedule IV of the act and liable to tax @ 4%.
To
M/s. Mayuri Film Distributors,

Anajpur, Ramoji Film City, R.R.District,
Andhra Pradesh – 501 512.
Copy to the Commercial Tax Officer, Vanasthalipuram Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Taj Residency, Visakhapatnam (TIN No.28700177972)
Rs.1000/-.

1. Whether the applicant can opt for composition scheme under Section
4(9) of the A.P.VAT Act, 2005.
2. If eligible for composition whether sale of Liquor is exempt from tax
or liable to tax on 60% of sales of Liquor.
Sri A.Sarveswara Rao, Advocate, on behalf of the firm has appeared

The applicant is running a Hotel / Restaurant & Bar that

serves Food and Drink including Liquor to the customers. The
applicant states that the Liquor served in the Bar attached to the
Restaurant is exempt at his hands as per the provisions of Section
4(5) of the A.P.VAT Act. However, the applicant seeks clarification
whether he can opt for composition provided under Section 4(9) of
the Act. The applicant seeks confirmation about the tax liability
under composition scheme, if eligible for.
Section 4(9) refers to a VAT dealer who runs any
restaurant and as part of the service supplies food and or drink
other than Liquor can opt to pay tax by way of composition. As the
applicant admits that he serves Liquor also he ceases to become
eligible to opt for composition as the language in the section does
not extend the benefit to those Restaurants that serve Liquor.
Therefore, it is held that the applicant being a Bar &
Restaurant is not entitled to opt for composition and should charge
12.5% VAT on the total value of supply of food and drink (otherthan
Liquor). As regards, Liquor the turnover representing sale of liquor
is exempt under the provisions of the Act.
In the light of the above clarification and ruling, the question

of paying tax on 60% of sale value of Liquor does not arise.
To
M/s. Taj Residency,
Beach Road,
Visakhaptnam.
Copy submitted to the Commissioner of Commercial Taxes,A.P.,

Hyderabad.
Copy to the Commercial Tax Officer, China Waltair Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. The Park Hotels, Visakhapatnam (TIN No.28060147988)
Rs.1000/-.

1. Whether the applicant can opt for composition scheme under
Section 4(9) of the A.P.VAT Act, 2005.
2. If eligible for composition whether sale of Liquor is exempt from
tax or liable to tax on 60% of sales of Liquor.


Liquor). As regards, Liquor, the turnover representing sale of liquor

To
M/s. The Park Hotels,
Beach Road,
Visakhaptnam.

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. S.L.Trading Company, Hyderabad (TIN.28410154637) have

Rs.1,000/-
With regard to the rate of VAT applicable on Polyster clear film and
“Trump” synthetic visiting cards
3. Copies of invoices of the supplying dealers.
4. Copies of sale invoices issued by the applicant for the goods sold.
Sri T.Loknath, Proprietor, appeared for hearing on 13-9-2005 and
explained the case.
The applicant sought for clarification of rate of tax on two
products referred herein.
(3) Polyster Clear Film-- They purchased Polyster clear film
from M/s Garware Polyster Limited, Aurangabad and the invoices
issued by them reveals that goods are covered under HSN Code
3920. The applicant resold the goods without any process or
modification. Since the HSN Code 3920 is appended to entry 90 of
the IV th Schedule, the product under clarification attracts VAT @
4%.
(4) However, in the second case the applicant purchases

synthetic paper from the dealers of outside the state and makes
into visiting cards with their brand name “ Trump” –Trump
synthetic visiting cards. Eventhough, the raw material purchased
falls under HSN Code 3920, by process and value addition ‘visiting
cards’ of standard size are made and sold through the invoices
issued by the applicant. Therefore such goods cannot assume the
nature and character of paper of all kinds but unique and specific
finished goods of altogether different nature liable to VAT @ 12.5%
under V th Schedule.

ruling.
To
M/s. S.L.Trading Company,
Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. PRAVEEN TRADING COMPANY, KURNOOL

(TIN.No.28160276348) sought clarification and advance ruling on the

Whether the commodity, “Ajwan” falls under the entry “Spices of all
varieties and forms” ?

Notification from Spicies Board, Cochin, defining “Ajwan” as spice and
listed as 12th item in the schedule of Spices under section 2(n) of the Spices
Board Act, 1986.
Mr. S.M.Peer, appeared for hearing on 15-9-2005 and explained the

case.
The entry 59 of the IVth schedule in the A.P.VAT Act, 2005

reads as under -- “Spices of all varieties and forms including cumin
seeds, aniseed, turmeric and dry chillies.” The Spices Board has
authenticated that “ajwan” is included in the definition of ‘spices’
under section 2(n) of the Spices Board Act,1986. Since, the entry is
of inclusive nature, all spices, including “ajwan” fall under the entry
59 of the IVth Schedule and thus liable to tax @ 4% under APVAT
Act.
ruling.
To
M/s. PRAVEEN TRADING COMPANY,
KURNOOL.


PROCEEDINGS OF THE

*****
O R D E R:
M/s. RAVI ELECTRONIC CORPORATION,

VIJAYAWADA(TIN.28420153796) have filed an application Dated 27-7-2005
2005 along with the application fee of Rs.1,000/-.

The rate of VAT applicable to parts of Televisions and Tape recorders.
Mr.V.Bhaskara Rao, S.T.P authorized representative appeared for

The applicant states that HSN Code No.8529 has been notified under
entry 39 of the IVth schedule and further states that the said heading
No.8529 reads as follows in the Central Excise Tariff Act, 2005.
8529—“Parts suitable for use solely and principally with the

apparatus of heading Nos. 8525 to 8528”. Therefore the applicant contends
that all parts of the goods falling under Heading numbers from 8525 to
8528 are deemed to be covered under Heading 8529.
Having examined the contention and the HSN Codes 8525 to 8528
and 8529, the advance ruling is given as under.
Since the HSN Code 8529 is notified by the Government vide G.O.s
referred supra, all parts enumerated in the tariff codes from 8525 to 8528
are covered under HSN Code 8529 and therefore the following parts are
liable to VAT @ 4% under entry 39 of the IVth Scheduled.
1. T.V.Tuners
2. T.V. Speakers
3. T.V. L.O.T. ‘s
4. T.V. Main Cords
5. T.V. Tap off switches
6. T.V. Amplifiers
Other items referred in their letter are not ‘parts` but accessories which
would not fall under Tariff No. 8529
They also sought clarification on rate of tax on “ parts and
accessories suitable for use solely or principally with the apparatus of
heading Nos 8519 to 8521”. HSN code 8522 is notified by the Department
whereas, HSN code 8519 is not notified. Therefore, the parts & accessories
of the apparatus enumerated in entry 8519 are not eligible for 4 % under
entry 39. However, the parts and accessories of the principal apparatus
notified in HSN code 8520 and 8521 are eligible to VAT @ 4%.
However, the Govt., vide G.O.Ms.No. 1596 Rev(CT-II) , Dated:
27.08.2005 have re-notified the HSN codes with examplations appended to.
In the revised list of HSN codes appended to entry 39 of the IV th Schedule,
HSN codes 8519 to 8529 have been rescinded. Therefore, all the parts and
accessories falling under HSN codes 8519 to 8529 are liable VAT @ 12.5%
w.e.f. 27.08.2005.
ruling.
To
M/s. Ravi Electronic Corporation,

Vijayawada.


PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Gurukrupa Associates,Raghava Ratna Towers,Chirag Ali Lane,

Hyderabad (TIN.28660192782) have filed an application and sought

Rate of tax applicable to bags meant for collection of blood.

1) Sample of the product.
2) Purchase order from Nizam Institute of Medical Sciences (NIMS)
3) Copy of Drugs and Cosmetics Act relating to Blood Bags.
4) Copy of the judgement of Hon’ble Alahabad High Court
IV. Mr. K.S. Rao, Chief Executive Officer appeared for hearing on 16-12-
VI. The applicant claims that he is dealer for Blood Collection

Bags which contains CPDA (CITRATE PHOSPHATE DEXTROSE
ADENINE SOLUTION) to preserve blood and that it is a medical item
coming under the purview of the Drugs and Cosmetics Act.
According to the applicant this product cannot be sold to any dealer
except to licensed blood banks and that sale of this item comes
strictly under the purview of Drugs Control Authority. The applicant
further relies on the purchase order of NIMS to emphasize that
blood collection bags can be purchased only from medical stores
but not from surgical stores. The applicant also relies on the
decision of Hon’ble Allahabad High Court holding that the definition
of Drug is comprehensive enough to take in its ambit not only
Medicines but also substances intended to be used for treatment of
diseases of human beings or animals. In support of this contention
the applicant also filed a copy of the provisions relating to the
Drugs and Cosmetics Act which explicitly state that the item blood
bags falls under the purview of the Act.
We heard the representative and also perused the
documentary evidence. A copy of the purchase invoice submitted by
the applicant showing sales made by Hindustan Latex Limited
contains description of the goods and among others things Central
Excise Tarrif number and also conditions attached for sale of the
blood collection bags.
Entry 88 of the Schedule IV of the Act as amended in
G.O.Ms.No.1564, Revenue (CT-II).Department, dated:17-8-2005
refers to Drugs and Medicines as defined in Clause (i), (ii) and (iii)
of Section 3(b) of Drugs and Medicines Act 1940. After the
amendment the entry also takes within its ambit needles, sutures,
dressing bandages and similar articles.
In G.O.Ms.No.1615, Revenue (CT-II)Department, dt.31-08-
2005 a revised notification regarding the scope of applicability of
certain items included under Schedule I and Schedule IV of the Act
has been issued. In the notification the HSN codes applicable to
certain products under Schedule I and Schedule IV have been
notified. Among other things HSN codes applicable to products
falling under Entry 88 have also been notified. Sale invoice issued
by Hindustan Latex Limited to the applicant specifies the tarrif
heading No.9018 as applicable code for the item in question. At
Serial Number 17 of Entry 88 this code has been notified in the
above mentioned G.O. Considering the identity of the product and
the HSN codes under which it falls, it is clarified that the applicant
is liable to pay tax at 4% on sale of Blood Collection Bag system as
per the entry 88 of the schedule IV of the APVAT Act, 2005.
ruling.
To
M/s. Gurukrupa Associates,
Chirag Ali Lane,
HYDERABAD.
.
Copy to the Commercial Tax Officer,Nampally Circle.
PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/455/2005. Dated:17-12-2005.
O R D E R:
I. M/s. India Food Exports, Tuni, E.Godavari Dist. (TIN.28280158877)


Whether the applicant is liable to tax under Sec.4(4) of APVAT Act,
2005 on purchases of Cashewnut Kernal and sent to his branch in
Tamilnadu for export purpose.

1) Copy of the invoice showing details of the consignee/importer of the
product.
2) Copy of bill of lading.
3) Copy of weight list
IV. Mr. D. Jayaseelan, Manager appeared for hearing on 16-12-2005 and

explained the case.
VI. The applicant claims that he has head office at Kollam in
Kerala with branches at Kuzhuthurai in Tamil Nadu and Tuni in
Andhra Pradesh. The applicant states that the Head office receives
orders from foreign buyers and in pursuance of the said orders he
dispatches consignments after effecting purchase from farmers and
converting them into kernel. In the circumstances the applicant
seeks to know whether he is liable for purchase tax under Sec.4(4)
of APVAT Act, 2005.
We heard the representative and also perused the

documentary evidence. As seen from the bill of lading, the
applicant’s head office at Kollam has consigned the goods to a
buyer located in foreign country. The invoice issued in relation to
the transaction also supports the view that the head office at
Kollam is exporting cashewnut kernel to the foreign buyer. Weight
list submitted by the applicant shows details of grading of
cashewnut kernal and the quantities. Description on this document
also indicates that cashewnut kernal sorted and packed in tins is
sent to other packing centers located at different places, outside
the State. An inter office memo submitted for our perusal gives
description of the goods, name of the buyer, contract number,
grade and shipment date, in pursuance of which the applicant
claims to effect purchases.
Thus, it is clear from the documentary evidence that applicant’s

head office located outside A.P., exports cashew kernel received from its
branches. Therefore, in circumstances, if the purchases are effected for the
purposes and in pursuance of pre-existing export order at Head office,
which is communicated to branch and the branch dispatches consignment
from A.P. in pursuance of the said export order, clause (ii) of Section 4(4)
of the AP.VAT Act, 2005 comes into play. Accordingly such transaction does
not attract levy under the said section. However, this is a question of fact
that has to be determined by the authorities of the department. The onus of
non-liability to tax under the Section lies on the applicant.
ruling.
To
M/s. .India Food Exports,
Thetagunta,
Tuni,
East Godavari Dist.

Copy to the Commercial Tax Officer,Tuni, Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Nava Durga Mineral Industries Ltd, Secunderabad

TIN.28800103214 have filed an application and sought clarification and
of Rs.1,000/-

Whether the applicant is eligible for input tax credit on the purchase
of furnace oil from VAT registered dealers in A.P. .
III. Mr. K. Narayanachari, Director, appeared for hearing on 16-12-2005

V. The applicant claims that he processes Natural Fuller’s

Earth out of the Bentonite Lumps purchased from local VAT dealers.
The finished product known as Natural Fuller’s Earth is used for
refining edible and non-edible oils. The applicant states that he
purchases furnace oil from the dealers registered for VAT within
A.P. and uses it for heating in Calcinatory to remove the moisture of
Fullers Earth Powder through Heat Reactors in order to obtain the
end product known as Natural Fuller’s Earth. In the circumstances
the applicant is seeking clarification whether he can claim input tax
credit in Form VAT 200.
We have heard the representative and also perused the
provisions of the APVAT Act, 2005. Section 13 of the Act deals with
credit for input tax. Rule 20(2) excludes items which are not
eligible for input tax credit. Among other things, the sub-rule refers
to fuels used for automobiles or for captive power generation or
used for any power plants. The applicant however claims that
furnace oil is used for heating purposes in order to remove the
moisture contained in the Bentonite Lumps. The sub-rule does not
provide for exclusion of furnace oil from the list of items eligible for
input tax credit. Therefore, the applicant is entitled to claim input
tax credit on purchase of furnace oil provided the said purchase is
from dealers situated within A.P. and registered as VAT dealers.

ruling.
To
M/s. _Nava Durga Minerals Industries Limited,
Padmarao Nagar, SECUNDERABAD.
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Himalaya Engineering Works (P) Limited (TIN
The applicant is seeking clarification regarding the rates of tax on
the following items :
1. Spring washers
2. Pack (Flat) washers & Bolts & Nuts
Smt. K.Radha Rani, Administration Manager appeared on

15.06.2005 for personal hearing and explained about the commodities dealt
by them. The copies of invoices issued in respect of the items and brochure
/ catalogues were also produced.
1 of page 3
is given as under.
On examination of the facts, it is found that Spring washers

are used for Transmission towers which are specified under Entry
No.64 of Schedule IV taxable @ 4%. The HSN codes notified are :
i) Towers whether or not assembled for transmission line :

7308.20.11
ii) Others :
7308.20.19
According to the applicant, the items ‘Spring washers’ and

Pack Washers (Flat) are used as for Transmission towers and the
customers are Power Supply Companies or firms who erect towers.
The applicant produced copies of four invoices raised by them

before 31.3.2005.
2 of page 3
From the facts arising out of nomenclature in Entry 64, HSN

codes notified and the invoices produced, it is held that the items
Spring Washers and Flat washers are covered in Schedule IV
taxable @ 4%. The item ‘Bolts & Nuts’ are taxable @ 12.5%.
To
M/s. Himalaya Engineering Works Pvt. Limited

Plot No.33, Phase-I, IDA., Jeedimetla,

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Khazana Jewellery (India) Private Limited, (TIN
The applicant claims to purchase Bullion in the state of A.P. inclusive of

VAT and then sends it for manufacturing outside the State through stock
transfer document since the applicant does not have manufacturing
facility in A.P. and receives finished goods in the form of Gold Jewellery
which is sold to customers in A.P.. While doing so the applicant claims
to charge VAT at 1%. In the circumstances the applicant seeks
clarification whether he can take set-off of VAT paid on purchase of
Buillion while paying tax on the sale (output) of Gold Jewellery in A.P.
and secondly whether the applicant need pay VAT on purchase of Gold
from customers / unregistered dealers.
Sri A.Kanab, Manager (Finance) of the firm has appeared for hearing
1 of page 2
APVAT Act and Rules 2005 and the ruling is given as under.
The dealer is eligible to claim input tax credit on Bullion
purchased from registered dealers within A.P. and can take credit of
the VAT paid on such purchases, while discharging tax liability on
sale (output) of Gold Jewellery. Secondly, the applicant is not liable
to pay any purchase tax on old Gold he claims to be purchasing
from customers because the transfer to his workshop outside A.P. is
for the purpose of manufacture and for subsequent sale in A.P.
Since there is no purchase tax liability at the hands of the applicant
on this transaction there is no necessity of collection of VAT from
the customers.

To
M/s. Khazana Jewellery (India) Private Limited,

6-3-885/7, Somajiguda,
Saphire Square,

Copy to the Commercial Tax Officer, Somajiguda Circle, Hyderabad.
2 of page 2
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. NAC Infrastructures Equipment Limited Hyderabad have
The applicant is primarily involved in the business of providing

construction equipments for development of infrastructure on rental
basis to contractors on hourly basis.
During the course of such activity the applicant will also be selling
old and worn out parts as scrap as also old equipments.
In the circumstances the applicant seeks clarifications whether he is

required to register under VAT and if so what is the tax liability.
Alternatively if the applicant is not required to register, he seeks
clarification regarding the procedure to be followed for clearing the goods at
the checkposts without waybill.
The applicant submitted the following document(s):

Copy of equipment service contract. 1 of page 2
Sri K.V.R.K.Sudhakar, Consultant of the firm has appeared for

Under the provisions of A.P.VAT Act, 2005 a registration is
necessary if a person or a firm or a company comes within the
scope of ‘dealer’ as defined under Section 2(10) of the Act and such
dealer should either have taxable turnover as defined under Section
2(38) or must be importing goods in the course of business from
outside the territory of India as specified under sub section (5) of
Section 17 of the Act. A dealer registered or liable to be registered
under CST Act, 1956 is also required to register as a VAT dealer.
There is scope to register voluntarily as a VAT dealer if sales of
goods liable to tax are effected but such voluntary registration is
subject to conditions prescribed in the Rules. A dealer having a
taxable turnover of less than Rs.5 lakhs in a period of twelve
consecutive months need not register. It is for the applicant to
determine whether he comes within the scope of the above
situations and decide to register or not.
This authority cannot give a ruling whether the applicant

should necessarily register or not. If he is registered, he can have
waybills for movement of goods from place to place.

To
M/s. NAC Infrastructure Equipments Limited Limited,

NAC Campus, Izzat Nagar, Kondapur,

Hyderabad.
Copy to the Commercial Tax Officer, Madhapur Circle, Hyderabad.
2 of page 2

PROCEEDING OF THE

(Enft)
CCT’s Ref.No.PMT/P&L/A.R.Com/21/2006 Dt:17-06-2006

2005.
***
O R D E R:
M/s. ACE Tyres Limited, Bachupally, R.R.District (TIN
No.28950193322) Hyderabad have filed an application and sought
admitted.
The applicant is seeking clarification on the following ;
1. Issue of way bills (Jobwork – Registered dealer)
2. Whether the dealer who is executing job work is liable to be
registered under VAT and CST Act.
The case was posted for hearing on 13-6-2006. Sri Syed Warisuddin
Naveed, Director of the firm appeared and explained the case.
The applicant explained that they have entered into an agreement

with M/s. CEAT Tyres Limited, Mumbai and M/s. Appollo Tyres Limited,
Delhi for executing job work which is to manufacture tyres on their behalf.
According to them, the raw material is fully supplied by the customers and
central excise duty paid by the customers on the raw materials is claimed
as Cenvat credit by the applicant after paying the excise duty on the value
of the finished goods in their hands. It was further explained that the excise
duty paid by them in their hands is reimbursed by the customer companies.
They have contended that they will be required to get certain portion of
work sub contracted outside the State. For this purpose they need to send
goods which requires waybills as per the provisions of A.P.VAT Rules, 2005.
It was also stated that the transportation of the finished goods to be sent to
their customers located outside A.P. requires waybills as prescribed in VAT
Rules. The applicant claims that he registered himself as a VAT dealer to
facilitate receipt of goods from outside the State and to transport goods
from his factory to customer locations outside State so that waybills can be
obtained by him. According to him, the field level officers are not issuing
the required waybills to them on the plea that they are not required to be
registered under the Act.
After examination of the facts with reference to Clause (b) of sub
section (5) of Section 17 of A.P.VAT Act, 2005 and also to the Rule 55 of
the A.P.VAT Rules, 2005 of A.P.VAT Rules, 2005, it is clear that the
applicant will be required to register himself as a VAT dealer and he will be
required to use waybills for transportation of goods outside the State. On
account of this, the ruling is given as under :
The applicant is under obligation to register himself as a VAT
dealer. The applicant is entitled to obtain waybills because there is
a requirement to use waybill for transportation of goods.
JT.COMMISSIONER
To
M/s. ACE Tyres Limited,
314, 315, Ameenpur Road,
Bachupally,
R.R.District.

Hyderabad.
Copy to the Commercial Tax Officer, IDA, Gandhi Nagar Circle.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Metrochem API Private Limited, Erragadda, Hyderabad have
The case was posted for hearing on 13-6-2006. Sri G.V.S.S.R.
Krishna, Accounts Executive of the firm appeared and explained the case.
The applicant is seeking a clarification regarding liability of Entry tax
on certain products specified by him in the application and whether such
entry tax paid can be claimed as input tax credit by him in case he is using
such goods as inputs.
The provisions of A.P. Tax on Entry of Goods into Local Areas Act,
2001 and A.P.VAT Act, 2005 relating to levy of entry tax and scope to
adjust entry tax against input tax under the provisions of A.P.VAT Act, 2005
were examined. It is found that certain amendments are made to Entry Tax
Act which was notified w.e.f. 2.1.2006 and the effect was given from
1.4.2005 in respect of the amendments made therein. As a result of these
amendments, no entry tax is leviable in respect of any inputs used in the
manufacturing activity. Similarly, the sub section (5) of Section 22 to
A.P.VAT Act stipulates that any entry tax paid can be adjusted against VAT
payable by him provided the credit for input tax is not restricted under sub
section (4) of Section 13 of A.P.VAT Act, 2005.
The ruling is therefore given that,

1. No Entry Tax is leviable on inputs used for the purpose of
manufacture
2. Entry Tax paid can be adjusted against VAT payable subject
to the restrictions under sub section (4) of Section 13 of the
A.P.VAT Act, 2005.
JT.COMMISSIONER
To
M/s. Metrochem API Private Limited,
Jeedimetla,
Hyderabad-500 055.
Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Volta Impex Private Limited, (TIN No.28920296531)
1. Whether the applicant being an Merchant exporter can issue

Form H to a local dealer, other state manufacturer / dealer.
2. Whether he is required to issue one H-Form for each invoice or
one Form for all invoices in a financial year.
Copies of invoice issued by the applicant.
Sri M.Sudhakar Rao, Manager of the firm has appeared for hearing
1 of page 2
The issue on which the clarification is sought falls under

provisions of the CST Act. Therefore, being outside the purview of
the provisions of Advance Ruling under the A.P.VAT Act, 2005, we
are not inclined to issue any ruling.

To
M/s. Volta Impex (P) Limited,

123/3RT, First floor, Sanjeeva Reddy Nagar,
Copy to the Commercial Tax Officer, Vengalraonagar Circle, Hyderabad.

2 of page 2

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Western India Cashew Company (P) Limited, Tuni (TIN
1. Whether the company is liable to tax under Section 4(4) of
AP.VAT Act, 2005 on purchases of raw cashew nuts from farmers in A.P.
which are then processed into cashew kernels within the State of A.P. and
subsequently sent to its branch in Kerala for onward export out of the
country ?
2. The company purchases cashew nuts from farmers in A.P.
and process the same into kernels in his units in A.P. and export to another
VAT dealer in A.P. who inturn will export the kernel to foreign countries. In
the circumstances the exporting deal
er situated in A.P. will issue Form H. The company seeks clarification
regarding the tax liability on the purchase of nuts and kernel sold in the
course of export.
3. The company purchases cashew nuts from farmers in A.P.
and process the same into kernel in his unit in A.P. and sells the resultant
kernel to the exporter who is a VAT dealer in other states and seeks
clarification whether the company is liable to tax on the purchase of cashew
nut and sale of kernel in the course of export.
The case was posted for hearing on 13-6-2006. Sri Shyam R.
Busamwar, General Manager (P&Q) of the firm appeared and explained the
case.
They also submitted certain documents and additional grounds in
support of their application.
1. The first question relates to applicability of levy of tax under sub

section (4) of Section 4 of the Act for the transactions of purchase of raw
cashew nuts from farmers in Andhra Pradesh and processed into cashew
kernels in A.P. and sent to branch offices in Kerala for onward export
outside India. The documents submitted by them were also examined. It is
observed that certain quality and grade cashew kernels are sent to their
Head office at Kollam in Kerala which inturn exported as a result of order
from a foreign buyer. The inter office order between Head office and the
branch in A.P. is also examined wherein it is stated that grade W320
cashew kernels are ordered to the extent of 62000 kgs vide inter office
order dt.4.5.2006. Clause (ii) of sub section (4) of Section 4 of the Act
stipulates that tax on the purchase price is leviable only if the goods, after
such purchase, are used as inputs for goods which are disposed of
otherwise than by way of sale in the State or dispatched outside the State
otherwise than by way of sale in the course of interstate trade and
commerce or export out of the territory of India. The reading of this clause
makes it clear that no tax on the purchase price can be levied if the goods
purchased are used as inputs and the corresponding output is dispatched in
the course of interstate trade and commerce or in the course of export
outside the territory of India. The transactions in question give prima facie
an impression that certain quality and grade cashew kernels are sent for
the purpose of export against a specific order from the foreign buyer.
2. The applicant claims that cashew nuts purchased from farmers in
A.P. are processed into cashew kernels in A.P. and sold to another VAT
dealer in A.P. who is exporting the same outside India. It is also claimed
that the transactions are supported by Form ‘H’ prescribed under CST
Rules. Schedule II to the A.P.VAT Act stipulates that sale of goods falling
within the scope of Section 5(1) and Section 5(3) of the CST Act, 1956 are
treated as zero-rated. Clause (ii) of sub section (4) of Section 4 of the VAT
Act excludes the levy of purchase tax when the corresponding outputs are
sold in the course of export. The intent of the legislation is clear that goods
exported outside the country should not bear the burden of any tax
component in the price charged. Therefore, no purchase tax is leviable on
the cashew nuts used for processing into cashew kernel which is sold in the
course of export supported by Form ‘H’.
3. The applicant claims that cashew nuts purchased in A.P. are
converted into cashew kernels and sold to an exporter located outside the
State. This transaction is similar to the one explained in Para 2. In the
circumstances explained, no purchase tax is leviable on the purchase of
cashew nuts corresponding to the cashew kernels sold in the course of
export.
The ruling therefore is given as under :
1. No purchase tax is leviable in respect of the transactions
explained in Question 1 provided the facts are found to be
true as explained by the applicant.
2. No purchase tax is leviable where corresponding outputs
are sold against Form ‘H’ to exporters within A.P.
3. No purchase tax is leviable where the corresponding
outputs are sold in the course of export supported by
Form ‘H’ to an exporter located outside A.P.
JT.COMMISSIONER
To
M/s. Western India Cashew Co. (P) Limited,
5/14/24-3, Kothapetta,
Tuni – 533 401. East Godavari Dist.
Hyderabad.
Copy to the Commercial Tax Officer, Tuni Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. CEAT Limited (TIN No.28900176672), Somajiguda, Hyderabad

have filed an application and sought clarification and Advance Ruling on the
following items under Section 67 of the APVAT Act, 2005 read with Rule
The applicant is seeking a clarification regarding the tax to be

charged on tyres and tubes fitted to Threshers, Harvesters and Tractor
Trailers.
Sri K. Hanumantha Rao, Advocate appeared on behalf of the

The applicant referred to the notification issued by G.O.Ms.No.1564,

Dt.17th August,2005 wherein certain changes were made to some entries in
the Schedules to the Act. In particular the reference was made to Entry
No.63 of Schedule-IV which was substituted by a fresh Entry by the said
notification. In the amended entry, the words “tractor trailers and tyres and
tubes of tractors” were specifically added and the words “and attachments
and parts there of” at
1 of 2
the end were retained in the same form. The issue regarding the
applicability of tax rate on tyres and tubes of items other than tractors
within the same entry is examined and it is here by clarified that the tax
rate shall be 4% in respect of tyres and tubes of all items within the
Entry 63 of Schedule-IV to the Act.
JT.COMMISSIONER
To
M/s. CEAT Limited,
Flat No.418, Maheswari Chambers,
6-3-650, Somajiguda,
Hyderabad-500 082.

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. G.S. Power Consultants (TIN No.28150193478), Madhuranagar,

1) Whether the contract for procuring, supplying and installation of

diesel generators and the and the connected ancillary equipment
like acoustic enclosures, diesel tank, control panel and related work
of earthing, exhaust pipe, cabling etc., could constitute works
contract under the provisions of the Act.
2) Whether the applicant can opt for composition to pay tax on the
entire value involved in the transactions and whether he can
purchase any goods by using ‘C’ forms.
3) The applicant also seeking to know the procedure regarding

payment of tax on goods purchased from outside the State and used
in a transaction which can be considered as a works contract.
Sri T. Ramesh Babu, Authorised Representative appeared on behalf

of the applicant and explained the case.
1 of 2
According to the applicant, they are executing complete turnkey
projects for power solutions with diesel generator sets and they are also
authorized dealers for Kirloskar Green DG Sets. The brochure submitted
during the hearing also indicated that they are specialized in manufacturing
of Acoustic Enclosures and AMF Panels suitable for any make of D.G. Sets.
After examining the facts of the case it emerges that the

major component in the transaction is the supply of Kirloskar Diesel
Generator Sets. The applicant is supplying certain other materials
and is also executing the work of installation. In so far as the diesel
generator set is concerned it is a clear case of a sale because it is
the most predominant aspect in the transaction and the
negotiations between the buyer and the supplier is on the basis of
specification, capacity, make, price etc. This cannot be construed a
transaction of works contract. However, the related work for
installation of diesel generator sets may be construed as a works
contract provided the cost of installation is not incidental or
ancillary to the transaction of supply of several equipments and
components involved in the transaction. If the cost of installation is
found to be very negligible and ancillary or incidental to the entire
transaction of supply of various equipments and accessories to
diesel generator sets, that would also clearly fall within the scope of
“sale” and exigible to tax at the rates applicable to such individual
items supplied. Once the issue is decided on such grounds, the
applicability of composition and the procedure to pay tax in respect
of the goods purchased outside the State would be relevant or
irrelevant based on such findings.
JT.COMMISSIONER
To
M/s. G.S. Power Consultants,
Plot A-46, Madhuranagar,
Hyderabad-500 038.

Hyderabad.
Copy to the Commercial Tax Officer, Vengalaraonagar Circle.
2 of 2

PROCEEDING OF THE

2005.
***
O R D E R:
M/s. Jain Turmerics (TIN No.28430103873), Main Road,

Rajahmundry have filed an application and sought clarification and Advance
The applicant is seeking clarification regarding the applicability of

purchase tax under sub-section (4) of Section 4 of the Act with regard to
the purchases of turmeric and pulses made by him on behalf of non-
resident principals and dispatched to the said non-resident principals.

1 of 3
According to the applicant he makes purchase of turmeric and pulses

from the farmers for the purpose of and to the account of non-resident
principals against prior instructions from the non-resident principals. He
claims that the goods so purchased are immediately dispatched to non-
resident principals without making any process or doing anything to such
goods. The claim is that the purchases and dispatch constitute a single
transaction and the purchase occasioned the movement of goods outside
the State. The applicant claims that the transactions fall within the scope of
Section 3(a) of CST Act,1956. The applicant also cited definitions of
“exempted turnover” under APVAT Act,2005 “exempted transaction” under
APVAT Act,2005 contending that the transactions in question fall within the
scope of these definitions.
The applicant also cited the judgment of Hon’ble Supreme Court in

the case of Bakhtawarlal Kailash Chand (87 STC 196) and also the
judgment of Hon’ble High Court in their own case in TRC Nos. 209 and 217
of 2001, Dt.20th September, 2001.
The TRCs cited were filed against the orders of the Tribunal on a
similar matter where the issue was whether the assessee dealer acted as an
agent to the non-resident principal or as an individual dealer while effecting
the purchase of turmeric. The Tribunal gave a finding that there was no gap
between the purchase and dispatch of turmeric purchased by the assessee
and despite the fact that no advances were received to effect the purchases
on behalf of non-resident principals, the transactions are in the nature of
purchases on behalf of non-resident principals and held that such turnovers
cannot be treated as part of the turnover of the assessee. The TRCs filed by
the Department were dismissed by the Hon’ble High Court on the basis that
it does not involve any question of law and there was no merit warranting
interference with the orders of the Tribunal.
A similar issue was already examined by this Authority in Advance

Ruling No.225 of 2005, Dt.21-07-2005 and it was clarified that to levy any
purchase tax under sub-section (4) of Section 4 of the Act, the initial
purchase and the subsequent dispatch outside the State must be two
separable events. In so far as the purchases made is occasioning the
movement of goods from A.P. to outside the A.P. and such purchases being
on behalf of non-resident principals, the transactions clearly fall within the
ambit of the judgment of the Hon’ble Supreme Court cited and the TRCs
already decided by STAT and High Court.
2 of 3
The ruling is, therefore given that the transactions of the

nature explained above do not attract the provisions of sub-section
(4) of Section 4 of the Act. However, this cannot be an embargo for
enquiry or examination as to the veracity of the transactions
effected by the applicant by any officer duly authorized under the
Act.
JT.COMMISSIONER
To
M/s. Jain Turmerics,
Door No.24-110, Main Road,
Rajahmundry.

Hyderabad.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Sree Foam Agencies (TIN No.28130213396), Kandakam Street,

Rajahmundry have filed an application and sought clarification and Advance
The applicant is seeking clarification regarding the eligibility of sales

tax relief under Section 13(2)(a) of the Act with regard to the goods
purchased before 31st March,2005 but such goods being in transit on 01-
04-2005.

The issue in question is regarding purchase of certain items like

mattresses by the applicant through several purchase invoices with dates
prior to 1st April,2005 and the goods being held with transporters as on 01-
04-2005.
The Authorized Representative could not answer specifically

whether the prescribed authority already initiated proceedings to
reject the claim of sales tax relief. In case any proceedings are
already passed, this Authority cannot intervene in the matter and
such proceedings would not alter. If the application was made on
Form 115
1 of 2
and no action is initiated to reject the claim, the material

placed before us and examined on merits gives the impression that
the applicant shall be eligible in case the stocks are held within the
State as on 01-04-2005 and such stocks were purchased within the
twelve months prior to 01-04-2005 from registered dealers of A.P.
by paying sales tax.
JT.COMMISSIONER
To
M/s. Sree Foam Agencies,
Kandakam Street,
Rajahmundry.

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Sri Sai Printers (GIR No.PJT/07/1/2940), Lakdi-ka-pool,

The applicant is seeking a ruling on the following:
1) Whether being a TOT dealer, he can sell the old machinery to a dealer
outside the State?
2) If so, what is the rate of tax to be collected and whether consequent on

selling goods outside the State, it would affect the status of being a TOT
dealer?
The case was posted for hearing on 22-10-2005. Sri A Narayana

Swamy, Managing Partner of the firm appeared and explained the case.
According to him he is presently registered as a TOT dealer under

the provisions of the Act and he would like to sell old machinery already
used by him to a customer outside the State of A.P. He is seeking to know
whether he can continue to be a TOT dealer and pay tax under the
provisions of CST Act for the interstate transactions involved in selling
machinery to a customer outside the State.
1 of 2
After examining the facts of the case and the provisions of Section
17 of the Act, it is hereby clarified that under sub-section (5)(a) of
Section 17 of the Act, every dealer making sales in the course of
interstate trade shall be liable to be registered as a VAT dealer
irrespective of the turnover. Under Rule 5, the time limit for
applying VAT Registration in such instances is also prescribed. As
regards the liability of tax on interstate sales of old machinery, the
provisions of CST Act,1956 shall apply depending upon whether the
sale is made to a registered dealer and the transaction is supported
by a declaration form.
JT.COMMISSIONER
To
M/s. Sri Sai Printers,
Flat No.B2(102),6-2-1/1-B2,
View Towers, Lakdi-ka-pool,
Hyderabad.

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. URC Construction (P) Ltd., (TIN No.28460173906), A.C.
Guards, Hyderabad have filed an application and sought clarification and
1) Whether they can opt for composition scheme for certain works and
regular payment of VAT for other works?
2) Whether any materials can be purchased against ‘C’ form for the works
covered under composition scheme?
3) Whether service tax collection and payment would form part of the
turnover under composition or for the purpose of regular VAT payment?
1 of 3
4) Whether sales tax relief can be claimed on closing stock on 31st

March,2005 in respect of goods to be used for the works covered under
composition scheme?
5) Whether they are eligible for exemption as sub-contractor if the main

contractor is covered by composition?
The case was posted for hearing on 24-10-2005. Sri M. Dakshina

Murthy, Authorized Representative appeared on behalf of the firm and
explained the case.
After examining all the facts with reference to the provisions of the
Act and Rules, the ruling is given as under:
1) Composition can be opted for each or specific works

contract. There can be certain works under composition and certain
other works outside composition.
2) If goods are purchased from outside the A.P. and such

goods are used in the works covered under composition, the
applicant shall pay tax on the value of such goods procured from
outside the State at the rates applicable to such goods under APVAT
Act,2005 and such value can be deducted from the total value of the
contract covered by way of composition. After deducting the value
of such goods from the total value of the contract the applicant can
pay tax @ 4% on the remaining portion under composition.
3) The turnover to be taken into consideration for

composition is the total consideration received and if service tax
collected as a part of the consideration no deduction towards
service tax is allowable whether it is in composition scheme or
outside composition scheme.
4) In respect of the goods held as closing stock on 01-04-

2005, sales tax relief can be claimed only if such goods are used in
works contract which are outside the composition scheme. Even if
any claim is originally made on closing stock, the applicant shall not
claim input tax credit to the extent such goods are used in works
contract covered under composition as and when VAT returns are
filed.
2 of 3
5) As a result of the amendments made to Section 4 of the

Act with effect from 01-09-2005 regarding the provisions relating
to works contract, the sub-contractor is not liable to pay any tax in
case main contractor is covered under composition and no
purchases are made by sub-contractor from outside the State or
from un-registered dealers in the State.
JT.COMMISSIONER
To
M/s. URC Construction (P) Ltd.,
C/o.IT Tower Project, CPWS,
10-2-3, AC Guards,
Hyderabad-500 004.

Hyderabad.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/473/2005. Dated 17-12- 2005.
O R D E R:
I. M/s. Gold Prince Gold Plated Jewellery, Machilipatnam


III. Mr. C.H. Narasimha Rao, Proprietor appeared for hearing on 16-12-
V. The applicant claims to manufacturer gold plated

jewellery and seeks to know the rate of tax applicable to
the item.

ruling.
To
M/s. Gold Prince Gold Plated Jewellery,
20/38,Narasimhanagar,
Machilipatnam,
Krishna Dist..

Copy to the Deputy Commissioner(CT) , Vij ayawada – II Division.
Copy to the Commercial Tax Officer,Machilipatnam Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/474/2005. Dated 17-12- 2005.
O R D E R:
I. M/s. Saloni, Begum Bazar, Hyderabad (TIN.28950190218) have filed

an application Dated 16-12-2005 and sought clarification and advance
Rs.1,000/-

III. Mr. C. Laxmi Kanth, Proprietor appeared for hearing on 16-12-2005 and
explained the case.
IV The issue has been examined with reference to the provisions of the
V. The applicant claims to be a trader of gold plated

the item.

has been added in the schedule IV to the Act. The entry reads
ruling.
To
M/s. _SALONI,
15-6-542, Bannajimet,
Begum Bazar,
HYDERABAD.

Copy to the Deputy Commissioner(CT) , Charminar Division.
Copy to the Commercial Tax Officer, Afzalgunj Circle.

PROCEEDINGS OF THE

*****

O R D E R:
I. M/s. Sudha Gold Covering Industries, Machilipatnam


III. Mr. Sadhu Gandhi, Managing Partner appeared for hearing on 16-12-
V. The applicant claims to manufacture gold plated jewellery

and seeks to know the rate of tax applicable to the item.


ruling.
To
M/s. _Sudha Gold Covering Industries,
12/39, Rustumabad,
Machilipatname,
Krishna Dist..

Copy to the Commercial Tax Officer, Machilipatnam Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Yasa Sri Gold Plating Works, Machilipatnam (TIN.28660158638)

of Rs.1,000/-

III. Mr. CH. Durgavara Prasad Rao, Proprietor appeared for hearing on 16-
VI. The applicant claims to manufacturer gold plated
the item.

ruling.
To
M/s. _Yasa Sri Gold Plating Works,
8-207-1, Godugupet,
Machilipatnam,
Krishna Dist..

Copy to the Deputy Commissioner(CT) , Vij ayawada – II Division.
Copy to the Commercial Tax Officer,Machilipatnam Circle.

PROCEEDING OF THE

2005.
***
O R D E R:
M/S Mithra Ceramics Pvt. Ltd., (TIN No.28180118981), Industrial

Estate, Mancherial have filed an application dt.17-05-2005 and sought
They sought clarification on the following products.
To clarify the rate of tax under APVAT Act for Stoneware Pipes.
The case was posted for hearing on 17-05-2005. Sri L. Anil Kumar
the AP VAT Act and Rules and HSN Codes notified by Government vide
G.O.Ms.No.490, Revenue (CT-II) Department, dt.15-4-2005 and the ruling
is given as under.
Stoneware Pipes are taxable @ 4% as per Entry 45 of
Schedule IV to APVAT Act,2005.
JT.COMMISSIONER
To
M/s Mithra Ceramics Pvt. Ltd.,.,
Industrial Estate, ‘ACC’,
Mancherial.
Adilabad District..

Hyderabad.
Copy to the Deputy Commissioner (CT), Adilabad Division.
Copy to the Commercial Tax Officer, Mancherial Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Parsi Sivayya & Co., (TIN No.28930211203) Nizamabad
Rs.1000/-.
They sought clarification on the rate of tax on the following items:
a. Lobia (Bebarlu – Alusandulu)

b. Ballar (Anumulu)
c. Jute seeds
d. Amchur (Pulp of Mango)

Reference of Central Warehousing corporation in No. CW/NZB/Tech
–Corres/2005-06/148, dt.17.5.2005 containing Botanical names of the
items on which clarification is sought.
1 of page 2
Sri P.Mahesh Kumar Parsi, Partner of the firm has appeared for
is given as under.
1 & 2. Lobia & Ballar: In the G.Os. cited above Entry 82 of Schedule
IV of A.P.VAT Act, 2005 has been notified. Items falling under HSN
Code 0713 such as dried leguminous vegetables, shelled, whether
or not skinned or split are mentioned. Under this code other things
like peas, chick peas, beans and other similar items are also
mentioned. Therefore Lobia and Ballar on which clarification is
sought by applicant are held as liable to tax @ 4%.
3. Jute seeds: This item is not found in any of the entries of the
schedules of A.P.VAT Act, 2005. Therefore held as liable to tax @
12.5%.
4. Amchur (Pulp of Mango): As the item is not found in any of the

entries in the schedules of the Act it is also held as liable to tax @
12.5%.
To
M/s. Parsi Sivayya & Co.,
H.No.7-8-716, Gandhi Gunj, Post Box No.3,
Nizamabad – 503 001.

Copy to the Commercial Tax Officer, Circle, Nizamabad.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Prakash Exporters, (TIN No.28280196028) Tuni, East
Godavari have filed a application dt.17.5.2005 and sought clarification and
of Rs.1000/-.
1. We purchase Cashew nuts from farmers / Ryots in A.P. and
process the same into kernal. The kernal is exported to Foreign
countries by us. In support of our export we have foreign buyers
order, Bill of lading, letter of credit, invoice raised in the name of
foreign buyer etc. We request to clarify the tax liability or not on
the above purchase of cashew nuts and export of kernal to
foreign countries.
2. We purchase cashew nuts from farmers/ Ryots in A.P. and

process the same into kernal. The kernal is sold in the interstate
transactions. PL clarify on the tax liability or not on the purchase
of cashew nuts and interstate of cashew kernal.
3. We purchase cashew nuts from farmers / Ryots in A.P. and

process the same into kernal. The krnal is sent to our branches
in other states. PL clarify the tax liability.
Sri B.Babu, Manager, appeared for hearing on 18-5-2005 and
explained the case.
After examination of the facts, the ruling is given as under :
1. With reference to clarification sought is para 1, the
purchase of cashew nuts from farmers / Ryots in A.P.
does not attract the provision of purchase tax under sub
section (4) of Section 4 of A.P.VAT Act at the time of
purchase. If the cashew nut purchased from farmers and
Ryots in A.P. is processed into Kernel and the kernel is
exported to foreign countries directly by a VAT dealer, the
transaction is zero rated under the provisions of Section 8
of A.P.VAT Act. In such a case, where cashew nut kernel is
exported directly from A.P. to outside the country to a
foreign buyer supported by proper documentation,
corresponding purchases of Cashew nut from farmers will
not attract the provisions of purchase tax.
2. With reference to clarification sought in para 2 above, as

clarified in para cited supra, the purchase of cashew nuts
from farmers will not attract purchase tax at the time of
purchase and at the same time if cashew nut kernel
processed out of such cashew nut is sold in the course of
interstate sale originating from A.P., the tax under the
provisions of CST Act will have to be paid.
3. In the case of purchase of cashew nut from farmers and
the corresponding cashew nut kernel being sent to
branches outside A.P., the purchase tax will have to be
paid under sub section (4) of Section 4 of A.P.VAT Act in
the month in which goods have been physically dispatched
outside the state by way of branch transfer or stock
transfer or for sale outside the state. In this case, the
purchase value of cashew nuts has to be worked out
correctly and the corresponding purchase tax needs to be
paid in the month in which the resultant goods i.e.,
cashew kernel are dispatched outside the state otherwise
than by way of sale.
In all the three situations above, the value of purchase
needs to be reported in tax returns in Form VAT 200 in Box 6A
which represents exempt or non creditable purchases. “The
purchase value of cashewnut relatable to the quantity of cashew
kernel that has been sent by way of branch transfer must be
reported in Box 15A. While doing so, the purchase tax component
must be excluded and this value must be reported in Box 15(B)”.
The value of branch transfers of cashew kernel should be reported
in Box No.12 i.e., exempt sales in the monthly VAT return.
An illustration is given below in respect of clarification

sought in para 3 to make clear the issues involved.
M/s. Prakash Exporters have purchased cashew nuts

valued at Rs.5 lakhs from farmers in the month of December 2005.
On processing the cashew nuts, the resultant cashew kernel valued
at Rs.7 lakhs was sent on branch transfer to other state in the same
month. There are no other purchases or sales in the month.
M/s. Prakash Exporters need to indicate the above turnovers

in monthly VAT return for December 2005 as follows :
Purchases in the month (Input) Value excluding VAT

Box No.6 : Exempt or non-creditable purchases : Rs.5,00,000
Sales in the month (Output) Value excluding VAT VAT Due

Box No.12 : Exempt sales Rs.7,00,000 XXX
Box No.15 : Tax due on purchase
of goods Rs. 5,00,000 Rs.20,000
To
M/s. Prakash Exporters,
2-17-24, Rani Subbadrammapet,
Tuni, East Godavari District.

Copy to the Commercial Tax Officer, Tuni Circle, Hyderabad.

PROCEEDING OF THE


2005.
***
O R D E R:
M/S Ravi Foods (P) Ltd., (TIN No.60193704), Kattedan, Hyderabad
have filed an application dt.13-05-2005 and sought clarification and
Whether Light Diesel Oil (LDO) which is used as fuel in the
manufacturing process of biscuits and confectionary is eligible for input tax
credit.
The case was posted for hearing on 17-05-2005. Sri Murugesan
The matter has been examined with reference to Section 13 of the
APVAT Act,2005 and Rule 20(2) of APVAT Rules,2005 and the following
ruling is given.
Light Diesel Oil (LDO) is listed in Schedule VI of APVAT
Act,2005 under Entry No.5 as Diesel Oil. As per Sub-section (1) of
Section 13 of APVAT Act “no input tax credit shall be allowed in
respect of the tax paid on the purchases of goods specified in
Schedule VI”. Hence purchase of Light Diesel Oil (LDO) is not
eligible for input tax credit irrespective of the usage.
JT.COMMISSIONER
To
M/s Ravi Foods (P) Ltd.,
Madhuban Colony road,
Kattedan,
Hyderabad.

Hyderabad.
Copy to the Commercial Tax Officer, Rajendranagar Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Shree Ram & Company, (TIN No.28280162757), Kishan Gunj,

To clarify the rate of tax on used empty MS, PVC Drums and Tins
(upto 200 Ltrs capacity).
The case was posted for hearing on 17-05-2005. Sri Rameswar
the AP VAT Act and Rules and HSN Codes notified by Government vide
is given as under.
Used MS, PVC Drums and Tins (upto 200 Ltrs capacity) are
taxable @ 4% as per Entry 90 of Schedule IV to APVAT Act,2005.
JT.COMMISSIONER
To
M/s Shree Ram & Company,
15-2-481, Kishan Gunj,

Hyderabad.

PROCEEDINGS OF THE
***
Dt.13.4.2005.
O R D E R:
M/s. Spectra Smart Solutions Private Limited, (TIN
No.28790196981) Panjagutta, Hyderabad have filed an application
They sought clarification on the rate of tax applicable to following:
1. Smart card readers

2. Smart card initializer
3. Bio metric readers (finger print)
4. Point of sale terminals (POS)
5. Fence controllers
6. Smart cards
7. RFID tags
8. Software to operate any of the above
9. Electro magnetic locks
1 of page 3
10. Turnstiles
11. Boom barriers
12. Can input tax credit be availed for having installed for their
offices / business / factories.
The applicant filed the following documents:
• Product literature of above mentioned items.
Sri P.Ramdas, Finance Manager, appeared for hearing on 17-5-2005
The issues and the documents have been examined with reference
to the provisions of the APVAT Act and Rules and HSN Codes notified by
Item 1 to 7 are covered under HSN code 8471 which has been
notified in the above mentioned G.Os. Therefore they are liable to
tax @ 4%.
Item No.8 is notified as falling under HSN code 8524.
Therefore, it is also liable to tax @ 4%.
Item No.9, 10 & 11 are not covered under any of the Chapter
headings notified in the above G.O. Therefore, they are liable to tax
@ 12.5%.
2 of page 3
As regards eligibility of input tax credit of a VAT dealer who

buys from the applicant the above mentioned products, it is held
that as long as the buying dealer is a VAT dealer and the items are
purchased for business use (as distinct from personal use), input
tax credit can be claimed by the VAT dealer who buys these items.
To
M/s. Spectra Smart Solutions Private Limited,

No.6-3-668/10/17, Durga Nagar, Panjagutta
Copy to the Deputy Commissioner (CT),Panjagutta Division.
Copy to the Commercial Tax Officer, Somajiguda Circle, Hyderabad.

3 of page 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sri Meenaa Foods, (TIN No.28600161356) Tanuku Road,
Kumadavalli Village, Palakoderu Mandal, West Godavari District have filed
an application dt.17.5.2005 and sought clarification and advance ruling on
1. Whether the Bread manufactured and sold under the brand name
“Meena” is liable to tax.
2. Whether Bread rusk is liable to tax, if so at what rate
3. Whether input tax credit is available on diesel used in oven for
manufacturing bread by the applicant.
Sri R.G.Satya Sai Ram, Managing Partner, appeared for hearing on

1 of page 2

is given as under.
1. The applicant manufactures Bread which carries the brand
name “Meena”. As per Schedule I of A.P.VAT Act, 2005
only unbranded bread is exempt. Therefore, bread sold by
the applicant with brand name “Meena” is liable to tax @
4% as per Entry 34 of Schedule IV of A.P.VAT Act, 2005.
2. Bread rusk sold by the applicant is liable to tax @ 12.5%.
3. Diesel used in oven is not eligible for input tax credit

because it is included in Schedule VI and as per sub
section (1) of Section 13 of AP.VAT Act, 2005, the tax paid
on purchase of goods specified in Schedule VI is not
eligible for input tax credit.

To
M/s. Sri Meenaa Foods,

R.S.No.52/4, Tanuku Road,
Kumudvalli Village, Palakoderu Mandal,
West Godavari District.
Copy to the Deputy Commissioner (CT), Eluru Division.

2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sun Food Corporation, (TIN No.28250182061)
Narasingapally, Visakhapatnam have filed a application dt.17.5.2005 and
1. We purchase Cashew nuts from farmers / Ryots in A.P. and process

the same into kernal. The kernal is exported to Foreign countries by
us. In support of our export we have foreign buyers order, Bill of
lading, letter of credit, invoice raised in the name of foreign buyer
etc. We request to clarify the tax liability or not on the above
purchase of cashew nuts and export of kernal to foreign countries.
2. We purchase cashew nuts from farmers/ Ryots in A.P. and process

the same into kernal. The kernal is sold in the interstate
transactions. PL clarify on the tax liability or not on the purchase of
cashew nuts and interstate of cashew kernal.
3. We purchase cashew nuts from farmers / Ryots in A.P. and process

the same into kernal. The krnal is sent to our branches in other
states. PL clarify the tax liability.
Sri B.Babu, Manager, appeared for hearing on 18-5-2005 and

explained the case.
1. With reference to clarification sought is para 1, the purchase
of cashew nuts from farmers / Ryots in A.P. does not attract
the provision of purchase tax under sub section (4) of Section
4 of A.P.VAT Act at the time of purchase. If the cashew nut
purchased from farmers and Ryots in A.P. is processed into
Kernel and the kernel is exported to foreign countries directly
by a VAT dealer, the transaction is zero rated under the
provisions of Section 8 of A.P.VAT Act. In such a case, where
cashew nut kernel is exported directly from A.P. to outside
the country to a foreign buyer supported by proper
documentation, corresponding purchases of Cashew nut from
farmers will not attract the provisions of purchase tax.

3. In the case of purchase of cashew nut from farmers and the
corresponding cashew nut kernel being sent to branches
outside A.P., the purchase tax will have to be paid under sub
section (4) of Section 4 of A.P.VAT Act in the month in which
goods have been physically dispatched outside the state by
way of branch transfer or stock transfer or for sale outside
the state. In this case, the purchase value of cashew nuts has
to be worked out correctly and the corresponding purchase
tax needs to be paid in the month in which the resultant
goods i.e., cashew kernel are dispatched outside the state
M/s. Sun Food Corporation have purchased cashew nuts

valued at Rs.5 lakhs from farmers in the month of December 2005.
On processing the cashew nuts, the resultant cashew kernel valued
at Rs.7 lakhs was sent on branch transfer to other state in the same
month. There are no other purchases or sales in the month.
M/s. Sun Food Corporation need to indicate the above

turnovers in monthly VAT return for December 2005 as follows :


of goods Rs. 5,00,000 Rs.20,000
To
M/s. Sun Food Corporation,
12-5-27, Behind Municipal Ground,
New Colony, Anakapalli
Visakhapatnam District.

Copy to the Commercial Tax Officer, Anakapalli Circle, Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Vijayalaxmi Cashew Company, (TIN No.28510297741)
Kasibugga, Vizianagaram have filed a application dt.17.5.2005 and sought
1. We purchase Cashew nuts from farmers / Ryots in A.P. and process

the same into kernal. The kernal is exported to Foreign countries by
us. In support of our export we have foreign buyers order, Bill of
lading, letter of credit, invoice raised in the name of foreign buyer
etc. We request to clarify the tax liability or not on the above
purchase of cashew nuts and export of kernal to foreign countries.
2. We purchase cashew nuts from farmers/ Ryots in A.P. and process

the same into kernal. The kernal is sold in the interstate
transactions. PL clarify on the tax liability or not on the purchase of
cashew nuts and interstate of cashew kernal.
3. We purchase cashew nuts from farmers / Ryots in A.P. and process

the same into kernal. The krnal is sent to our branches in other
states. PL clarify the tax liability.
Sri K.Suryanarayana, Accountant, appeared for hearing on 18-5-

1. With reference to clarification sought is para 1, the purchase
of cashew nuts from farmers / Ryots in A.P. does not attract
the provision of purchase tax under sub section (4) of Section
4 of A.P.VAT Act at the time of purchase. If the cashew nut
purchased from farmers and Ryots in A.P. is processed into
Kernel and the kernel is exported to foreign countries directly
by a VAT dealer, the transaction is zero rated under the
provisions of Section 8 of A.P.VAT Act. In such a case, where
cashew nut kernel is exported directly from A.P. to outside
the country to a foreign buyer supported by proper
documentation, corresponding purchases of Cashew nut from
farmers will not attract the provisions of purchase tax.

3. In the case of purchase of cashew nut from farmers and the
corresponding cashew nut kernel being sent to branches
outside A.P., the purchase tax will have to be paid under sub
section (4) of Section 4 of A.P.VAT Act in the month in which
goods have been physically dispatched outside the state by
way of branch transfer or stock transfer or for sale outside
the state. In this case, the purchase value of cashew nuts has
to be worked out correctly and the corresponding purchase
tax needs to be paid in the month in which the resultant
goods i.e., cashew kernel are dispatched outside the state
M/s. Vijayalaxmi Cashew Company have purchased

cashew nuts valued at Rs.5 lakhs from farmers in the month of
December 2005. On processing the cashew nuts, the resultant
cashew kernel valued at Rs.7 lakhs was sent on branch transfer to
other state in the same month. There are no other purchases or
sales in the month.
M/s. Vijayalaxmi Cashew Company need to indicate the

above turnovers in monthly VAT return for December 2005 as
follows :


of goods Rs. 5,00,000 Rs.20,000
To
M/s. Vijayalaxmi Cashew Company,
Kasibugga,
Srikakulam District.

Copy to the Deputy Commissioner (CT), Vizianagaram Division.
Copy to the Commercial Tax Officer, Kasibugga Circle, Hyderabad.

PROCEEDING OF THE
Sri P. Satyanarayana Reddy, Joint Commissioner (Enft)

2005.
***
O R D E R:
M/s. Glassy Impex, Mehdipatnam (TIN No.28710141629),
The applicant stated that he is executing works contract for

installation of glass windows and glass elevations for the buildings and
he has opted for composition under the provisions of A.P.VAT Act, 2005.
He is seeking clarification regarding the tax implications in the context
of certain amendments made to the provisions relating to works
contracts by Act 23 of 2005 w.e.f. 29.8.2005.
The case was posted for hearing on 16-5-2006. Sri Rafat Iqbal,
Partner of the firm appeared and explained the case.
After examining the various issues raised by the applicant the
clarification is given as under.
1. If the applicant opted for composition and he buys goods
from outside the State, he will be required to pay tax at applicable
rate to such goods purchased from outside A.P. and after deducting
that value from the total value of the contract, he will be required
to pay 4% composition tax rate on the balance portion of the value
of the contract.
2. If he did not opt for composition for any specific work to be
executed by him, he will be eligible for input tax credit to the extent
of 90% of the tax paid on the purchases made by him from VAT
registered dealers in A.P. to the extent used in such works which
are outside composition. He will however be required to take into
account value addition on the materials used upto the stage of
incorporation for such goods used in the execution of works
contract.
3. Tax deduction at source at 4% is applicable for works in
composition as well as for transactions outside composition.
4. Regarding the specific question regarding the works
executed outside State of A.P. he will be required to pay tax under
the provisions of CST Act in case any goods are moved by him from
A.P. to outside A.P. and if transactions are covered by C-Forms in
such case, the tax rate shall be 4%. At the same time, if no goods
are moved from the State of A.P. for the purpose of execution of
works contract outside A.P., such transactions or turnovers will not
fall within the provisions of A.P.VAT Act, 2005.
JT.COMMISSIONER
To
M/s. Glassy Impex,
10-3-89/A & B, Near Sarojini Devi Eye Hospital,
Mehdipatnam,

Hyderabad.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Siddaiah Naidu, Tirupathi (CTR/02/02/52/71/GIR(TOT)
The applicant is seeking clarification on tax component of 4% in
works contract can be charged and passed on to the customers and
whether customer is required to make provisions of such tax in the arrears
for works contract. The applicant is also seeking a clarification regarding
applicability of G.O.Ms.No.11 Fin (P&W) Dept. dt.29.7.2005 on Tirumala
Tirupathi Devasthanams.
The case was posted for hearing 16-5-2006. Sri Siddaiah Naidu,
Contractor appeared and explained the case.
After examining the issue, it is clarified that ;
a) Any tax payable under the provisions of A.P.VAT Act can
be charged and passed on to the customers. However, the
provisions of A.P.VAT Act, 2005 do not impose any restrictions that
a customer should always build 4% tax component in the
estimations for the cost in respect of any works contract. Such
matters are purely between the parties involved in the contract.
Irrespective of whether tax provision is incorporated in the cost,
and whether tax is actually paid by the customer or not, the dealer
is liable to pay tax under the provisions of A.P.VAT Act, 2005.
b) As regards the applicability of G.O.Ms.No.11, issued by
Fin.(W&P) Dept. dt.29.7.2005, this Authority cannot decide whether
Tirumala Tirupathi Devasthanams is bound by administrative
instructions issued by State Government to the Authorities under
their control. No specific order is brought to the notice of this
Authority to decide that administrative instructions issued by the
State Government are binding on Tirumala Tirupathi Devasthanam.
JT.COMMISSIONER
To
M/s. Siddaih Naidu,
Tirupathi.

Hyderabad.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Sri Srinivasa Dairy Products (P) Limited, Esamia Bazaar (TIN
The applicant is seeking clarification on ;
i) Rate of tax on Skimmed milk powder
ii) Rate of tax on Pasteurized milk and milk mix.
The case was posted for hearing 16-5-2006. Sri Rathi, Authorized
Representative of the firm appeared and explained the case.
After examining the provisions of A.P.VAT Act and in
particular the Schedules appended to the Act, it is clarified that ;
i) Skimmed milk powder is taxable @ 4% under Entry 58 of
Schedule IV to the Act.
ii) Pasteurized milk is exempted as per Entry 16 of Schedule
I to the Act.
iii) Milk mix without addition of any other material will fall
under Entry 16 of Schedule I and if it is mixed with any
other material, it may fall under residuary category in
Schedule V to the Act.
JT.COMMISSIONER
To
M/s. Sri Srinivasa Dairy Products,

4-6-464 & 465, Esamia Bazaar,
Hyderabad.

Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Ashish Health Care, (TIN No.28160252971) Hyderabad
Rs.1000/-.
1. Glucometer
2. Prestige strips
3. Prestige lancets
4. Thermocheck
5. Cardiac marker
The applicant produced samples of the products on which

clarification is sought.
Sri Thomas Gilgl.h, Authorised Signatory of the firm has appeared

1 of page 3
is given as under.
1. Glucometer: On examination of the product it is held that though

the instrument is meant to measure Sugar levels of human beings
apparently it is operating on principle of electronics and in the G.O.
cited above, the item has not been notified. Therefore it is held as
2. Prestige strips: On examination of the sample produced for
classification it is found to be used for diagnostic purpose falling
under Entry 88 of Schedule IV of A.P.VAT Act, 2005 notified in the
above mentioned G.Os as falling under HSN code 3822. Therefore
this item is held as liable to tax @ 4%.
3. Prestige Lancets: On examination of the sample produced, they
are used for pricking for taking samples of blood for further tests.
Since they are not covered by any of the entries in the schedules
they are treated as goods liable to tax at standard rate in Schedule
V of the A.P.VAT Act, 2005. Hence liable to tax @ 12.5%.
2 of page 3
4. Thermocheck : This is an instrument to check body temperature.

As the entries in Schedules do not contain this item, it is held as
liable to tax @ 12.5% in terms of the language in Schedule V of
A.P.VAT Act, 2005.
5. Cardiac marker: On examination of the sample produced by the
applicant and having heard the applicant explain the functions and
as the product contains reagents, it is held as falling under entry 88
“Drugs and Medicines” of Schedule IV of A.P.VAT Act, 2005 and
falling under HSN code 3822 notified in the above said G.O.
Therefore this item is liable to tax @ 4%.

To
M/s. Ashish Health Care,

D.No.4-3-143, Ground Floor,
BPR Towers, Attapur,
Copy to the Commercial Tax Officer, Rajendranagar Circle, Hyderabad.
3 of page 3
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Jurong Infrastructure (India) Private Limited (TIN
The applicant is seeking clarification on the provisions relating to
works contracts executed for Visakhapatnam Urban Development Authority,
a local authority and sub contracts in respect thereof.
Sri K.Sanjeev Rao, Chartered Accountant appeared on 16.06.2005
for personal hearing and explained about the nature of transactions.
On examination of the facts of the case and the provisions of the Act
& Rules relating to works contracts there under, the ruling is given that ;
i) If the applicant is executing works contracts for local
authority and opts to pay tax by way of composition @ 4%
all the sub contracts in respect of such works done by
other dealers shall be exempt as prescribed under Rule
17(2)(j). If the sub contractor is further awarding any
portion of the work to another dealer, it is also eligible for
the exemption. While it is immaterial whether sub
contract is first level or second level or third level, it is
essential to prove that such sub contract is part of the
work being done for local authority and the entire work is
already under composition.
ii) As regards tax deduction or collection at source, it is to be

done only at one source by the local authority against the
main contractor and there is no obligation to deduct tax at
source for the sub contracts.
iii) The exemption available for such sub contracts is

irrespective of the sub contractor being a VAT dealer or a
TOT dealer.
To
M/s. Jurong Infrastructure (India) Private Limited,

668, Road No.33,
Jubillee Hills, Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Lotus Chocolate Company Limited, (TIN
1. Cocoa beans
A note on the description of Cocoa pod and Botanical literature.
Sri G.S.Ram, General Manager of the firm has appeared for hearing
1 of page 2
is given as under.
Entry 18 of Schedule IV reads “Coffee beans and seeds,

Cocoa pod, green tea leaf and chicory”.
The applicant claims that Cocoa pod is not a merchandible
commodity. The Cocoa beans are sold by farmers after they are
extracted from the Pod. The beans are said to be covered with the
pulp which induces fermentation and once the fermentation is over
the beans are allowed to dry naturally or artificially. The applicant
claims to purchase only beans and not pod.
In the circumstances explained, it is held that Cocoa beans

fall within the scope of the entry 18 and liable to tax @ 4%.

To
M/s. Lotus Chocolate Company Limited,

H.No.8-3-966/13, Nagarjuna Nagar,
Srinagar Colony, Hyderabad – 500 073.

2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Power Tech Services (TIN No.28830116890) Hyderabad
Rs.1000/-.
The applicant is seeking clarification regarding the rates of tax on
the following items :
1. Electric Investors
2. Servo Stabilizers
3. Battery chargers
4. Electronic constant voltage transformer
Sri M.Shiv Shankar Reddy, Accountant appeared on 16.06.2005 for

personal hearing and explained about the items manufactured and sold by
them.
is given as under.
It is found that HSN code 8504 is fully notified which covers
all the items specified by the applicant. The ruling therefore is given
that the tax rate shall be 4% on the four items specified by the
applicant.
To
M/s. Power Tech Services,

Plot No.14, Pragathi Industrial Area,
Bhavani Nagar, Kapra,
ECIL Post, Hyderabad – 62.
Copy to the Commercial Tax Officer, Keesara Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sri Venkateswara Coir Products (P) Limited, (TIN

Whether coir products excluding Coir mattresses such as Rubberized
coir bare blocks / Sheets / Cushions / Bolster / Pillows attract tax @ 4%
as per Sl.No.21 of Schedule IV.

Copy of tax invoice issued by the application containing description
of standard mattresses, coir mattresses and bare block.
Sri N.K.Malani, Managing Director of the firm has appeared for

1 of page 2
is given as under.
Entry 21 of Schedule IV of A.P.VAT Actr, 2005 reads “Coir and
Coir products excluding Coir mattresses”. As seen from the
documentary evidence submitted by the applicant Standard
mattresses as well as Bare blocks are sold by the applicant. As the
entry excludes coir mattresses they are held as liable to tax @
12.5%.
As regards coir products where such products are rubberized

and sold in the form of bare blocks / sheets / cushions / bolsters /
pillows they should be held as falling outside the scope of the entry
as they are impregnated with materials other than coir and cease to
be coir products. Therefore coir products made purely of coir alone
would qualify under Entry 21 and accordingly they alone will be
liable to tax @ 4%. All the goods referred by dealers are liable to
tax @ 12.5%.

To
M/s. Sri Venkateswara Coir Products (P) Limited,

204, Amarchand Sharma Complex,
S.D.Road, Secunderabad – 500 003.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Vishwajit Castings & Engineering Works (TIN
1) Fabricating Bus bodies for APSRTC. Whether the transaction is a

works contract as defined under sub section (45) of Section 2 of
APVAT Act, 2005 and whether composition can be opted @ 2%.
2) Fabrication of Bus bodies for various individuals and institutions

amounts to works contracts and composition @ 2% can be opted.
Sri A.Purender Reddy, Managing Partner of the firm has appeared

for hearing on 16-6-2005 and explained about the nature of business
activities conducted by them and sought a clarification regarding tax
implications under APVAT Act, 2005.
1 of page 3
‘Works contract’ is defined under sub section (45) of Section

2 of APVAT Act, 2005. Among several activities specified therein,
fabrication, erection, fitting out, improvement and modification of
movable or immovable property are also included. The applicant is
fabricating, building and fitting out bus body on the chassis owned
by the customer. This clearly constitutes a ‘works contract’ because
the work is done according to specification and requirement on the
movable property owned by the customers.
Under the provisions of sub section (7)(c) of Section 4
of APVAT Act, 2005 any dealer executing works contract for any
customer other than for Government or local authority can opt to
pay tax by way of composition at the rate of 4% on 50% of the total
consideration received or receivable. Therefore, the applicant is
eligible for composition in respect of works done for APSRTC and
other individuals or institutions.
The applicant is not eligible for input tax credit as
stipulated under sub section (5)(a) of Section 13 of the Act. He
should report all purchases inside or outside the State in Box 6A of
VAT return Form 200. As regards the sale consideration received or
receivable, he should put 50% in Box 12A and the remaining 50%
in Box 16A. The tax @ 4% on 50% of the sale consideration should
be reported in Box 16B. Under sub section (4) of Section 22 of the
Act, the tax @ 2% of the payment made to him must be deducted by
APSRTC or any institution and it shall be remitted to Government
account and a certificate be issued in Form 501A as prescribed in
Rule 17(3) of the Rules.
The applicant can opt for composition by applying in Form
VAT 250 either for all contracts or for specific contracts.

To
M/s. Viswajit Castings & Engineering Works,
Plot No.P/8/8, Nacharam,
Industrial Area,
Copy to the Commercial Tax Officer, Nacharam Circle.
3 of page 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. The Park Hotels, Visakhapatnam (TIN No.28060147988)
Rs.1000/-.

3. Whether the applicant can opt for composition scheme under
Section 4(9) of the A.P.VAT Act, 2005.
4. If eligible for composition whether sale of Liquor is exempt from
tax or liable to tax on 60% of sales of Liquor.


Liquor). As regards, Liquor, the turnover representing sale of liquor

To
M/s. The Park Hotels,
Beach Road,
Visakhaptnam.

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. L.G.Electronics INDIA (P) Ltd.,Uppal, Hyderabad

Discounts allowed through credit notes to customers.
1. A note on procedure of credit note.
2. Copies of VAT tax invoice and credit notes.
Sri Ravindranath, Advocate and Devarish Mukherjee appeared for

The applicant company, LG. Electronics India (P) Ltd.,
(LGEIL) is engaged in the business of electrical and electronics
consumer durable goods in the state of A.P. and other states. LGEIL
has two manufacturing places in India—one at NOIDA (U.P.) and
the other at PUNE (MH). They also import certain goods from its
parent company, LG Intl. Korea. LGEIL has three distribution
warehouses in India and out of which one is in the state of A.P.
LGEIL AP branch (s) receive goods from warehouses or from works
by way of stock transfer and sell the goods as first sale in the state
of A.P. LGEIL issue credit notes for the trade discounts allowed
other than the discounts already allowed in sale invoices. They also
issue credit notes for the monthly, quarterly, yearly discounts as
per the terms of contract with the dealers.
1. LGEIL while issuing credit notes for the discount excluding

tax component and issuing a certificate to the effect that VAT tax
has been paid on the pre-discounted sale value. Based on the
certificate, the dealers are claiming full ITC on the value of sale
price on which VAT tax has been paid by the LGEIL. On the other
hand they stated that dealers are demanding inclusion of “VAT
component” in the ‘discounts’ issued to them through credit notes.
According to the definition in Sub-Sec.38 of Sec.2 taxable turnover
means the aggregate of sale prices of all taxable goods and
explanation I to the said sub-section stipulates, “for the purpose of
a VAT dealer, it shall not include the amount of VAT paid or
payable”.
Sec.13(1) stipulates that, an input tax credit shall be allowed to

the VAT dealer for the tax charged in respect of all purchases of
taxable goods, made by that dealer during the tax period, if such
goods are for use in the business of the VAT dealer.
Rule 16 (2)(a) refers to the purpose of determining taxable turnover and
Rule 28 (3)(8) refers to the credit notes and debit notes in respect of any
annual discounts (other than the discounts in the bills or monthly discounts)
and any price adjustments, shall be issued as and when the accounts are
settled between the seller and buyer provided the settlement is made
within the twelve months from the end of the year and supported by proper
documentary evidence. All such credit notes and debit notes shall contain
the particulars enumerated in sub rule (4) and (5) of Rule 16, respectively.
Therefore, when the accounts are settled between the seller and
buyer within the stipulated period, dealers (buyers) of the applicant
(seller) on receiving the credit note from the sellers (LGEIL) for
discounts reduce the input tax VAT credit equivalent to the amount
of output tax on the credit note. In other words this results in
reduction of output tax in the hands of sellers issuing credit notes
and reduction of input tax in the hands of buying dealer and it
should be done in the return for the tax period in which such credit
notes are issued and received.

ruling.
To
M/s. _L.G.Electronics India (P) Ltd.,
Uppal, Hyderabad.

Copy to the Asst. Commissioner(CT), LTU, Abids Division.

PROCEEDINGS OF THE
*****
O R D E R:
M/s. BECO LIFTS (P) LTD., HYDERABAD (TIN.28670196985) have

Rs.1,000/-.

Whether the supply, erection and installation of lifts, comes under the
works contract or supply contract and the rate of tax applicable.
Sri S.Linga Rao, Managing Director appeared for hearing on 12-7-

under:
They are dealers in supply, erection and installation of lifts. Whether a

particular transaction falls under contract of sale or contract of works,
depends on the question of facts and the terms of contract.
The Supreme Court in the case of State of A.P. Vs. Kone Elevators
(I) Limited, Secunderabad (140 STC, 22, SC,2005), held that supply
of lifts would not amount to works contract but sale of goods liable
to tax as per the Schedules under the APGST Act.
Under the APVAT Act also, there is no specific entry, enumerated

either in Ist or IVth Schedule relating to lifts or elevators, and
therefore by default, such goods fall under Vth Schedule liable to
VAT @ 12.5%.
However, if any repairs / service contract is undertaken by the

dealers, it amounts to works contract, liable to tax as per the
provisions of Sec.4 (7) (a) to (e) of the APVAT Act.

ruling.
To
M/s. BECO LIFTS (P) LIMITED,
HYDERABAD.
Copy to the Deputy Commissioner(CT) Panjagutta Division.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Kayvee Enterprises, Hyderabad (TIN.28970141976) have filed
66(2)(i) of APVAT Rules, 2005 along with the application fee of Rs.1,000/-.

Whether the following Departments are Government Departments :
1. A.P.State Police Housing Corporation
2. A.P.Health, Medical Housing Corporation (APHMHIDC)
3. J.N.T.University
4. Osmania University
5. A.P.State Irrigation Development Corporation
6. A.P. Tribal Welfare Corporation
7. A.P.State Coop. Bank.
Sri Chandra Sekhara Reddy, Managing Partner appeared for hearing on 5-

The applicant is a works contractor and seeks clarification whether
the above-mentioned Government Corporations and Universities are
Government departments.
It is by virtue of the sovereign’s prerogative exercised by a charter
or of an Act of Parliament or of prescription, that the artificial
personage called a ‘corporation’ is created. The
Parliament/Legislature gives it a legal immortality and a name by
which it acts and becomes known. The sub section [2(18)] does not
encompass corporations, though they are created by Legislature in
exercise of sovereign power. Clarifications were issued in the past
(under APGST) that Govt. Corporations, Local bodies, Universities
are not Government. Hence all corporations solely owned by the AP
State Government cannot be considered as Government
Departments as per the definition provided under sub-sec.18 of
Section 2 of the APVAT Act, 2005.
Universities referred at Sl.Nos. 3 & 4 are autonomous bodies

and they are not considered as Government Department. So is, the
A.P.State Coop. Bank Ltd., which is a limited company registered
under the Companies Act.
ruling.
To
M/s. KAYVEE ENTERPRISES, HYDERABAD
Copy to the Deputy Commissioner(CT) Charminar Division.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Kozylon Industries Limited, (TIN No.28940190962) have filed

Rate of tax on Rubberised Coir Bare Sheets.

1. Copy of delivery challan-cum-tax invoice issued by the applicant.
2. Copy of invoice issued by another trader.
Sri M.Satyanarayana, Managing Director appeared on behalf of the
is given as under.
Entry 21 of Schedule IV of A.P.VAT Act, 2005 reads
“Coir and Coir products excluding Coir Mattresses”. As seen from
the documentary evidence submitted, the applicant charged 4%
VAT describing the product as Coir product and Bare sheets,
whereas invoice issued by another trader shows tax has been
charged at 12.5%.
During the course of hearing, the applicant also stated
that invariably or all Coir products are impregnated with Rubber
though the percentage of such material is insignificant. In the
circumstances he urged that Coir sheet need not be excluded from
the ambit of Coir and Coir products.
We have considered the documentary evidence and
also the contention of the applicant. Coir products when rubberized
and sold in the form of Bare blocks / Sheets / Cushions/ Bolsters /
Pillows do not answer the description of Coir and Coir products.
They cease to be Coir products once they are impregnated with
foreign materials such as latex etc. In other words Coir products
made purely out of Coir alone would qualify under Entry 21 and
accordingly they alone will be liable to tax as per Entry 21 of
Schedule IV of A.P.VAT Act, 2005. Therefore, the item on which the
applicant sought clarification not being a pure Coir product it does
not fall within the ambit of Entry 21 and therefore liable to tax at
12.5% in terms of the language under Schedule V of the A.P.VAT
Act, 2005.
To
M/s. Kozylon Industries Limited,

83/A, Ist Floor, MIGH,
Vengal Rao Nagar,
Copy to the Commercial Tax Officer, Vengal Rao Nagar Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Apex Tapes Private Limited, Hyderabad (TIN No.28210143909)

The rate of tax applicable to Poly propylene tapes / webbings called

narrow woven fabrics

i) Copies of sale invoice issued by certain dealers located outside
A.P.
ii) Copy of the notification No.31 & 32/2004 Central Excise
dt.9.7.2004.
iii) Copies of sale invoice issued by the applicant.
4. Sri G.Rajeswara Rao, Director appeared on behalf of the firm for

6. The applicant claims that he is a dealer in buying and selling
of Poly propylene tapes known in the commercial world as ‘narrow
woven fabrics’. Documentary evidence furnished shows that the
applicant buys this item from certain dealers situated outside A.P.
Recitals on the documents show that the product is exempted under
additional duties of excise goods of special importance. Entry 45 of
Ist Schedule of A.P.VAT Act, 2005 refers to “Cotton fabrics,
manmade fabrics, and woven fabrics”. Explanation provided under
Entry 45 states that the goods mentioned in the said entry are
those goods which are included in the relevant heads and sub heads
of the Ist Schedule to the Additional Duties of Excise (Goods of
special importance) Act, 1957, but does not include goods where no
additional duties of excise are levied under that schedule. As seen
from the notifications issued under the Central Excise Act and
furnished by the applicant, items in chapter 50 to 58 of HSN codes
refer to various types of textile and textile articles. As the
description of the product sold by the applicant is in conformity
with the entry in the schedules to the A.P.VAT Act, read with the
description of items in the central excise HSN chapters, we hold
that “narrow woven fabric” sold by the applicant is exempted from
tax under AP.VAT Act, 2005.
To
M/s. Apex Tapes Private Limited,
Plot No.F-23/A, Phase-1, IDA Jeedimetla
Hyderabad – 55.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Baba & Co., Hyderabad (TIN No.28610139272) have filed an

The rate of tax applicable to Unserviceable store scrap

i) Copy of delivery order
ii) List of scrap items
iii) Copies of invoice issued by the applicant
iv) Copy of assessment order under the APGST Act.
4. Sri Syed Hasham, Accountant appeared on behalf of the firm for

6. The applicant claims that he purchases Unserviceable scrap
from certain agencies like M/s. BSNL & others and sells it. He seeks
to know the rate of tax applicable to such scrap.
We have heard the representative and examined the
documentary evidence submitted. As seen from the APGST
assessment order, the applicant is engaged in the business of
buying and selling scrap from agencies like M/s. BSNL. Copies of
sale invoice issued by the applicant also show that he is merely
reselling the unserviceable telecom tube scrap, telecom tube iron
wire etc., and on certain invoices he charged VAT @ 4%. We have
also perused the scheduled entries and the HSN codes notified in
G.O.1615 dt.31.8.2005 notifying the applicable HSN codes to the
entries in the Schedules. Entry 67 of Schedule IV of the A.P.VAT Act,
2005 reads “Ferrous and non-ferrous metals and alloys and
extrusions thereof”. In the G.O. cited above various sub items
falling under the said entry have been notified with HSN
codes.Various sub entries on waste and scrap are notified under
Entry 27 in the said G.O. For instance copper waste and scrap
attracting HSN code 8002, Alumunium scrap, 7602 have been
notified. Thus it appears that scrap of ferrous and non ferrous
metals and alloys are covered under Entry 27 of Schedule IV of the
Act and in the circumstances the applicant being engaged in sale of
unserviceable scrap shall be liable to tax on the sale of such scrap
@ 4%.
To
M/s. Baba & Co, 19-5-16/2/13/A,
Kishan Bagh,
Bhadurpura, Hyderabad

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. CHARISMA PRINTERS (P) LIMITED HYDERABAD (TIN

of Rs.1,000/-

VAT applicability on the job works done without material supplied in
the printing contracts and also on the works contract done with material.
1) Copies of work orders of the customers and invoices issued by

the applicant.
IV. Sri L. Srinivasulu Reddy, Managing Director, appeared for hearing and
explained the case.
G.O.Ms.No: 1615, Revenue (CT.II) Department Dated 31-08-2005 and the
VI. The applicant represents that he is undertaking printing works
of two types.
(1) Customers supply materials such as paper and ink and ask
them to print certain brochures, leaflets, papers, annual
reports etc.,
(2) Customers simply give quotations for supply of printed multi
coloured brochures or leaf sizes with specific paper.
For both the works, the applicant seeks to know the VAT
applicability under the APVAT Act.
After due verification of the material evidence produced
before this authority advance ruling is given as follows :
(1) If the applicant executes works on the materials supplied by the
contractee with due deligency of maintaining proper accounts/records,
works executed by the printer amounts to works contract and liable to tax
as per the charging section 4(7) of the APVAT Act and if the applicant opts
for composition, he is liable to tax under section 4(7) © of the APVAT Act.
(2) In the second case, the applicant is liable to pay tax on
sale / supply of ‘printed material’ as chattel u/e 47 of the IVth Schedule
taxable @ 4%.

ruling.
To
M/s. Charisma Printers Private Limited, Lakdikapul, Hyderabad.
PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Dynamic Medical & Surgical Private Limited, Hyderabad (TIN

of Rs.1000/-.

i) I.V.Sets (Intravenous infusion sets)
ii) Blood transfusion Set
iii) Pediatric dry set
iv) Infant feeding tube
v) Urine collection bags
vi) Ryles tube (Nasal feeding tube)

Copies of purchase and sale invoices.
4. Sri Gulam Mohammed, Managing Director appeared on behalf of the

6. The applicant claims to be a manufacturer of Surgical
disposables and seeks to know the rate of tax applicable to the
items mentioned above. Besides being a manufacturer himself, the
applicant also appears to purchase certain items from dealers
situtated outside the state of A.P.
documentary evidence. We have perused the entries in the
schedules and find that entry 88 refers to drugs and medicines and
Hypodermics syringes, needles and similar articles. An amendment
to the entry was carried out by G.O.1564 dt.18.8.2005 which reads
as “Drugs and medicines whether patent or proprietory, as defined
in clauses (i), (ii) and (iii) of Section 3(b) of Drugs and Cosmetics
Act, 1940 including hypodermic syringes, hypodermic needles,
catguts, sutures, surgical cotton, dressings, plasters, catheters,
cannulae, bandages and similar articles”. The items in question
appear to be in conformity with the items such as those mentioned
in the entry. The words “similar articles” used in the entry also
widens the scope of the items falling under the said entry. The I.V.
sets, Blood transfusion sets etc., are similar to the ones specified in
the entry of Schedule IV of the AP.VAT Act, 2005. Therefore we hold
that the items on which the applicant sought ruling fall under entyr
88 of said schedule and therefore liable to tax @ 4%.
To
M/s. Dynamic Medical & Surgical Private Limited,

208, B Block, Shahjahan Apartments,
Khairatabad, Hyderabad – 500 004.

Hyderabad.
Copy to the Commercial Tax Officer, Basheer Bagh Circle.
PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Lanco Kondapalli Power Private Limited, Hyderabad (TIN

of Rs.1000/-.
Whether service tax levied on transportation charges forms part of

sale price for the purpose of levy of VAT

i) Notes on the issue on which the applicant sought clarification.
ii) Copy of Supreme Court decision in Anand Swarup Mahesh Kumar
Vs. Commissioner of Sales Tax.
4. Sri A.Mohan Rao, Senior Manager(F&A) appeared on behalf of the

6. The applicant claims to be engaged in the business of power
generation whose primary fuel is natural gas. M/s. Gas Authority of
India (GAIL) a Government Company is stated to be supplying
natural gas to the applicant under an agreement and that GAIL
would raise a monthly gas supply bill consisting the cost of gas and
the transportation charges. As per Finance Act, 2005 which came
into effect from 15.6.2005, it is stated by the applicant that the
scope of service tax has been expanded to include transportation of
goods through a pipeline or other conduit. In the circumstances, the
applicant states that GAIL has raised invoice levying VAT @ 12.5%
on cost of Goods, Transportation charges and service tax levied on
transports under the Service Tax Act. The applicant is however
contesting the inclusion of service tax on transportation charges
and relies on the ratio of the decision of Supreme Court in Anand
Swarup Mahesh Kumar Vs. The Commissioner of Sales Tax (46 STC
477). In the said decision the Supreme Court had observed that
such tax would not form part of sale price.
contentions. The applicant is recepient of gas supplied by GAIL. He
is required to pay the cost of gas as per the supply bills raised by
the GAIL. Further the applicant raises a doubt whether service tax
forms the tax paid for collecting VAT. We find that the question can
appropriately be raised by the supplier of gas as the statutory
liability to charge and perhaps recover tax under the service tax
provisions raised with the supplier and not the recepient of gas.
Therefore, we find that the applicant as no locus standi in the
matter. Accordingly the applicant is disposed off.
To
M/s. Lanco Kondapalli Power Private Limited,

Lance House, 141, Avenue, 8 Banjara Hills,

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Texmo Industries, Rasoolpura,

ecunderabad(TIN.28070118047)have filed an application and sought

1) Whether the words “upto a capacity of 10 HP” applies to all products
under item No.17 notified in the G.O.Ms.No.1564 Rev.(CT.II) Department
dt.17-8-2005 or qualifies only for electric motors and oil engines including
starters and parts and accessories of –
2) What is the rate of tax on (a) three core flat cable wire used for
submersible pumps ets for agriculture purpose ? (b) panel boards used for
agricultural submersible pump sets.
3) What is the rate of tax on bearings for monoblocks

A copy of the G.O.ms.No.1564 Rev.(CT.II) Department dt.17-8-2005
IV. Sri S.Subba Rao, Accountant, appeared for hearing and explained the
case.
VI. 1) The phrase employed in the entry is applicable only to
‘electric motors’ and ‘oil engines’ but not to other items. Therefore,
centrifugal monoblocs, and submersible pump sets irrespective of
capacity including their starters, parts and accessories are liable to
tax @ 4%. Electric motors and oil engines up to a capacity of 10 HP
are also liable to tax @ 4%. Electric motors and oil engines having
capacity of more than 10 HP are liable to tax @ 12.5%.
2) a) Rate of tax on 3 core flat cable wire used for
submersible pump sets irrespective of its end use is liable to tax @
12.5%
b) Panel boards used for agricultural submersible pump sets also
attract tax @ 12.5%
3) Bearings of all kinds attract tax @ 4% under entry 10 of
the IVth Schedule.

ruling.
To
M/s Texmo Industries,
Plot No. 2 & 3, Chanda Nagar Colony, Rasulpura,
Secunderabad.
Copy to the Asst.Commissioner (CT)LTU, Vijayawada-II Divn.

PROCEEDINGS OF THE
*****
CCT’s Ref.No:A.R.Com/115 /2006. Dated :18–11-2006.
O R D E R:
I. Uday Enterprises, Hyderabad (TIN 28930152324) have filed an


Rate of tax on Water Treatment Chemicals: HSN Code 3824.90
1) Copies of purchase invoices.
2) Copies of sale invoices.
IV. Mr. T.S.V.Diwakar, advocate,( Authorized Representative,) appeared
G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005 G.O.Ms.No.502,
Rev. (CT-II) Dept., dt.1-5-2006 w.e.f. 1-5-2006 and G.O.Ms.No.656, Rev.
(CT-II) Dept., dated 2-6-2006 w.e.f. 1-6-2006 and the ruling is given as
under:
VI. The dealer is dealing in manufacturing and sale of Water

Treatment Chemicals which fall under Tariff heading 3824.90.22.
Vide G.O.Ms.No.502, Revenue (CT-II) Department, dated 1-5-2006
w.e.f. 1-5-2006 sub-entry 148 with HSN Code 3824.90 for the items
“Retarders used in d Printing industry was issued under item 100
“industrial inputs” in IV Schedule to APVAT Act, 2005. Since the
HSN Code 3824.90 covers the items with all eight digit codes under
it the tariff heading 3824.90.22 dealing with “Water Chemicals” is
also covered under this sub- item (148 of item 100 of IV Schedule).
Hence, it is clarified that the water treatment chemicals with tariff
heading 3824.90.22 are covered under HSN 3824.90 and are liable
to tax @ 4% only w.e.f.
1-5-2006.
Sd/- Sd/- Sd/-

Addl /Jt /Commissioner
ruling.
To
M/s. Uday Enterprises,
Mehdipatnam,
Hyderabad.


PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Acer Engineers Private Ltd., (TIN No.28800291006),

Chintalapalli Village, Sangareddy Mandal, Medak District have filed an
Whether packaged drinking water sold in returnable plastic

containers –exempted under Entry 36 of Ist Schedule to APVAT Act,2005.
The case was posted for hearing on 13-07-2005. Sri K. Yatish

Kumar, Executive Director appeared on behalf of the firm and explained the
case.
1 of 3
According to the applicant, he is a manufacturer of packaged

drinking water sold under the brand name of “BIBO”. He explained that
packaged drinking water is sold in two ways. In the first category, packaged
drinking water is packed in 1 Ltr. and 2 Ltrs. bottles and sold with MRP of
Rs.10/- and Rs.18 and bottles are not returnable and generally the
customers destroy the containers after consuming the water. In the second
category, the applicant claims that he is selling packaged drinking water in
bulk containers containing 20 Ltrs. and in this category deposits are
collected from customers for the cost of the container, whereas the value of
the packaged drinking water is separately shown in the invoice. The
applicant claimed that the deposit would be returned to customers after the
receipt of empty plastic containers.
On the basis of the above facts, the applicant argues that the Entry
36 of Schedule-I to the APVAT Act,2005 clearly provides for exemption from
tax on water other than sold in sealed containers. He argues that the
nature of transaction in the second category where container is not sold but
only deposit is collected, clearly falls within the scope of Entry 36 of
Schedule-I to the Act. He also made an attempt to compare the
transactions with that of sale of LPG where gas is sold by packing in a
cylinder and cylinder as such is not sold to the customers.
After examining all the facts, it is very clear that the customer is
buying packaged drinking water sold in sealed container and he is not
interested in buying water in a loose condition without appropriate safety
measures for the purity of the water. There is no choice either for the seller
or to the buyer to open the container and deliver or receive water in a loose
form. It is altogether a different matter that the cost of the container is
kept as a deposit as a matter of convenience but there is no guarantee that
all the containers would be returned by the customers at any given point of
time. Even if they are returned at a later date to some extent or in some
cases, it is a fresh transaction between the customer and the applicant to
the extent that the containers are purchased by the applicant from the
customers at the agreed price initially fixed provided the container is in
appropriate condition. There could be some situations where containers
would be damaged or lost or destroyed in the hands of the customers to
that extent the customer cannot take money back from the applicant.
The regulations regarding the manufacture and sale of packaged

drinking water also stipulate that the purified water is sold only in sealed
containers and it is subject to several quality checks and standards by the
Regulatory Department. A reading of Section 6 of the A.P. Value Added Tax
Act,2005 would also indicate that whenever any goods are sold with
container, the consideration received for container shall be taxed against
the contents and there cannot be separate treatment for the two items.
2 of 3
In view of the facts mentioned above, the ruling is that the

consideration received for the sale of packaged drinking water
including the cost of the container collected initially shall be liable
to tax @ 12.5% because the item is not covered under Entry 36 of
Schedule-I as well as in Schedule-III and IV to the Act.
JT.COMMISSIONER
To
M/s. Acer Engineers Private Ltd.,
Chintalapalli Village, Sangareddy Mandal,
Medak District.

Hyderabad.
Copy to the Commercial Tax Officer, Sangareddy Circle.
3 of 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Hitech Insulators, Hyderabad (TIN No.28750142145)
Rs.1000/-.

1) Whether the applicant is eligible for input tax claim on diesel
purchased by him and used in Kiln for manufacturing insulators.
2) Rate of tax on Minerals like Quartz, Feldspar, Ball clay, China
clay, Ceramic or Porcelain insulators.
1) Copies of tax invoices showing sales of Quartz powder, Feldspar
powder, Ball clay, Insulator porcelain.
2) Copy of challans-cum-invoice issued under Central Excise Rules
by M/s. Birla NGK Insulators Pvt. Ltd. Porcelain
Sri Nirmal Kumar Jain, Advocate appeared on behalf of the firm for
is given as under.
The applicant claims to sell Insulators that are used by the
Electricity Department and contends that they are covered under
Chapter 85 of the Central Excise Tariff and further claims that the
item is liable to tax @ 4% VAT under Entry 39 of Schedule IV of the
Act. In support of the claim of the said rate of tax, the applicant
also relies on the rates of tax applicable in West Bengal, Karnataka
and Maharastra where the item is claimed to be liable to tax @ 4%.
The sale invoices issued by some dealers showing sales of
Insulators however do not contain the VAT charged by such sellers.
As such the documentary evidence is of little help. The challan-cum-
invoice issued by the West Bengal dealer that contains the VAT rate
indicates the excise tariff code 8546. The applicant contends that as
Insulators are covered under Chapter 85 of the Central Excise Tariff
code, it attracts tax @ 4%. We have browsed the chapter but are
unable to agree with the plea taken by the applicant as we find that
‘Insulating fittings’ are falling under tariff code 8547 but they are
not notified by State Government for any of the entries in Schedule
IV to the A.P.VAT Act, 2005. In the circumstances we hold that
Insulators are liable to tax @ 12.5% in terms of the language in
Schedule V of the A.P.VAT Act, 2005.
As regards the rate of tax applicable to Quartz powder,
Feldspar powder, Ball clay, certain HSN codes have been notified in
the G.Os cited above which are relevant for Ores & Minerals of Entry
43 of Schedule IV of the Act. As the items fall under the notified
HSN codes under Entry 43 of Schedule IV of the Act, we hold that
these items are liable to tax @ 4%.
As regards applicant’s eligibility for claiming input tax credit
on Diesel, Section 13(1) clearly prohibits input tax credit in respect
of purchase of goods specified in Schedules VI. In Schedule VI,
among other things, Diesel Oil is also mentioned. Therefore, read
together it can be understood that the applicant is not eligible for
claiming input tax credit on purchase of Diesel Oil.
To
M/s. Hitech Insulators,
K.S.Lane, Sultan Bazaar,
Hyderabad.


PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Mohan Marketing Associates (TIN No.28520214547), S.D.

Road, Secunderabad have filed an application dt. -2005 and sought
1. The rate of tax on Oscilloscope/Scope meter, Multi meter.

2. Electronic PQ Analysers, Electronic Ohm meters, Electronic clamp
meters, Electronic infrared thermometers, Eletronic calibrators etc.
The case was posted for hearing on 20-07-2005. Sri Praveen Gupta,
Proprietor of the firm appeared on behalf of the firm and explained the
case.
The applicant has produced the catalogues for various electronic

items dealt by him and mentioned that only few items under electronic
testing and measuring instruments are mentioned for sub-item 29 in entry
39 of Schedule-IV to the Act. He has also enclosed a copy of the G.O.
issued under APGST Act where certain items of electronics were notified
under 4% tax and testing and measuring instruments covered under HSN
Code 9030 was one of the items notified. The applicant argued that all
these items are industrial capital goods and therefore, they should have
been notified under 4% category.
1 of 3
The items notified under IT products for the entry 39 of Schedule-IV

to the Act was examined with reference to the relevant HSN Code “9030”
notified by Government for sub-item 29 dealing with “cathode ray
oscilloscopes, spectrum analysers, cross-talk meters, grain measuring
instruments, distortion factor meters, psophometers, network & logic
analyzer and signal analyzer”. The perusal of the items covered under
Excise Tariff Code 9030 indicates that the following items are covered under
Tariff Code 9030.
____________________________________________________________
________
9030 Oscilloscopes, spectrum analysers and
other
instruments and apparatus for measuring
or
checking electrical quantities, excluding
meters
of heading 9028; instruments and
apparatus for
measuring or detecting alpha, beta,
gamma,
X-ray, cosmic or other ionizing radiations
9030 10 00 Instruments and apparatus for measuring or

detecting
iconising radiations
9030 20 00 Cathode-ray oscilloscopes and cathode-ray
oscillographs
Other instruments and apparatus, for
measuring or
Checking voltage, current, resistance or power,
without
a recording device:
9030 31 00 Multimeters
9030 39 Other:
9030 39 10 Ammeters, volt meters and watt meters
9030 39 20 Spectrum resistance meters
9030 39 30 Capacitance meter
9030 39 40 Frequency measuring apparatus
9030 39 50 1[Megar meters]
9030 39 90 Other
9030 40 00 Other instruments and apparatus, specially
designed for
telecommunications (for example, cross-talk
meters, gain
measuring instruments, distortion factor
meters, pso-
phometers)
- Other instruments and apparatus:
9030 82 00 For measuring or checking semiconductor
wafers or
devices
9030 83 00 Other, with a recording device
9030 89 Other:
9030 89 10 Scintillator counters
9030 89 20 Vectroscope
2 of 3
9030 89 90 Other
9030 90 Parts and accessories:
9030 90 10 Of meters and counters
9030 90 90 Other
____________________________________________________________
________
In view of the above, the ruling is given that in so far as any items
dealt by the applicant clearly are covered under the above HSN
Codes or any other HSN Codes for the Entry 39 of Schedule-IV, the
tax leviable under the Act shall be 4% and the items not covered
there under shall be liable to tax at 12.5%. This ruling shall be
subject to any changes in the HSN Codes notified by the
Government from time to time and in case the codes are de-
notified, the applicability of 4% shall be restricted to the
nomenclature used in the entries to the Schedules to the Act.
JT.COMMISSIONER
To
M/s. Mohan Marketing Associates,
328, 3rd Floor, Chandralok Complex,
S.D. Road, Secunderabad-500 003.

Hyderabad.
Copy to the Commercial Tax Officer, S.D. Road Circle.
3 of 3

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Palm Beach Hotel, (TIN No.28170296750), Visakhapatnam

Whether he can collect VAT at 12.5% from the customers if he opted

for composition under sub-section (9) of Section 4 of the Act.

Row, Advocate appeared and explained the case.
After examining the provisions of the Act, the following ruling is

given.
The tax liability under sub-section (9) of Section 4 of the Act

is only 12.5% on 60% of the total consideration received for supply
of food and drink other than liquor. The tax which can be collected
by a dealer who has opted to pay tax by way of composition under
sub-section (9) of Section 4 of the Act can be 12.5% on 60% of the
consideration charged or 7.5% on the total consideration charged.
Sub-section (2) of Section 57
1 of 2
stipulates that no dealer shall collect any amount by way of tax at a

rate exceeding the rate at which he is liable to pay tax under the
provisions of the Act. While 12.5% can be collected by a dealer
under sub-section (9) of Section 4, such 12.5% is only on 60% of
the total consideration charged and it cannot be on the 100%
consideration charged.
JT.COMMISSIONER
To
M/s. Palm Beach Hotel,
Visakhapatnam.

Hyderabad.
Copy to the Commercial Tax Officer, China Waltair Circle, Visakhapatnam.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Tiki Tar Industries (TIN No.28030173015), Pendurthi,

Visakhapatnam have filed an application dt.24-05-2005 and sought

The rate of tax on Bitumin Emulsion.

Row, Advocate appeared and explained the case.
The applicant has claimed that he is a manufacturer of bituminous

products mainly used in road construction and for water proofing purposes.
He has also mentioned that bitumin is specified under entry 14 of IV
Schedule to the Act and the Government have notified HSN Code for
bitumin as 2714.90.20. He explained that petroleum bitumin is covered
under 2713.20 and bituminous mixture is covered under HSN Code 2715.
He has also enclosed one invoice issued by Bharat Petroleum Corporation
Ltd., showing item description as “bitumin (bulk)” with Tariff Code as
2713.20. This invoice indicates that only 4% tax is charged. Another invoice
submitted by him is issued by Indian Oil Corporation Ltd., which does not
indicate any HSN Code but the tax charged on bitumin in the invoice is 4%.
One more invoice issued by Hindustan Colas Ltd., is produced which is in
respect of bitumin emulsion and the rate of tax charged is 4% in the
invoice.
1 of 2
After examining the facts of the case it is found that only “bitumen”
is specified in Entry No.14 of Schedule-IV to the Act and only one HSN Code
2714.90.20 is notified by the Government for the HSN Codes. Similar items
of bitumen, asphalt and bituminous mixtures are found under Excise Tariff
Codes 2713, 2714 and 2715 but they are not notified by the Government.
The specific code of 2714.90.20 is for natural bitumin whereas petroleum
bitumin is covered under 2713.20.00 and bituminous mixture are covered
under 2715.
The ruling is therefore, given that the items specified by the

applicant in so far as they are not covered under 2714.90.20 shall
attract tax @ 12.5%.
JT.COMMISSIONER
To
M/s. Tiki Tar Industries,
Plot No.26, IDA, Gurrampalem, Pendurthy,
Visakhapatnam.

Hyderabad.
Copy to the Commercial Tax Officer, Gajuwaka Circle, Visakhapatnam.
2 of 2

PROCEEDINGS OF THE

*****

***
O R D E R:
I. M/s. Gayatri Projects Limited, Hyderabad (TINo.28190175370) have

2. They sought clarification on the following :

They are executing the works contract awarded to Joint Venture
projects.
i) In respect of goods purchased from other states incurring CST
what would be the tax liability when such goods are used in
execution of works contract.
ii) How to fill the return VAT 200
iii) How to identify the turnovers separately for each item like steel,
cement, metal etc. which are taxable at different rates.
iv) Is it possible to transfer the excess lying credit in the JV account
to their account for the purpose of adjustment against the
applicant’s liability etc.
3. As per sub rule (3) of Rule 66 of A.P.VAT Act, 2005 the Authority
has called for information from the concerned assessing authority i.e., CTO,
Hyderaguda Circle, Abids Division and he has sent a copy of the Form VAT
305A & Form VAT 305 issued to the dealer on 14.9.2005 & 26.9.2005
respectively.
4. Since the CTO, Hyderguda circle, Abids division has already

passed orders of assessment of value added tax under Rule 25(5) in
Form VAT 305, the applicant may prefer an appeal before the
Appellate Deputy Commissioner concerned under Section 31(1) of
the A.P.VAT Act, 2005 within the stipulated time. Hence this
Authority cannot interfere with the proceedings of the Assessing
Authority and accordingly no ruling is issued.
ruling.
To
M/s. Gayatri Projects Limited,
D.No.6-3-1090, Ist Floor,
TSR Towers, Raj Bhavan Road,
Somajiguda,
Hyderabad
Copy to the Deputy Commissioner(CT), Abids Division.

PROCEEDINGS OF THE

*****

***
O R D E R:
I. M/s. JOCIL Limited, Guntur (TINo.28270207248) have filed an


Whether the words specific output as described in Rule 20(6) can be
partly taxable goods, partly exempted transactions and partly exempted
sales or not? If other words specific output need not be entirely be
taxable goods or entirely exempted goods or entirely exempted
transactions or not ? If the specific output is in combination of taxable
goods, exempted transactions and exempted sales whether the input
tax credit which the VAT dealer is able to establish to the specific output
can be availed as per the formula given there in for taxable goods or
not?
has called for information from the concerned assessing authority i.e.,
Asst.Commissioner (VAT Management Unit-I), Narasaraopet Division and he
has sent a copy of the Form VAT 305A issued to the dealer on 17.11.2005.
4. Section 67(2) stipulates that no application shall be

entertained by this Authority if the question raised in the
application is already pending before any officer or authority of the
department. Since, the Asst.Commissioner (VAT Management Unit-
I), Narasaraopet Division has already issued notice of assessment
of value added tax under Rule 25(5) in Form VAT 305A, this
ruling.
To
M/s. JOCIL Limited,
Dokiparru,
Guntur.

Copy to the Deputy Commissioner(CT), Narasaraopet Division.
Copy to the Asst.Commissioner (VAT Management Unit-I) Narasaraopet
Division.

PROCEEDINGS OF THE
*****

***
O R D E R:
I. M/s. Navodaya Traders, Samarangam Chowk, Vijayawada

(TINo.28370170029) have filed an application and sought clarification and
of Rs.1,000/-

Whether Unbranded brooms are exempted from tax or not?
Samarangam Chowk Circle, Vijayawada-I Division and he has sent a copy
of the Form VAT 305A issued to the dealer on 3.1.2006.

department. Since, the CTO, Samanrangam Chowk Circle,
Vijayawada-I Divn., has already issued notice of assessment of
value added tax under Rule 25(5) in Form VAT 305A, this Authority
cannot interfere with the proceedings of the Assessing Authority
and accordingly no ruling is issued.

ruling.
To
M/s. Navodaya Traders,
D.No.9-77-23,
Poolabavi Street,
Samarangam Chowk,
Vijayawada

Copy to the Deputy Commissioner(CT), Vijayawada-I Division.
Copy to the Commercial Tax Officer, Samarangam Chowk.

PROCEEDINGS OF THE

*****

***
O R D E R:
I. M/s. Sri Aravinda Steels, Vijayawada (TINo.28680196241) have filed


Whether the premises i.e., S.R.Transporters, Visakhapatnam where
the applicant sends the H.R. coils for conversion into various sizes and
stores the entire purchases made by the applicant has to include the
above name of the premises in the Registration Certificate or not? If so,
rent agreement is required or no?
Kothapet Circle, Vijayawada-I Division and he has sent a copy of the Form
VAT 305A issued to the dealer on 23.9.2005.

department. Since, the CTO, Kothapet Circle, Vijayawada-I Divn.,
has already issued notice of assessment of value added tax under
Rule 25(5) in Form VAT 305A, this Authority cannot interfere with
the proceedings of the Assessing Authority and accordingly no
ruling is issued.
ruling.
To
M/s. Sri Aravinda Steel,
D.No.11-3-13,
Angadalavari Street, Kothapet,
Vijayawada

Copy to the Deputy Commissioner(CT), Vijayawada-I Division.

PROCEEDINGS OF THE

*****

***
O R D E R:
I. M/s. Victory Transformers & Switchgears Limited, Jeedimetla

of Rs.1,000/-
2. They sought clarification on the rate of tax on the following items:
1. CRGO Core (Sec.CRGO Steel sheets/Coil/Strip)
2. CRGO Lamination
3. Double paper cover aluminum wire
4. Double paper cover aluminum strip
5. Copper delta wire
6. MS material all varieties including tank
7. PC Board
8. Cooling tube (Steel tube)
9. Enameled copper wind wire
10. Enameled copper strip
11. Copper rope
12. Core coil assembly
13. Semi finished transformer
14. Sim paper (Copper sim)
Assistant Commissioner (Vat Management-II), Hyderabad Rural Division
and he has sent a copy of the Form VAT 305A & Form VAT 305 issued to
the dealer on 29.9.2005 & 19.10.2005 respectively.
4. Since, the Asst.Commissioner (Vat Management-II), Hyd®

Divn., has already passed orders of assessment of value added tax
under Rule 25(5), the applicant may seek remedy provided in the
A.P.VAT Act, 2005. This Authority cannot interfere with the
proceedings of the Assessing Authority and accordingly no ruling is
issued.

ruling.
To
M/s. Victory Transformation & Switchgears Limited,
D-52, Phase IV, Extension IDA,
Jeedimetla, Hyderabad.

Copy to the Assistant Commissioner(VAT Management-II),
Hyderabad(Rural) Divn.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. G.M.R. Tuni-Anakapalli Expressways (P) Limited, Begumpet,
The applicant is seeking advance ruling regarding;
a) Whether annuity paid under concession agreement between
National Highway Authority of India (hereinafter referred to as
NHAI) and the applicant attracts tax deduction at source under
sub section (4) of Section 22 of A.P.VAT Act, 2005 and
b) Whether a taxable works contract already assessed in the hands
of sub contractors of EPC Contractor during the period of APGST
Act was in force and payment of annuities under concession
agreement could be subjected to TDS under A.P.VAT Act, 2005
presently in force.
The case was posted for hearing 16-5-2006. Sri O. Bangaru Raju,
Managing Director of the company and Sri P.Srinivasa Reddy, Senior
Advocate, A.P.High Court appeared and presented the case.
According to the applicant, they have entered into an agreement
with NHAI on 9.10.2001 to investigate, study, design, engineer, procure,
finance, construct, operate and maintain a section of national highway NH5
between Tuni and Anakapalli from Km 300/0 to Km 359/20 for a period of
17 ½ years which includes construction period of 2 ½ years and
maintenance period of 15 years. This agreement according to them is a
concession agreement which is not confined to the works contract but it is
for making available the project / road for 15 years by the applicant as
owner. According to the applicant, it is in the nature of granting right in the
land or profit a prendre. They have further contended that annuity paid is
not consideration for mere construction of road but it is the over all cost for
making available the road in useful condition. It was also stated that no
bills were raised by them directly for the construction of the road work on
NHAI.
The applicant submitted the following documents ;
1. Concession agreement between NHAI and GMR consortium
executed on 9.10.2001.
2. Written opinion of Sri C.Natarajan, Senior Advocate, Chennai to
be read as part of the submissions of the applicant.
3. Copy of the assessment order of EPC contractor namely M/s.
U.E. Development India Private Limited.
4. Copies of statement of TDS made in respect of sub contractors of
EPC Contractor.
5. Copies of tax returns filed by M/s. Madhucon Projects Limited,
one of the sub contractors and Certificate given by their
assessing authority for non deduction of tax at source.
The following are the extracts of the written submissions made by
the applicant ;
1. Government of India, by Notification No.S.O. 78(E) dt.4.2.99 issued
under Section 11 of the National Highways Authority of India Act, 1988
entrusted National Highways Authority of India (hereinafter referred to as
“NHAI”) with the stretch of National Highway km.300/0 to Km.359/20 in
Tuni-Anakapalli section on NH-5 in the State of Andhra Pradesh. As a
consequence, NHAI entered into a Concession Agreement dt.9.10.2001 with
M/s. GMR Tuni-Anakapalli Expressways Private Limited (hereinafter referred
to as “the Querists”) to develop the given stretch of highway for widening
thereof as 4-lane dual carriageway, with private sector participation to
Build, Operate and Transfer (BOT) basis.
2. By MOU dt.30.5.2001 involving GPCL, CIL, GTL and UEM, the parties
joined to form a consortium accepted GPCL as the leader of the consortium.
Each member of the consortium had a special background and qualification.
United Engineers (Malaysia) Berhad (hereinafter referred to as “UEM), a
member of the consortium, is one of the largest road and infrastructure
groups in Malaysia engaged in the business of infrastructure construction
and management, and operation and maintenance. NHAI issued a Letter of
Acceptance dt.13.8.2001 to the consortium on 4-Laning of the NH-5 in the
allocated sector on BOT (Annuity) Basis. The Letter of Acceptance
addressed to M/s. GMR Power Corporation Private Limited vide Paragraph
12 stated that the acceptance was subject to promotion of a Special
Purpose Vehicle in the form of a limited liability company and execution of
the concession agreement.
3. The concession agreement contemplates implementation of
carriageway with private sector participation on Build, Operate and Transfer
Basis. Schedule-I provides for Operation and Maintenance requirements.
The agreement refers to the querists as concessionaire.
4. The applicant entered into a further agreement dt.10.1.2002 with
M/s. U.E.Development India Private Limited and M/s. United Engineers
(Malaysia) appointing them as EPC contractors. The EPC contractors
thereupon executed the work and completed the project.
5. The EPC contractor is registered under the Sales Tax Act with
Rc.No.VSP/05/2/2245. Sales tax has been remitted by the sub contractors
of EPC contractor on the project work and assessment completed upto
2003-04. The work was commenced on 9.5.02 and completed by 24.12.04.
6. The expression “concession” is of consequence. Advanced Law
Lexicon Volume-I (3rd Edition, 2005) refers to concession as a form of
privilege and, inter alia, the following is stated;
“The right granted by the host government for a private company to
undertake an otherwise public sector project and operate that project over
a period of time. (Water Law)”.
7. Concession Agreement: The agreement with a government body
that entitles a private entity to undertake an otherwise public service.
(Water Law)”.
8. The concession agreement by Article 8 provides for annuity. The
character of this receipt by the concessionaire may have a bearing on the
question of consideration. Annuity has a legal connotation.
9. In one of the earliest legal compilations of the English law, the term
“annuity” has been explained as an yearly payment of a certain sum of
money granted to another in fee or for life or for a term of years either
payable under a personal obligation of the grantor or charged upon his pure
personality, although it may be made a charge upon his freehold or
leasehold land in which latter case it is commonly called a rent-charge (See
Co. Litt. 144b). In Halsbury’s Laws of England, Third Edition (Vol.32, Page
534 para 899), the meaning of the said expression is given as a certain
sum of money payable yearly either as a personal obligation of the grantor
or out of the property not consisting exclusively of land; it differs from a
rent-charge in that a rent-charge issues out of land.
10. In Bignold v. Giles, (1859 4 Drew 343: 113 Revised reports 390),
annuity is described thus:
“An annuity is a right to receive de anno in annum a certain sum;
that may be given for life, or for a series of years; it may be given during
any particular period, or in perpetuity; and there is also this singularity
about annuities, that although payable out of the personal assets, they are
capable of being given for the purpose of devolution, as real estate; they
may be given to a man and his heirs, and may go to the heir as real estate;
so an annuity may be given to a man and the heirs of his body; that does
not, it is true, constitute an estate tail, but that is by reason of the Statute
De Donis, which contains only the word ‘tenements’ and an annuity, though
a hereditament, is not a tenement; and an annuity so given is a base fee”.
11. Vide Paragraph 19, In-re Duke of Norfold: Public Trustee v. Inland
Revenue Commr., (1950) 1 Ch 467 was referred to and the statement of
Jenkins L.J. was extracted, as under:
“An annuity charged on property is not, nor is it in any way
equivalent to, an interest in a proportion of the capital of the property
charged sufficient to produce its yearly amount. It is nothing more or less
than a right to receive the stipulated yearly sum out of the income of the
whole of the property charged (and in many cases out of the capital in the
event of a deficiency of income). It confers no interest in any particular part
of the property charged, but simply a security extending over the whole.
The annuitant is entitled to receive no less and no more than the stipulated
sum. He neither gains by a rise nor loses by a fall in the amount of income
produced by the property, except in so far as there may be a deficiency of
income in a case in which recourse to capital is excluded”.
12. Under the concession agreement, the concessionaire is handed over
peaceful possession to develop the infrastructure and to earn revenue
which can either be annuity paid by NHAI or in lieu of the same, the
privilege to levy demand and collect a toll.
13. The infrastructure developed by the concessionaire remains in the
enjoyment of the concessionaire for 17 years so that under Clause 9.2
rights are reserved for NHAI either to levy and collect toll or construct,
erect or operate plazas with right to permit / allow advertisements.
14. The annuity has a connotation being a sum pre-determined payable
as a personal obligation of the guarantor and charge personally on
guarantor. In the context of the matter, it is in lieu of the relinquishment of
the right of the concessionaire to collect toll for the infrastructure.
15. Article 8 pertaining to Annuity shows that it is related to carriageway
measured by total of lane km hours. Annuity lacks the characteristics of a
contract price.
16. The concession agreement identifies the applicant as concessionaire
and not as contractor. The expression “contractor” is defined as the person
with whom the concessionaire has entered into project agreement.
17. A works contract has a fixed connotation being a contract with an
employer to construct employing material and labour for the employer in
which property in goods passes by accession.
18. The concession agreement dt.9.1.01 is not merely an agreement to
construct, provide materials and labour to an employer.
19. The concession agreement stipulates by Article 5 the
concessionaire’s obligations, by Article 6 the NHAI’s obligations, Article 8
provides for Annuity, and by Article 9, the concessionaire’s obligation and
NHAI rights with regard to the toll and fee. The agreement read as a whole,
is not for mere execution of works contract as that expression has been
construed.
20. “Works contract” has been defined by Section 2(45) of the Andhra
Pradesh Value Added Tax Act, 2005 as under:
“Works contract” includes any agreement for carrying out for cash or
for deferred payment or for any other valuable consideration, the building
construction, manufacture, processing, fabrication, erection, installation,
laying, fitting out, improvement, modification, repair or commissioning of
any movable or immovable property”.
21. The definition is consistent with the pre-Forty-sixth Amendment
conception of works contract. Neither the Constitution nor the Andhra
Pradesh Act is intended to fasten a liability merely because there is an
agreement between two parties as an incidence of which a construction
takes place. The concession agreement is a complex arrangement
conceiving participation of NHAI and the private sector to provide
infrastructure facility as partnership of two agencies. A Special Purpose
Vehicle is created, financed and operated by private sector. The
concessionaire has long term obligations. The concessionaire is the
instrument through which NHAI discharges its functions under the Central
Act. Compensation is provided to the concessionaire either by enabling
collection of tariff from service users or by providing for payment of annuity
by the Government. The land is contributed by NHAI whereas the
infrastructure is developed by the concessionaire. The operational control
and physical possession of the infrastructure is retained by concessionaire
till the concession period is completed.
22. The Concession Agreement dt.9.10.01 cannot be considered as a
works contract within Article 366 (29-A)(b) of the Constitution of India or
for the purpose of A.P.Value Added Tax Act, 2005.
23. The EPC contract dt.10.1.02 between the applicant and EPC
contractors is a works contract rightly assessed to sales tax.
24. In the circumstances where the contractor has been nominated in
the agreement between NHAI and the applicant, there is only one taxable
event when the contract was executed by the EPC contractor.
25. To the extent, the construction was completed before the Andhra
Pradesh Value Added Tax Act, 2005 there may be no taxable event
attracting tax in relation thereto under the Andhra Pradesh Value Added
Tax Act, 2005.
Sri P.Srinivasa Reddy the learned counsel who appeared on behalf of
the counsel, contended that the concession agreement is for performing
various services and financing the project is the main component of the
agreement. It was stated by him that annuity fixed and payable for every
half year over a period of 15 years is for making available the highway for
uninterrupted use. It was also mentioned that the payment of annuity
would suffer if the highway is not made available during any part of the 15
year period. According to the learned counsel, the project is the property of
the applicant during the entire period of annuity and it needs to be handed
over to NHAI on expiry of the concession agreement. It is therefore
contended that concession agreement as a whole cannot be treated as a
works contract either for the purpose of APGST Act or AP.VAT Act. A
reference was also made to the decision of Supreme Court in Builders
Association (73 STC 370) contending that property passes when goods are
incorporated in the work and it cannot be postponed until the bill is raised.
A reference was also made to the decision of A.P.High Court in Media
Communication case (105 STC 227) wherein it was held that value of goods
consumed in the work in each year is liable to tax. In this context Rule
6(3)(i) of APGST Rules, 1957 was also cited contending that where
execution of contract is extended over a period of more than one year, the
turnover for the purpose of works contract is the value of goods purchased
and used in the execution of contract in that particular year. Based on all
the above references, the learned counsel contended that the event of
execution of work was fully completed before A.P.VAT Act, 2005 came into
force, the consideration was also received by EPC Contractor and his sub
contractor, the incorporation of goods in the execution of the work was fully
completed and annuity received by the concessionaire is therefore not the
actual consideration for the work executed. Subsequently, the learned
counsel also filed a statement from the main sub contractor M/s. Madhucon
Projects Limited showing the turnovers declared in their assessments and
returns for the three assessment years covering the execution of the
project.
After hearing the arguments and after examining the written
submissions, it is observed that ;
1. The work in question was executed between the period 2002-04.
2. The concession agreement envisaged that the “Concessionaire” may
undertake construction works by itself or through a contractor possessing
requisite technical, financial and managerial expertise / capability.
3. An agreement was also made between NHAI and the Concessionaire
on 2.8.2002 to modify the original concession agreement to the extent of
definition of ‘Contractor’ and it was specified in the new definition that it
shall include M/s. United Engineers (Malaysia) Berhad, M/s.
U.E.Deveopment Private Limited and shall further include M/s. Madhucon
Projects Limited in respect of any sub contract executed pursuant to EPC
Contract.
4. The work actually commenced on 9.5.2002 and was completed by
24.12.2004.
5. For the years 2002-03 and 2003-04, the assessments were
completed in respect of EPC Contractor and the copies of such orders were
submitted.
6. As seen from the assessment orders of EPC Contractor, it is noticed
that EPC Contractor inturn sub contracted the work to M/s. Madhucon
Projects Limited and M/s. Paramitha Contractors Private Limited to a large
extent and to some other sub contractors for smaller works.
7. Based on the provisions of APGST Act, 1957 and Rules thereunder,
the assessing authority allowed exemption on the turnovers relating to the
portion of work awarded to the sub contractors registered under APGST Act.
As seen from the assessment orders of EPC Contractor, about Rs.23.10
crores and Rs.111.72 crores were declared as gross turnovers for the years
2002-03 and 2003-04 respectively for the works involved.
8. In addition to the copies of assessment orders of EPC Contractor,
copies of the tax returns filed by sub contractors were submitted by the
applicant at the time of hearing, and the records in respect of one of the
contractors M/s. Madhucon Private Limited were obtained from CTO/Jubillee
Hills. As seen from these records, M/s. Madhucon Private Limited were
assessed on the gross turnovers of Rs.161.99 crores for the year 2002-03
under APGST Act and this include a turnover of Rs.29.45 crores relating to
the work involved in the concession agreement between the applicant and
NHAI. For the years 2003-04 and 2004-05, the assessments were not
completed but audited statements in AR1 and AR2 as prescribed under
APGST Act were submitted by the M/s. Madhucon Private Limited. In both
the years, the turnover relating to the work executed in respect of the
concession agreement between applicant (GMR and NHAI) were reflected.
9. The provisions of APGST Act relating to works contract have been

examined. It is seen that as per the proviso under Section 5F of APGST Act,
1957, the main contractor is not liable to pay tax to the extent any
amounts are paid to sub contractor as consideration for the execution of
works contract provided that such sub contractor is a registered dealer and
such turnover is included in the return of turnover filed by such contractor.
It is also observed that the definition of “turnover” under APGST Act means
the total amount set out in the bill of sale and if the bill of sale does not set
out correctly the amounts for which the goods are sold, the basis is the
total amount of consideration for the sale of goods as determined by the
assessing authority. Reading both the provisions together, the turnover
relating to the goods incorporated in the execution of works contract in
respect of the particular project in question was already scored well before
A.P.VAT Act, 2005 which came into force on 1.4.2005 and such turnovers
have already been filed by the respective EPC Contractor and his sub
contractors and assessments in respect of certain years were also passed.
Having considered all the above points, the ruling is given as

under :
1. The turnovers relating to execution of work covered in the
concession agreement between the applicant and NHAI were
already declared under the provisions of APGST Act, 1957 and taxes
thereon were also levied / collected / declared.
2. The transaction and the consideration having already been

covered under the provisions of APGST Act and annuity received not
being linked to the quantum of work completed, no tax need to be
deducted at source on such annuity payments under the provisions
of sub section (4) of Section 22 of A.P.VAT Act, 2005.
JT.COMMISSIONER
To
M/s. G.M.R. Tuni – Anakapalli Expressways (P) Limited,
6-3-866/1/G2, Greenlands,
Begumpet,

Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Involute Automation (P) Liimited (TIN No.28520168569)
The rate of tax applicable to Servo Controlled Antenna Pedestals.

Copy of invoice issued under Central Excise Regulations.
Sri A.Sarup Narayan, Accounts Officer of the firm has appeared for
1 of page 2
is given as under.
On the excise invoice furnished by the applicant, tariff sub
heading 8483.90 is quoted. In the G.Os cited above neither the
tariff heading nor the sub heading have been notified. Therefore,
the item on which clarification is sought is held as liable to tax @
12.5%.

To
M/s. Involute Automation Private Limited,
12, Technocrats Industrial Estate,
Balanagar,
2 of page 2
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sambasiva Engineering Works, Guntur have filed an
The rate of tax applicable to manually operated sprayers, power

operated sprayers, spare parts and accessories thereof.
Sri P.Sambasiva Rao, Proprietor of the firm has appeared for hearing
1 of page 2
is given as under.
Entry 20 of Schedule IV of A.P.VAT Act refers to plant
protection equipment and accessories thereof. In the G.O. cited
above mechanical appliances under Entry 20 of Schedule IV of the
Act have been notified as falling under tariff sub heading
8424.20.00. As the items on which clarification is sought answer
the description of appliances such as spray guns and similar
appliances it is held that the rate of tax applicable to these items is
4%.

To
M/s. Sambasiva Engineering Works,
Rajarao Street, Street Road,
Guntur – 522001.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sign Mart (TIN No.28930263195) Hyderabad have filed an
i) Self adhesive plates, sheets
ii) Flex, PVC coated / Laminated, Plastic sheet, PVC sheeting roll
The applicant submitted the following :
a) Copy of purchase invoice showing description of materials purchased
by the applicant.
b) Sample of the product.
Sri Manoj Kumar Bothra, Proprietor of the firm has appeared for
1 of page 2
is as under.
In the G.Os cited above HSN code applicable to Entry 90 have
been notified. At Sl.No.1 and 2, Self adhesive, Plates, Sheets, Film,
Foil, Tape etc., have been notified as falling under HSN code 3919.
Other Plates, Sheets and Strip of Plastics including HDPE / PP
woven fabric are notified as falling under HSN code 3920. Product
description on the purchase invoice of the applicant and samples
produced for examination are in conformity with the description of
items under the notified codes.
Therefore, it is held that the items on which applicant sought
clarification are liable to tax @ 4%.

To
M/s. Sign Mart,
D.No.4-3-64, Kandaswamy Lane,
Hyderabad.


PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/493 / 2005. Dated 20 - 06-2006.
O R D E R:
M/s. Matha Gayatri Oils, Narsaraopet (TIN.28630201028) have filed


Whether the applicant can claim input tax credit or sales tax relief
on suffered vegetable oil purchased on 31-3-2005 and stock received on 1-
4-2005 and 2-4-2005.

1) Purchase Invoice copies of Maniyar Industries, dt.31-3-2005.
2) Purchase invoice copy of Agrotech Foods Limited, dt.29-3-2005
3) Purchase Invoice copy of Nikhil Refineries Pvt. Ltd.,
Sri M.V.J.K. Kumar, Advocate, appeared for hearing and explained

the case.
In case of M/s. Matha Gayatri Oils, the assessing authority

already initiated the proceedings rejecting the claim of the Input tax on the
stocks actually received on
1-4-2005 and 2-4-2005 while invoices are dated on 31-3-2005. Since, the
proceedings are already initiated, this authority cannot interfere in the
matter.
Sd/- Sd/- Sd/-

E:- An appeal against this proceedings can be filed before the Sales Tax
To
M/s. Matha Gayatri Oils,
Narsaraopet.
Copy to the Deputy Commissioner(CT) Narsaraopet Division.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Cal-on Instruments, (TIN No.28560127278), Cherlapalli,

The rate of tax on electrical testing and measuring instruments.
The case was posted for hearing on 13-07-2005. Sri Hari Prasad,
Accounts Executive appeared on behalf of the firm and explained the case.
The applicant has demonstrated the instrument which is sold by him

along with technical details and a copy of the invoice issued for the item.
The applicant argued that the electronic weighing scale consists of a printed
circuit board and it is operated on electronic principle and also has LCD
display. The invoice produced indicates that the item sold is “electronic
balance” and there is no HSN Code mentioned on the invoice issued by
them.
After examining the facts, the entries in the Schedules and the HSN
Codes notified by the Government, the ruling is given as under:
1 of 2
All items of weighing machinery are covered under Excise

Tariff Code 8423 and this is not notified for any of the entries in the
Schedules to the Act. Therefore, the items mentioned by the
applicant “electronic weighing scales” shall be liable to tax at
12.5%. Regarding the “electronic testing and measuring
instruments”, the Excise Tariff Code applicable is found to be 9031
which is not notified in any of the sub-items for entry 39 dealing
with IT products in Schedule-IV to the Act. The HSN Code notified
for sub-item 29 of entry 39 of Schedule-IV to the Act is 9030 and
only items covered under this Tariff Code shall be eligible for 4%.
JT.COMMISSIONER
To
M/s. Cal-on Instruments,
S.Y.No.193, IDA, Phase-IV, Cherlapally,
Rangareddy, Hyderabad-500 051.

Hyderabad.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Paraxit Industries, Hyderabad, (TIN No.28720179103)
Whether : i) Transportation charges attract VAT

iv) Installation charges attract VAT
v) To show unit rate in the delivery challan for
sprinkler and drip irrigation separately.
1. Copies of invoice issued.

2. Copies of delivery challans.
Sri N.Pradeep Kumar, Asst. General Manager of the firm has

1 of page 3
The applicant claims to supply sprinklers and drip irrigation
systems as per the guidelines and rates approved by Govt. of A.P.,
and that the applicant is being paid transportation and installation
charges separately per hector basis. Besides, the applicant also
claims that he is paying service tax on installation charges @
10.2%. In the circumstances the applicant seeks clarification
whether transportation and installation charges attract VAT.
Perusal of invoices issued by the applicant indicate that there
is a sale of complete set of drip irrigation system. Besides, he is
also charging amounts towards installation, transportation / fitting
and assembling charges etc. The description on the invoice
therefore indicates that the applicant is obligated to install the
system at the customer’s site and being paid for such work. As seen
from the invoice, the applicant has charged VAT on such items of
work. As the applicant supplies the system, erects it at the site and
finally being responsible for making it operational, expenses
incurred prior to the completion of work (installation etc.) form part
of the consideration. Therefore, the installation and transportation
charges are liable to VAT.
2 of page 3
The question whether the applicant can show unit rate in

delivery challans for sprinklers and drip irrigation system
separately is a matter of choice of the applicant. As such there is no
legal bar on this issue.
To
M/s. Parixit Industries,

11-5-421/5, Red Hills,

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Godavari Clay (Mines), Bommuru, Rajahmundry (TIN

Rate of tax applicable to Fire clay extracted from the Mines.

1. Copy of tax invoice depicting sales of Fire clay by VAT dealers registered
within A.P.
2. Copy of transport permit issed by Mines & Geology Department, Govt. of

A.P.
Sri V.S.Sivaram, Authorised Representative appeared on behalf of

is given as under.
According to the applicant Fire clay is extracted from the
Mines that are taken on lease from the State Govt., and sold by the
applicant. The applicant is of the view that the item being a natural
mineral falls under Entry 43 of Schedule IV of the Act and seeks a
confirmation to this effect. We have examined the contents of the
application and the documentary evidence furnished. Entry 43 of
Schedule IV refers to “Ores & Minerals”. The department of Mines &
Geology while issuing the transport permit has described the item
as a mineral. The applicant claims to sell the mineral in its natural
state. Therefore, we are inclined to hold that Fire caly falls under
Entry 43 of Schedule IV of the Act and accordingly attracts a tax
rate of 4%.
To
M/s. Godavari Clay (Mines),
Bommuru,
Rajahmundry Rural.

Copy to the Commercial Tax Officer, Alcot Garden Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Rakshit Durgs Private Limited (TIN No.28840241470) have filed
Rate of tax on :
1. Sildenafil Citrate
2. Amlodipine Besilate
3. Cinnarizine
4. Citalopram HBR
5. Triclabendazole
6. Diflotxacin
7. Intermediate & Chemicals
i) Drug licence and approvals of additional items issued by the Drug
Controller
ii) Certificate of HSN codes issued by Superintendent, Customs
& Central Excise, Hyderabad applicable to the products
manufactured by the applicant.
Sri P.Srinivas, Finance Manager appeared on behalf of the firm for

is given as under.
The applicant claims to manufacture bulk drugs and

intermediates and seeks to know the rate of tax applicable under
A.P.VAT Act, 2005.
Documentary evidence furnished shows that the applicant is
licenced to manufacture Drugs and that HSN code 2942.00.90
applies to them. In the G.Os cited above the HSN code 2942 has
been notified at Sl.No.5 of Entry 88 of IV Schedule of the Act. As the
4 digit code has been notified, products falling under that code are
deemed as falling under the relevant entry of the Schedule.
According to the A.P.VAT Act, 2005 items falling under Schedule IV
Therefore, held that the items on which the applicant soght
ruling are liable to tax @ 4%.
To
M/s. Rakshit Drugs Private Limited,

Flat No.315, Bhanu Enclave,
Sunder Nagar, Erragadda, Hyderabad – 500 038.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. V-Guard Industries, Hyderabad (TIN No.28580204554) have

1) Rate of tax on automatic Voltage Stabilisers & Voltage Regulators
2) Rate of tax on Electronic Motor Starters.
3) Eligibility for input tax credit on purchase of items like Computers,
Printers, Furnitures & Fixtures, Electrical fittings and installations,
Machinery and testing equipments.
4) Items purchased for office building repairs.
Sri G.Madhusudhan, Senior Officer (Accounts) appeared on behalf of

is given as under.
1) Voltage Regulators & Automatic Stabilizers: In the G.O. cited
above items falling within the scope of the Entry 39 of the Schedule
IV of the A.P.VAT Act 2005 have been notified with the HSN codes.
At Sl.No.7 of the Entry 39, HSN code 8504 is mentioned. Under
Chapter heading 8504 in the Central Excise Tariff, Voltage
Regulators & Automatic Stablizers are included with HSN code
8504.40.40. As the Chapter code has been notified, items falling
under the said chapter code are liable to tax @ 4% of Schedule IV of
the Act. Therefore, it is held that Voltage Regulators & Automatic
Stablizers are liable to tax @ 4%.
2) Electric Motor Starters: This item is notified in the above G.Os as
falling under HSN code 8536 under Entry 39 of Schedule IV of the
Act. Under this Schedule goods are liable to tax @ 4%. Therefore,
this item is held as liable to tax @ 4%.
3)The applicant seeks clarifiction whether he can take input tax
credit on purchase of items meant for office purposes. The items
that are purchased purportedly for office use are Computer,
Printers, Furniture & Fixtures, Electrical fittings and installations,
Machinery and testing equipment, Computer paper for printing,
Stationery and other consumables. Rule 20 of the A.P.VAT Rules,
2005 specifies items on which input tax credit cannot be taken.
Excluding the items mentioned under Rule 20(2), all other items are
eligible for input tax credit provided they are purchased for the
purpose of business. As the applicant states that he intends to
purchase the items stated in the application for office purpose,
which in otherwords means business purpose, it is held that the
applicant is eligible for input tax credit on these items if they are
purchased from another VAT dealer within the State.
4) The applicant seeks to know whether he is eligible for input tax
credit on items purchased for office building repairs. In terms of the
language of Rule 20(2) items that are purchased for building repair
purpose are not eligible for input tax credit.

To
Plot No.24 & 25, Mansoorabad, Sri Lakshmi Nagar Colony,
GSI Post, R.R.District, Hyderabad – 500 068.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Johnson and Johnson Ltd., Hyderabad (TIN.28750148062)have

Rs.1,000/-

The rate of tax on “Contact lenses”

Literature on Chapter 90 of CE Tariff Act.
Sri S.Anantha Narayanan, Authorised Representative, appeared for

Contact lenses fall under HSN Code 9001 3000. In the G.Os cited above
the code has been notified under entry 39 of IVth Schedule. Hence liable to
VAT @ 4%.
ruling.
To
M/s. Johnson & Johnson Limited
Secunderabad.


PROCEEDINGS OF THE

*****
O R D E R:
M/s. Lawrence and Mayo(Opticals) Parklane, Secunderabad,


The rate of tax chargeable on contact lens, spectacles, lenses fitted
to customer frame and other accessories like solutions.

Xerox Copy of the News item relating to West Bengal VAT Act.
Sri K.Vijaya Kumar, Branch Accountant, appeared for hearing

on 16.08.2005 and explained the case.
under:
On verification and examination of HSN Codes notified it is

observed that HSN Code No.9001 has been notified under item
No.27 of entry 39 to the IVth Schedule, which covers, contact
lenses, spectacle lenses of glass, polarized glass and spectacle
lenses of other material. Therefore, ophthalmic and contact lenses
are taxable @ 4%. The other items viz., spectacles, frames,
mountings for spectacles, goggles and accessories like solutions are
covered in HSN Codes 9002-9004, which are not notified for entry
39 of the IVth Schedule. As such, the goods covered under HSN
Codes 9002, 9003 and 9004 are taxable @ 12.5%.
ruling.
To
M/s. Lawrence and Mayo,(Opticals), Parklane, Secunderabad.

Copy to the Commercial Tax Officer, General Bazaar Circle.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. SAI SOWMYA PRODUCTS, HYDERABAD (TIN.28410103518)

of Rs.1,000/-

The rate of tax applicable on the following goods.
8. Electrical Transformer (Application for control circuits)
9. Voltage Stabilizers
10. Electrical Inverter
11. Battery charges
12. Electronic Ballasts for tubes
13. Uninterupted power supplies
14. Electrical control panel

Copies of invoice cum delivery challan for electronic stabilizers.
Sri B.Parameswara Rao, Managing Partner appeared for hearing on
The applicant contends that the items enumerated supra fall under HSN
Code 8504, which reads as Electrical transformers static converters and
inductors. On verification it is found the following items are enlisted in the
Chapter 85.
1. Electrical Transformers : 8504

2. Voltage Stabilizers : 8540-4040
3. Electric Inverter : 8504-4010
4. Battery charges : 8540-4030
5. Electric ballast for tubes : 8504-10
Since, the HSN code 8504 is notified under entry 39 of the IVth
Schedule, all the above noted items are liable to VAT @ 4% upto 26-8-
2005.
Consequent to the issue of orders by the Government in

G.O.Ms.No.1596 Rev.(CT.II) Dept., dt.27.8.2005 wherein the chapter 8504
has been deleted from the items of I.T. products, all the items at Sl.No.1 to
5 are liable to VAT @ 12.5% w.e.f. 27.8.2005. However, uninterrupted
power supply (UPS) and their parts continue to be liable to tax @ 4% from
1-4-2005 under Entry 39 of the IVth Schedule.
Electrical Control Panel falling under HSN code 8537.10 has not been
notified and as such would not fall under the Entry 39 of the IVth Schedule
and continues to be liable to VAT @ 12.5% from 1-4-2005.

ruling.
To
M/s. SAI SOWMYA PRODUICTS,
HYDERABAD.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Vijay Traders, Vijayawada (TIN 28130139579) have filed an

application Dated 4-7-2005 and sought clarification and advance ruling on

The rate of tax on Cherry fruit (CANDIED KARONDA)

Copies of invoices dated prior to 31st March, 2005 and after 1st April,2005.
Sri K.V.G.Krishna Murthy, appeared for hearing on 26-7-2005 and

explained the case.
The applicant sought for the rate of tax applicable on the
goods viz., -- Cherry Fruit (Candied Karonda). On verification of the
entries in Schedule Ist & IVth to the APVAT Act,2005, it is found
that, the goods, cherry fruit is not enumerated in any of the entries
in the said Schedules and thereby liable to tax @ 12.5% under the
residual entries of Vth Schedule. Accordingly, it is held that cherry
fruit is liable to tax @ 12.5%.
ruling.
To
M/s. Vijay Traders,
Vijayawada.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Anam Electrical Manufacturing Company, Kadiyam, East

Godavari District have filed an application dt.11.5.2005 and sought
1. ACSR Conductors
2. All Aluminum Alloy Conductors
3. All Aluminum Conductors
4. Aluminum Conductors Alloy Reinforced
1 of page 3
Sri K.Venkateswarlu, Sales Officer, appeared for hearing on 20-5-

1. A copy of excise invoice issued by Moser Bayer (I) Limited

indicating central excise tariff number and description of goods.
2. Invoice issued by the applicant under the provisions of central

excise rules.
1. ACSR Conductors: This item is covered under HSN code

7604.29.10. In terms of the above G.O. under sub item 38 of
Entry 27 the chapter heading 7604 has been notified as falling
under Schedule IV of A.P.VAT Act, 2005. Therefore this item
attracts 4% tax rate.
2 of page 3
2. Items 2, 3 & 4 fall under HSN chapter code 8544. In terms of

the G.Os cited above chapter code 8544 has been notified as
sub item 26 of entry 39 of Schedule IV of A.P.VAT Act, 2005.
Therefore the rate of tax applicable to these items is also 4%.
To
M/s. Anam Electrical Manufacturing Company,

Kadiyam – 533 126,
East Godavari District.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Crompton Greaves Limited, (TIN No.28600196761)
Minverva House, S.D.Road, Secunderabad have filed an application
1. Rate of tax on sale of Electric motors

2. Rate of tax on sale of Cooler fan motors and Cooler pump
3. Rate of tax on spare parts for AC motors, AC generators, DC
motors
Sri S.Jayaraman, Finnace Executive, appeared for hearing on 20-5-

1. A copy of invoice cum challan issued by the applicant at his works
(GOA) in favour of the applicant at his address in the state indicating
chapter heading number under the HSN code.
1 of page 2
1. Electric motors and spares : This item falls under HSN
chapter code 8501 and notified as item 5 of entry 39 of
Schedule IV of A.P.VAT Act, 2005 in the G.Os cited above.
Therefore, the rate of tax applicable is 4%.
2. Cooler Fan Motors: This item also falls under chapter

heading 8501. Therefore the item and its parts are also
liable to tax @ 4%. However Cooler pumps are not
covered under the same chapter heading. Therefore they
are liable to tax @ 12.5%.
3. Spare parts for AC / DC motors and AC Generators: These

items listed under chapter heading 8501 & 8503 are
notified as item 5 & 6 of entry 39 of Schedule IV of
A.P.VAT Act, 2005 in the G.Os cited above. Therefore,
these items are taxable @ 4%.

To
M/s. Crompton Greeves Limited,

4th Floor, Minerva House,
94, S.D.Road,

2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sri Valli Computers, (TIN No.28690267568) Park Lane,
Secunderabad have filed an application dt.17.5.2005 and sought
1. Rate of tax on sale of Compack Disc Recordable (CD-R)

2. Rate of tax on Digital Versatile Disc Recordable (DVD-R) and Floppy.
Sri P.Nagender, Manager appeared for hearing on 20-5-2005 and

explained the case.
The applicant submitted the following items:
Samples of the items on which clarification is sought have been

furnished as material evidence.
1 of page 2
The items fall under HSN chapter code 8523 which has been
notified as sub entry 13 of entry 39 of Schedule IV of A.P.VAT
Act, 2005 in the above said G.Os. Therefore the rate of tax
applicable is 4%.

To
M/s. Sri Valli Computers,
1-4-222, Park Lane, Kalasigu,
Secunderabad – 09.
Copy to the Commercial Tax Officer, , Hyderabad.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Unnati Industrial Co-op Society Limited, (TIN
The rate of tax applicable to Voltage stabilizers.

Sri Hari Prasad, Manager, of the firm has appeared for hearing on
is given as under.
1 of page 2
In the G.Os cited above under Entry 39 of Schedule IV of the
A.P.VAT Act various types of items falling within the scope of I.T.
products have been notified alongwith the HSN codes. At Sl.No.7 of
the notified codes under Entry 39, the HSN code 8504 is mentioned.
Under the chapter heading 8504 in the Central Excise Tariff, Voltage
regulators and Stabilizers are included with HSN code 8504.40.40.
Therefore as the chapter code has been notified in the above said
G.O. all items falling under the said chapter code are deemed to be
falling under the same code. Therefore Voltage stabilizers are held
as liable to tax @ 4%.

To
M/s. Unnati Industrial Co-op Society, Limited,
1-9-596, Adikmet,
Copy to the Deputy Commissioner (CT), Secunderbad Division.
Copy to the Commercial Tax Officer, Vidyanagar Circle,

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Ammana Industries, IDA Jeedimetla, Hyderabad (TIN
1. Rate of tax on Cast iron powder
2. Eligibility for input tax credit on packing material
and consumables
Sri A.Satyanarayana Reddy, Managing Partner appeared on behalf of
is given as under.
The applicant claims that he is a manufacturer of Cast iron
powder from scrap cast iron borings that are purchased mostly
from unregistered dealers. The process of making cast iron powder
according to the applicant involves pulverization, cleaning and
packing etc., and that it is excisable under chapter sub head
7205.10 and that the applicant is collecting VAT @ 4% and seeks
confirmation to this effect.
We have examined the contents of the application. Entry 70
of Schedule IV of the A.P.VAT Act refers to Iron and Steel and
specifies various forms of the metal. In the G.Os cited above, HSN
code applicable to Entry 70 has been notified. At Sl.No.2 under the
notified entry, HSN code 7205 is mentioned as applicable to
granules and powders of Iron & Steel. The chapter heading 7205.10
refers to Granuels of Iron and 7205.10.90 refers to powders. As the
chapter heading 7205 has been notified, all items under the
heading fall within the ambit and scope of the code. Therefore, it is
held that Cast Iron powder is liable to tax @ 4%.
The applicant claims that he uses packing material and other
consumables and seeks to know whether he is eligible for input tax
credit on these items. Section 13 read with Rule 20 makes it clear
that a VAT dealer can claim credit of taxes paid on inputs provided
the same are purchased from VAT dealers within the State and used
for business purpose excluding the items listed in Rule 20(2).
Therefore the applicant must ensure that the conditions prescribed
for input tax credit are met with before making a claim.
To
M/s. Ammana Industries,
D-53, Phase IV Extension,
IDA, Jeedimetla,

Hyderabad.
Copy to the Commercial Tax Officer, IDA Gandhi Nagar Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/203/ 2005 Dated 21-7-2005
***
O R D E R:
M/s. GRINDWELL NORTON LTD, P.G.ROAD, SECUNDERABAD,

Represented for inclusion of Bonded Abrasives, Coated Abrasives, Abrasive
Wheels,Tools etc.,to cover under industrial inputs attracting the rate of tax
@ 4%.
1. A copy of the representation by Abrasives Manufacturers
Association of India dt. 16-6-2005.
2. Literature relating to abrasives.
Mr. V.R.Venkateswaran, S/o.M.A. Puranik, G.M.Finance, appeared
Section 67 of A.P.VAT Act provides for clarification and
Advance Ruling on issues falling within the scope of the Act. The
applicant, however, seeks inclusion of power tools in Schedule IV of
the Act. Inclusion / deletion of items is a prerogative of the
legislature and outside the scope of this Authority. Accordingly this
application is disposed of.
Addl.Commissioner Jt.Commissioner Jt.Commissioner
NOTE:- An appeal against this proceedings can be filed befre the Sales Tax
To
M/s. Grindwell Norton Limited,
P.G.Road,
Secunderabad.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Pearl Mineral Private Limited, Prakasam Distrist (TIN

1. The rate of tax applicable to :
b) Rough granite blocks
c) Rough granite slabs
d) Rough granite tiles
e) Polished granite slabs and
f) Polished granite tiles
2. The liability of the applicant for transactions effected :
a) Within the State
b) With 100% EOU
c) Interstate
d) Direct export
e) Export through an exporter
3. Eligibility for input tax credit on raw material on which VAT was paid.
4. Eligibility for input tax credit on consumables.
Sri N.V.Sudhakar, Asst.General Manager (Accounts & Legal)

appeared on behalf of the firm for hearing on 20-7-2005 and explained the
case.
1. Academic note on Minerals
2. Copy of Granite Conservation and Development Rules, 1999.
3. Treasury challans depicting payment of royalty.
4. Notices issued by department of Mines & Geology.
5. Copy of G.O.Ms.No.217 Industries & Commerce (MI) Department,
Dt.29.9.2004.
6. Extract of definition of ‘Minor Minerals’ under the A.P.Minor Mineral

Consession Rules, 1966.
is given as under.
The applicant is a dealer in Granite and claims to extract
Granite from Mines leased to him by the department of Mines and
Geology, Govt. of A.P. The applicant is under the impression that
Granite falls under Entry 43 of Schedule IV of the A.P.VAT Act, 2005
that refers to ‘Ores and Minerals’ and further takes support from
the fact that it is treated as a minor mineral by the Department of
Mines & Geology and royalty is paid by the applicant accordingly. In
support of his claim, the applicant submitted detailed academic
notes on the meaning of the word ‘mineral’, the various types of
minerals, their composition and the distinction between mineral
and rock. To supplement the view that Granite falls under the Entry
43, copies of documents stated above have also been filed. In the
Granite Rules, 1999 the word ‘Granite’ is explained, among other
things, as ‘an igneous rock’. Other documents merely supplement
the fact that the department of Mines & Geology classifies it as a
minor mineral for the purpose of payment of royalty. The definition
of minor minerals under the Mineral Rules, 1966 says minor
minerals are building stones etc., and those that are declared by the
Central Govt., as minor minerals from time to time. The applicant, in
the light of the above mentioned literature and Government orders
etc., seeks confirmation to the effect that Rough Granite blocks /
slabs / tiles and Polished Granite slabs / tiles are minerals and fall
under Entry 43 of the Schedule IV of the Act.
We have considered the contents of the application and the
documentary evidence furnished by the applicant. In the G.O. cited
above the HSN codes applicable to entries in the Schedules have
been notified. Entry 43 of the Schedule IV contains a list Ores &
Minerals alongwith their respective HSN codes. The notified chapter
headings do not contain Granite. We have browsed the HSN code
further and find that Granites that are not roughly trimmed or
merely cut into blocks or slabs etc., falls under chapter heading
2560. Since the chapter code has not been notified as falling within
the ambit of Entry 43 of Schedule IV, we are unable to confirm the
view of the applicant that Granite is a mineral in terms of Entry 43
of Schedule IV of the Act. In the circumstances and in view of the
language in Schedule V of the A.P.VAT Act, 2005, the items in
question attract 12.5% rate of tax.
As regards liability of the applicant on transactions within the
State the applicant is liable to pay tax on the output value @ 12.5%.
In so far as sales to 100% EOUs are concerned the
transaction is taxable and accordingly the applicant is required to
charge tax on the output value at the rate determined above.
In the event of interstate sale, the applicant is liable to pay
tax at the rate prescribed under the Central Sales Tax Act, 1956
which is presently 4%.
When the applicant makes direct exports he is not liable to
tax on the transaction as they are zero-rated under the A.P.VAT Act,
2005. The applicant may also export through an exporter but he will
be required to establish proof of such export furnishing the
documents prescribed under Rule 29(2)(c) read with Rule 35(6)(b).
The applicant states that he buys raw materials i.e., Granite,
by paying VAT and exports the same directly or indirectly. He seeks
to know whether he is eligible to claim input tax credit on the said
purchases. As exports either direct or indirect are zero-rated, the
applicant is eligible to claim credit of input tax paid on raw
material. However, he is required to maintain records / books of
account as mentioned in Rule 29(2)(c) read with Rule 35(6)(b).
Finally the applicant seeks clarification whether he is eligible
to claim input tax credit on consumables when the same are
purchased by paying VAT. According to the applicant these
consumables are used to produce the goods. According to the
scheme of A.P.VAT Act, the consumables that suffer VAT within the
State will be relieved of the tax burden when they are used as
inputs for making goods that are taxable. Accordingly, the applicant
is eligible to claim input tax credit of VAT paid on consumables.
To
M/s. Pearl Mineral Private Limited,
Survey No.394/5, Pernamitta Village,
Santhanuthalapadu Mandal, Ongole, Prakasam District,Andhra Pradesh–523
225.


PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Polisetty Somasundaram Tobacco Threshers Private Limited,

(TIN No.28540171058), D.No.8-24-31, Mangalagiri Road, Guntur have filed
an application dt.16-05-2005 and sought clarification and Advance Ruling
on the following items under Section 67 of the APVAT Act, 2005 read with
Rule 66(2)(i) of APVAT Rules,2005 along with the application fee of
1. Whether they are eligible for claiming refund of tax credit only if
they are engaging in trading transactions i.e., purchase and sale of
tobacco.
2. Whether they are also eligible for claiming refund of tax credit even
if they carry on transactions only on job work basis.
The case was posted for hearing on 12-07-2005. Sri V.S.R. Murthy,
Accountant of the firm appeared and explained the case.
After examining the facts of the case, the ruling is given as under:
1) The benefit of input tax credit is given only against zero rated
sales (exports and CST sales) and taxable sales made in the State.
There is no distinction whether the VAT dealer is a trader or a
manufacturer.
1 of 2
2) As regards the benefit of input tax credit, if business is done
only on job work basis, there cannot be any claim of input tax credit
if the output is exempted or it is a exempt transaction.
3) If the total business comprises taxable sales, zero rated sales

and exempted transactions and the inputs are common for all these
transactions, the tax paid on the common inputs shall be claimed on
the basis of A X B/C as prescribed in Rules. Since the amount
received towards job work charges is not taxable under the
provisions of the Act, no input tax credit shall be claimed for such
transactions.
JT.COMMISSIONER
To
M/s. Polisetty Somasundaram Tobacco Threshers Private Ltd.,
D.No.8-24-31, Mangalagiri Road,
Guntur-522 001.

Hyderabad.
Copy to the Deputy Commissioner (CT), Guntur-I Division.
Copy to the Commercial Tax Officer, Kothapet Circle, Guntur.
2 of 2

PROCEEDINGS OF THE


O R D E R:
I. M/s. V.B.Oil Mills (P) Ltd.,Adoni (TIN.28950165095) have filed an


Whether a VAT dealer, making both taxable sales and exempt transactions
of taxable goods in a tax period is expected to apply the formula AX B/C for
each tax period or not .
Sri M.Ramachandra Murthy, Authorized Representative , appeared for
Act and Rules the ruling is given as under
The applicant states that they own a composite unit for solvent extraction
and refinery and purchases raw materials – oil cakes and non-refined oils
both within the state and as well as from outside the state. The raw
materials purchased from other states are converted into oil and sent to
branches or consignment agents located in other states for sale. Likewise,
the raw materials purchased in the state of A.P., are converted into oil and
deoiled cakes and sold within the state. It is also stated that they maintain
separate stock registers for such purchases and sales. Thus they want to
apply the formula provided in Rule 20(8) separately and independently—
once for outside purchases of Raw material and stock transfers of finished
goods, and again for local purchases of Raw materials and local sales of
finished goods.
The issue involved in the applicant’s representation is
examined with reference to the facts and circumstances and rules
prescribed in the APVAT Act,2005.therein. Rule 20 prescribes eligibility of
ITC for all VAT registered dealers. Specific Sub-rules are also prescribed
depending on the nature of business and character of transactions. The
applicant has composite solvent extraction and refinery. Thus, process of
solvent extraction precedes refining of oils. Thus, the unit is a composite
unit suitable for solvent extraction and simultaneously for refining. Sub-
Rule (8) of Rule 20 stipulates that a VAT dealer like the applicant effecting
sales of taxable goods and also exempt transactions of taxable goods, in a
tax period, the ‘C’ in the formula in AXB/C prescribed in the said sub-rule,
should be the amount of total turnover which includes the turnover of
exempt transaction of taxable goods. The applicant cannot apply such
formula independently for taxable goods and exempt goods. Therefore, this
authority clarifies the applicant to follow sub-rule 8 of Rule 20 for
calculation of ITC.
ruling.
To
M/s. V.B.Oil Mills (P) Ltd.,Adoni.,
Copy submitted to the Commissioner of Commercial Taxes, A.P. Hyderabad.
Copy to the Deputy Commissioner(CT) Kurnool Division.
Copy to the Asst.Commissioner, L.T.U.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Sri Venkata Sai Minerals, Bethamcherla

1. Calcite lumps and powders
2. Steatite lumps and powders (Soapstone, talc)
3. Dolomite lumps and powders
4. White Shale lumps and powders

Copy of the Extraordinary Gazettee of Government of India No.454 Dt.14-
1-2004 of Ministry of Coal & Mines.
Sri Hyder Vali, Authorised Representative, appeared for hearing on

The applicant stated that the items referred supra are n

notified by the Department of Coal and Mines, Government of India
as falling under minerals and contended that pure powders of such
minerals should also fall under the entry Ores and Minerals. Entry
43 of IVth schedule enumerates – ores and minerals covers all ores
and minerals.
Since, all the commodities referred are natural minerals

converted into powder by pulverizing them. Therefore, all ores and
minerals in their natural or powder forms fall under entry 43 of the
IVth Schedule liable to VAT @ 4%.
ruling.
To
M/s. Sri Venkata Sai Minerals,
Bethamcherla.

Copy to the Commercial Tax Officer-III, Kurnool Circle.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Babulal Singhania, Hyderabad have filed an application and
sought clarification and Advance Ruling under Section 67 of the APVAT Act,
1. Whether a dealer dealing in Sugar exclusively and having a turnover
of above Rs.40 lakhs per annum is required to register as a VAT dealer?
The case was posted for hearing on 9-11-2006. Sri Abhay Kumar,
Chartered Accountant and authorised representative of the firm appeared
(CT.II) Dept, dt.29.6.2006.
After examining the provisions of compulsory registration under sub

section (5) of Section 18 of A.P.VAT Act, the ruling is given as under ;
Every dealer liable to be registered under CST Act or any dealer

making purchase or sales in the course of interstate trade shall be liable to
be registered as VAT dealer irrespective of the quantum of taxable
turnover.
In the circumstances explained by the applicant, he shall be liable to

be registered if purchases sugar from outside the State or imports from
outside the country. In case he does not make any purchase from outside
the State, he will not be required to register as VAT dealer.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Babulal Singhanaya,
Plot No.259, Shop Mo.1,
L.B.Nagar, Shahpur Nagar,
Hyderabad.
Hyderabad.
Copy to the Commercial Tax Officer, Gandhinagar Circle.
PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Nagarjuna Fertilizers and Chemicals Limited, Kakinada (TIN
Advance Ruling under Section 67 of the APVAT Act, 2005 read with Rule
The applicant is seeking clarification regarding the inclusion of
Transmission charges paid to the supplier of Natural gas as part of sale
price attracting tax in the hands of selling dealer.
The case was posted for hearing on 21-11-2006. Sri A.C.Gangaiah,
Chartered Accountant and authorized representative of the firm appeared
(CT.II) Dept, dt.29.6.2006.
It was explained by the applicant that Gas Authority of India Limited
is supplying Natural gas to the applicant. It was stated by the applicant that
an amount of Rs.3,30,94,568/- is paid as monthly transmission charges to
GAIL in addition to the sale price and tax is being charged after including
such charges in the sale price.
The issue has been examined. Firstly, it is a case where seller of the
goods is liable to pay tax and such seller should have been the right person
to seek a clarification on his tax liability. Secondly, this issue is not specific
to the provisions of VAT Act because the definition of sale price under the
provisions of A.P.VAT Act is same as contained under the provisions of the
APGST Act. This issue is already well settled and it does not need to be
resolved by this Authority. Any price paid upto the stage of delivery shall
form part of sale price and in this particular case the goods are not
delivered and parted with unless transmission is done.
The ruling is therefore given that, there is no case for the applicant
to raise this issue before this Authority.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Nagarjuna Fertilizers and Chemicals Limited,
Kakinada.

Hyderabad.
Copy to the Asst.Commissioner (CT)LTU, Kakinada Division.

PROCEEDING OF THE
(Enft)

05.
***
O R D E R:
M/s. V.A.Marketing, (TIN No.28750111978) Hyderabad have filed an
application and sought clarification and Advance Ruling under Section 67 of
following items :
1. Pre-compressed press board
2. Insulation press board
3. Mill press board
The case was posted for hearing on 9-11-2006. Sri A.V.Prasada Rao
authorised representative of the firm appeared and explained the case.
(CT.II) Dept, dt.29.6.2006.
The applicant produced the relevant copies of the invoices containing
the applicable HSN codes. The codes applicable are falling under Chapter
48. It is seen that Insulation press board falls under HSN code 4811 which
is notified against Entry 44 of Schedule IV dealing with ‘Paper of all kinds’.
Similarly PCPP press board falling under HSN code 4804 is also covered in
the notification issued by the Government. One of the items is Pre-
compressed press board grade 2.6 which falls under HSN code 4823. The
HSN code 4823 is notified by the Government separately vide
G.O.Ms.No.502 dt.1.5.2006 against Entry 100 dealing with industrial inputs.
Since the item of the applicant falls particularly under the HSN code 4823,
this will also attract 4% tax under the provisions of A.P.VAT Act, 2005.
The ruling is that all the three items mentioned by the applicant
attract tax @ 4% for the sales made within the State.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. V.A.Marketing,
D-101, Opp:D-Block Park,
Madhuranagar, Hyderabad.

Hyderabad.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Deccan Chronicle Holdings Ltd., (TIN No.28800185179), S.D.
Road, Secunderabad have filed an application and sought clarification and
Whether he is entitled to claim the benefit of input tax credit on the

purchases of newsprint, printing ink, chemicals etc., since he is selling
waste news paper, waste news print scrap etc., on which tax is leviable
under the Act.
The case was posted for hearing on 09-12-2005. Sri K.G. Naidu,
General Manager, Finance appeared on behalf of the firm and explained the
case.
The applicant also enclosed a copy of the reply furnished by him to a

notice issued by Commercial Tax Officer, S.D. Road Circle. As seen from
this, certain proceedings are already initiated by the Commercial Tax
Officer, S.D. Road Circle with regard to the claim of input tax credit by the
applicant.
1 of 2
According to sub-section (2) of Section 67 of the Act, no

application can be entertained by this Authority on the question
raised in the application is already pending before any Officer or
Authority of the Department. Therefore, we do not see any reason
to pass any orders on this application.
JT.COMMISSIONER
To
M/s. Deccan Chronicle Holdings Limited,
36, Sarojini Devi Road,

Hyderabad.
Copy to the Commercial Tax Officer, S.D. Road Circle.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. National Electro Systems, (TIN No.28620241736), Industrial
Estate, Anantapur have filed an application and sought clarification and
Rate of tax on various types of Copper and Aluminium Enamelleld

Wire and Strips shown below, whether attract 4% tax under Entry 38 of
Schedule IV to the Act.
Copper & Aluminium Enamelled Wire and Strips.

Copper & Aluminium Paper Covered Wire and Strips.
Copper & Aluminium Fiber Glass Covered Wires and Strips.
Copper & Aluminium Capton Covered Wires and Strips.
Copper & Aluminium Cotton Covered Wires and Strips.
Copper & Aluminium Poly Covered Wires and Strips.
Copper & Aluminium Branded Wires and Strips.
Sri Shomal Bafra, Business Development Executive of the firm

It was explained that the items manufactured and sold by them are
used by various types of industries in manufacturing pumps, electric
motors,
1 of 2
transformers etc., According to them they are not meant for use as
domestic cables which are basically PVC coated cables. Some samples have
also been produced along with the copies of invoices. As seen from the
samples and the invoices it is very clear that they are enamelled and paper
covered wires which can be used only by the industry. The applicable HSN
Code is 8544.11.90. The HSN Codes for Entry 38 were notified vide
G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-2005. However, the
Government re-notified HSN Codes vide G.O.Ms.No.1615, Revenue (CT.II)
Department, Dt.31-08-2005. In the latest notification, the HSN Codes for
the Entry 38 relating to “industrial cables” have not been specified. A
circular was issued by Commissioner of Commercial Taxes Office vide
No.A.III(1)/1/2005, Dt.22-09-2005 regarding the clarification on items
falling under industrial cables. According to this circular, Aluminium and
Copper Cables excluding single wire upto 6 Sq.mm will be treated as
industrial cables. In the same circular it was mentioned that single core
cables upto 6 Sq.mm will be taxable at 12.5%. The Entry 38 in Schedule-IV
specifically mentions the word “cables” and it does not refer to wires. The
HSN Code 8544.11.90 notified by Government against Entry 38 is
withdrawn with effect from 01-09-2005.
The ruling is therefore, given that the items mentioned

by the applicant do not fall within the scope of Entry 38 of Schedule
IV to the Act and therefore, liable to tax @ 12.5% as a residual
items falling within the scope of Section 5 of the Act.
JT.COMMISSIONER
To
M/s. National Electro Systems,
Plot No.5/14, Industrial Estate,
Anantapur-515 004.

Hyderabad.
Copy to the Deputy Commissioner (CT), Anantapur Division.
Copy to the Commercial Tax Officer-II, Anantapur Circle.
2 of 2

PROCEEDING OF THE

CCT’s Ref.No.PMT/P&L/A.R.Com/53/2005 Dated:23-5-2005

***
O R D E R:
M/S Hotaco, Visakhapatnam had made an application on 4-5-

2005 seeking clarification and Advance Ruling on the following items under
Section 67 of the APVAT Act, 2005.
The issue on which clarification sought is as to whether
Polymer Modified Asphaltic Waterproofing Membrane liable to tax at 4% ?
Their application is examined with reference to the payment
of fees of Rs.1000/- and other material is enclosed and found in order.
Hence admitted. They also enclosed Invoice for clearance of Excisable
goods showing their Excise Tariff Code as 6807 90 .
The case was posted for hearing on 12-5-2005 at 3.30 P.M.
Sri Mr.Satyanarayana, Manager, appeared on behalf of the firm and
explained the case.
The issue raised by the firm have been examined with
Since the commodity under reference is covered under
HSN Code 6807 which is notified as Entry No.4 of IVth Schedule, the
rate of tax applicable is 4%.
JT.COMMISSIONER
To
M/s Hotaco,
IDA-11, Gurrampalem, Pendurthi,
VISAKHAPATNAM –73.

Hyderabad.
Division.

PROCEEDING OF THE

CCT’s Ref.No.PMT/P&L/A.R.Com/42/2005 Dated -5-2005
Ref.CCT’S REF.NO.PMT/P&L/A.R.COM/2005, DATED -5-2005
***
O R D E R:
M/S McDowell & Company Ltd., (TIN No.28160121827), IDA,

Nacharam, Hyderabad have filed an application on 29-4-2005 and sought
clarification and Advance Ruling on several items under Section 67 of the
APVAT Act, 2005. They also enclosed an application fees of Rs.1000/-. The
The applicant sought clarification on the following:
1) The procedure for claiming Input Tax Credit on the purchases of
packing raw-materials and raw-materials from various vendors.
2) Clarification of rate of tax on the following items.
The case was posted for hearing on 6-5-2005 at 2.30 P.M.
Mr.V.V.S.N.Murthy, authorized Executive Accountant of the firm appeared
and presented the case.
The application is examined with reference to the to the provisions
of the AP VAT Act and Rules and HSN Codes notified by Government vide
is given as under. (1) They are not eligible for claiming input tax
credit on purchases as per the provisions of the AP VAT Act, 2005.
(2) The rate of tax on the following items as per HSN codes notified
by Government are as under:
1) Used Carton : (HSN Code 4819 ) taxable @ 4% U/E 90
2) Waste Carton : (HSN Code 4819 ) taxable @ 4% U/E 90
3) Waste Plastics : (HSN Code ) taxable @ 12.5% Vth Sch.
4) Crushed PP Caps : (HSN Code ) taxable @ 12.5% Vth Sch.
5) Used Gunny bags : (HSN Code 6305) taxable @ 4% U/E 90 IV
6) Broken Glass Pieces : (HSN Code ) taxable @ 12.5% V Sch.
7) Empty Carbouys : (HSN Code 7010)taxable @ 4% U/E 90 IV
8) Waste Cables : (HSN Code ) taxable @ 12.5% Vth Sch.
9) Crushed Malt ( for cattle Feed) : (HSN Code ) taxable @ 12.5% Vth Sch.
10) Denatured (Impure) Spirit : (HSN Code ) taxable @ 12.5% Vth Sch.
11) M.S.Scrap. : (HSN Code ) taxable @ 4% U/E 71
of IV
schedule.
JT.COMMISSIONER
To
M/s McDowell & Company Ltd.,
IDA, Nacharam,
HYDERABAD.

Hyderabad.
Copy to the Deputy Commissioner (CT),Division.

PROCEEDING OF THE

***
O R D E R:
M/S Suguna Industries, Thanappa Chetty Street, Mittoor,

Chittoor, A.P. (TIN No.28020192480), the applicant sought for clarification
Act, 2005. They also enclosed an application fees of Rs.1000/-. The
They sought for clarification on the following goods as to the
rate of tax.
1. Electric Motor.
2. Deepwell Jet Moboblocs
3. Stage Pumps
4. Single Phase Monoblocs
5. Submersible pumpsets
6. Openwell submerible monoblocs
7. Centrifugal monoblocs
8. Diesel Generators
9. Agricultural Pumps
10. Air Compresor
11. Borewell compressors
12. Mobobloc compressors
13. Piston pumps
14. High Pressure Pumps
15. Semi Hydraulic Hoist.
Sri C.Ravichandran, Regional Manager has appeared in person on
behalf of the company and explained the case and also furnished copies of
the Central Excise gate pas cum invoices.
The case was posted for hearing on 7-5-2005. Their case is
examined with reference to the provisions of the AP VAT Act and Rules and
HSN Codes notified by Government vide G.O.M.No.398, Revenue (CT-II)
Department, dt.31-3-2005 and G.O.Ms.No.490, Revenue (CT-II)
Department, dt.15-4-2005 and the ruling is given as under.
1) Electric Motors excluding generating sets, falling under HSN
Code 8501 are notified in the G.Os cited above as falling
under Entry 39 of IV Schedule of A.P.VAT Act, 2005. Hence
liable to tax @ 4%.
2) Hand pumps, parts an fittings thereof falling under HSN code,

8413.11, 8413.19.10, 8413.20, 8413.91.40 and
3) Centrifugal, monoblock, and submersible pump falling under

HSN code 8413.70.10, 8413.70.91, 8413.70.92, 8413.70.93,
8413.70.94, 8413.70.95, 8413.70.96, 8413.70.93 and
8413.81.10, 8413.81.30, 8413.91, 8414.10 and 8414.90.90
are taxable @ 4%.
Other goods, not falling under the above mentioned codes
would attract tax @ 12.5%.
JT.COMMISSIONER
To
M/s Suguna Industries.,
19-4, Thanappa Chetty Street, Mittoor,Chittoor –1, A.P.
Hyderabad.
Division.

PROCEEDING OF THE

***
O R D E R:
M/S Techno Lines (TIN No.28090218021), have filed an

application on 17-5-2005 and sought clarification and Advance Ruling on
the following items under Section 67 of the APVAT Act, 2005. They also
enclosed an application fees of Rs.1000/-. The application is examined and
The case was posted for personal hearing on 20-5-2005 at
3.30 P.M. Mr.K. Srinivasa Rao, Authorised Signatory of the firm appeared
on behalf of the firm and presented this case.
What is the VAT to be charged on :
e. Servo Stabilizers
f. Control Transformers / Isolation transformers
g. Constant voltage transformers
h. DC regulated power suppliers and
i. Battery chargers
The issue is examined with reference to the provisions of the
is given as under.
The products, Servo controlled stabilizers, control
transformer / isolation transformers, constant voltage
transformers, battery chargers fall under HSN Code 8504 and
whereas DC regulated power supplies fall under HSN code 8501. As
these codes have been notified in the G.O. cited above, they attract
tax @ 4% under entry 39 of the IV Schedule.
JT.COMMISSIONER
To
M/s Techno Line.
Plot No.71, Shaktipuram, Near Kukatpally I.E.,
Hyderabad – 72.

Hyderabad.
Division.

PROCEEDINGS OF THE

SriP.Satyanarayana Reddy,Jt.Commissioner (Enft.)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/587/ 2005. Dated23- 05-2006.

O R D E R:
M/s. Hybrid Rice International (P) Limited (TIN.28470141346) have filed
items under Section 66(2)(i) of APVAT Act, 2005 of APVAT Rules, 2005
along with the application fee of Rs.1000/-.
1) Whether the applicant requires to issue a way bill in form
600 for dispatching truthfully labeled seeds for
sowing/agricultural purpose or not.
2) Whether they require to issue ‘C’ and ‘F’ forms prescribed
under the CST Act for sales/stock transfers of the said
exempted goods.
Sri J.V.Rao, Advocate on behalf of the firm appeared for hearing on 18-5-
1) Application in form 570
2) Brief note of their nature of business.
3) A copy of the proceedings of Advance Ruling in the case of M/s.
Poshak Feeds Private Limited, dt. 25-10-2005.

the APVAT Act and Rules and (HSN Codes notified by
Government vide G.O.Ms.No.398, Rev. (CT.II) Department and
G.O.Ms.No.490, Rev. (CT.II) Department Dated 15-04-2005 as
superceded in G.O.Ms.No.1596, Rev. (CT.II) Department, dt.27-
8-2005 and G.O.Ms.No.1615 Rev. (CT.II) Department, dt.31-8-
2005.and the ruling is given as under:
The applicant is a dealer in processing and distribution of “
truthfully labeled seeds” for agricultural and sowing purpose The
commodity at item No.44 of the 1st Schedule of the APVAT Act 2005
reads as ---“seeds for sowing and gardening purposes” are exempt
from VAT U/S.7 of the APVAT Act. The applicant states that check
post authorities are insisting for way bills. In the circumstances the
applicant seeks ruling whether way bill is required for transporting
truthfully labeled seeds. . We have considered the plea of the
applicant. Rule 55 of the APVAT Rules refers to movement of goods
in goods vehicle. Proviso U/Sub-Rule (1) of the said rule exempts
use of way bill in respect of transport of goods specified in Schedule
I of the Act. Thuswe hold that when exempt goods listed in
Schedule I of the Act are transported, there is no necessity of issue
of Way bill.
ruling.
To
M/s. Hybrid Rice International Private Ltd.,
8-1-39 Qutub Shahi Tombs Road,Tolichowk, Hyderabad.

Copy to the Commercial Tax Officer Mehdipatnam Circle.

PROCEEDINGS OF THE

****
O R D E R:
M/s. MEKINS AGRO PRODUCTS LIMITED (TIN.28030123060) have

Rate of tax on the following items.
1) Animal drawn agriculture implements and attachments
2) Hand operated implements and tools
3) Power operated implements
4) Post harvesting implements
1) List of items falling under the heads as indicated above./
2) Brochure showing various implements de eloped by the applicant
3) Copy of the notice in form 305 and notice in form 305A issued by
the A.C. Abids, Division.
IV. Mrs. Sharada. Accounts Officer, appeared for hearing on 20-5-2006
and explained the case. She brought to our notice that notice in form 305
issued by the Asst.Commissioner (LTU) is not related to the issue under
reference. Hence, she sought for clarification.
According to the applicant they are the manufacturers of
Agricultural implements and machinery consists of animal drawn
equipments, hand operated equipments, tractor drawn implements,
threshers, crop processing equipments etc., The brochure submitted
shows they are specialists in manufacture of agricultural
implements and machinery.
After examining the facts of the case including the nature and
character of items manufactured and with reference to the
provisions of the APVAT Act & Rules it is observed that Item No.1 of
Schedule I to the APVAT Act prescribes Agricultural implements
manually operated or animal driven including hand operated
sprayers and dusters which are exempt from levy of VAT U/S.7 of
the APVAT Act. Like-wise item No.1 of IVth Schedule to the APVAT
Act also prescribes list of ”Agricultural implements not operated
manually or not driven by animals”. As against item No.1 of 1st
Schedule, no HSN Code is notified, where as against item No.1 of
IVth Schedule, HSN Codes 8432, 8433 except 8433.51 and 8433.52,
8436 and 8433.53 are notified. Thus, all items covered in these HSN
Codes notified at itemNo.1 of the IV Schedule are taxable @ 4%
whereas the items falling under item No.1 of 1st Schedule are
exempted.

ruling.
To
M/s. MEKINS AGRO PRODUCTS LTD.Plot No. 30 IDA Gandhinagar,
Hyderabad.
Copy to the Commercial Tax Officer,Basheerbagh Circle.

PROCEEDINGS OF THE

Sri P.Satyanarayana Reddy, Jt.Commissioner (Enft.)
*****
O R D E R:
M/s. PAYAL FOOT WEAR , Sultan Bazar, Hyderabad
of Rs.1,000/- They sought clarification on the following:
1) Rate of tax on Plastic Footwear
2) Procedure for adjustment of excess tax paid through VAT 200
returns
Sri Raj Kumar, Manager, on behalf of the firm appeared for hearing
1) Copy of the proceedings of the Authority for clarification and
advance ruling in the case of M/s. Sri Bhavani Rubber Industries,
Vijayawada, dt. 26-9-2005.
2) A certificate issued by Footwear Design and Development
Institute. Ministry of Commerce, Government of India.
The applicant represented that he sells plastic footwear. He
seeks to know the rate of tax applicable to the footwear sold by
him. The certificate issued by Director, Technical, FDDI, Ministry of
Commerce, Government of India contains information about the
components of plastic footwear and its classification under the HSN
codes. However, the applicant could not furnish the purchase and
sale invoices depicting the HSN Code 6402.19.90 is applicable to the
commodity/goods dealt by them.
In the absence of evidence of HSN Codes, this authority is not
in a position to give a ruling whether the footwear dealt by the
applicant falls under entry 46 of the IVth Schedule of the APVAT Act
or not. Further, the applicant already paid tax @ 12.5% on the sale
of foot wear upto 30-9-2005 but it is not revealed whether the
applicant charged VAT or not from the customers. Therefore, a
question of fact i.e. whether tax has been collected from the
customers lies on the part of the applicant. Therefore, the applicant
is advised to file a representation in form VAT 213 so that the CTO
may conduct necessary audit under Rule 23(6)(b) and to have the
benefit of over-declaration of tax by the applicant and adjustment
of excess tax, if any.

ruling.
To
M/s Payal Footwear,
4-4-19/24, Sultan Bazar, Hyderabad.
copy submitted to the Commissioner of Commercial Taxes, A.P. Hyderabad
Copy to the Commercial Tax Officer Abids Circle.
PROCEEDINGS OF THE

SriP.SathyanarayanaReddy, Jt. Commissioner (Enft.)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/586/ 2005. Dated23- 05-2006.
O R D E R:
M/s. Pro Agro Seed Company (P) Limited (TIN.28930120314) have filed an
3) Whether the applicant requires to issue a way bill in form
600 for dispatching truthfully labeled seeds for
sowing/agricultural purpose or not.
4) Whether they require to issue ‘C’ and ‘F’ forms prescribed
under the CST Act for sales/stock transfers of the said
exempted goods.
Sri J.V.Rao, Advocate on behalf of the firm appeared for hearing on 18-5-
3) Application in form 570
4) Brief note of their nature of business.
3) A copy of the proceedings of Advance Ruling in the case of M/s.
Poshak Feeds Private Limited, dt. 25-10-2005.
VI. The issue has been examined with reference to the provisions of
the APVAT Act and Rules and (HSN Codes notified by
Government vide G.O.Ms.No.398, Rev. (CT.II) Department and
G.O.Ms.No.490, Rev. (CT.II) Department Dated 15-04-2005 as
superceded in G.O.Ms.No.1596, Rev. (CT.II) Department, dt.27-
8-2005 and G.O.Ms.No.1615 Rev. (CT.II) Department, dt.31-8-
2005.and the ruling is given as under:
commodity, at item No.44 of the 1st Schedule of the APVAT Act 2005
reads as—“seeds for sowing and gardening purposes’ are exempt
I of the Act. Thus we hold that when exempt goods listed in
of Way bill.
ruling.
To
M/s. Pro Agro Seed Company Private Ltd.,
8-1-39, Qutub Shahi Tombs Road,Tolichowk, Hyderabad.

Copy to the Deputy Commissioner(CT)Charminar Division.
Copy to the Commercial Tax Officer,Mehdipatnam Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Gouthami Spun Piples (TIN No.28110215369)

Karimnagar have filed an application dt.23.5.2005 and sought clarification
The rate of tax applicable to RCC pipes.
is given as under.
1 of page 2
Entry 45 of Schedule IV of A.P.VAT Act, 2005 specifies Pipes
of all varieties including G.I.Pipes, C.I.Pipes, Ductile pipes and PVC
pipes. In the G.Os mentioned above HSN codes for Entry 45 have
been notified. Sl.No.20 Cement pipes are mentioned but the HSN
code has not been mentioned. However, having regard to the
language of the entry which reads “Pipes of all varieties”, it must
be construed that RCC pipes squarely fall under the description of
Pipes of all varieties. Therefore they are held as liable to tax @ 4%.
To
M/s. Gouthami Spun Pipes,
Plot No.23, Industrial Area,
Gouthaminagar, Fertilizer City,
Karimnagar – 505 210.
Copy to the Deputy Commissioner (CT), Karimnagar Division.
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Solar Nimba Limited, (TIN No.28370272849) Adoni have
1) The liability to tax under A.P.VAT Act when the applicant

purchases Oil cake on cash basis from unregistered dealers and
sell the same to other VAT dealers or consumers in the State and
dealers of other states.
2) Further, how such transactions are to be reported in the monthly

returns.
1 of page 2
1) Oil cakes fall under Entry 87 of Schedule IV of A.P.VAT
Act. As the applicant purchases Oil cakes from
unregistered dealers, he cannot claim input tax credit
when he sells the same. The applicant is liable to pay
output tax on the sale price of Oil cake, on his sales to VAT
dealers as well as consumers in the State. In the case of
sales to dealers of other States, the applicant is liable to
pay tax under the CST Act.
2) As the applicant claims to purchase Oil cake from

unregistered dealers and such purchases not being
eligible for input tax credit he shall report purchases in
Box 6(A) of VAT 200 (Return). He should report the value
of sales in Box 16(A) and output tax (VAT) in Box 16(B).

To
M/s. Solar Nimba Limited,
17/4, Madhavaram Road,
Adoni – 518 301.
Kurnool District.
2 of page 2

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Godrej Boyce Manufacturing Co. Limited, Hyderabad (TIN
The applicant is seeking clarification regarding the rate of tax

applicable on Home Uninterrupted Power System (UPS) having HSN code
8504.40.
The case was posted for hearing on 21-11-2006. Sri N.V.Raj Gopal
(CT.II) Dept, dt.29.6.2006.
After examining the Entry 39 in the Schedule IV and the sub items
specified therein, it is observed that Sl.No.7 therein deals with
Uninterrupted Power Supply (UPS) and their parts.
The ruling therefore is given that the item mentioned by the

applicant Home UPS with HSN code 8504.40 attracts tax at 4%.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Godrej & Boyce Manufacturing Co. Limited,
5-1-94 to 97, Lala 1 Landmark,
Hyderabad.
Copy to the Asst.Commissioner (LTU) Abids Division.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Devi’s Laboratories Ltd., (TIN No.28600188807), Ameerpet,

Whether input tax credit is eligible on sales of DEPB Licenses on which VAT
is paid at 4%.
The case was posted for hearing on 16-12-2005. Sri L. Sudheer

Kumar, Accounts Executive of the firm appeared on behalf of the firm and
explained the case.
It was explained by the applicant that they are entitled to DEPB
Licenses based on the quantum of exports made by them and such DEPB
Licenses are sold by them to other dealers for a consideration. It was also
explained that VAT @ 4% is paid by them on the sale consideration relating
to DEPB Licenses as per Entry 2 of Schedule-IV to the VAT Act. It was
contended that their customers who are registered as VAT dealers are not
being extended the benefit of input tax credit on purchases of such DEPB
Licenses.
1 of 2
After examining the issue, the ruling is given that:
(i) Any goods purchased by paying VAT within the State of Andhra
Pradesh supported by tax invoice are eligible for the benefit of input
tax credit subject to restrictions under Section 13 read with Rule
20.
(ii) It is for the person affected who should seek ruling regarding
tax liability or eligibility of input tax credit.
JT.COMMISSIONER
To
M/s. Divi’s Laboratories Ltd.,
7-1-77/E/1/303, Dharam Karam Road, Ameerpet,
Hyderabad-500 016.

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Rain Calcining Limited (TIN No.28250116683), Somajiguda,
1) Whether the benefit of input tax credit is available on purchases of LSHS

Fuel Oil, which is used in manufacturing process as well as in generating
power.
2) Whether Calcinied Petroleum Coke (CPC) attracts VAT at 4% under Entry

69 of Schedule IV to the Act.
The case was posted for hearing on 16-12-2005. Sri V. Nagendra

Prasad, Authorised Representative and Sri G.R. Chari, General Manager of
the firm appeared on behalf of the firm and explained the case.
According to them Calcining is a high temperature process which

removes the moisture and volatile matter in the Green Petroleum Coke. For
heating purpose upto a temperature of 14000C, LSHS Fuel Oil is used on
account of which steam is generated which is let into a steam turbine to
generate power. According to them, power to the extent of 49.5 MW is
generated and supplied to
1 of 2
APSEB Grid. From the detailed explanation furnished by them regarding the
manufacturing process and power generation process, it is clear that the
applicant is generating two types of outputs i.e., a taxable output in the
shape of Calcinied Petroleum Coke (CPC) and Electricity an exempted
commodity as per Entry 13 of Schedule-I to the Act.
As regards the Calcinied Petroleum Coke (CPC) produced by them it

was contended that the Government have notified HSN Code 2713.12 for
the Entry 69 of Schedule-IV to the Act which deals with “coal including coke
in all its forms but excluding charcoal”. This has been verified and found to
be correct.
On the basis of the examination of the above facts, the ruling is

given as under:
1) The benefit of input tax credit on the purchases of LSHS can be

claimed proportionately by applying A X B/C, where A is the tax
paid on LSHS in A.P., B is the taxable turnover and C shall include
taxable turnover, turnover of sale of exempted goods (Electricity)
and turnover of exempt transactions.
2) As regards the rate of tax on Calcinied Petroleum Coke, the rate

is 4% if the product sold by him falls under HSN Codes 2713.11 and
2713.12 notified by Government.
JT.COMMISSIONER
To
M/s. Rain Calcining Limited,
6-3-571/2, II Floor, “Rockvista”,
Rockdale Estate, Somajiguda,
Hyderabad-500 082.

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:


1 of 2

JT.COMMISSIONER
To

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Shree Agencies (TIN No.28435094523), Himayatnagar,

The rates on Herbal products i.e., Amla, Arita & Sheekakai.
The case was posted for hearing on 16-12-2005. Sri Pawan,

Proprietor of the firm appeared and explained the case.
After examining the items with regard to the Entries in the

Schedules it is found that these goods are not specified in any of the
Schedules to the Act. Consequently, these items fall within the scope of
Schedule-V to the Act and taxable at 12.5%.
1 of 2
The ruling is, therefore, given that the items mentioned by the
applicant will attract tax @ 12.5% under the Act.
JT.COMMISSIONER
To
M/s. Shree Agencies,
3-5-907/A/1, Hafiza Anwar Manzil, Himayatnagar,
Hyderabad-500 029.

Hyderabad.
2 of 2

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Blossoms Oils & Fats Limited, Kakinada (TIN No.28080113326)

i) Whether the applicant should issue Form VAT 600 or 602.
ii) Whether the applicant is required to report the value of crude oil
imported from foreign countries, tentatively stored in storage
tankers in Kakinada and subsequently dispatched to its
processing plant at Yanam.
3. Sri M.Ramachandra Murthy, Chartered Accountant appeared for

5. The applicant is engaged in the business of manufacture of
Vegetable oils in the factory located at Yanam, Pondichery. The
applicant claims to purchase goods during the course of import
(High-sea purchase) and also effect purchase and sale of the said
product within the State of A.P. The applicant states that he
purchases crude palm oil during the course of import for processing
in the factory at Yanam and the oil so purchased is tentatively
stored in the tankers at Kakinada and the entire quantity of such
crude palm oil will be transported to Yanam as and when tankers
are available. For the purpose of transportation of tankers from
Kakinada, the applicant seeks to know the document required to
accompany the goods. He states that the C.T.Dept. authorities have
been insisting for production of Form VAT 602 but the applicant is
of the view that the said form has to be issued only by a clearing
agent and as the applicant is clearing the goods himself, he cannot
be equated with clearing agent and hence he is not required to use
Form VAT 602. Alternatively, the applicant also seeks to know
whether he is required to issue way bill in Form VAT 600.
We have examined the facts of the applicant and find merit in

the view that the applicant is not required to use Form VAT 602 as
he is not acting as a clearing agent but he is himself clearing the
goods. Further, the crude palm oil which the applicant purchases on
high sea is being stored tentatively at Kakinada due to non-
availability of tankers and its subsequent transportation to Yanam
entails use of waybill in Form VAT 600. Therefore, it is clarified that
the applicant is required to use Form VAT 600 to accompany the
goods while they are transported from Kakinada to Yanam.
The applicant further seeks to know whether the value of

purchase of crude palm oil which is meant for processing in the
factory at Yanam but temporarily stored at Kakinada falls within the
scope of Section 6A of the CST Act and consequently required to be
reported in Form VAT 200 prescribed under the A.P.VAT Rules,
2005. On the basis of the facts furnished before this authority, we
hereby clarify that temporary storage of crude palm oil purchased
by the applicant and subsequently transported to Yanam does not
constitute a transaction in the nature of stock transfer from A.P. to
Pondichery as the goods are ostensibly purchased while they are on
high seas. As the purchases are made during the course of import,
mere storage in Kakinada for onward transportation to Yanam does
not make it a transaction of stock transfer from A.P. to Pondichery,
since there is no receipt of the goods into the applicant’s books of
account in order to qualify as a transaction of stock transfer.
Therefore, it is clarified that the applicant is not required to report
the value of these goods as exempt transactions in Form VAT 200.
To
M/s. Blossoms Oils & Fats Limited,

36-8-36, Tilak Street.
Next Old Andhra Bank,
Kakinada – 533 002.
Hyderabad.
Copy to the Deputy Commissioner (CT), Kakinada Division
PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. ACE Tyres Limited, Bachupally, R.R.District (TIN
admitted.
The applicant is seeking clarification on the following ;
3. Issue of way bills (Jobwork – Registered dealer)
4. Whether the dealer who is executing job work is liable to be
registered under VAT and CST Act.
The case was posted for hearing on 13-6-2006. Sri Syed Warisuddin
Naveed, Director of the firm appeared and explained the case.
The applicant explained that they have entered into an agreement

with M/s. CEAT Tyres Limited, Mumbai and M/s. Appollo Tyres Limited,
Delhi for executing job work which is to manufacture tyres on their behalf.
According to them, the raw material is fully supplied by the customers and
central excise duty paid by the customers on the raw materials is claimed
as Cenvat credit by the applicant after paying the excise duty on the value
of the finished goods in their hands. It was further explained that the excise
duty paid by them in their hands is reimbursed by the customer companies.
They have contended that they will be required to get certain portion of
work sub contracted outside the State. For this purpose they need to send
goods which requires waybills as per the provisions of A.P.VAT Rules, 2005.
It was also stated that the transportation of the finished goods to be sent to
their customers located outside A.P. requires waybills as prescribed in VAT
Rules. The applicant claims that he registered himself as a VAT dealer to
facilitate receipt of goods from outside the State and to transport goods
from his factory to customer locations outside State so that waybills can be
obtained by him. According to him, the field level officers are not issuing
the required waybills to them on the plea that they are not required to be
registered under the Act.
After examination of the facts with reference to Clause (b) of sub
section (5) of Section 17 of A.P.VAT Act, 2005 and also to the Rule 55 of
the A.P.VAT Rules, 2005 of A.P.VAT Rules, 2005, it is clear that the
applicant will be required to register himself as a VAT dealer and he will be
required to use waybills for transportation of goods outside the State. On
account of this, the ruling is given as under :
The applicant is under obligation to register himself as a VAT
dealer. The applicant is entitled to obtain waybills because there is
a requirement to use waybill for transportation of goods.
JT.COMMISSIONER
To
M/s. ACE Tyres Limited,
314, 315, Ameenpur Road,
Bachupally,
R.R.District.

Hyderabad.
Copy to the Commercial Tax Officer, IDA, Gandhi Nagar Circle.
PROCEEDINGS OF THE

*****

***
O R D E R:
I. M/s. Evergreen International Limited, Pattancheru

(TINo.28910186889)have filed an application and sought clarification and
of Rs.1,000/-

Whether they are eligible for Input tax credit on exempted
transactions i.e., stock transfers from Hyderabad to Gurgoan (HO).

4) Copy of notice of assessment of VAT in form 305 A issued by the
CTO, Gandhinagar Circle.
4. E.Eresha Rao, Accounts Manager appeared for hearing and explained

the case.
APVAT Act And Rules and HSN codes notified by the Government vide
G.O.Ms.No.1615 Rev.(CT.II) Department dt.31.8.2005 and the ruling is
given below :
6. Section 67 (2) stipulates that no application shall be
entertained by this authority if the question raised in the
Department. Since, the C.T.O. Gandhinagar has already issued a
notice of assessment of value added tax under Rule 25(5), this
ruling.
To
M/s. Evergreen International Limited,
Plot No.25, Phase I,
IDA, Pattancheru,
Medak District.


PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Somani Ispat Private Limited, Hyderabad (TIN

of Rs.1000/-.
Whether freight charges, hamali and payment charges form part of

the consideration for levy of VAT.

Copies of tax invoices issued by the applicant
4. Sri Gonar Chawan, Accountant appeared for hearing and explained
the case.
6. The applicant claims to be a trader in M.S. plates, sheets
channels, angles etc., and claims to deliver the material at the
premises of his customers who are mostly registered dealers. The
applicant however seeks to know whether he can collect VAT on
loading, unloading and freight charges besides the cost of material.
According to Section 2(29) “sale price” includes total amount

set out in the tax invoice or bill of sale. The applicant claims that he
delivers goods at the customer’s premises which makes it clear that
sale concludes at the buyers’ end. Thus the consideration passing
from the buyer to the seller (applicant) is the total amount that
includes cost of the goods and other expenses up to the time of
delivery of goods which the applicant is entitled to recover from the
buyer. The total amount being the sale consideration, components
other than sale price of the goods also constitute the total
consideration on which the applicant is entitled to charge tax.
Therefore, it is clarified that the applicant can collect tax on
components such as loading, unloading charges and freight charges
in circumstances where goods are delivered at the customers
premises which is the point where sale finally concludes.
To
M/s. Somani Ispat Pvt. Limited,
5-41 to 16, Ist Floor, Distillery Road, Ranigunj, Secunderabad.
Hyderabad.
Copy to the Commercial Tax Officer, Ranigunj Circle.5

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Supreme Agencies, Hyderabad (TIN No.28120175146) have

i) Expanded polythene sheets
ii) Cross linked polyethylene foam sheets
iii) Air bubble sheets
iv) Expanded polyethylene tubing
v) Expanded polyethylene foam netting
vi) Fabricated products made out of above products
3. The applicant submitted the following documents :

i) Product literature
ii) Copies of invoice cum challan issued by M/s. Supreme Industries
Ltd, Hosur, Tamilnadu.
iii) Copies of tax invoice issued by the applicant.
4. Sri Sandeep Sanghi, Proprietor appeared for hearing and explained
the case.
6. The applicant is a distributor of the products
mentioned at para 2 above. These products are stated to be
manufactured by the applicant principals located in Tamilnadu.
Copies of invoice-cum-challan issued by the said principal indicate
description of goods and tariff sub heading as shown under.
S.No. Description of codes Tariff sub heading no.

1. Polythene sheets 3921.19.00
2. Polythene foam sheets 3921.19.00
3. Air bubble sheets 3923.90.90
4. Polythene tube 3917.21.10
5. Plastic rods 3917.21.10
6. Armour buffer 3923.90.90.

documentary evidence. Entry 90 of Schedule IV of A.P.VAT Act,
2005 refers to various kinds of packing material and among other
things sheets, films, foils and strips of plastics at sub entry 2. In
G.O.Ms.No.1615 dt.31.8.2005, the HSN code applicable to the said
items has been notified as 3920. As seen from the invoice cum
challan issued by the principals of the applicant who are
manufacturers, HSN code 3921 has been mentioned. In the G.O.
cited a specific ‘8’ digit code i.e., 3921.90.10 applicable to
thermacol only has been notified. Thus, the products distributed by
the applicant are apparently falling outside the notified HSN codes
except Armour buffer, which is shown as attracting HSN code
3923.90.90. This code has been notified in the above mentioned
G.O. against sub entry (4) of Entry 90.
Therefore, it is clarified that items attracting HSN code 3921
& 3917 falling outside the scope of Entry 90 and G.O.1615 attract
tax rate @ 12.5%.
As per the documentary evidence furnished by the applicant
Air bubble film attracting HSN code 3923.90.90 and Armour buffer
attracting the same HSN code are notified as falling under sub entry
(4) of Entry 90. Therefore these products attract tax @ 4%.
The applicant has not furnished any documentary evidence

regarding polythene foam netting. In the absence of any evidence
we are not inclined to issue any clarification nor ruling in respect of
this item.
To
M/s. Supreme Agencies,

10-5-127, Fathenagar,

Hyderabad.
Copy to the Commercial Tax Officer, Ferozguda Circle.
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. J.Vencoba Rao & Sons, (TIN No.28300139832) have filed an

1. Whether handloom parts and accessories are liable to tax @ 4%
under CST Act.
2. Whether purchases of handloom parts and accessories from the
State of Gujarat where VAT is not implemented and resold within
and outside A.P. attract tax.
3. Rate of tax applicable to handloom parts and accessories either
produced by the applicant or purchased by the applicant from
other states and if they are sold to State or Central Government,
whether eligible for exemption.

Copy of CCT’s Ref.No.AIII(2)/136/2005, Dt.15.7.2005.
Sri J.Viswanath Rao, Partner appeared on behalf of the firm for
The applicant claims that he is a manufacturer of Handloom
parts and accessories and that he purchases raw materials from
Ahmedabad (Gujarat) by paying 4% CST against C-Form. The
manufactured product, handloom accessories are sold by the
applicant both within and outside A.P. The applicant further claims
that handloom parts and accessories are fully exempt as they fall
under Entry 21 of Schedule I of the A.P.VAT Act, 2005. In the
circumstances, he seeks to know whether he should charge 4% CST
for interstate sales and collect C-Forms.
The documentary evidence furnished by the applicant
contains the clarification issued by the Commissioner(CT) to the
effect that handlooms and their parts & accessories are exempted
from tax as per Entry 21 of Schedule I of A.P.VAT Act, 2005. The
goods that are exempt generally under the State Act are also
exempt under the Central Sales Tax Act. Therefore, the applicant
need not charge 4% tax under the CST Act. However, he shall
collect C-Form from the buying dealer and submit the same to the
prescribed authority.
In case the applicant purchases such handloom parts and
accessories from other States and resells them either within or
outside the State, there is no tax liability in both the events.
The applicant also claims that some times he produces
handloom parts and accessories and also purchases them from
other states and effects sales to State or Central Government.
These transactions are also not liable to tax at the hands of the
applicant as the goods have been notified as exempt.
To
M/s. J.Vencoba Rao and Sons,

15/473/1, City Press Compound,
Adoni – 518 301
Kurnool District.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sandvik Smith Asia Limited, (TIN No.28630151752) have filed

Rate of tax applicable to Mining tools like Down the Hole Bits, Cutter Picks,
Rock Rollet Bits etc.

a) Copies of invoice
b) Product literature
Sri V.Nagendra Prasad, Tax Consultant, appeared on behalf of the

is given as under.
We have perused the invoice and product literature and also
heard the representative. The applicant being under the impression
that the products on which he is seeking ruling attract 12.5% has
charged that rate on the invoice. We also find that these items have
not been specified in any of the Schedules of the A.P.VAT Act, 2005.
Therefore in accordance with the language of the Schedule V of the
A.P.VAT Act, 2005 the tools on which the applicant is seeking
clarification attract 12.5%.
To
M/s. Sandvik Smith Asia Limited,

1-8-165/179/3,
Usha Kiran Complex, S.D.Road,
Hyderabad.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Weld Fuse Private Limited, (TIN No.28880262356) have filed an
Rate of tax applicable for Poultry Cages meant for rearing and laying
units such as single cover, double cover, Partition and Center partition
made of iron wire and soft mesh made with Plastic.
j) Photograph of the item
k) Copies of invoice
l) Copy of Form ER1 issued under Rule 12 under Central Excise Rule
number.
Sri P.Chakradhara Rao, Managing Director, appeared on behalf of
is given as under.
The applicant manufactures Poultry cages meant for Poultry
keeping, farming and rearing. Besides, he also manufactures laying
units known as single cover, double cover etc., made of iron wire
and soft mesh with plastic. The applicant claims that the equipment
falls under Entry 1 of Schedule IV of A.P.VAT Act, 2005 and that in
the G.Os cited above the entry has been notified as attracting HSN
code 8436. In support of the contention he submitted a copy of the

applicant and also the contention of the applicant. In the G.O. cited
above Entry 8436 has been notified. Under that code Poultry
keeping machinery finds place at 8436.90.00. The same code has
been adopted by the applicant on the Central excise return.
Therefore we hold that the items on which the applicant is seeking
a ruling regarding the rate of tax attract 4% in terms of Entry 1 of
Schedule IV of A.P.VAT Act read with the G.Os cited above.
To
M/s. Weld Fuse Private Limited,
H.No.7-144/3, Huda Complex,
Saroornagar, Hyderabd – 35.


PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Anil Enterprises, Vijayawada (TIN No.28810225369) have filed


vi) Reference of Director (Technical), Footwear Design and
vii) Sale invoice issued by certain traders in Vijayawada
viii) Sale invoice issued by Ganesh Plastics, Delhi
4. Sri Naresh Kumar Gupta, Managing partner appeared on behalf of

6. The applicant states that he purchases Plastic Footwear from dealers
within and outside A.P.. In support of the statement, the applicant filed
copies of a few sale invoices issued by the dealers located both within and
outside A.P. As seen from the recitals on the invoice, the dealers have sold
Plastic Footwear of different varieties to the applicant and apparently they
are also traders. The sellers located in A.P. have charged 4% tax. Likewise
M/s. Ganesh Plastics, Delhi has charged 4% towards CST. In the reference
issued by Director (Technical), Footwear Design & Development Institute,
Ministry of Commerce, GOI, the terms Rubber and Plastics has been
explained to include woven fabrics or other textile fabrics with an external
layer of Rubber or Plastics being visible to the naked eye. In the
circumstances, the Director (Technical) concluded that such materials are
Plastics. The Director further certified the articles produced by the applicant
as Footwear made of plastic material.
We have considered the contents of application and documents
submitted by the applicant. Entry 46 of the Schedule IV of A.P.VAT Act,
2005 reads “Plastic Footwear and Hawai Chappals”. In the G.O.Ms.No.1615
dt.31.8.2005 issued in supercession of G.O.Ms.No.398 dt.31.3.2005 and
G.O.Ms.No.490 dt.15.4.2005, the HSN code applicable to Entry 46 has been
notified as 6402.19.90.
In view of the documentary evidence, we hold that plastic
footwear sold by the applicant is falling within the scope of HSN
code notified and is liable to tax @ 4%.
To
M/s. Anil Enterprises,

14-5-13, Andhra Ratna Road,
Hanumanpeta,
VIJAYAWADA – 3.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Meher Agencies, Vijayawada (TIN No.28960135930) have filed


ii) Sale invoice issued by Mayur Uniquoters Limited.
iii) Sale invoice issued by the applicant.
4. Sri K.V.S.Gupta, Proprietor appeared on behalf of the firm for
6. The applicant states that he manufacturers Footwear made entirely
of Plastic and in support of the statement submitted invoice showing
purchase of coated non-woven fabric etc. The applicant also
submitted samples of footwear to the Director (Technical), Ministry
of Commerce, GOI, for the purpose of certification. The applicant
had submitted a copy of certificate issued by Director, Technical,
FDDI, Ministry of Commerce, GOI to the effect that the terms
“Rubber” and “Plastics” include woven Fabrics or other textile fabrics
with an external layer of Rubber or Plastics being visible to the
naked eye. In the circumstances the Director certifies that the
uppers of such Footwear are Plastics and as such identified as Plastic
footwear. Further, the Director certifies that such items fall under
Central Excise tariff code 6402.19.90.
2005 reads “Plastic Footwear and Hawai chappals”. In
G.O.Ms.No.1615 dt.31.8.2005 issued in supercession of
G.O.Ms.No.398 dt.31.3.2005 and G.O.Ms.No.490 dt.15.4.2005, the
HSN codes applicable to the items under Entry 46 have been
notified. The notified items contain chapter code 64. Thus in so far
2005.
To
M/s. Meher Agencies,
D.No.18-4-23, 2nd Lane,
Kedareswarapet,
VIJAYAWADA.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Meher Enterprises, Vijayawada (TIN No.28920173826) have


ii) Copy of Sale invoice issued by Kannan Plastic Products
Private Limited, Haryana and Mayur Uniquoters Limited,
Jaipur
iii) Copy of Sale invoice issued by the applicant.
4. Sri K.V.S.Gupta, Manager appeared on behalf of the firm for hearing
6. The applicant states that he manufactures Footwear made entirely of
Plastic and in support of the statement submitted copies of invoices
showing purchase of PU soles, Coated non-woven fabric etc. The
applicant also submitted samples of footwear to the Director
(Technical), Ministry of Commerce, GOI, for the purpose of
certification. The applicant had submitted a copy of certificate issued
by Director, Technical, FDDI, Ministry of Commerce, GOI to the
effect that the terms “Rubber” and “Plastics” include woven Fabrics
or other textile fabrics with an external layer of Rubber or Plastics
being visible to the naked eye. In the circumstances the Director
certifies that the uppers of such Footwear are Plastics and as such
identified as Plastic footwear. Further, the Director certifies that such
items fall under Central Excise tariff code 6402.19.90.

2005.

To
M/s. Meher Enterprises,
D.No.18-4-34, 2nd Lane, Kedareswarapet,
VIJAYAWADA.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Metro Chappals, Vijayawada (TIN No.28810213923) have filed


i) Copy of reference of Director (Technical), Footwear
Design and Development Institute, Ministry of Commerce,
GOI.
ii) Copies of Sale invoice issued by J.P.Footwear Agencies,
New Delhi
iii) Copies of Sale invoice issued by the applicant
4. Sri M.S.A. Sarma, authorized representative appeared on behalf of

within and outside A.P. In support of the statement, the applicant filed
copies of few sale invoices issued by some dealers located both within and
outside A.P. As seen from the recitals on the invoice, the seller-dealers
have sold Plastic Footwear of different varieties to the applicant and
apparently they are also traders. The sellers located in A.P. have charged
4% tax. Likewise M/s. J.P.Footwear Agencies, New Delhi has charged 4%
towards CST. In the reference issued by Director (Technical), Footwear
Design & Development Institute, Ministry of Commerce, GOI, the terms
“Rubber” and “Plastics” has been explained to include woven fabrics or
other textile fabrics with an external layer of Rubber or Plastics being visible
to the naked eye. In the circumstances, the Director (Technical) concluded
that such materials are Plastics. The Director further certified the articles
produced by the applicant as Footwear made of plastic material.
2005 reads “Plastic Footwear and Hawai chappals”. In the G.O.Ms.No.1615

To
M/s. Metro Chappals,

D.No.12-3-32, B-Block,
Peena Mohammed Street,
Tarapet, VIJAYAWDA-1

Hyderabad.
Copy to the Deputy Commissioner (CT), Vijayawada-I Division
Copy to the Commercial Tax Officer, Convent Street Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Monarch Footwear, Hyderabad (TIN No.28580199219) have


i) Copy of Reference of Director (Technical), Footwear
Design and Development Institute, Ministry of Commerce,
GOI.
ii) Copies of Sale invoice issued by Maxwell Traders, Agra;
Manohar Shoe Co., Agra; Karman Enterprises, Mumbai;
Johnson Enterprises, Agra.
4. Sri Deepak Kumar, Manager of the firm appeared on behalf of the

6. The applicant states that he purchases and sells Plastic Footwear
and in support of the statement, the applicant filed sale invoice issued by
the dealers located outside A.P. As seen from the recitals on the invoice,
the dealers have sold Plastic Footwear of different varieties to the applicant
and apparently they are also traders. They have charged 4% towards CST.
In the reference issued by Director (Technical), Footwear Design &
Development Institute, Ministry of Commerce, GOI, the terms Rubber and
Plastics has been explained to include woven fabrics or other textile fabrics
with an external layer of Rubber or Plastics being visible to the naked eye.
In the circumstances, the Director (Technical) concluded that such
materials are Plastics. The Director further certified the articles produced by
the applicant as Footwear made of plastic material.
2005 reads “Plastic Footwear and Hawai Chappals”. In the G.O.Ms.No.1615

To
M/s. Monarch Footwear,

21-1-8, Chappal Market,
Nayapool,

Hyderabad.
PROCEEDINGS OF THE

***
O R D E R:
1. M/s. N.N.Fashions, Vijayawada (TIN No.28340129290) have filed an


ii) Sale invoice issued by J.P.Footwear Agencies, New Delhi
iii) Sale invoice issued by the applicant
4. Sri M.S.A. Sarma authorized representative appeared on behalf of

within and outside A.P. In support of the statement, the applicant filed
copies of sale invoice issued by some seller-dealers. As seen from the
recitals on the invoice, the seller-dealers have sold Plastic Footwear of
different varieties to the applicant and apparently they are also traders. The
sellers located in A.P. have charged 4% tax. Likewise M/s. J.P.Footwear
Agencies, New Delhi has charged 4% towards CST. In the reference issued
by Director (Technical), Footwear Design & Development Institute, Ministry
of Commerce, GOI, the terms Rubber and Plastics has been explained to
include woven fabrics or other textile fabrics with an external layer of
Rubber or Plastics being visible to the naked eye. In the circumstances, the
Director (Technical) concluded that such materials are Plastics. The Director
further certified the articles produced by the applicant as Footwear made of
plastic material.
2005 reads “Plastic Footwear and Hawai chappals’. In the G.O.Ms.No.1615

To
M/s. N.N.Fashions,
D.No.12-3-32, Ist Floor,
Peena Mohammed Street,
Tarapet, VIJAYAWADA

Hyderabad.
Copy to the Deputy Commissioner (CT), Vijayawada-I Division
PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Padmavathi Enterprises, Vijayawada (TIN No.28370109210)


ii) Sale invoice issued by Ashoka Footwear, Delhi; India
Associates, New Delhi; Lovely Traders, New Delhi.
4. Sri K. Srinivasa Reddy, Manager appeared on behalf of the firm for
6. The applicant states that he manufactures Footwear made
entirely of Plastic and in support of the statement submitted
invoices showing purchase of PU soles, Resins etc. The applicant
also submitted samples to the Director (Technical), Ministry of
Commerce, GOI, for the purpose of certification. A certificate
issued by the said authority contains information about the
components of Plastic Footwear. The applicant had submitted a
copy of certificate issued by Director, Technical, FDDI, Ministry of
Commerce, GOI to the effect that the terms “Rubber” and
“Plastics” include woven Fabrics or other textile fabrics with an
external layer of Rubber or Plastics being visible to the naked
eye. In the circumstances the Director certifies that the uppers of
such Footwear are Plastics and as such identified as Plastic
footwear. Further, the Director certifies that such items fall under
Central Excise tariff code 6402.19.90.
2005.

To
M/s. Padmavathi Enterprises,
D.No.23-16-1-4, Dakshinyamvari Street, Satyanarayanapuram,
VIJAYAWADA – 520 011.
Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. R.P.Enterprises, Vijayawada (TIN No.28940299117) have filed


ii) Sale invoice issued by Nikhil Footwears Private Ltd.,
Haryana; Kannan Plastic Products Pvt. Ltd., Haryana;
Mayur Uniquoters Ltd., Jaipur; Saipatham Leathers,
Chennai
4. Sri V.Ramprasad, Proprietor appeared on behalf of the firm for
6. The applicant states that he manufactures Footwear some of which
is partly plastic and some with leather content. He seeks to know the rate
of tax applicable to the Footwear sold by him. The certificate issued by
Director, Technical, FDDI, Ministry of Commerce, GOI contains information
about the components of Plastic Footwear and its classification under the
HSN codes. Among other things the Certificate states that Poly Urethane
and PVC coated rexine used in the making of Footwear is classified as
Plastic Footwear and also refers to Chapter 64 of the HSN code and
concludes that the terms “Rubber” and “Plastics” include woven fabrics or
other textile fabrics with an external layer of rubber or plastics being visible
to the naked eye and therefore such material are plastics. Thus, it
reiterates that Footwear made out of these materials in different
combinations will be identified as Plastic Footwear. The applicant also filed
purchase invoices showing PU sole, Coated non-woven fabric and other
materials used in manufacture of different types of Footwear. Sale invoices
issued by him describe such Footwear as Plastic Footwear attracting HSN
code 6402.19.90. On some invoices the applicant charged VAT @ 12.5% as
the footwear sold was made of leather.
However, if the applicant manufactures and sells Footwear
with leather content, even if it is used partly either as in-sole or
upper or any part of the Footwear, it will be treated as other than
Plastic footwear and would fall outside the scope of entry 46 of
Schedule IV of the Act. In such circumstances the applicant will be
liable to tax @ 12.5% in terms of the language in Schedule V of
A.P.VAT Act, 2005.

To
M/s. R.P.Enterprises,
26-4-8, Gnanolive Street,
Gandhinagar, Vijayawada – 3.
Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Walker Shoes, Narasaraopet (TIN No.28870145924) have filed


ii) Sale invoice issued by Tagbros, New Delhi; Uttam
Enterprises, New Delhi; Tafazzul Hussain & Co., Delhi &
iv) Tax invoice issued under Central Excise Regulations by
Vima Industrial Plastics, Delhi.
4. Sri H. Chandra sekhar proprietor appeared on behalf of the firm for
6. The applicant states that he manufactures and sells footwear made
of plastic and also purchases footwear from dealers situated outside the
State of A.P and sells them in the State. The applicant seeks to know the
rate of tax applicable to the footwear sold by him. The applicant had
submitted a certificate issued by Director, Technical, FDDI, Ministry of
Commerce, GOI to the effect that the terms “Rubber” and “Plastics” include
woven Fabrics or other textile fabrics with an external layer of Rubber or
Plastics being visible to the naked eye. In the circumstances the Director
certifies that the uppers of such Footwear are Plastics and as such identified
as Plastic footwear. Further, the Director certifies that such items fall under
Central Excise tariff code 6402.19.90. The applicant also filed tax invoice
issued by Vima Industrial Plastics, Delhi in support of the plea that the raw
materials purchased by him belong to the family of Plastics. Besides
manufacturing the applicant also apparently buys and sells ready-to-wear
Footwear made of Plastics as evidenced from the invoice submitted by the
applicant.
2005.
To
M/s. Walker Shoes,
11-8-3, R.R.Pet,
Arundel Pet, Narasaraopet.

Hyderabad.
Copy to the Deputy Commissioner (CT),Guntur II Division
Copy to the Commercial Tax Officer, Narasaraopet Circle.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Paduka Agencies, Vijayawada (TIN No.28680206523) have filed


ii) Sale invoice issued Mayur Uniquoters Limited, Jaipur,
Kanan Plastic Products Private Limitedi, Haryana
4. Sri S. Srinivasa Rao, proprietor appeared on behalf of the firm for
6. The applicant states that he manufacturers Footwear by importing
raw materials from outside the State. In support of the statement, the
applicant filed copies of invoice showing purchase of raw materials such as
coated non-woven fabric, PU soles etc. In the circumstances the applicant
seeks to know the rate of tax applicable to the Footwear manufactured out
of such raw material and sold by him in the State. The applicant had
submitted a certificate issued by Director, Technical, FDDI, Ministry of
Commerce, GOI to the effect that the terms “Rubber” and “Plastics” include
woven Fabrics or other textile fabrics with an external layer of Rubber or
Plastics being visible to the naked eye. In the circumstances the Director
certifies that the uppers of such Footwear are Plastics and as such identified
as Plastic footwear. Further, the Director certifies that such items fall under
Central Excise tariff code 6402.19.90. The applicant also filed invoice issued
by Mayur Uniquoters Limited, Jaipur in support of the plea that the raw
materials purchased by him belong to the family of Plastics.
2005.
To
M/s. Paduka Agencies,
18-1-33, Mango Market,
Kedereswerpet,
VIJAYAWADA – 520 003.

Hyderabad.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Ashian Herbex Limited, Hyderabad (TIN No.28430105425) have
1. Whether one domestic unit of the applicant can issue tax invoice to
100% EOU owned by the applicant. Whether input tax credit on these
invoices can be availed by EOU against tax payable on domestic sales by
EOU ?
2. Whether applicant can set off input tax available to EOU against total
VAT liability while filing consolidated VAT returns for both the units ?
The case was posted for hearing on 23-11-2006. Sri M.Rama Krishna
(CT.II) Dept, dt.29.6.2006.
The applicant explained that two separate units are being run by the
firm and one of the units is exclusively an 100% Export Oriented Unit. It
was further explained that 100% EOU gets certain income tax benefits and
tax paid in the domestic unit is not allowed as expenditure in 100% EOU.
The issue has been thoroughly examined.
The ruling is given as under :
1. There cannot be sale by one unit to another unit owned by the
applicant. Unless there is a change in the constitution of the two units and
such two units are registered separately under A.P.VAT Act there cannot be
a transaction of sale between them.
2. If the domestic unit is purchasing any goods from another VAT
dealer through a tax invoice, the tax charged therein can be claimed as
input tax in a combined manner for both the units in a single VAT return to
be filed.
3. Input tax paid on all purchases irrespective of one unit dealing in
domestic transaction and another exclusively 100% EOU, can be claimed
totally on month to month basis in a combined manner in one VAT return to
be filed.
4. If the applicant exports any goods of more than Rs.10 lakhs value in
a given month and the over all output tax on his sales during that month is
less than the input tax credit eligible for such month, he shall be eligible to
make a claim for refund on a monthly basis in Box 23 on VAT return Form
200. In case the export is not exceeding Rs.10 lakhs in any given month
the applicant will be required to carry forward excess input tax credit in Box
24 until March, 2007.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Ashian Herbex Limited,
5, Prembagh, 3-4-490/A, Barkatpura, Hyderabad.

Hyderabad.

PROCEEDING OF THE

(Enft)
CCT’s Ref.No.PMT/P&L/A.R.Com/332/2005 Dt:-24-11-2006

05.
***
O R D E R:
M/s. Bharthi Builders, Hyderabad (TIN No.28240252839) have filed
1. Whether purchases have to be reported in Box-6 and Box-10 on VAT
return 200 if the applicant being sub contractor is exempted under Rule
17(2)(g)?
2. Whether advance ruling issued for another dealer is binding on the
applicant ?
The case was posted for hearing on 23-11-2006. Sri T.Ramesh Babu
(CT.II) Dept, dt.29.6.2006.
The issue has been examined and the ruling is given as under :
1. Any VAT dealer is required to furnish the details of purchases either
as non creditable purchases in Box-6 or creditable purchases in Box-7, 8 &
9 if eligible for the benefit of input tax credit. Eventhough the applicant is
exempted on the works undertaken as sub contractor based on composition
opted by the main contractor, he will be required to show his purchases in
Box-6 relating to such works which is exempted in his hands.
2. As regards the applicability of a ruling given to another applicant,

a ruling is binding on the applicant directly and also binding on all
departmental authorities other than Commissioner in respect of the good or
transaction in relation to which a clarification was sought.
Sd/- Sd/- Sd/-
JT.COMMISSIONER
ADDL/JT.COMMISSIONER
To
M/s. Bharti Builders,
Flat No.D-304, Keerthi Apartmennts,
Behind Saradhi Studio,
Yellareddyguda, Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT),Panjagutta Division.
Copy to the Commercial Tax Officer,Srinagar Colony Circle.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Fibre Glass Auto Products, Medak District (TIN
The applicant is seeking clarification regarding tax rate applicable on
‘Fibre reinforced plastic articles’ used as auto parts by their customers.
The case was posted for hearing on 23-11-2006. Sri H.Santhosh,
Unit Manager authorized representative of the firm appeared and explained
the case.
(CT.II) Dept, dt.29.6.2006.
It was explained by the applicant that 70% of the raw material is
unsaturated polyester resin and other items like chopped stranded mat,
calcium carbonate, metal inserts, paints, chemicals etc. are also used. The
end product is directly used as an auto component by M/s. Mahindra &
Mahindra as explained by the applicant.
After examining the issue and HSN code 7014.00.01 applicable to
the products, it is observed that the items do not find place in 4% list
notified.
The ruling is therefore given that the items mentioned by the
applicant would attract tax at 12.5%.
Sd/- Sd/- Sd/-
JT.COMMISSIONER
To
M/s. Fibre Glass Auto Products,
Plot No.6, Rural Industrial Estate,
Zaheerabad, Medak District.

Hyderabad.
Copy to the Deputy Commissioner (CT),Nizamabad Division.
Copy to the Commercial Tax Officer,Sangareddy Circle.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Geetha Traders, Vijayawada (TIN No.2815009670) have filed
1. Whether purchase tax under the provisions of sub section (4) of
Section 4 of A.P.VAT Act could be attracted on purchases of Bengal gram
from farmers if the resultant product is sent outside the State other than by
way of sale ?
2. Whether Moong dal received from outside A.P. on commission basis
and some portion of that sent to different States on consignment basis is
not liable for tax under A.P.VAT Act ?
The case was posted for hearing on 23-11-2006. Sri Sree Rama
Murthy authorized representative of the firm appeared and explained the
case.
(CT.II) Dept, dt.29.6.2006.
The issue has been examined. As regards the first question, the
provisions of sub section (4) of Section 4 of A.P.VAT Act, 2005 are attracted
if goods purchased from unregistered dealers are subsequently sent on
consignment basis in the same form or after conversion into some other
form. As regards the question relating to Moong dal received on
consignment basis from outside State and some quantity of such goods
sent again on consignment basis to another State, this is purely a question
of facts which cannot be either examined or concluded or clarified by this
Authority.
The ruling therefore is given that purchase tax under sub section (4)
of Section 4 shall be attracted on Bengal gram purchased from farmers and
the second question needs to be resolved based on facts by the concerned
authorities.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Geetha Traders,
11-49-372, PVSR Complex, Sivalyam Street, Vijayawada

Hyderabad.
Copy to the Deputy Commissioner (CT),Vijayawada Division.
Copy to the Commercial Tax Officer,Sivalayam Street Circle.

PROCEEDING OF THE

(Enft)
CCT’s Ref.No.PMT/P&L/A.R.Com/436/2005 Dt:-24-11-2006

05.
***
O R D E R:
M/s. Sri Rama Non Ferrous Foundry, Hyderabad (TIN
The applicant is seeking clarification regarding the tax rate
applicable on rough castings of Aluminum, Bronze and Brass.
The case was posted for hearing on 23-11-2006. Sri B.Ram Mohan
Singh authorized representative of the firm appeared and explained the
case.
(CT.II) Dept, dt.29.6.2006.
The applicant produced copies of the invoices relating to the sales of
the items mentioned in the application. According to the applicant all the
items sold by him are rough castings which need further machining by the
customers. The applicant also produced a copy of the order of CEGAT on
the issue relating to classification of unmachined and unfinished castings
wherein it is held that they are not parts of machinery or parts of vehicles
so long as further machining is required on them before being used as parts
of machines. The applicant further explained that the items fall under HSN
codes 7403 and 7601. These two codes are found to be notified against
Entry 27 of Schedule IV to the Act.
The ruling therefore is given that the items specified by the applicant
attract tax @ 4%.
Sd/- Sd/- Sd/-
JT.COMMISSIONER
To
M/s. Sri Rama Non Ferrous Foundry,
Plot No.17, H.No.8-140, Vinayaknagar, Balanagar, Hyderabad.

Hyderabad.
PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. Swamy Plastics, Hyderabad (TIN No.28290154253) have filed
The applicant is seeking clarification regarding rate of tax on Power
cables and Power cords.
M.V.L.Narasimha Rao authorized representative of the firm appeared and
explained the case.
(CT.II) Dept, dt.29.6.2006.
The applicant explained that the items manufactured and sold by
him are useable mostly for electronic equipments and they are not domestic
cables used for wiring. It was also explained that such cables and cords will
have ports on either side to suit specific requirements of customers for
certain types of computers, computer peripherals and other electronic
equipments.
The issue has been examined with reference to Entry 38 in Schedule

IV to the Act dealing with Industrial cables, and sub items 26 and 27 of
Entry 39 in Schedule IV and also the Circular dt.22.9.2005 issued by the
Commissioner(CT) regarding the classification of industrial and domestic
cables. Entry 38 specifies industrial cable and items are mentioned therein
to the list are only indicative. Similarly sub items 26 and 27 of Entry 39
mention ‘Optical fibre cables’ and ‘Optical fibre and optical fibre bundles and
cables’.
The ruling is given that the items specified by the applicant will
attract tax at 4%.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. Swamy Plastics,
P.No.16, Electronic Complex Extension,
Kushaiguda Hyderabad.

Hyderabad.
Copy to the Deputy Commissioner (CT),Saroornagar Division.

PROCEEDINGS OF THE

***

Dt.13.4.2005.
O R D E R:
M/s. Bajaj Sales Corporation, (TIN No.28860220097)
2. Plastic footwear
Sri Jagdev Singh Varma partner of the firm appeared for hearing on
1 of page 2
is given as under.
The rate of tax applicable to Plastic Footwear falling under
HSN code No.6402.19.90 is 4%.

To
M/s. Bajaj Sales Corporation,

22-7-270, A/C+B & G+H, Nizamabagh,
Dewandewdi, Hyderabad.

2 of page 2
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Manibadra Gift Center, (TIN No.28700189321)

Vijayawada have filed an application dt.21.5.2005 and sought clarification
1. Imitation Jewellery
2. And other miscellaneous items.
Sri K.Pavan Kumar, Accountant appeared for hearing on 23-5-2005

1 of page 2
is given as under.
1. Imitation Jewellery : 12.5%
2. And other miscellaneous items. : 12.5%

To
M/s. Manibadra Gift Center,

Publipativari Street,
2 of page 2

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Nice Spice, (TIN No.28740233875) Sikh Village,
Secunderabad have filed an application dt.20.5.2005 and sought
1. Rate of tax if the turnover is below Rs.40 lakhs or above Rs.40

lakhs.
2. Rate of tax :
(a) In the case of Bar and Restaurant and

(b) Sale of food only.
Sri M.Narsireddy, Managing Partner appeared for hearing on 23-5-

1 of page 2
1. The rate of tax applicable is 1% if the turnover of sale of
food is below Rs.40 lakhs in a period of twelve
consecutive months or above Rs.10 lakhs in a period of
three consecutive months. If the turnover of sale of food
is above Rs.40 lakhs, in 12 months or above Rs.10 lakhs in
three months, the applicant is liable to tax @ 12.5%.
2. Rate of tax in case of Bar and Restaurant is 12.5%.
However, the applicant is not supposed to charge tax on
sale of liquor. The applicant cannot opt for composition as
his business includes sale of food and liquor.

To
M/s. Nice Spice,

230-44, Staff Road, Wahab Nagar, Sikh Village,
2 of page 2

PROCEEDING OF THE

***
O R D E R:
M/S Rama Marketing Services, Rajahmundry (TIN

No.28540228191), have filed an application on 19-5-2005 and sought
the APVAT Act, 2005. They also enclosed an application fees of Rs.1000/-.
The case was posted for personal hearing on 20-5-2005 at
3.00 P.M. Mr.M.Krishna Murthy, Manager of the firm appeared on behalf of
the firm and presented this case.
1) Graphite Flakes : HSN Code 2504.10 Taxable @ 4%
2) Fire Clay : HSN Code 2508.30 Taxable @ 4%
3) Natural Borates : HSN Code 2528. Taxable @ 4%
The issue is examined with reference to the provisions of the
is given as under.
1) Graphite Flakes (HSN code 2504.10)
2) Fire clay (HSN code 2508.30) and (3) Natural
Borates (HSN Code 2528) in natural form do fall under entry 43 of
the IV Schedule, ie., Ores & Minerals and attract tax @ 4%. Further
crucible scrap is liable to tax @ 4% under entry 23 of the IVth
Schedule.
JT.COMMISSIONER
To
M/s Rama Marketing Services,
6/60-1, Morampudi, Hukurupeta Post,
RAJAHMUNDRY- 03, A.P.

Hyderabad.
Division.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Sha Mukesh Kumar Ricabchand, (TIN No.28240172911)
Vijayawada have filed an application dt.21.5.2005 and sought clarification
1. Braided cord
2. Opthalamic lenses
3. Frames
4. Hardware goods
5. Flasks and flask refils
Sri K.Pavan Kumar, Accountant appeared for hearing on 23-5-2005

1 of page 2
is given as under.
All the goods except opthalamic lenses referred in their
application fall under Vth schedule attracting 12.5%. However,
opthalamic lenses are taxable @ 4% vide Entry 39 of Ivth schedule
as per HSN code 9001.

To
M/s. Sha Mukesh Kumar Ricabchand,

Publipativari Street,

2 of page 2

PROCEEDINGS OF THE

*****
O R D E R:
M/s. South India Mineral Industries, Bethamcherla

1. Yelloe Ocher Powder
2. Talc, Steatite and Soap Sone
3. White Clay Powder
4. White Shale Powder

Copy of the Extraordinary Gazette of Government of India No.454 Dt.14-1-
2004 of Ministry of Coal & Mines.
Sri K.Hyder Vali, Authorised Representative, appeared for hearing on

The applicant stated that the items referred supra are

minerals should also fall under the entry “Ores and Minerals”. Entry
and minerals.
All the commodities referred are natural minerals converted

into powder by pulverizing them. Therefore, all ores and minerals in
their natural or powder forms fall under entry 43 of the IVth
Schedule liable to VAT @ 4%.

ruling.
To
M/s. South India Mineral Industries,
Bethamcherla, Kurnool Dist.


PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/94/2005 DT.25 -5-2005
Dt.13.4.2005.
O R D E R:
M/s. Sree Durga Pharma, (TIN No.28230224735) Hyderabad
Rs.1000/-.
3. Orthopedic & Fracture appliances

4. Handloom crepe bandage, Handloom bandage cloth, Infusion set
(saline sets)
Sri K. Pavan Kumar, Accountant of the firm has appeared for hearing
1 of page 2
is given as under.
3. Orthopedic and Fracture appliances covered under HSN
code 9021.10 are exempt from A.P.VAT Act, 2005.
4. All medical devises and equipment including bandages are
taxable @ 12.5%.

To
M/s. Sree Durga Pharma,

Yendurivari Street,
Vijayawada

2 of page 2
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Vishnu Priya Slate Industries, (TIN No.28860191288)
Markapur, Prakasam District have filed an application dt.13.5.2005 and
Whether rough slate stones purchased from unregistered dealers and

exported outside the country would attract purchase tax under section
4(4) of A.P.VAT Act, 2005 ?
Sri P.Ramesh Babu, Proprietor appeared for hearing on 23-5-2005

1 of page 2
The applicant explained the modus operandi of the

transaction. The applicant obtains raw slates from mines owned
by himself by paying royalty there on to the Mines and Geology
Department and cuts them into required sizes and packs them
and exports outside India either directly or through other
intermediary. The applicant also purchases rough slate stones
from unregistered dealers and after processing them exports the
same.
In terms of the language in section 4(4) of A.P.VAT
Act, 2005 liability arises only if the goods purchased are
disposed off otherwise than by way of export sales. Since the
applicant claims to make exports, provisions of sub section (4)
of Section 4 are not attracted.

To
M/s. Vishnu Priya Slated Industries,

Markapur,
Prakasam District.
Copy to the Deputy Commissioner (CT), Nellore Division.
Copy to the Commercial Tax Officer, Markapur circle, Hyderabad.

2 of page 2

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Inter Labs (India) Private Limited, Yellareddyguda (TIN
i) Meaning of words “Capital goods”
ii) Whether VAT paid on capital goods like Plant & Machinery,
Building materials used for construction of factory buildings
eligible for input tax credit.
iii) Whether they are eligible for input tax credit or not and what is
the limit.
iv) Whether the grant of incentive under G.O.Ms.No.178
dt.21.6.2005 can be availed simultaneously with other input tax
credit for years.
The case was posted for hearing on 23-5-2006. Sri L.Prakasam,

Chartered Accountant of the firm appeared and explained the case.
The applicant stated that he is not in a position to understand the

treatment of capital goods with regard to eligibility for input tax credit. In
particular he wanted to know whether tax paid on purchase of capital goods
can be claimed in one lumpsum and whether capital goods in the shape of
building materials are also eligible for input tax credit. Another question
raised by him is regarding industrial incentives granted by G.O.Ms.No.178
dt.21.6.2005 and its implications with regard to input tax credit, tax paid by
him etc.
The question raised regarding the eligibility of input tax credit on

capital goods is examined with reference to Section 13 of the Act read with
Rule 20 of the rules thereunder. In the absence of any restrictions
regarding the entire amount of tax paid on capital goods, the input tax
regarding the eligible items of plant and machinery can be fully claimed in
one lumpsum in the month in which such goods are purchased. As regards
the materials used in buildings, there is a specific restriction under clause
(i) under sub rule (2) of Rule 20. The perusal of G.O.Ms.No.178 indicates
that 25% of the tax paid during one financial year will be given as grant by
the Government and this is available for five years from the date of
commencement of production i.e. upto 6th year.
Basing on the above, the ruling is given as under :

i) Items of plant and machinery and any other items used as
Capital goods excluding the items mentioned under clause (i) of sub
rule (2) of Rule 20 are eligible for the benefit of input tax credit to
any VAT dealer subject to such restrictions based on his output
whether it is fully taxable or partly taxable. Such input tax on plant
and machinery can be claimed in one lumpsum without any system
of instalments. Restrictions like proportionate input tax credit is
based on branch transfers, exempted goods sold by him etc. will be
applicable.
ii) Any inputs used in construction or maintenance of any
buildings including factory or office building are not eligible for the
benefit of input tax credit.
iii) The input tax credit availed by him will be a running
account so that he can carry forward excess input tax credit and he
is eligible for refund as stipulated under the provisions of the Act
and Rules.
iv) This Authority may not be in a position to clarify regarding
the grant of 25% of the tax paid as industrial incentives under
G.O.Ms.No.178 dt.21.6.2005. This may require clarification from the
Government or from the concerned administrative Authority /
Department.
JT.COMMISSIONER
To
M/s. Inter Labs (India) Private Limited,

8-3-670, Flat No.13,
Srinagar Apartments,
Yellareddygyda, Hyderabad – 73.
Hyderabad.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Mayuri Traders, Kukatpally, (TIN No.28970130433)
The applicant is seeking clarification regarding the applicable tax
rate on C.R.Strips purchased in coiled form and sold after rebetting into
different sizes.
The case was posted for hearing 23-5-2006. Sri L.Murali, Authorised
Representative of the firm appeared and explained the case.
It was explained by the applicant that there was no applicability of
excise duty for the activity at his hands and therefore HSN codes are not
used by him in the invoice. The purchase invoices of the applicant also do
not contain HSN codes. It was explained by the applicant that the
conversion at his hands is only to cut the item purchased into different sizes
and shapes. The applicable HSN codes for C.R. coils strips were examined.
It is found that HSN codes 7225 and 7226 are applicable. The Entry 70 of
Schedule IV to the A.P.VAT Act deals with “Iron and Steel” and various sub
items under this category are specified therein. Sub item (vi) specifies
“Sheets, hoops, strips and skelp, both black and galvanized, hot and cold
rolled, plain and corrugated in all qualities, in straight lengths and in coil
form as rolled and in revitted condition”. From the reading of this sub item
and examination of HSN codes 7225 and 7226, it can be concluded that the
items are declared goods under the category of “Iron and Steel”.
The ruling is therefore given that the items in question are
liable to tax @ 4% under Entry 70 of Schedule IV.
JT.COMMISSIONER
To
M/s. Mayuri Traders,

Shop No.71, Soni Business Complex,
Prashant Nagar,
Kukatpally, Hyderabad – 500 072.

Hyderabad.

PROCEEDING OF THE
(Enft)

2005.
***
O R D E R:
M/s. Nifty Labs Private Limited, Ameerpet, (TIN
The applicant is seeking clarification regarding the tax rate
applicable on “Other Organic Compounds” vide HSN Code number
2942.00.90.
The case was posted for hearing on 23-5-2006. Sri J.V.Reddy,
Managar (Accounts), of the firm appeared and explained the case.
The applicant produced tax invoice issued by him to his customers.
However, these invoices do not contain the HSN code. After examining all
the items included in HSN code 2942, it is found that the chapter heading is
“Other Organic Compounds” and items like Cefadroxil, Ibuprofen,
Ranitidine, Oxyclozanide etc. are mentioned therein. The specific HSN code
mentioned by the applicant, 2942.00.90 under this chapter deals with other
items of organic compounds. It is found that the HSN codes notified by the
State Government contain chapter 2942 under Entry 88 dealing with Drugs
and medicines in Schedule IV to the AP.VAT Act, 2005. The Government
have recently issued another notification vide G.O.Ms.No.502 dt.1.5.2006
wherein chapter 2942 dealing with other organic compounds is notified as
industrial inputs to be taxed at 4%.
Based on the above, the ruling is given that the applicable tax
rate shall be 4% in case the items sold fall under HSN code 2942
under “Other Organic Compounds”.
JT.COMMISSIONER
To
M/s. Nifty Labs Private Limited,

Flat No.203, Satya Sai Residency,
Plot No.7-1-54/1, Beside MCH Park,
Ameerpet, Hyderabad – 16.

Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. M.T.R.Foods Limited, Ramanthapur, Hyderabad

APVAT Act, 2005 read with Rule 66(2) (i) of APVAT Rules, 2005 along with
of 1987.
Mr.D.Harikishen Advocate appeared for hearing on 20-7-2005 and
explained the case.
for Vermicelli.
Act by G.O. Ms.No.114, dt.14-4-1990.
APVAT Act,2005.
tax @ 4%.

ruling.
To
M/s. M.T.R.Foods Limited,
Ramanthapur, Hyderabad.

Copy to the Deputy Commissioner(CT) Division.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Blowin USA, Hyderabad have filed an application and sought
admitted.
The applicant is seeking a clarification regarding rate of tax on
‘Gabela’ or ‘Gampa’ (made of iron and made of plastic) and also on the
applicable rate on Plastic bulk containers used for chemicals.
The case was posted for hearing on 28-6-2006. Sri P.Venkateswara
Rao (STP), authorized representative of the firm appeared and explained
the case.
According to them, ‘Gampa’ made of iron and steel or made of
plastic can be classified under Entry 1 of Schedule I of A.P.VAT Act which
deals with agricultural implements manually operated or animal driven.
Regarding the second item, the plastic container used for chemicals, they
have raised a doubt whether it can be classified under Entry 90 of Schedule
IV dealing with all kinds of packing material.
The issue has been examined with reference to the entries in the
Schedules to the VAT Act. ‘Gampa’ made of iron and steel cannot be
interpreted as falling under the category of agricultural implements
manually operated specified in Item 1 of Schedule I to the Act. Different
types of packing materials and containers are specified under Entry 90 of
Schedule IV to the Act. Going by the common understanding that ‘Gampas’
are used for the purpose of conveyance, it can be interpreted that they fall
under Entry 90 of Schedule IV to the Act.
Regarding the item “Plastic bulk containers used for chemicals and
liquids”, it is seen that sub item (4) notified under HSN code for Entry 90 of
Schedule IV includes this item.
In view of the above, ruling is given that both the items
specified by the applicant attract tax @ 4% under the provisions of
A.P.VAT Act.
JT.COMMISSIONER
To
M/s. Blowin USA,
Flat No.806, Mount Nasir,RBI Road,
Saifabad, Hyderabad – 4.

Hyderabad.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Kavita Engineering Industries, Hyderabad have filed an
The applicant is seeking a clarification regarding the applicable tax
rate on De-Flouride Water Filters.
According the applicant, they are manufacturing and selling
domestic De-Flouride Water Filters under the brand name of ‘Sri Surya’
meant exclusively for domestic purposes. They have stated that the item
falls under Entry 7 in Schedule IV dealing with ‘Utensils including Pressure
cookers and Pans’. They have referred to the definition of word ‘Utensil’ as
per Compact Oxford Dictionary wherein it is defined as ‘a tool or container
specially for household use’. It was also submitted by them the item is only
meant for household purpose and it is also used as a container for
containing protected water.
The issue has been examined. It is found that the item is understood
in common parlance as the item meant for use in household kitchens.
Therefore it can be interpreted as falling under Item 7 of Schedule IV to the
VAT Act.
The ruling is given that the item ‘De-Flouride Water Filter’
dealt by the applicant falls under Entry 7 of Schedule IV to the VAT
Act and taxable at 4%.
JT.COMMISSIONER
To
M/s. Kavita Engineering Industries,
5-239/4/1, H.P.Road,
Moosapet, Hyderabad – 500 018.

Hyderabad.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Larsen & Toubro Limited, Hyderabad have filed an application
and sought clarification and Advance Ruling under Section 67 of the APVAT
The applicant is seeking ruling on the rate of tax applicable on
Starters of Electric motors and pumps irrespective of their capacity in the
context of amendment made to Entry 17 of Schedule IV to the Act.
According to the applicant Entry 17 was amended by Act No.23 of
2005 removing the word ‘their’ which was the prefix to the Starters of
electric motors prior to the amendment. The issue has been examined with
reference to Entry 17 and the amendment made to the entry by way of
G.O.Ms.No.1564 dt.17.8.2005 and also the amendment made by way of Act
23 of 2005. It is found that the word ‘their’ is removed while enacting the
amendment made in G.O.Ms.No.1564 dt.17.8.2005. From this it is clear
that starters of electric motors do not have any classification based on
capacity of the electric motors due to the amendment made by Act 23 of
2005.
The ruling is given that starters of electric motors irrespective of the
capacity fall under Entry 17 of Schedule IV to the Act and taxable at 4%.
JT.COMMISSIONER
To
M/s. Larsen & Toubro Limited,
5-10-173, Fateh Maiden Road,
Hyderabad.

Hyderabad.

PROCEEDING OF THE

(Enft)

2005.
***
O R D E R:
M/s. Ori Flame India (P) Limited, Hyderabad have filed an
The applicant is seeking a clarification regarding the post sale
discounts offered to customers and the implications of tax in their hands.
The case was posted for hearing on 28-6-2006. Sri K. Srinivas
Reddy, Commercial Engineer of the firm appeared and explained the case.
According to them, their customers are not VAT dealers but they are
members enrolled with them and sales made to each of these members is
within the threshold limits for the purpose of registration under the
provisions of A.P.VAT Act. They have stated that discounts are offered to
the members subsequent to original sales based on achievement by each
member on monthly basis. It was also stated that all these members are
customers who directly purchase goods from them.
The issue has been examined with reference to the amended Rule
16 under A.P.VAT Rules by addition of clause (f) under sub rule (3). This
amendment is basically meant for the transactions between two registered
VAT dealers to neutralize the effect of credit notes on input tax and output
tax in the hands of selling VAT dealer and buying VAT dealer.
From the facts explained by the applicant, the ruling is given
that the applicant is entitled for reducing his tax liability to the
extent of discount offered to the customers by way of credit notes
cost as prescribed under Rule 16.
JT.COMMISSIONER
To
M/s. Oriflame India Private Limited,
MIG A 2, Indian Air Lines Housing Colony,
Parigah Lands,

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Rocksand Minerals (P) Limited, Hyderabad (TIN

Whether manufactured Sand & Metal aggregates fall under Entry 43

of the Schedule IV of A.P.VAT Act, 2005.
Tax invoice issue by the applicant.
Sri P.Purnachand, Joint Managing Director appeared on behalf of the
is given as under.
The applicant states that he extracts Stone boulders from

captive mines and crushes them into Sand and Metal aggregates
and pays seignorage to Mines Department. The substance - Sand
and metal aggregate being classified as a ‘minor mineral’ by the
Mines Department, the applicant contends that it falls squarely
within the scope of Entry 43 of Schedule IV of A.P.VAT Act, 2005.
We have heard the applicant and also perused the

documentary evidence submitted. Description of the product on the
invoice issued by the applicant shows that varying sizes of metal
(10mm/20mm/40mm) are sold by the applicant. The applicant has
charged VAT @ 12.5%. While this being so the applicant contends
that he is selling merely Sand & Metal aggregate which is nothing
but reduction of stone boulder without addition of any external
substance. In the G.Os cited above, the Government have notified
the HSN code applicable to items falling under Entry 43 of Schedule
IV of the Act. The codes notified are 2601 to 2617. These codes
refer to Iron, Manganese, Copper, Cobalt, Lead, Zinc, Tin, Titanium
etc., in the form of Ore and their concentrates. The product sold by
the applicant as evidenced from the invoice is metal of different
sizes. Thus, apparently the description of the product sold by the
applicant does not match with the Ores and Minerals mentioned in
the Excise chapters notified. Further, the product description on the
invoice makes it clear that the applicant is selling metal of various
sizes that has its own commercial identity as distinct from the
natural ores and minerals mentioned in the Schedule IV of the Act.
The contention of the applicant that stone boulder is classified as
minor mineral by the Mines Department and that the applicant is
paying seignorage to that department does not assist the case
because the applicant is not selling stone boulder as such. The
product description available on the invoice clearly leads to a
conclusion that it falls outside the scope of Entry 43 of Schedule IV
of the Act and also the HSN code notified by the Government.
Therefore, it is held as liable to tax @ 12.5% upto 17.8.2005.
Government have since issued a notification vide G.O.Ms.No.1564,
dt.17.8.2005 published in Gazette dt.18.8.2005 wherein a fresh
entry vide Entry No.92 in Schedule IV to the Act was added covering
“Riversand, Grit and Stone chips” taxable @ 4%. The sales of stone
chips from 18.8.2005 shall therefore be liable to tax @ 4%.
To
M/s. Rocksand Minerals,
203, Vijaya Enclave,
Srinagar Colony,

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Jain Turmerics, Rajahmundry (TIN No.28430103873) have filed
Whether tax paid under the VAT Act on sale of Sago is eligible for credit out
of tax payable on the sales of the same goods in the course of interstate
trade and commerce.

1. Copies of sale invoice and way bill.
Sri Ugamraj Gulecha, Proprietor appeared on behalf of the firm for

The applicant claims that he is a manufacturer of Sago and
Starch and registered as VAT dealer in the State. The applicant
claims that he purchases Sago and Starch from VAT dealers within
the State and effects sale of the same goods in the course of
interstate trade or commerce. The applicant seeks to know whether
he is eligible for input tax credit on sales made in the course of
interstate trade and commerce.
According to Section 8 of A.P.VAT Act, 2005, certain

transactions are declared as zero rated sales and eligible for input
tax credit. Section 8(a) of the Act refers to transactions falling
within Section 3 of the CST Act, 1956 as zero rated sales. Therefore,
it is held that the applicant is eligible for input tax credit in respect
of sales made in the course of interstate trade and commerce falling
within the scope of Section 3 of the CST Act, 1956.
To
M/s. Jain Turmerics,

Main Road,
Rajahmundry.


PROCEEDINGS OF THE

*****
O R D E R:
M/s. Mangalam Timber Products Limited., Barkathpura, Hyderabad,

the application fee of Rs.1,000/-.

Whether organic manure / organic manure with neem is taxable or
exempted under entry 26 of the Ist Schedule.
Write up on the nature of the organic manure.
Mr. P.K.Jain, appeared for hearing on 23-8-2005 and explained the case.
under:
The applicant states that they procure organic matter/manure/ from sugar
division of GMR Industries, which is a waste material. In order to keep pest
free, they add 5% crushed neem seeds in the manure and market as
“organic manure with neem”.
‘Organic Manure’ is enlisted in entry 26 of the 1st Schedule and a

HSN Code bearing No.3101 is also notified vide G.Os. referred. The
description of goods of HSN Code 3101 is as under “Animal or
vegetable fertilizers, whether or not mixed together or chemically
treated, fertilizers produced by the mixing or chemical treatment of
animal or vegetable products”
Therefore, in view of the notification of the HSN Code 3101 for the entry
26 of the Ist Schedule, organic manure with neem or otherwise is exempted
from tax.

ruling.
To
M/s. Mangalam Timber Products Limited,
Barkathpura, Hyderabad.

Copy to the Commercial Tax Officer, Special Commodity Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Muthyapu Ramulu and Brothers, Kamareddy (TIN

To condone delay in filing stock statement in Form 115.

i) Representation addressed to Commissioner(CT) seeking
Condonation of delay
ii) Copy of judgement of A.P.High Court in Surya General Traders
Vs. CTO, Palakol.
Sri M.Narayana, Authorised Representative appeared on behalf of

The applicant states that he could not file the stock
statement within the stipulated time for the stock held with him on
Form 115 to the CTO, Kamareddy as the dealer was apparently not
clear about the provisions of A.P.VAT Act and that the Managing
Partner, Muthyapu Anjaneyulu aged about 70 years was not in a
good health because of old age. The applicant contends that non-
submission of Form 115 is only a technical mistake. Therefore, he
should not be deprived of the legal benefit of sales tax relief on
closing stocks. In support of the plea the applicant relies on the
judgement of Surya General Traders Vs. CTO, Palakol (25 APSTJ
85).
We have heard the representative and also perused the
documents submitted. While the representation addressed to
Commissioner(CT) states the reasons for failure to submit the claim
in time, the decision of the High Court relied on by the applicant
deals with the question where a dealer has a good case on merits,
the state should not take a technical plea of limitation as to deprive
the dealer of his just dues. Rule 37 of A.P.VAT Rules lays down the
procedure and conditions for relief of sales tax at the
commencement of the VAT Act. According to this Rule a dealer is
required to submit his claim for sales tax relief before the
prescribed date.
As per the provisions of the Act, this Authority can only
clarify the matters falling squarely within the frame work of law. As
the plea raised by the applicant does not pertain to the clarificatory
nature of law, the application falls outside the scope of this
Authority and therefore no ruling can be given.
To
M/s. Muthyapu Ramulu & Brothers,

Commission Agents, Gandhi Gunj,
Kamareddy – 503 111.


PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/137 / 2005. Dated 25- 06-2005.
O R D E R:
M/s. Natraj Stationery Products (P) Ltd., Hyderabad


The rate of tax on Photo Albums.
1.Copy of Form-ER-I
2.Copy of Bill of entry of import
3.Copy of shipping bill for export
4.Copy of page 2 of CE Act
5.Copy of letter from the CE Department
6.Copy of CE Registration issued by CE Department
Sri Manohar Agarwal, C & F Agent appeared for hearing on 20-6-2005 and
explained the case.
under:
The applicant has enclosed documentary evidence showing

that the goods –photo albums fall under chapter 48.20. On due
verification it is found that, the said HSN Code 4820 has been
notified by the Department vide G.Os.cited above, for the entry 25
of the IVth Schedule, which is liable to tax @ 4%. Hence, Photo
Albums are liable to tax @ 4% under entry 25 of the IVth Schedule.
ruling.
To
M/s. Natraj Stationery Products (P) Ltd.,
Balkampet, Hyderabad.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Oblum Electrical Industries (P) Limited (TIN No.28620284610)
Rs.1000/-.
Rate of tax applicable to Surge Arresters / Lightening Arresters
Smt. P.Lalitha Kamaneni, Authorised Representative appeared on

is given as under.
Lightening Arresters / Surge Arresters do not find place in
any of the Schedules of the A.P.VAT Act, 2005. Therefore in terms of
the language of Schedule V of the Act, the item Surge Arresters /
Lightening Arresters are held as liable to tax @ 12.5%.
To
M/s. Oblum Electrical Industries (P) Limited,

A-16 & 17, APIE, Balanagar,
Copy to the Commercial Tax Officer, Fatehnagar Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Quality Care India Limited, (TIN No.28550128410) have filed

i) Whether Lab reagents purchased by the applicant and used in
lab investigation such as Blood test etc., are liable to tax.
ii) Whether use of implants such as stents, heart valves and
surgical disposables in the course of treatment of outpatients are
liable to tax.
iii) Whether surgical disposables such as Cotton, bandage, surgicals
used as part of surgical procedures are liable to tax.

a) Copy of outpatient bill-cum-receipt in respect of item (i)
above.
b) Copy of hospital bill in respect of item (ii) above
c) Copy of hospital bill in respect of item (iii) above.
Sri P.S.R.Swamy, Company Secretary appeared on behalf of the firm
1. The applicant claims that he purchases lab reagents by
paying VAT and uses them in lab investigations such as Blood test
etc., and issues lab reports to the patients. The applicant further
states that he is not collecting VAT under the impression that there
is no transfer of property as required under the law and therefore
seeks to know whether the reagents used in lab investigations are
liable to tax at the hands of the applicant.
We have considered the facts stated on the application and
by the representative of the applicant. In terms of the scheme of
A.P.VAT Act, 2005, the lab reagents used in lab investigations are
not put to sale by the applicant and therefore the applicant need
not charge VAT on the outpatient bill-cum-receipt issued in respect
of such lab reports.
2. As regards tax liability on surgical disposables,
implants such as stents, heart valves etc., that are used in the
course of treatment / surgery of the patients, there is no element of
sale by the applicant. Therefore, the applicant need not charge VAT
on the hospital bill issued to the patients.
3. The applicant also claims that he uses surgical

disposables such as cotton, bandage, disposable surgicals etc., as
part of the surgery procedures and further states that presently he
is not collecting VAT. We have considered the facts borne on the
application and the hospital bill issued by the applicant. As there is
no element of sale in the transaction, the applicant need not charge
VAT on the hospital bill issued to the patient.
In all the three circumstances stated above, the applicant
shall not claim any benefit of input tax credit since the
corresponding outputs are exempted.
To
M/s. Quality Care India Limited,

Care Hospital, Road No.1,
Banjara Hills,

PROCEEDINGS OF THE

***
O R D E R:
M/s. Rocksand Minerals (P) Limited, Hyderabad (TIN

Whether manufactured Sand & Metal aggregates fall under Entry 43

of the Schedule IV of A.P.VAT Act, 2005.
Tax invoice issue by the applicant.
Sri P.Purnachand, Joint Managing Director appeared on behalf of the
is given as under.
The applicant states that he extracts Stone boulders from

captive mines and crushes them into Sand and Metal aggregates
and pays seignorage to Mines Department. The substance - Sand
and metal aggregate being classified as a ‘minor mineral’ by the
Mines Department, the applicant contends that it falls squarely
within the scope of Entry 43 of Schedule IV of A.P.VAT Act, 2005.
We have heard the applicant and also perused the

documentary evidence submitted. Description of the product on the
invoice issued by the applicant shows that varying sizes of metal
(10mm/20mm/40mm) are sold by the applicant. The applicant has
charged VAT @ 12.5%. While this being so the applicant contends
that he is selling merely Sand & Metal aggregate which is nothing
but reduction of stone boulder without addition of any external
substance. In the G.Os cited above, the Government have notified
the HSN code applicable to items falling under Entry 43 of Schedule
IV of the Act. The codes notified are 2601 to 2617. These codes
refer to Iron, Manganese, Copper, Cobalt, Lead, Zinc, Tin, Titanium
etc., in the form of Ore and their concentrates. The product sold by
the applicant as evidenced from the invoice is metal of different
sizes. Thus, apparently the description of the product sold by the
applicant does not match with the Ores and Minerals mentioned in
the Excise chapters notified. Further, the product description on the
invoice makes it clear that the applicant is selling metal of various
sizes that has its own commercial identity as distinct from the
natural ores and minerals mentioned in the Schedule IV of the Act.
The contention of the applicant that stone boulder is classified as
minor mineral by the Mines Department and that the applicant is
paying seignorage to that department does not assist the case
because the applicant is not selling stone boulder as such. The
product description available on the invoice clearly leads to a
conclusion that it falls outside the scope of Entry 43 of Schedule IV
of the Act and also the HSN code notified by the Government.
Therefore, it is held as liable to tax @ 12.5% upto 17.8.2005.
Government have since issued a notification vide G.O.Ms.No.1564,
dt.17.8.2005 published in Gazette dt.18.8.2005 wherein a fresh
entry vide Entry No.92 in Schedule IV to the Act was added covering
“Riversand, Grit and Stone chips” taxable @ 4%. The sales of stone
chips from 18.8.2005 shall therefore be liable to tax @ 4%.
To
M/s. Rocksand Minerals,
203, Vijaya Enclave,
Srinagar Colony,

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Sai Krishna Agencies, Hyderabad (TIN.28980151320) have filed

66(2) (i) of APVAT Rules, 2005 along with the application fee of Rs.1,000/-
of 1987.
Mr.K.Hanumantha Rao, Advocate appeared for hearing on 23-8-
for Vermicelli.
Act by G.O. Ms.No.114, dt.14-4-1990.
APVAT Act,2005.
tax @ 4%.

ruling.
To
M/s. Sai Krishna Agencies,
Hyderabad.
Copy to the Deputy Commissioner(CT), Saroornagar Division.
Copy to the Commercial Tax Officer, Malkajgiri Circle.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Smt. B.S.Suseelamma (Mine Owner) Bethamcherla


Sri K. Hyder Vali, Authorised Representative, appeared for hearing

under:

and minerals.


ruling.
To
M/s. Smt. B.S.Suseelamma (Mine Owner)
Bethamcherla.

Copy to the Deputy Commissioner(CT), Kurnool Division.

PROCEEDINGS OF THE
*****
O R D E R:
M/s. Sri Udaya Raghavendra Minerals, Bethamcherla

(TIN.28230110023)
of Rs.1,000/-.


under:
The applicant stated that the items referred supra are notified by the
Department of Coal and Mines, Government of India as falling under
minerals and contended that pure powders of such minerals should also fall
under the entry “Ores and Minerals”. Entry 43 of IVth schedule enumerates
– ores and minerals covers all ores and minerals.
All the commodities referred are natural minerals converted into
powder by pulverizing them. Therefore, all ores and minerals in their
natural or powder forms fall under entry 43 of the IVth Schedule liable to
VAT @ 4%.
ruling.
To
M/s. Sri Udaya Raghavendra Minerals,
Bethamcherla, Kurnool Dist.


PROCEEDINGS OF THE

*****
O R D E R:
M/s. Sri Venkata Raghavendra Minerals, Bethamcherla


Copy of the Extraordinary Gazette of Government of India No.454 Dt.14-1-
2004 of Ministry of Coal & Mines.

under:
The applicant stated that the items referred supra are notified by the
under the entry “Ores and Minerals”. Entry 43 of IVth schedule enumerates
– ores and minerals covers all ores and minerals.
All the commodities referred are natural minerals converted into

powder by pulverizing them. Therefore, all ores and minerals in their
natural or powder forms fall under entry 43 of the IVth Schedule liable to
VAT @ 4%.

ruling.
To
M/s. Sri Venkata Raghavendra Minerals,
Bethamcherla, Kurnool District.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Suzlon Energy Limited, Ahmedabad have filed an application

Whether the applicant is liable for registration as VAT dealer under the
A.P.VAT Act.
Sri J.V.Rao, Advocate, Authorised Representative appeared on behalf

The applicant claims that he is engaged in the business of
Renewable energy devices and also purchases and sells Electrical
energy. The applicant further states that he purchases and sells
electrical energy which falls under Entry 13 of Schedule I of the
A.P.VAT Act which is exempt from tax under Section 7 of the said
Act. In the circumstances, he seeks to know whether he is required
to register as VAT dealer under the A.P.VAT Act since Electrical
energy is exempt.
According to Section 17 of A.P.VAT Act, 2005, an obligation is

cast on a dealer who makes taxable sales. Different turnover
thresholds are prescribed for the purpose of registration. A taxable
sale arises if the goods involved are taxable. In the case of the
applicant it appears that he is engaged in the business of
Renewable energy devices and sale and purchase of electrical
energy as well. If the applicant engages himself in buying and
selling Renewable energy devices, he will be liable to register
himself as VAT dealer as these devices are taxable under the Act. If
the applicant is merely engaged in buying and selling of electrical
energy within the state of A.P., he has no obligation to register
himself under the provisions of the Act as electrical energy is
exempt and the sales turnover entirely of such goods does not
create legal obligation for registration.
To
M/s. Suzlon Energy Limited,

Suzlon House, Near Krishna Centre,
Navrangpura, Ahmedabad – 3800 009.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. The South India Mining Company, Bethamcherla



Sri K.Hyder Vali, Authorised Representative, appeared for

under:

and minerals.

ruling.
To
M/s. The South India Mining Company
Bethamcherla.

Copy to the Deputy Commissioner (CT) Kurnool Division.

PROCEEDINGS OF THE
*****
O R D E R:
M/s. TOTAL PRESENTATION DEVICES (P)LTD, HYDERABAD

TIN.No.28100267135 have filed an application Dated 27-7-2005 and sought

Can the goods lying under custom bonded warehouse be treated
as goods not crossed the Custom Frontiers of India. Are they liable to pay
VAT in A.P for such sales?
Sri M.S.Prasad, Chartered Accountant, authorized representative

The issue has been examined with reference to the provisions of

the APVAT Act and Rules and the ruling is given as under:
The applicant states that goods after import from other countries
are kept in Custom bonded warehouse from where the prospective buyer
takes delivery after paying the customs duty and filing the bill of entry.
The issue, “when the goods are to cross the customs

barriers”, has been decided by the SCI in the case of 1) Kiran
Spinning Mills Vs Commissioner of Customs (113 ELT, 753 (SC)) and
in the case of State Trading Corporation Vs. State of Tamilnadu and
another (129 STC, 294).
Goods lying in bonded ware house are deemed as not crossed

the customs frontiers of India, until customs duty is paid. A dealer
who pays customs duty and takes delivery of goods from the
bonded ware house becomes the owner of goods and sales made by
such dealer in the State of A.P. shall be liable to tax.
ruling.
To
M/s. Total Presentation Devices (P) Ltd.,
Hyderabad.
Copy submitted to the Commissioner of Commercial Taxes,

A.P.Hyderabad

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Goa Opto Lab Private Limited, Hyderabad (TIN

of Rs.1000/-.

i) Opthalmic lenses
ii) Spectacle frames
iii) Spectacle lenses
iv) Contact lenses
v) Contact lens solutions
vi) Sun glasses
vii) Accessories
i) Copy of stock transfer note issued by GOPL – Plant, Goa.
4. Sri Y.Ashok Reddy, Regional Accountant appeared on behalf of the
6. We have heard the applicant and considered the documentary
evidence. The applicant relies on the HSN code applicable to some
of the products on which the ruling is sought. The codes relied upon
are 9001, 9003, 9004. In G.O.Ms.No.1615 dt.31.8.2005, HSN code
applicable to some items falling under Schedule I and Schedule IV
have been notified. The HSN codes on which the applicant relied as
applicable to the products in question have not been found in the
said G.O.
We have also perused Schedules appended to the A.P.VAT
Act, 2005 and do not find the products in question. Therefore in
terms of the language of Schedule V of the A.P.VAT Act, 2005 we
hold that all the products in question are liable to tax @ 12.5%.

To
M/s. Goa Opto Lab Private Limited,
Shop No.6-3-867, Ist Floor, Greenland circle,
Ameerpet Road, Begumpet, Hyderabad.
Hyderabad.
Copy to the Commercial Tax Officer, Narayanguda Circle

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Kirloskar Brothers Limited, Secunderabad (TIN

of Rs.1000/-.
ii) Whether the applicant, a member of the consortium is liable for

assessment independently under the A.P.VAT Act, 2005
iii) Whether the consortium which is joint venture comprising the

applicant and four other contractors is an independent entity and
liable for registration
iv) If the applicant does not opt for composition whether
C.T.Department issues a suitable certificate to the employer
namely Superintendent Engineer, Irrigation not to deduct tax @
4% at source while making payment.
v) In case TDS is to be deducted whether the employer namely

Superintendent Engineer, Irrigation can issue TDS certificate in
the name of respective members of the consortium or
alternatively if the consortium is recognized as separate legal
entity whether applicant being a member is exempt from
assessment under Rule 17(2)(j) as Sub-Contractor.
1 of 5
vi) In the event of applicant not opting for composition whether Rule
17(1) applies to such contracts
vii) The employer (Contractee) being a State Government

department and deducts tax at source, whether such tax
deducted is in addition to actual liability or can it be set-off
against liability with a refund of excess TDS.
i) Agreement bond
ii) Copy of Internal Joint Venture Agreement
4. Sri G. Vijay Ghir, Manager (Accounts) appeared on behalf of the firm

6. The applicant claims to be a company incorporated under the Indian

Companies Act carrying on business in the execution of works contract. The
applicant claims to be one of the members of Joint venture and succeeded
in bidding for executing the contract of Gutpa Lift Irrigation Scheme (GLIS).
The other members being the Indian Hume Pipe Company Limited,
Bhooratnam Construction Company Private Limited, Taher Ali Industries &
Projects Private Limited and Kirloskar Brothers Limited. The applicant states
that all the 5 companies named above including the applicant himself have
formed themselves into a joint venture for the specific and limited purpose
to bid in the project and the joint venture is called KCCPL-IHP-BRC-TAIPPL-
KBL JV. Among the 5 members of the consortium, the applicant claims to
be the leader of the joint venture. Each of the member has expertise in
their respective area / work and have agreed to participate by sharing the
scope of work by distributing the total contract among themselves on
mutually agreed terms. Responsibility for the completion of work is joint
and several and there will be inter-party indemnification. The defaulting
party shall only be responsible and hold others harmless and innocent
parties of the joint venture. The employer is not concerned with the manner
of sharing the scope of work or internal rights and liabilities of the JV
members and their payments will be made to the contractor namely the JV.
The amount received from the employer will be distributed to the individual
members of the consortium for their portion of work without any
2 of 5
retention in the JV account. The applicant being the leader of JV will certify
individual bills of the members. The applicant further states that as per
Aticle 2 (of Internal Joint Venture Agreement) individual parties to the joint
venture enter into contract with the employer and Article 2.4 clarifies that
the agreement is limited to mere execution of the contract and does not
result in partnership for sharing the profits and losses. The applicant further
states that there is no separate accounts or profit and loss of the joint
venture and all realizations under the contract, tax obligations etc. will be
to the account of respective parties. Further as per Article 10, all taxes are
to be borne by the respective parties themselves. In view of these clauses
in the contract, the applicant states that the joint venture is neither a
partnership nor an independent association of persons and therefore it is
not a separate legal entity. In the circumstances clarification is sought on
the following questions.
i) Whether the applicant, a member of the consortium is liable for

Considering the nature of the contract and the role of

respective parties of the consortium, we hold that the applicant
continues to retain his independent identity despite being a
member of the consortium. Therefore the applicant is liable to be
assessed independently under the A.P.VAT Act, 2005.
ii) Whether the consortium which is joint venture comprising the

applicant and four other contractors is an independent entity and liable for
registration
Perusal of clauses in the general conditions and Articles in

the internal joint venture agreement shows that the consortium is
created merely for pooling the resources of the members and for
smooth and efficient coordination of the work. Inasmuch as each of
the constituents of the consortium retains its independent identity
and liable for execution of the work and operation and maintenance
and satisfactory performance of the project, we hold that the
consortium is not a separate legal entity with an obligation to
register. Therefore the consortium is not liable for registration and
assessement under A.P.VAT Act, 2005.
iii) If the applicant does not opt for composition whether

C.T.Department issues a suitable certificate to the employer namely
Superintendent Engineer, Irrigation not to deduct tax @ 4% at source while
making payment
3 of 5.
Provisions of A.P.VAT Act, 2005 do not envisage issuance of

letter to the employer. As per Section 22(3) when a dealer executes
works contract for Government or Local authority, tax @ 4% shall
be deducted from the amount payable to the contractor. In so far as
tax deduction is concerned, there is no option available to the
employer and the deduction shall be irrespective of the option to
pay tax by way of composition exercised by the contractor.
iv) In case TDS is to be deducted whether the employer namely

Superintendent Engineer, Irrigation can issue TDS certificate in the name of
respective members of the consortium or alternatively if the consortium is
recognized as separate legal entity whether applicant being a member is
exempt from assessment under Rule 17(2)(j) as Sub-Contractor.
As the applicant continues to be an independent legal entity

despite being member of the consortium, tax at source shall be
deducted from the amount payable to him by the employer and a
certificate in Form VAT 501 shall be issued by the employer. In view
of this the question of applicant being treated as Sub-Contractor
and exempt from assessment under Rule 17(2)(j) does not arise.
In case, the payment by the employer is released in the name

of JV Company, the TDS certificate in Form 501 can also be issued
to JV. However, the J.V. can endorse it in favour of individual
member if the amount involved is fully payable to such individual
member and whenever payments are to be released to more than
one member against one 501 issued by employer, the JV can issue
individual 501 forms to the members with detailed reference of
original 501 form, the total TDS made by employer and allocations
of TDS among members. This shall also be accompanied by a
certificate issued by JV and signed by all members of JV as a proof
that original TDS made by employer is apportioned between
members.
v) In the event of applicant not opting for composition whether Rule

17(1) applies to such contracts ?
Rule 17(1) of A.P.VAT Rules, 2005 stipulates the procedure

for treatment of VAT dealer executing works contract. According to
this Rule, a VAT dealer shall pay tax on the value of the goods at the
time the goods are incorporated in the work. The tax rate shall be
the rate applicable to the goods incorporated. This rule squarely
applies to the applicant.
4 of 5
vi) The employer (Contractee) being a State Government department
and deducts tax at source, whether such tax deducted is in addition to
actual liability or can it be set-off against liability with a refund of excess
TDS ?
The provision in Rule 17(2)(k) stipulating that no refund is

allowed to the contractor executing works contracts for the State
Government or Local Authority, is to be read with rate of tax by way
of composition being 4% under Section 4(7)(b) and tax deduction
at source @ 4% under sub-section (3) of Section 22 of the Act. The
assumption made is that all employers or contractees would build
4% tax component in the work estimate and any contractor
remaining outside composition shall not claim refund against public
money released by State Government or Local Authority. The
Government have accordingly issued a G.O. vide G.O.Ms.No.11,
Finance (Works & Projects) Department, Dt.29-07-2005 to make
provision for tax component of 4% in works estimates. Therefore, it
is to be clearly understood that no refund can be claimed against
public money earmarked towards tax.
To
M/s. Kirloskar Brothers Limited,
403, Jade Arkade, Paradise Circle, M.G.Road,
Secunderabad.

Hyderabad.
Copy to the Commercial Tax Officer, R.P. Road Circle.
5 of 5

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Sangam Health Care Products Limited, S.P.Road, Hyderabad

Rate of tax applicable to:
ii) Intravenous sets

iii) Urine collection bags
iv) Disposables needles
v) Ryle’s tube
vi) Infant feeding tube
vii) Suction catheters
viii) Neleton catheters
ix) Urethral catheters
x) Hypodermic disposable syringes

i) Product literature
ii) Write-up on products on which ruling is sought
4. Sri N.N.Rao, Chartered Accountant appeared on behalf of the firm

The applicant states that he is engaged in the business of
manufacturing and selling I.V.sets and other items on which ruling is
presently sought and that the products are manufactured by him under
license issued by the Drug Controller under the provisions of Drugs and
Cosmetics Act, 1940.
We have examined the product literature and considered the
write-up submitted by the applicant. We find that Entry 88 of the
Schedule of the VAT Act, 2005 as amended in G.O.Ms.No.1564
dt.17.8.2005 contains, Hypodermic syringes, hypodermic needles,
catheters and similar articles. Various products falling under the
said entry have also been notified alongwith the HSN code
applicable to them in G.O.Ms.No.1615 dt.31.8.2005. Among other
things Syringes with or without needles has been notified as falling
under HSN code 9018.31.00. Sub entry (16) of Entry 88 for the said
notification also refers to tubular metal needles and needles for
sutures. Sub entry 17 of the notification also refers to “others”
falling under HSN code 9018.39. The language of amended entry,
besides specifying certain products, also refers to similar articles.
As seen from the documentary evidence submitted by the applicant
and in view of the amendment made to Entry 88 expanding and
including certain products, we are inclined to hold that the items on
which the applicant sought ruling fall within the scope of the
amended Entry 88 and therefore liable to tax @ 4%.
To
M/s. Sangam Health Care Products,
205 & 206, Amarchand Sharma Complex, S.P.Road,
Secunderabad – 3.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Super Surgico Appliances Private Limited, Hyderabad (TIN

of Rs.1000/-.

i) Intravenous sets
ii) Perfusion sets &
iii) Infusion sets

i) Sale invoice issued by certain dealers situated outside the State
of A.P.
ii) Sale invoice issued by the applicant
4. Sri Noman Ahmed, Director appeared on behalf of the firm for

The applicant claims to be engaged in the business of selling
Surgical items and seeks to know the rate of tax applicable to Intravenous
sets, Perfusion sets and Infusion sets. The applicant states that he
purchases these items from certain dealers situated outside the State of
A.P. and effects sale within A.P.
The documentary evidence submitted by the applicant shows that
needles, tubes, roller clamps etc. which are said to be forming part of I.V.
sets are purchased by the applicant. Sale invoices issued by the applicant
indicate that I.V. sets are sold and tax @ 12.5% has been charged by the
applicant. However the applicant seeks a ruling regarding the rate of tax
applicable to the product.
Entry 88 of Schedule IV of the A.P.VAT Act, 2005 as amended by
G.O.Ms.No.1564 dt.17.8.2005 reads as under :
“Drugs and medicines whether patent or proprietary, as defined in
clauses (i), (ii) and (iii) of Section 3(b) of Drugs and Cosmetics Act, 1940
(Central Act 23 of 1940), including hypodermic syringes, hypodermic
needles, catguts, sutures, surgical cotton, dressings, plasters, catheters,
cannulae, bandages and similar articles”.
As seen from the language of the entry, the products sold by
the applicant on which a ruling is sought conform to the description
of hypodermic syringes, needles etc. The entry also uses the phrase
“similar articles”. In the circumstances we hold that I.V. sets,
Perfusion and Infusion sets fall under Entry 88 of Schedule IV of the
Act and liable to tax @ 4%.
To
M/s. Super Surgico Appliances Pvt. Ltd.,
Plot No.16/E/, IDA, Kattedan,
HYDERABAD – 500 077.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Taher Ali Industries & Projects Private Ltd., Hyderabad (TIN
of Rs.1000/-.
viii) Whether the applicant, a member of the consortium is liable for

ix) Whether the consortium which is joint venture comprising the

x) If the applicant does not opt for composition whether

xi) In case TDS is to be deducted whether the employer namely

1 of 5
xii) In the event of applicant not opting for composition whether Rule
xiii) The employer (Contractee) being a State Government

iii) Agreement bond

iv) Copy of Internal Joint Venture Agreement
4. Sri V. Bhaskar Reddy and Sri Uday Kumar Bhagavat, Advocates
the case.

2 of 5



registration


making payment
3 of 5.



members.


4 of 5
TDS ?

To
M/s. Taher Ali Industries & Projects Private Limited,
6-3-1089/1/1, Flat No.102,103, Pavani Avenue, Raj Bhavan Road,
Somajiguda,Hyderabad.

Hyderabad.
5 of 5

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Bhooratnam Construction Company (P) Limited, Secunderabad

xiv) Whether the applicant, a member of the consortium is liable for

xv) Whether the consortium which is joint venture comprising the

xvi) If the applicant does not opt for composition whether

xvii) In case TDS is to be deducted whether the employer namely

1 of 5
xviii) In the event of applicant not opting for composition whether Rule
xix) The employer (Contractee) being a State Government


v) Agreement bond
vi) Copy of Internal Joint Venture Agreement
4. Sri V.Bhaskar Reddy and Uday Bhagwat, Advocates appeared on


2 of 5



registration


making payment
3 of 5.




members.


4 of 5
TDS ?
To
M/s. Bhooratnam Construction Company Private Limited,
7-3-719, R.P. Road,
Secunderabad.

Hyderabad.
Copy to the Commercial Tax Officer, Hissamgunj Circle.
5 of 5

PROCEEDINGS OF THE
***
O R D E R:
1. M/s. Koya & Company Construction (P) Limited, Hyderabad (TIN

of Rs.1000/-.
xx) Whether the applicant, a member of the consortium is liable for

xxi) Whether the consortium which is joint venture comprising the

xxii) If the applicant does not opt for composition whether

xxiii) In case TDS is to be deducted whether the employer namely

1 of 5
xxiv) In the event of applicant not opting for composition whether Rule
xxv) The employer (Contractee) being a State Government

vii) Agreement bond

viii) Copy of Internal Joint Venture Agreement
4. Sri K.Murali Krishna, G.M.(Finance) alongwith Sri V.Bhaskar Reddy

and Uday Bhagwat, Advocates appeared on behalf of the firm for hearing on

2 of 5



registration


making payment
3 of 5.



members.


4 of 5
TDS ?

To
M/s. Koya & Company Construction Private Limited,
12-2-831/38, 72 MIGH, Mehdipatnam,

Hyderabad.
5 of 5

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. Poshak Feeds Private Limited, Hyderabad (TIN

of Rs.1000/-.
Whether waybill is required for transportation of Poultry feed which

is exempt under Entry 3 of Schedule I of A.P.VAT Act, 2005.
3. Sri J.V.Rao, Authorised Representative appeared on behalf of the

5. The applicant states that he is engaged in the business of
Poultry feed and that while dispatching poultry feed the applicant is
not enclosing waybill form prescribed under the A.P.VAT Act, 2005
as Poultry feed is exempted from tax under the Act. While this
being so, the applicant has stated that check post authorities are
stopping the consignment and insisting for waybill. In the
circumstances, the applicant seeks ruling whether waybill is
required for transporting Poultry feed.
We have considered the plea of the applicant. Rule 55 of
A.P.VAT Rules refers to movement of goods in goods vehicle.
Proviso under sub rule (1) of the said rule exempts use of waybill in
respect of transport of the goods specified in Schedule I of the Act.
In the said Schedule, goods that are exempt are specified. Thus it
may be deduced that when exempt goods listed in Schedule I of the
Act are transported, there is no necessity of issue of waybill.
To
M/s. Poshak Feeds Private Limited,
TTurkhyamjal Village, Mangalpalli (PO),
Nagarjunasagar Road, Hyderabad – 501 510

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
1. M/s. The Indian Hume Pipe Company Limited, Hyderabad (TIN

of Rs.1000/-.
xxvi) Whether the applicant, a member of the consortium is liable for

xxvii) Whether the consortium which is joint venture comprising the

xxviii) If the applicant does not opt for composition whether

xxix) In case TDS is to be deducted whether the employer namely

1 of 5
xxx) In the event of applicant not opting for composition whether Rule
xxxi) The employer (Contractee) being a State Government

ix) Agreement bond

x) Copy of Internal Joint Venture Agreement
4. Sri V. Bhaskar Reddy and Sri Uday Kumar Bhagavat, Advocates

the case.
2 of 5


registration


making payment
3 of 5.



members.


4 of 5
TDS ?

To
M/s. The Indian Hume Pipe Company Limited,
502-C, 3-6-237, Lingapur House, Himayatnagar,
Hyderabad.

Hyderabad.
5 of 5

PROCEEDINGS OF THE

Sri P. Sathyanarayana Reddy, Jt. Commissioner (Enft)
*****
CCT’s Ref.No: /A.R.Com/ 50 / 2006. Dated 25- 11-2006.

O R D E R:
I. M/s. Godrej & Boyce Manufacturing Co. Ltd, M.G.Road,

Secunderabad (TIN.28270208218) have filed an application and sought
1. The rate of tax payable on sale of Cellular Telephones with HSN
code 8525.20.17.
2. The rate of VAT payable on sale of parts and accessories of
Cellular Telephones including batteries.

Sri N.V.Raj Gopal, Advocate,Authorised Representative appeared for
. The issue has been examined with reference to the provisions of the
The applicant seeks to know the rate of tax applicable on sale

of cellular telephones and parts, accessories and batteries of
cellular telephones under the VAT Act.
Cellular Telephones do fall under sub entry 15 of Entry 39,

I.T. Products, that is to say with HSN Code 8525.20.17. Under sub-
entry 16 of Entry 39 parts of HSN 8525 and 8527 are notified,
whereas accessories including batteries are not enlisted in the
entry 39 which ends with suffix “that is say”. Further batteries
(others) included in HSN code 8506. Hence, cellular telephones and
parts are taxable @ 4% whereas batteries used for cellular phones
are taxable @ 12.5%. Advance ruling given by this authority in )
A.R./ 61 / 2005/ dt. 13.5.2005 and AR /320/2005 dated 15.9.2005
may also be referred.
Sd/- Sd/- Sd/-
ruling.
To
M/s. Godrej & Boyce Manufacturing Co.Ltd,
M.G.Road,
Secunderabad.

Copy to the Commercial Tax Officer, M.G.Road circle.

PROCEEDING OF THE

(Enft)

05.
***
O R D E R:
M/s. R.K.Trading Company, Hyderabad (TIN No.28150192023) have
The applicant is seeking clarification on the applicable tax rate for
the School bags sold by him.
The case was posted for hearing on 23-11-2006. Sri K.Ramulu,
Proprietor of the firm appeared and explained the case.
(CT.II) Dept, dt.29.6.2006.
The applicant explained that he is selling different kinds of bags

including School bags and they are made of Jute cloth or plastic material. It
was also explained that 4% tax rate is being charged and paid by him. The
issue has been examined with reference to Entry 90 in Schedule IV to the
Act which specifies all kinds of packing material. The Government have
notified certain HSN codes for this entry. Two items notified are as under :
1. Articles for conveyance or packing of goods, all plastics – HSN Code
3923
2. Sacks and bags of a kind used for packing of the goods – HSN Code
6305
The sub items under Central excise tariff code 3923 and 6305 are as
under :
HSN Code Description

3923 Articles for the conveyance or packing of goods, of
plastics, stoppers, lids, caps and other closures of plastics
3923.10 Boxes, cases, crates and similar articles
3923.10.10 Plastic containers for audio or video cassettes, cassette
tapes, floppy disk and similar articles
3923.10.20 Watch box, jewellery box and similar containers of
plastics
3923.10.30 Insulated ware
3923.10.40 Packing for accommodating connectors
3923.10.90 Other sacks and bags (including cones)
3923.21.00 Of polymers of ethylene
3923.29 Of other plastics
3923.29.10 Of poly (vinyl chloride)
3923.29.90 Other
3923.30 Carboys, bottles, flasks and similar articles
3923.30.90 Other
3923.40.00 Spools, cops, bobbins and similar supports
3923.50 Stoppers, lids, caps and other closures
3923.50.10 Caps and closures for bottles
3923.50.90 Other
3923.90 Other
3923.90.20 Aseptic bags
3923.90.90 Other
6305 Sacks and bags of a kind used for the packing of goods
6305.10 Of jute or of other textile bast fibres of heading 5303
6305.10.10 Jute bagging for raw cotton
6305.10.20 Jute corn (grains) sacks
6305.10.30 Jute hessain bags
6305.10.40 Jute sacking bags
6305.10.50 Jute wool sacks
6305.10.60 Plastic coated or paper cum polythene lined jute bags and
sacks
6305.10.70 Paper laminated hessain jute
6305.10.80 Jute soil savers
6305.10.90 Other
6305.20.00 Of cotton – of man made textile materials
6305.32.00 Flexible intermediate bulk containers
6305.33.00 Other, of polyethylene or polypropylene strip or the like
6305.39.00 Other
6305.90.00 Of other textile materials
The words Sacks and Bags are found in both the chapters of Central
excise tariff codes notified.
The ruling therefore is given that if the goods sold by the applicant
fall under the goods notified with HSN codes, applicable tax rate shall be
4%. Otherwise the applicable tax rate shall be 12.5%.
Sd/- Sd/- Sd/-

JT.COMMISSIONER
To
M/s. R.K.Trading Company,
15-8-514/1/B, Feelkhana, Begum Bazaar, Hyderabad.

Hyderabad.
Copy to the Commercial Tax Officer, Begum Bazaar Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. A.K. Agrico, (TIN No.2886014966), Kishan Gunj, Hyderabad

The applicant is seeking clarification on items of
Agricultural implements as to whether they are exempted from the
tax or not? The applicant has specified the following items.
1. Trenching Hoe.
2. Sickil.
3. Crowbar with spade end.
The applicant has stated that the items cannot be operated by
machines and they can use only manually.
The case was posted for hearing on 24-05-2005.
Sri appeared and explained the case.
The matter has been examined with reference to Entry No.1 in
Schedule I to APVAT Act,2005, HSN Codes notified by Government vide
G.O.Ms.No.490, Revenue (CT-II) Department, dt.15-4-2005 and the
Customs Tariff Code No.8201 notified by State Government against
Agricultural Implements manually, operated or animal driven. The items
finding place in Chapter Code 8204 of Customs Tariff Code includes Hoes,
Sickil and other hand tools of all kinds used in agricultural and the ruling is
given as under:
The items viz., Trenching Hoe, Sickil and Crowbar with Spade
End clearly fall under the category of agricultural implements
manually operated and therefore, they are exempted from tax as
per Entry No.1 of Schedule I to APVAT Act,2005.
JT.COMMISSIONER
To
M/s. A.K. Agrico,
15-2-690, Kishan Gunj,

Hyderabad.

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Avanti Bufa Pvt. Ltd., (TIN No.28950205447), Basheerbagh,

The applicant is seeking clarification regarding the amounts realized
as a result of price escalation for the sales made prior to 31-03-2005. The
applicant has enclosed copies of the invoices raised towards price escalation
after 01-04-2005 and explained that the price difference on account of
escalation is collected for the sales effected during January, February and
March,2005 to M/s. Mahendra & Mahendra.
The case was posted for hearing on . Sri appeared and explained the
case.
In the invoices produced, it is noticed that the applicant
issued tax invoices and charged 12.5% VAT to M/s. Mahendra &
Mahendra.
After examination of the facts, it is clearly established that
the amounts realized as a result of price escalation relate to the
sales transactions effected prior to 01-04-2005 and therefore, the
amounts cannot be subjected to levy of VAT, as provisions of APVAT
Act,2005 have come into force from 01-04-2005. There is already
clear provisions under APGST Act,1957 for price escalation to be
returned and tax to be paid on the extra price realized for the sales.
The applicant can therefore, take reports from the provisions of
APGST Act,1957. The applicant has stated that the additional
amount realized in the month of April,2005 was reported in VAT
Return 200 and tax was also paid @ 12.5%. As regards the VAT
return already filed for the month of April,2005, the applicant can
submit an application in Form VAT 213 as prescribed in Sub-rule (6)
of Rule 23 of APVAT Rules,2005 to get the correction made.
He can also accordingly cancel the tax invoices issued
in April,2005 for the additional amounts realized against the sales
made prior to 01-04-2005.
JT.COMMISSIONER
To
M/s. Avanti Bufa Pvt. Ltd.,
Flat No.301, Sri Devi Castle,
3-6-69/B/16/4, Avanti Nagar, Basheerbagh,

Hyderabad.

PROCEEDING OF THE

2005.
***
O R D E R:
M/S. G.K.B.Rx Lens Pvt. Ltd., (TIN No.28640158380), Abids,

The applicant is seeking clarification regarding the applicable tax
rates under the provisions of APVAT Act,2005 on the following:
1. Opthalmic Lenses.
2. Spectacles Frames and goggles.
3. Contact Lenses.
4. Cleaning Solution.
5. Accessories.
The case was posted for hearing on . Sri appeared and explained the
case.
The matter has been examined with reference to entries in the
Schedules to APVAT Act,2005 and HSN Codes notified by Government vide
G.O.Ms.No.490, Revenue (CT-II) Department, dt.15-4-2005.
It is observed that the items specified by the applicant are not
specifically mentioned in any of the entries in the Schedules but at the
same time the Chapter Heading 9001 notified for the Entry No.39 of the
Schedule IV to APVAT Act,2005 includes Contact Lences, Spectacle Frames
and Goggles, Polarised Glasses and Spectacle Lenses of other material. The
items viz., Spectacle Frame, Cleaning Solutions and Accessories do not find
place either in the Schedules to the APVAT Act,2005 or in the HSN Codes
notified by the State Government. The ruling is, therefore, given as under:
Opthalmic Lenses and Contact Lenses will be taxable at 4%
because they find place in the HSN Code notified against Entry
No.39 of Schedule IV to APVAT Act,2005. The items viz., Spectacle
Frames and Goggles, Cleaning Solution and Accessories do not find
place in any of the Schedules and HSN Codes notified by
Government and therefore, they are liable to tax @ 12.5%.
JT.COMMISSIONER
To
M/s G.K.B. Rx Lens Pvt. Ltd.,
C-18/19, Maltinaik Plaza,
Reddy Hostel Lane, Abids,

Hyderabad.

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Vamshi Rubber Limited, (TIN No.28350160556), Himayat

Nagar, Hyderabad have filed an application dt.21-05-2005 and sought
The applicant is seeking a clarification
Whether Light Diesel Oil (LDO) used as a fuel for heating purposes is
eligible for the benefit of input tax credit. The applicant also stated that
Light Diesel Oil (LDO) is not used for generation of power.
The case was posted for hearing on 23-05-2005. Sri appeared and
explained the case.
The matter has been examined taking into consideration the
provisions of Section 13 of APVAT Act,2005 and Rule 20 of APVAT
Rules,2005. The Sub-section (1) of Section 13 clearly stipulates that input
tax credit shall be allowed in respect of the tax paid on the purchases of
goods specified in Schedule IV. As seen from Schedule IV to APVAT
Act,2005, Item No.5 specifies “diesel oil”. The item “diesel oil” includes light
diesel oil also. Therefore, the tax paid on the purchases of light diesel oil is
not eligible for the benefit of input tax credit irrespective of the usage of the
item.
The Ruling, therefore, given that the applicant is not eligible
for the benefit of input tax credit with regard to the purchase of
light diesel oil.
JT.COMMISSIONER
To
M/s. Vamshi Rubber Ltd.,
3-5-612, Himayat Nagar,

Hyderabad.

PROCEEDINGS OF THE
Present:Sri T. Yugandhar Reddy, Addl.Commissioner(VAT)

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 390/ 2005. Dated 26.7.2006.

O R D E R:
M/s. CIRCARS LAKSHMI MILL STORES ,VIJAYAWADA

of Rs.1,000/-
1) Vee Belts or Beltings (2) Link Vee Belts or beltings (3) cotton
belts or beltings (4) Hair belts or beltings (5) Nylon belts or
beltings, do fall u/e.12 of IVth Schedule or not.
2) 2) The rate of tax applicable on calcined Magnesite Powder and
Magnesium chloride..
1) Write up of literature on the products /goods under reference.
2) Form of authorization in form 565
3) Copy of invoice dt.20-2-2006 issued by Fenner (India) Ltd.,
4) Copy of invoice dt.14-2-2006 issued by Lakshmi Durga Mill
Stores, Vijayawada
5) Copy of invoice dt.20-1-2006 issued by Burn Standard
Co.,Hyderabad.
6) Copy of invoice dt.14-6-2006 issued by Ghanshyam Magnesia
Works.
Mr.Nitin Parekh and Mr.P.Sree Rama Rao, STP, appeared for hearing
on
(1) The applicant is a trader. He deals in Vee Belts, Calcined

Magnesite Powder, Magnesium Chloride etc. The applicant has
sought to know the rate of tax on the above items. (1) Vee
Belts (2) Link Vee Belts (3) Cotton Belts (4) Hair belts and Nylon
belts:
The applicant furnished evidence to show that, “Transmission

rubber belts” manufactured and sold by the Fenner (India) Limited
are covered under Central Excise tariff No.40.10. Entry 12 of the
IVth Schedule covers transmission rubber belts /vee belts/cotton
belts/nylon belts etc., as covered by HSN codes notified
3926.90.10, 4010, 4204,.00.40 and 5910.
Therefore, all the belts or beltings covered under chapter

4010 and 5910 do fall under entry 12 of the IVth Schedule besides
specific pre belt carrier (3926.90.10) and leather belting for
machinery (4204.00.40). We hold that belts/beltings falling under
HSN Codes notified above would attract 4%.
(2)(a) The applicant states that Calcined magnesite powder and

Magnesiuym chloride fall under “Ores and minerals” of entry 43 of the IVth
Schedule. Since, HSN Code 2519-covers Natural Magnesium Carbonate
(Magnesite) and magnesium calcined, the natural mineral converted into
powder by pulverization, i.e. all minerals and ores in their natural or powder
forms fall under entry 43 of the IVth Schedule.
(2)(b) With regard to Magnesium Chloride, which is extracted

from sea water, through a process or manufacture, can not be
considered as a natural ore or mineral or its powder form and it is
not fitting into the ‘minerals’ under chapter of 25 of the HSN Codes.
Hence, the commodity fall under the residual entry of the Vth
Schedule liable to tax @ 12.5%
ruling.
To
M/S Circars Lakshmi Mill Stores,
Vijayawada.
Copy to the Deputy Commissioner(CT) Vijayawada-I Division.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Abhinay Industries, Vijayawada (TIN No.28810168430) have

Rs.1000/-.

Sri J.Ramesh Babu, Managing Partner appeared on behalf of the firm

G.O.Ms.No.1596 Revenue (CT.II) Department, Dt.27.8.2005 and the ruling
is given as under:
The applicant states that he manufactures Footwear some of which
concludes that the terms Rubber and Plastics include woven fabrics or other
textile fabrics with an external layer of rubber or plastics being visible to
the naked eye and therefore such material are plastics. Thus, it reiterates
that Footwear made out of these materials in different combinations will be
identified as Plastic Footwear. The applicant also filed purchase invoices
showing PU soul, Coated non-woven fabric and other materials used in
manufacture of different types of Footwear. Sale invoices issued by him
describe such Footwear as Plastic Footwear attracting HSN code
6402.19.90.

2005.
To
M/s. Abhinay Industries,
D.No.4-17, Kodalivari Street, Enikepadu, Vijayawada.

Hyderabad.
PROCEEDINGS OF THE

***
O R D E R:
M/s. Degremont Limited, Nacharam, Hyderabad (TIN

Applicability of provisions of works contract awarded to the applicant

and executed on “back to back basis”.

Copy of agreement entered by the applicant with the Chief Engineer,
Hyderabad Urban Development Authority, Hyderabad.
Sri K.Hanumanth Rao, Authorised Representative appeared on

The applicant states that he has been awarded a contract for the
construction of sewerage treatment plant at Nacharam by the Hyderabad
Urban Development Authority and that the civil works part has been
executed through registered contractors on ‘back to back basis’ under the
applicants’ supervision. In the circumstances the applicant would like to
know the applicability of provisions of works contract under A.P.VAT Act,
2005. The applicant would further like to know liability of the sub contractor
and implications of Rule 17(2)(k).
Section 22(3) deals with the payment and recovery of tax in the
case of dealer executing works contract for the Government or Local
Authority. A Contractor shall be liable for deduction of 4% tax at source
from the amount payable to him by the Contractee. In the present case,
the applicant is executing a contract for a Local Authority namely
Hyderabad Urban Development Corporation. Therefore, the Local Authority
shall deduct tax @ 4% from the amount payable to the applicant and the
same shall be remitted by the Authority in the prescribed manner. Rule
17(2) deals with the procedural aspect of deduction at source and the
remittance. Clause (j) of the sub rule stipulates that if any part of the
contract is awarded to a sub contractor the latter shall be exempt from tax
on the value of sub contract. Consequently, the sub contractor shall not be
eligible to claim input tax credit on the inputs used in the sub contractor.
Applied to the facts of the applicant it would mean that the liability to pay
tax rests with the applicant himself being the contractor. Conversely, the
agency awarding the contract namely HUDA shall deduct tax @ 4% from
the amount payable to the applicant. The applicant being the contractor
shall declare the amount received on Form VAT 200 and the tax due on that
amount and also submit Form VAT 501 certified by the Contractee (HUDA)
alongwith Form VAT 200 by the 20th of the month following the month in
which payment was received by him. In case the applicant fails to submit
Form VAT 501 he shall be liable to pay tax due on the amount received.
Further the applicant, if opted to pay tax by way of composition under
Section 7(4)(b) of A.P.VAT Act, 2005, will not be eligible to claim input tax
credit [Section 13(5)(a)].
As regards Rule 17(2)(k) it is clarified that if contracts are executed
for State Govt. Department or Local Authority and tax deducted at source
@ 4% is found in excess of the tax due payable by the contractor, claim for
refund of the said excess amount cannot be entertained because the tax
component is built over and above the estimates data and as such it is not
factored in the total cost of the contract awarded to the contractor.
To sum up the ruling is given as under:
a) Execution of contract for Hyderabad Urban Development
Authority, a local body, creates tax liability at the hands of
the applicant and he can opt for composition to pay tax @
4% on the total consideration received.
b) Sub contractor of the applicant is exempt from tax liability
in circumstances cited at (a) above.
c) The applicant is not required to deduct tax at source from
the payments made to the sub contractor.
d) The applicant shall disclose the consideration received in
Box 12A and tax @ 4% in Box 12B on Form VAT 200. The
purchases have to be declared in Box 6A in Form VAT 200
since he is not entitled for input tax credit.
e) The applicant is not entitled to claim refund of tax
deduction made because liability for composition and TDS
are one and the same.
To
M/s. Degremont Limited,

10 MLD TTP at Peddacheruvu,
HMT Nagar, Nacharam,
HYDERABAD.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Disney Footwear (P) Limited, Enkipadu, Vijayawada (TIN


Sri J.Ramesh Babu, Managing Director appeared on behalf of the

is given as under:
6402.19.90.
2005.
To
M/s. Disney Footwear (P) Limited,

D.No.2-16, Opp: Pratap Industries, Enikepadu, Vijayawada.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Krishna Traders, Vijayawada (TIN No.2831012250) have filed


ii) Invoice showing purchase of different types of plastic
footwear from outside the State.
Sri N.Sambasiva Rao, Manager appeared on behalf of the firm for

is given as under:
The applicant states that he purchases Plastic Footwear from other
traders situated outside the State of A.P. and that they are pure Plastic
Footwear. In the circumstances he seeks to know the rate of tax applicable
to the product. In support of the claim the applicant filed tax invoices
issued by the sellers situated outside the state of A.P. The applicant had
further filed a copy of certificate issued by Director (Technical), FDDI
Ministry of Commerce, GOI which contain the description of materials that
go into making of Plastic Footwear.
We have considered the documentary evidence and the plea
of the applicant. The certificate issued by Director (Technical), GOI,
lists various types of materials that go into making plastic footwear.
Among other things it contains PVC coated fabric upper and rubber
soles. The certificate also concludes by stating that the term rubber
and plastics include woven fabrics or other textile fabric with an
external layer of rubber or plastics being visible to the naked eye
and that such Footwear has been identified as Plastic footwear. The
certificate also refers to chapter 64 of the HSN codes as applicable
to the said items. The notes attached to Chapter 64 have been
perused. It is found that at Para No.3, it is clarified that ‘For the
purpose of this chapter, the terms “rubber” and “plastics” include
woven fabrics or other textile products with an external layer of
rubber or plastics being visible to the naked eye. Invoices showing
purchase of Plastic Footwear by the applicant from across the state
also indicate that the applicant had purchased only Plastic
footwear. As the applicant is engaged in buying and selling of
Plastic Footwear we hold that the applicant is liable to tax @ 4% in
terms of Entry 46 of Schedule IV of the A.P.VAT Act, 2005.
Further in G.O.Ms.No.1596 dt.27.8.2005 the schedule entry
has been amended to read “Plastic footwear and Hawai chappals”.
In G.O.Ms.No.1615 dt.31.8.2005 specific 8 digit HSN codes have
been notified under the Entry 46 of IV schedule. The item codes
notified by Government fall under Chapter 64. The applicant shall be
liable to tax @ 4% if he carries on trading in those items. If the
applicant happens to sell footwear other than those specified in
Entry 46 and HSN codes notified thereunder, he shall be liable to
tax @ 12.5%.
To
M/s. Krishna Traders,
D.No.26-22-19, Mudunurivari Street,
Gandhi Nagar, Vijayawada – 3.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. S.R.Zee Enterprises, Vijayawada (TIN No.28810213438) have

Rs.1000/-.

Sri Krishna Murthy Naidu, Partner appeared on behalf of the firm for
is given as under:
Ministry of Commerce, GOI, which contain the description of materials that
tax @ 12.5%.
To
M/s. S.R.Zee Enterprises,
D.No.26-22-24, Sundaramma Street,

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Saint Gobain Glass India Limited, Tada, Nellore (TIN

Rate of tax applicable on Silica Sand (Mineral).

i) Copy of Schedule II of Mines & Minerals (D & R) Act, 1957.
ii) Photocopy of Transit form issued by Mines & Geology Dept.
Sri L.Venkataeswaran, Company Secretary and Sri S.Sridharan,
Chartered Accountant appeared on behalf of the firm for hearing on 22-09-
The applicant claims that he is a manufacture of Glass and has a
Sand Benefication Plant for Silica Sand at Thada in A.P. The applicant
claims to procure Silica sand from Sand Mines and that the operations are
regulated by license issued under the Mines & Geology (Development &
Regulation ) Act, 1957. Transit form is issued by the Mines & Geology,
Hyderabad and royalty is paid for Silica sand under the said Act. According
to the applicant, Silica sand is covered by HSN code 2505.10 and further
contends that though in the G.Os issued by the Government notifying
certain HSN codes, the code applicable to Silica sand has not been notified,
the product nevertheless falls under Entry 43 of Schedule IV to the A.P.VAT
Act, 2005 which reads as “Ores and Minerals”. The applicant relies on the
fact of payment of royalty under Schedule II of the Mines & Minerals
(Development & Regulation) Act, 1957 and filed a copy of the extract of the
Schedule. In the said Schedule under Entry 37 Silica sand appears
alongside quartz, moulding sand and quartz sand. The applicant also relies
on payment of royalty to the Mines & Geology Department and supports it
with documentary evidence in the form of transit form issued by the said
department.
We have heard the representatives and also considered the

documentary evidence. Entry 37 as contended by the applicant
shows Silica sand as liable to royalty @ Rs.20/- per ton in Schedule
II of the Mines & Minerals (Development & Regulation) Act. The
applicant is apparently purchasing Silica sand from lease holders of
Mines and supports that claim with transit form issued by the
department of Mines & Geology, Hyderabad. This document also
contains payment of royalty by the suppliers of Silica sand.
Entry 43 of the A.P.VAT Act, 2005 reads “Ores & Minerals”.

The documentary evidence furnished by the applicant supports the
view that Silica sand is a mineral. In G.O. 398 and G.O.490
mentioned above, certain HSN codes applicable to goods listed
under Schedule I and Schedule IV have been notified. However, in
G.O.1615 dt.31.8.2005 that superceded the above G.Os.,
Government have notified HSN codes applicable to certain items in
Schedule I and Schedule IV. In the latter G.O. Entry 43 that refers
to ‘Ores & Minerals’ HSN code has not been notified.
We have considered the plea of the applicant that Silica sand
attracts HSN code 2505.10. The tariff heading of this code refers to
natural sands of all kinds whether or not coloured and also lists
Silica sand and Quartz sand with HSN code 2505.10. In the light of
documentary evidence furnished by the applicant and also the fact
of payment of royalty applicable to Silica sand being mineral, we
are inclined to hold that Silica sand is a mineral and it squarely falls
under the description of Entry 43 “Ores & Minerals”. We therefore
hold that Silica sand is liable to tax @ 4%.
To
M/s. Saint Gobain Glass India Limited,

Plot No.98, APIIC IDA, Karur IV,
Tada,
Andhra Pradesh.

Hyderabad.
Copy to the Deputy Commissioner (CT), Nellore Division
Copy to the Commercial Tax Officer, Sulurpet Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Sri Bhavani Rubber Industries, Vijayawada (TIN


Sri N.Sambasiva Rao, Proprietor appeared on behalf of the firm for

is given as under:
6402.19.90.
2005 reads “Plastic Footwear and Hawai chappals”. In the

leather content, even if it is used partly either as in-soul or upper or
tax @ 12.5% in terms of language in Schedule V of A.P.VAT Act,
2005.
To
M/s. Sri Bhavani Rubber Industries,
D.No.26-22-19, Mudunurivari Street, Gandhi Nagar, Vijayawada.

Hyderabad.
PROCEEDINGS OF THE

***
O R D E R:
M/s. Sri Vijaya Durga Traders, Vijayawada (TIN No.28720279304)

of Rs.1000/-.


is given as under:
Ministry of Commerce, GOI which contain the description of materials that
tax @ 12.5%.
To
M/s. Sri Vijaya Durga Traders,
D.No.26-22-19/B, Mudunurivari Street,

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Sri Durga Traders, Vijayawada (TIN No.28280155676) have

Rs.1000/-.


is given as under:
6402.19.90.

2005.
To
M/s. Sri Durga Traders,
D.No.26-22-19/1, Mudunurivari Street, Gandhi Nagar, Vijayawada.

Hyderabad.

PROCEEDINGS OF THE

Sri P. Satyanarayana Reddy Jt. Commissioner (Enft.)
***
CCT’s Ref.No A.R.Com/ 7 /2006 DT.26-9-2006
O R D E R:
M/s. Bajaj Associates (TIN No.28730131896) have filed an

APVAT Rules, 2005 along with the application fee of Rs.1000/-.
Rate of tax applicable to CHIPS BRAND Plastic Footwear.

iii) Reference of Director (Technical), Footwear Design and
iv) Invoice showing purchase of different types of plastic
Sri Kanwal Bajaj Partner appeared on behalf of the firm for hearing
on
is given as under:
The applicant states that he purchases CHIPS brand Plastic Footwear
from manufacturers situated outside the State of A.P i.e. from M/s condor
Footwear India Ltd, Surat and that they are pure Plastic Footwear. In the
circumstances he seeks to know the rate of tax applicable to the product. In
support of the claim the applicant filed tax invoices issued by the sellers
situated outside the state of A.P. The applicant had further filed a copy of
certificate issued by Director (Technical), FDDI Ministry of Commerce, GOI
which contain the description of materials that go into making of Plastic
Footwear.
lists various types of materials that go into making of plastic
footwear. Among other things it contains synthetic material. The
certificate also concludes by stating that the term rubber and
plastics include woven fabrics or other textile fabric with an
Entry 46 and HSN codes notified there under, he shall be liable to
tax @ 12.5%.
To
M/s. Bajaj Associates,
D.No.5-9-705,Qamar Manzil,
Gunfoundry, Hyderabad

Hyderabad.
Copy to the Commercial Tax Officer, Narayangudas Circle.

PROCEEDINGS OF THE

Sri P. Satyanarayana Reddy Jt. Commissioner (Enft.)
***
CCT’s Ref.No A.R.Com/ 7 /2006 DT.26-9-2006
O R D E R:
M/s. Bajaj Associates (TIN No.28730131896) have filed an

APVAT Rules, 2005 along with the application fee of Rs.1000/-.
Rate of tax applicable to CHIPS BRAND Plastic Footwear.

v) Reference of Director (Technical), Footwear Design and
vi) Invoice showing purchase of different types of plastic
Sri Kanwal Bajaj Partner appeared on behalf of the firm for hearing
on
is given as under:
The applicant states that he purchases CHIPS brand Plastic Footwear
from manufacturers situated outside the State of A.P i.e. from M/s condor
Footwear India Ltd, Surat and that they are pure Plastic Footwear. In the
circumstances he seeks to know the rate of tax applicable to the product. In
support of the claim the applicant filed tax invoices issued by the sellers
situated outside the state of A.P. The applicant had further filed a copy of
certificate issued by Director (Technical), FDDI Ministry of Commerce, GOI
which contain the description of materials that go into making of Plastic
Footwear.
lists various types of materials that go into making of plastic
footwear. Among other things it contains synthetic material. The
certificate also concludes by stating that the term rubber and
plastics include woven fabrics or other textile fabric with an
Entry 46 and HSN codes notified there under, he shall be liable to
tax @ 12.5%.
To
M/s. Bajaj Associates,
D.No.5-9-705,Qamar Manzil,
Gunfoundry, Hyderabad

Hyderabad.
Copy to the Commercial Tax Officer, Narayangudas Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Polisetty Somasundaram (TIN No.28930139423), P.O. Box

No.54, Mangalagiri Road, Guntur have filed an application dt.16-05-2005
and sought clarification and Advance Ruling on the following items under
1. Whether they are eligible for refund of VAT paid on the inputs used
for export of tobacco which is an exempted commodity under the
VAT Act.
2. Whether they are eligible for any benefit of input tax credit with
regard to the tax paid on consumption of packing material used for
sale of tobacco in the domestic market.
3. Whether any relief is available at the time of purchase with regard to

packing material purchased against exports invoice-wise.
4. Whether tax paid on the machinery and spare parts can be carried
forward to the subsequent years and claimed as refund for exports
in subsequent years.
1 of 3
The case was posted for hearing on 12-07-2005. Sri V.S.R. Murthy,
Accountant of the firm appeared and explained about the business activities
and the nature of inputs purchased and the outputs sold in domestic market
and out side the country by way of export.
The matter has been examined in detail and the ruling is given as
under:
1) The benefit of input tax credit is available in respect of

exempted goods also if they are exported as specified in Section
8(b) read with sub-section (5) (c) of Section 13 of the Act. For any
specific inputs used for outputs exported outside the country, the
credit can be claimed without adopting proportionate basis. For
instance, if a specific type of packing material is used for the
purpose of exports and it is clearly distinguishable and the same is
not used for domestic sales, the input tax on such goods can be
fully claimed as credit against export sales.
2) If any specific inputs are used exclusively for the domestic

sales of exempted goods, no amount of input tax paid on such
inputs can be claimed at all.
3) As regards the exemption of tax at the time of purchasing

packing material or for that matter any other material the applicant
is liable to pay VAT to the seller of packing material at the time of
purchase and account for the same as input tax in his books of
accounts. There is no provision in the VAT Act to claim relief of VAT
on the assumption that the dealer will make exports.”
4) Any common inputs like machinery and spare parts used for
exports as well as exempt domestic sales, the input tax credit can
be claimed on the basis of A X B/C prescribed in Rule 20 of APVAT
Rules,2005. This can be done on monthly basis and it can also be
finally calculated again on the basis of A X B/C for the 12 month
period ending March every year and the adjustment is to be made in
the return for March. At the end of March every year if any input tax
paid on common inputs is lost on the basis of A X B/C there is no
facility or eligibility to carry forward such ineligible input tax into
the return for the month of April. For instance if Rs.8,00,000 worth
of machinery is purchased in a particular year by paying a tax of
Rs.1,00,000 @ 12.5% and such machinery is used
2 of 3
commonly for exempted goods sold in domestic market as well as

by way of exports in 50:50 ratio during the period from April,2005
to March,2006, the ineligible input tax of 50% lost because of
domestic sales being exempted (tobacco), such ineligible tax left
over at the end of March,2006 cannot be carried forward to the
return for April,2006.
Regarding the procedure for claiming refund, the claim is to

be made in Box 23 of form VAT-200 which is a monthly return
provided there are zero rated sales in that month and the overall
input tax exceeds the output tax for that month. The VAT dealer
also has a choice to carry forward his claim by entering such excess
input tax credit in Box 24 if he has a reasonable belief that his
output tax in subsequent months is likely to exceed the input tax
and that he will be liable to pay net tax.
JT.COMMISSIONER
To
M/s. Polisetty Somasundaram,
Post Box No.54, Mangalagiri Road,
Guntur-522 001.
Hyderabad.
Copy to the Deputy Commissioner (CT), Guntur-I Division.
Copy to the Commercial Tax Officer, Kothapet Circle, Guntur.
3 of 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Deccan Switchgears, Hyderabad (TIN No.28250168869) have
Rate of tax applicable to the following items :
i) Automatic circuit breakers
ii) Aircuit breakers
iii) Moulded case circuit breakers
iv) Miniacutre circuit breakers
v) Earth leek circuit breakers
vi) Others
vii) Motor starters for DC motors
viii) Motor starters for AC motors
ix) Control and Switchgears
x) Fuses
xi) Other apparatus for protecting electrical circuits relays
Copies of purchase invoice showing description of the product and
the applicable HSN code.
Capt.B.S.P.Rao, Partner appeared on behalf of the firm for hearing
is given as under.
According to Entry 39 of Schedule IV of the A.P.VAT Act, 2005
read with the G.O. cited above, the items on which the applicant
sought clarification fall under HSN code 8536. The purchase invoice
submitted by the applicant and issued by the manufacturer of these
products also shows the same HSN code. All the products fall under
the excise tariff heading 8536. Therefore it is held that the rate of
tax applicable to the items on which applicant sought clarification

To
M/s. Deccan Switchgears,

5-4-70, Vyas Complex, M.G.Road, Secunderabad – 3.

Copy to the Commercial Tax Officer, Ramgopalpet Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Karkhana Zinda Tilismath, Hyderabad (TIN No.28410162009)
Rs.1000/-.
Rate of tax applicable to Zinda Tilismath and Zinda Balm.

1. Copies of invoice-cum-delivery challans issued in accordance with
the
Central Excise Rules.
2. Copies of sale invoice.
Sri Syed Masood Ahmed, Chief Accounts Officer, appeared on behalf
is given as under.
Unani drugs namely Zinda Tilismath and Zinda Balm manufactured
by him under the Unani drug license issued by the Commissioner,
Indian Medicines and Homeo Department, A.P. According to the
applicant, these items fall under the entry 88 of Schedule IV of the
A.P.VAT Act, 2005 and therefore attract 4% rate of tax.
The invoice-cum-delivery challans issued by the applicant
under the Central Excise Rules contains HSN chapter heading 3003.
In the G.O. cited above drugs and medicines falling under Entry 88
of Schedule IV of the Act are notified as attracting HSN code 3001-
3004. Therefore Zinda Tilismath and Zinda Balm are held as liable to
tax @ 4%.

To
M/s. Karkhana Zinda Tilismath,

D.No.2-3-728, 743, 744, Amberpet,
Hyderabd – 500 013.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Speed-A-Way Private Limited, Hyderabad (TIN
Rate of tax applicable to Engine bearings.
Copies of purchase invoice showing HSN code adopted by the selling
dealer.
Sri S.Ramesh, Branch Manager appeared on behalf of the firm for
is given as under.
The applicant claims to purchase Bearings and sells them as
part of his trading activity. In support of this fact he submitted
purchase invoices issued by Bimetal Bearings Limited, Chennai and
seeks to know the rate of tax applicable under the A.P.VAT Act,
2005.
As per Entry 10 of Schedule IV of the A.P.VAT Act “Bearings
of all kinds” are liable to tax @ 4%. In the G.O. cited above, HSN
code applicable is notified as 8482. The Central Excise tariff also
provides details of various types of Ball or Roller bearings. The
documentary evidence submitted by the applicant shows 8483 as
the excise chapter sub heading. This code, however, applies to
Transmission shafts according to the Central Excise Tariff.
Therefore, in view of the Schedule entry and the HSN code notified
in the G.O. cited above, Bearings sold by the applicant are held as
liable to tax @ 4% in terms of Entry 10 of the Schedule IV of the
A.P.VAT Act, 2005.

To
M/s. Speed-A-Way Private Limited,
No.5-2-439, Risale Abdullah, Near M.J.Market, Hyderabad – 500 095.
Hyderabad.

PROCEEDINGS OF THE

*****

***
O R D E R:
I. M/s. Foods, Fats & Fertilizers Ltd., Tadepalligudem

of Rs.1,000/-

Whether the purchases palm fresh fruit bunches from farmers in A.P.
attracts purchase tax and if so, whether the same can be taken as in put
credit against the tax paid on palm oil/nuts.
Asst.Commissioner (VAT Management Unit-I), Eluru Division and he has
sent a copy of the Form VAT 305A & Form VAT 305 issued to the dealer on
17.8.2005 & 30.09.2005 respectively.
4. Since the Asst.Commissioner (VAT Management Unit-I)

Eluru division has already passed orders of assessment of
value added tax under Rule 25(5) in Form VAT 305, the
applicant may seek remedy provided in the AP VAT Act,
2005 This Authority cannot interfere with the proceedings
of the Assessing Authority and accordingly no ruling is
issued.

ruling.
To
M/s. Foods, Fats & Fertilizers,
Tanuku Road,
Tadepalligudem,
West Godavari Dist.

Copy to the Asst.Commissioner (VAT Management Unit-I), Eluru Divn.
PROCEEDINGS OF THE

***
Ref: CCT’s Ref.No.PMT/P&L/A.R.Com/2005,Dt.13-4-

2005.
***
O R D E R:
M/s. Dujodwala Products Ltd., Secunderabad have filed an

application dt.21th April,2005 for clarification and advance ruling under
Sri Ch. Kamaiah, Finance Executive has appeared on behalf of the

firm on 26-04-2005. The clarification sought by the applicant is as under:
To clarify the tax rate applicable to camphor (HSN Code 2914.20).
1 of 2
As seen from the HSN Code notified by the Government under

Section 76 of the APVAT Act, 2005, vide G.O.Ms.No.398, Revenue
(CT.II) Department, Dt.31-03-2005 and G.O.Ms.No.490, Revenue
(CT.II) Department, Dt.15-04-2005, the item “Camphor” with HSN
Code 2914.20 falls under Entry No.16 of Schedule IV to APVAT
Act,2005 to be taxed @ 4%.
Addl.Commissioner (VAT) Jt. Commissioner (VAT) Jt.Commissioner (Audit)
To
M/s. Dujodwala Products Ltd.,

506-B, 5th Floor, Minerva Complex,
Secunderabad.
2 of 2
PROCEEDINGS OF THE

***
O R D E R:
M/s. K.B. Power Care Pvt. Ltd., Kukatpally, Hyderabad have filed an
Sri K. Venu Babu, Managing Director has appeared on behalf of the

firm on 27-04-2005. The ruling sought is with regard to the tax rates
applicable on the following items.
Electronic Constant Voltage Transformers and Servo Stabilizers.

The applicant has produced documentary evidence regarding the
HSN Codes applicable to Electronic Constant Voltage Transformers and
Servo Stabilizers. According to the applicant, the HSN Codes applicable for
these products is 8504.
The issue has been examined with reference to the Entry 39 of

Schedule IV to APVAT Act and also the HSN Codes notified by Government
vide G.O.Ms.No.398, Revenue (CT.II) Department, Dt.31-03-2005 and
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005. As seen from
the entry in the schedule and the HSN Codes notified, all items falling under
HSN Code 8504 will be eligible for 4% tax rate. The ruling, therefore, given
is as under:
1 of 3
The following items under HSN Code 8504 are taxable @ 4%

under the provisions of APVAT Act,2005.
8504 Electrical transformers, static converters (for

example, rectifiers) and inductors
8504 10 Ballasts for discharge lamps or tubes:
8504 10 10 Conventional type
8504 10 20 For compact fluorescent lamps
8504 10 90 Other
Liquid dieletric transformers:
8504 21 00 Having a power handling capacity not exceeding 650
kVA
8504 22 00 Having a power handling capacity exceeding 650 kVA
but
not exceeding 10,000 kVA
8504 23 Having a power handling capacity exceeding 10,000
kVA:
8504 23 10 Having a power handling capacity exceeding 10,000
kVA but
not exceeding 50,000 kVA
8504 23 20 Having a power handling capacity exceeding 50,000
kVA but
not exceeding 1,00,000 kVA
8504 23 30 Having a power handling capacity exceeding 1,00,000
kVA
but not exceeding 2,50,000 kVA
8504 23 40 Having a power handling capacity exceeding 2,50,000
kVA
Other transformers:
8504 31 00 Having a power handling capacity not exceeding 1 kVA
8504 32 00 Having a power handling capacity exceeding 1 kVA but
not
exceeding 16 kVA
but not
exceeding 500 kVA
8504 40 Static converters:
8504 40 10 Electric inverter
Rectifier:
8504 40 21 Dip bridge rectifier
8504 40 29 Other
8504 40 30 Battery chargers
8504 40 40 Voltage regulator and stabilizers (other than
automatic)
8504 40 90 Other
8504 50 Other inductors:
8504 50 10 Choke coils (Chokes)
2 of 3
8504 50 90 Other
8504 90 Parts:
8504 90 10 Of transformers
8504 90 90 Other
To
M/s. K.B. Power Care Pvt. Ltd.,

5-9-285, R.G. Nagar, I.E. (Extn),,
Kukatpally, Hyderabad-500 037.
3 of 3

PROCEEDINGS OF THE
***

2005.
***
O R D E R:
1. M/s. Pragati Offset Private Ltd., Red Hills, Hyderabad have filed an
2. Sri P. Narendra, Jt. Managing Director has appeared on behalf of the

firm on 26-04-2005 and explained about the clarification being sought
under the provisions of APVAT Act,2005. The applicant has explained in
detail about the business activity, the present method of payment of tax
and the implications as per the provisions of APVAT Act,2005.
3. The applicant sought clarification on the following points.
1) Whether the business of printing constitutes works contract.
2) Whether books and periodicals printed under works contract are

exempted or taxable.
3) Input tax credit against CST transactions.
1 of 3
4) Whether export transactions are eligible for input tax credit.
After hearing the facts of the case with reference to the provisions of
the APVAT Act & Rules,2005, ruling is given as under:
Point (1): The activity undertaken by the applicant constitutes work

contract.
The applicant may opt for composition @ 2% on the total

turnover (Rule 17(3) or he can pay tax outside composition (Rule
17(1)) and get the benefit of input tax credit as per the provisions
of APVAT Act and Rules.
Any works contract outside composition will be eligible for

input tax credit to the extent of 90% of the input tax on the
purchases made within the State.
The value of such goods at the time of incorporation will

have to be adopted by the applicant and accounts have to
determine the value correctly, failing which a standard deduction of
40% is available (for printing) and the remaining 60% will be liable
to tax @ 12.5%.
Point (2): Books and periodicals printed under works contract are
taxable.
Point (3):The applicant will be eligible for input tax credit against
CST transactions also in the same manner as specified
under point 1 above.
2 of 3
Point (4):The applicant will be eligible for the benefit of input tax
credit for the export transactions under Section 8 of the
APVAT Act,2005.
To
M/s. Pragathi Offset Private Ltd.,

17, Red Hills, Road No.1,,
Hyderabad-500 004.

Hyderabad.
3 of 3
PROCEEDINGS OF THE

***
O R D E R:
M/s. Saptagir Camphor Ltd., B. Kothapalli, Anantapur District have

filed an application dt.20th April,2005 for clarification and advance ruling
Sri J. Vijaya Kumar, Dy. Commercial Manager has appeared on

behalf of the firm on 26-04-2005. The clarification sought by the applicant
is as under:
Whether Isoborneol (HSN Code 2906) and Synthetic Camphor (HSN

Code 2914) fall under “Bulk drugs”. They have furnished a list of their
products with HSN Codes as under:
S.No. Name of the Product New Tariff No.

1 Synthetic Camphor 29142120
2 Isoborneol 29061910
3 Isobornyl Acetate 29153920
4 Camphene 29142990
5 Dipentene 29029010
6 Camphor Oil 29142990
7 Terpinolene 29029090
8 Fenchone 29029090
9 Sodium Acetate 29152200
Trihydrate
10 Pinetar 38070030
1 of 3
They have sought clarification with regard to the applicable tax rates
under APVAT Act,2005.
The entries in the schedule IV to APVAT Act,2005 have been

examined with reference to “bulk drugs” under Entry No.16 in the schedule
IV. The Government have also notified HSN Codes vide G.O.Ms.No.398,
(CT.II) Department, Dt.15-04-2005. The HSN Codes notified for bulk drugs
are as under:
Sl.No. Entry No. in Description of goods HSN Code

Schedule
13 16 Bulk Drugs
1) Ketones and quinines, whether or
not with other oxygen function and
their halogenated, sulphonated,
nitrated or nitrosated derivatives. 2914
3) Organic derivatives of hydrazine or
of hydro xylamine 2928
5) Hetero cyclic compounds with oxygen
hetero-atom(s) only 2932
6) Hetero cyclic compounds with
nitrogen hetero-atom(s) only 2933
7) Nucleic acids and their salts, whether
or not chemically defined; other
hetero cyclic compounds 2934
As seen from the above, the Heading 2914 is fully covered

under entry bulk drugs to be taxed @ 4%. Three of their items
“synthetic camphor” with HSN Code 29142120, “camphor oil’ with
HSN Code 29142990 and “camphene” with HSN Code 29142990 are
fully covered under Chapter 2914. Therefore, these three items are
taxable @ 4% under Entry 16 of Schedule IV to APVAT Act,2005.
With regard to other items, the applicable tax rate will be

12.5% because the HSN Codes as specified by the applicant are not
notified in the G.Os issued by the State Government under Section
76 of APVAT Act,2005.
2 of 3
The applicant is, therefore, required to follow the tax rates

mentioned above in respect of their products.
To
M/s. Saptagir Camphor Ltd.,

Gooty Road, N.H-7, B. Kothapalli,
Anantapur Dist., Pin.515 731.

Copy to the Commercial Tax Officer-1, Anantapur,
Copy to the Deputy Commissioner (CT), Anantapur Division.
3 of 3

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Oblum Insulators, Balanagar (TIN No.28770210206)
Whether High speed diesel oil used in the production process of

manufacturing Porcelain insulators eligible for claiming input tax credit.
Details of manufacturing process with photos.
Sri O.Balagangadhar, Managing Partner of the firm has appeared for

1 of page 2
Section 13(1) of the A.P.VAT Act, 2005 provides for input tax
credit that can be availed by a VAT dealer and the conditions
thereof. It also lays down that no input tax credit shall be allowed
in respect of the tax paid on the purchase of goods specified in
Schedule VI. In Schedule VI of the Act, among other things, diesel
oil is specified as liable to tax at the point of first sale. Thus read
together, it is clear that high speed diesel oil is not an item on
which the applicant can claim input tax credit as the Law
specifically prohibits such claim. Therefore, it is held that the
applicant is not eligible for claiming input tax credit on High Speed
Diesel purchased.

To
M/s. Oblum Insulators,

49, IDA Balanagar,

2 of page 2

PROCEEDINGS OF THE
Sri P. Satyanarayana Reddy Jt.Commissioner (Enft.)
*****
O R D E R:
I. M/s. AUROBINDO PHARMA LIMITED AMEERPET, HYDERABAD,

of Rs.1,000/-
Whether the transaction of transfer of business as an ongoing
concern is exempt from payment of VAT under Rule 36 of the A.P. Value
Added Tax Rules, 2005.
. The applicant submitted the following documents:
1) Form 570
2) Form 565
3) A copy of the draft agreement of sale between the applicant and
the purported buyer.
Sri M.Ramachandra Murthy, appeared for hearing on 28-7-2006 and
explained the case.
The applicant is a registered company under the Companies

Act. They are the manufacturers and dealers in bulk drugs and
pharmaceuticals. The applicant manufactures drugs at different
manufacturing units at different places in A.P. The applicant
company is planning to sell one of its units, presently,
manufacturing bulk drugs. The applicant intends to transfer by way
of sale of the said manufacturing unit, situated at Sy.No.10,
10/E2/A2, Gaddpotharam Village, Jinnaram Mandal, Medak District,
A.P.in favour of M/s Jupiter Bio science Limited as a ongoing
concern.
The applicant has explained the terms and conditions laid
down in the contract and emphasized that their transaction falls
under “transfer of business “. The contention of the applicant is
examined with reference to rule 36 of the APVA T Rules and found
that the transfer of a business from one VAT dealer to another VAT
dealer is exempt from VAT subject to certain conditions laid down in
the said rule.
Therefore, we hold that, transfer of a business’ as an ongoing
concern on “slump sale basis” as the agreement is to sell an
undertaking as a whole consisting of movable and immovable
properties, as is where is condition and exempt from VAT under rule
36.
However, all the conditions prescribed under Rule 36 of the
APVAT rule are applicable and should be followed. The enunciation
of “no input tax credit shall be aollowed on the transfer of a
business as a whole” as provided u/s 13(5) © of the APVAT Act, is
also a precondition and binding on the applicant, for continuation of
the business, activity liability of taxes etc.
ruling.
To
M/s Aurobindo Pharma Limited.
Copy to the Assistant Commissioner(CT) LTU, Punjagutta division.

PROCEEDINGS OF THE

Sri P. Satyanarayana Reddy, Jt.Commissioner (Enft)
*****
O R D E R:
M/s. Madras Auto Service, Secunderabad. registered dealers U/VAT

(TIN No. 28610204456) have filed an application and sought clarification
2005. The application is examined and found to be in order. Hence,
admitted.

Whether bolts and nuts that are used in automobile industrial and
diesel spare parts are liable to tax @ 4% according to G.O. Ms. No. 795
Revenue (CT-II) department dated: 09-06-2006 or not?
Mr. N. Pentaiah, authorized representative appeared for hearing and
explained the case.

1) Copies of write up from the applicant.
2) A copy of the invoice issued by Sundaram fasteners Ltd, dated:
29-03-2006.
3) Form 565
G.O.Ms.No.1615 Revenue (CT.II) Department dated 31-8-2005, and G.O.
Ms. No. 795 Revenue (CT-II) department dated: 29-06-2006, and the
The applicant is a dealer of T.V. Sundram Iyengar & Sons,

Ltd. They deal in automobile industrial and diesel parts and spares,
which includes various types of bolts and nuts. They have been
collecting VAT @ 12.5% on sales of bolts and nuts until 30-06-2006.
By G.O. Ms. No. 795 Revenue (CT-II) department dated: 29-

06-2006 the Government of A.P. notified certain goods under entry
104, which enumerates as under “ Bolts, Nuts threaded or taped
and screws of base metal or alloys thereof including bolt ends,
screws, studs, screw studding, self tapped screws, screw hooks and
screw rings” liable to tax @ 4% with effect from 01-07-2006.
Against entry of 104, no HSN codes notified. Hence we hold that all
bolts and nuts as enumerated under entry 104 are liable to tax @
4% irrespective of their end use.
ruling.
To
M/s. Madras Auto Service, M.G.Road, Secunderabad..

PROCEEDINGS OF THE

Sri P.Satyanarayana Reddy, Jt. Commissioner (Enft.)
*****
CCT’s Ref.No: A.R.Com/78/ 2005. Dated 28-07-2006.
O R D E R:
M/s. SANKA NARASIMHARAO CO. VIJAYAWADA (TIN.28910111520)
The rate of tax, applicable on ASAFEOTIDA (HING) compounded
under the VAT Act.

1) A copy of the Agmark grade specifications for spices issued by
Spices Board.
2) Copy of the extract of the Spice board showing the spices falling
under the purview of the Board and defining asafetida (hing) as at
item No.34 u/e.2(n) of the spices Board Act,1986.
3) Copy of the orders of the Advance ruling in case No.CCT’s
Ref.No.PMT/P&L/AR.Com/1./2005 dt.16-9-2005.
Sri P.Ramnath, Proprietor, appeared for hearing on 26-7-2006 and

explained the case.
The entry 59 of the IVth Schedule in the APVAT Act, 2005

reads as under – Spices of all varieties and forms including cumin
seeds, aniseed, turmeric and dry chillies, curry, masala powder”.
The applicant brought to our notice that the Spices Board under
Sec.2(n) of the Spices Board Act,1986, has authenticated that
asafetida (Hing) at Sl. No. 34 of the 52 spices. Further, the
applicant also stated that entry 182 of the 1st schedule of the APGST
Acy also includes asafoetida under “Spices that is say,
Jeera….asafoetida….and Japatri”. Since, the entry 59 of the IVth
Scheduile to the AP VAT Act is of inclusive nature, all spices,
including “asafoetida” fall under entry 59 of the IV schedule, and
thus liable to tax @ 4% under the APVAT Act.

ruling.
To
M/s Sanka Narasimha Rao Co.,
Vijayawada.
Copy to the Deputy Commissioner(CT) Vijayawada-I Division.
Copy to the Commercial Tax Officer,Sivalayam street Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/249 / 2005. Dated - 05-2005.
O R D E R:
M/s. Nandini Mineral Industries, Bethamcherla (TIN.28170201884)

have filed an application Dated ___________ and sought clarification
and advance ruling on the following items under Section 67 of APVAT
Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the
Copy of the Extraordinary Gazettee of Government of India No.454
Dt.14-1-2004 of Ministry of Coal & Mines.
IV. _______________________________ , appeared for hearing on

__________ and explained the case.
Act and Rules and (HSN Codes notified by Government vide
G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-2005 and) the
VI The applicant stated that the items referred supra are n otified by the
under the entry Ores and Minerals. Entry 43 of IVth schedule enumerates –
ores and minerals covers all ores and minerals. . Since, all the commodities
referred are natural minerals converrted into powder by pulverizing them. A
similar issue is also clarified by this authority vide orders No.145/2005,
dt.29-6-2005. Therefore, all ores and minerals in their natural or powder
forms fall under entry 43 of the IVth Schedule liable to VAT @ 4%.
ruling.
To
M/s. Nandini Mineral Industries,
Bethemcherla.

PROCEEDINGS OF THE

***

2005.
***
O R D E R:
M/s. Bright Star Rubber Industries, (TIN No.28770101857),

Bazarghat, Hyderabad have filed an application dt.21-04-2005 and sought
To clarify the rate of tax on De-Husking Rice Rubber Rollers.
Venkateshwarlal, Manager of the firm appeared and explained his case.
is given as under.
De-Husking Rice Rubber Rollers are taxable @ 12.5%.
To
M/s. Bright Star Rubber Industries,

11-4-812, Bazarghat,
Hyderabad-500 001.

PROCEEDINGS OF THE

***

2005.
***
O R D E R:
M/s. Cannon India Private Ltd., (TIN No. ), S.P.Road, Secunderabad

advance ruling on the following items under Section 67 of the APVAT
Whether Digital Still Image Camera falling under HSN Code 8525 will
fall under I.T. Products.
The case was posted for hearing on 27-04-2005. Sri P. Sunil Singh,
Branch Credit Executive of the company appeared on behalf of the company
and explained the features of the Digital Still Image Video Camera. He
further clarified that these cameras are of two types (a) Digital Video
Camera (with add on feature of capturing still images) and (b) Digital Still
Image Camera (with add on feature of Video shooting).
The points raised by the company have been examined with
reference to the provisions of the APVAT Act and Rules and HSN Codes
notified by Government vide G.O.Ms.No.398, Revenue (CT.II) Department,
Dt.31-03-2005 and G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-
04-2005 and the ruling is given as under.
Digital Video Camera (with add on feature of capturing still
images) and Digital Still Image Camera (with add on feature of
Video shooting) will fall under I.T. Products covered by HSN Code
8525, taxable @ 4%.
To
M/s. Cannon India Private Ltd.,

No.302, 3rd Floor,
Ashoka Bhoopal Chambers, SP Road,
Copy submitted to the Commissioner of Commercial Taxes ,A.P.,

Hyderabad.
Copy to the Commercial Tax Officer,

PROCEEDINGS OF THE

***
O R D E R:
M/s. M.R.F.Ltd., (TIN No.28620142408), Hyderabad have filed an

application dt.13-04-2005 and sought clarification and advance ruling on
the following items under Section 67 of the APVAT Act,2005 read with Rule
The ruling sought by the company is as follows.
Whether tyres, tubes, flaps of Tractors fall under Entry 64 of

Schedule IV.
The case was posted for hearing on 27-04-2005. Sri A.D. Joshi,
Sr.Asst., appeared on behalf of the Company and explained the company’s
case.
The facts of the case have been examined with reference to the
provisions of the APVAT Act and Rules and HSN Codes notified by
the following ruling is given.
1 of 2
Tyres, tubes and flaps of Tractors do not fall under Entry 64

of schedule IV of APVAT Act and hence are taxable @ 12.5%.
To
M/s. M.R.F. Ltd.,

P.B.No.200, 5-8-328/2, Chapel Road, Nampally,
Hyderabad-500 001.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Ricoh India Ltd., (TIN No.28420166406), Banjara Hills,

1. To clarify rate of tax on Multi Functional Digital Copiers (HSN Code

8471.60.29)
2. To clarify rate of tax for Spares, Consumables for Multi Functional

Digital Copiers bearing HSN Code 8473.30.99.
3. To clarify rate of tax on Analog Plain Paper Copiers bearing HSN

Code 9009 and Spares Consumables for the above bearing HSN Code 9001.
4. To clarify rate of tax on Toners, Developers, PCB’s, Spares

Consumables used for copiers Machines bearing HSN Code 8473.30.99.
5. To clarify rate of tax on Copiers given on lease.
6. To clarify rate of tax on the sales of spare parts and labour involved
in annual maintenance contract.
1 of 3
7. To clarify whether we are eligible for input tax credit on the stock
received from our branches in other states against ‘F’ Form, if the tax paid
in other States.
The case was posted for hearing on 25-04-2005. Sri Pradeep Naik,
Authorised Signatory of the company appeared on behalf of the company
along with copies of invoices for sales and AMC’s and further explained the
company’s business activities.
The issues raised by the company have been examined with
reference to the provisions of the APVAT Act and Rules and HSN Codes
notified by Government vide G.O.Ms.No.398, Revenue (CT.II) Department,
Dt.31-03-2005 and G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-
04-2005 and the ruling is given as under.
1 & 2. Rate of tax on Multi Functional Digital Copiers and Spares

thereof which fall under HSN Codes 8471 and 8473 respectively as
per Entry 39 of Schedule IV of APVAT Act is 4%.
3. Rate of tax on Analog Plain Paper Copiers and Spares

Consumables for the same which fall under HSN Code 9009 & 9001
are taxable @ 12.5%
4. Toners, Developers, PCB’s, Spares and Consumables used for

copiers machines falling under HSN Code 8473 as per Entry 39 of
Schedule IV of APVAT Act,2005 is 4%.
5. Lease tax under Section 4(8) of APVAT Act,2005 will be the

rate applicable to the goods (given on lease) as per the schedules
to the APVAT Act,2005.
6. Tax will be levied only on the supply of goods involved in the

annual maintenance contract at the rates mentioned in the
schedules to the APVAT Act,2005, as per Section 4(7)(a) of the
APVAT Act. However, if the dealer has not maintained account to
determine the value of goods and service separately, he is liable to
pay tax @ 12.5% on the consideration received subject to
permissible deduction and conditions as specified under Rule
17(1)(f) of the APVAT Rules,2005.
2 of 3
7. The dealer is not eligible to claim credit for tax paid in other
States.
To
M/s. Ricoh India Ltd.,
8-2-695/E-10B, Empress Garden,
Road No.12, Banjara Hills,
Hyderabad-500 034.
Copy to the Commercial Tax Officer, Basheerbagh Circle

PROCEEDINGS OF THE

***

2005.
***
O R D E R:
M/s. Sarveshwara Marketing, (TIN No.28470110500), Goshmahal
Road, Hyderabad have filed an application dt.21-04-2005 and sought
1. To clarify the rate of tax on Pet Bottles, Jars and Containers.
2. To clarify rate of tax on all types of Vegetable Sauces, Soups,
Noodles and Instant Curries.
The case was posted for hearing on 27-04-2005. Sri Gopal Rathi,
Proprietor of the firm appeared and explained that he is dealing in Pet
Bottles, Jars and other products and requested for clarification.
is given as under.
1. Pet Bottles, Jars and Containers falling under Entry 90 of
Schedule IV with HSN Code 3923.30, are taxable @ 4%.
2. All kinds of Vegetable Sauces, Soups, Noodles, Instant
Curries are taxable @ 12.5%.
To
M/s. Sarveshwara Marketing,

15-8-296, 107, Ist Floor,
Durga Complex, Goshmahal Road,
Hyderabad-500 012.

PROCEEDINGS OF THE

***

2005.
***
O R D E R:
M/s. Shalimar Fastenings Private Limited, (TIN No.28440117097),

Banjara Hills, Hyderabad have filed an application dt.23-04-2005 and
67 of the APVAT Act,2005 read with Rule 66(2)(i) of APVAT Rules,2005
To clarify whether Iron & Steel Items – Turnouts, Switches, Points,
Crossings, Switch Expansion Joints, Channel Sleepers, Elastic rail clips,
Bridge Girders (all falling under HSN Code 7302) fall under Entry 70 of
Schedule IV.
The case was posted for hearing on 27-04-2005. Sri Ravi Kishore,
Finance Manager of the company appeared on behalf of the company and
explained that all these items are supplied to the Railways and produced
proof that they are falling under HSN Code 7302.
The issue has been been examined with reference to the provisions
of the APVAT Act and Rules and HSN Codes notified by Government vide
is given as under.
Iron & Steel Items – Turnouts, Switches, Points, Crossings,
Switch Expansion Joints, Channel Sleepers, Elastic rail clips, Bridge
Girders (all falling under HSN Code 7302) fall under entry 70 of
Schedule IV to APVAT Act, 2005 taxable at 4%
To
M/s. Shalimar Fastenings Pvt. Ltd.,
311A, M.L.A.Colony, 2nd Floor,
Road No.12, Banjara Hills,
Hyderabad-500 034.


PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/9 /2005 Dt:29-04-2005.
O R D E R:
M/s. Sudhakar Polymers Ltd (TIN No.28630207139), Suryapet have

filed an application dt.13-04-2005 for clarification and advance ruling under
The clarification sought is on the following issues.
1. What is the rate of tax on PVC and other plastic fittings used along
with pipes.
2. What is the procedure for issue of credit notes and debit notes.
The application of the company has been examined with reference to

the provisions of APVAT Act and Rules and the following ruling is given as
under.
1. The rate of tax for all kinds of pipes and pipe fittings
including PVC pipes, tubes and their fittings is 4%. The HSN Code
notified by Government vide G.O.Ms.No.398, Revenue (CT.II)
Department, Dt.31-03-2005 and G.O.Ms.No.490, Revenue (CT.II)
Department, Dt.15-04-2005 for the above items is 3917.
1 of 2
2. Credit and debit notes have to be issued as per the format

prescribed under Rule 28 of the APVAT Rules, 2005.
To
M/s. Sudhakar Polymers Ltd.,

46, Raghava Ratna Towers, Chiragi Ali Lane,
Hyderabad-500 001.
Copy to the Commercial Tax Officer, Suryapet Circle.
2 of 2

PROCEEDINGS OF THE

***

2005.
***
O R D E R:
M/s. Supreme Music, (TIN No.28720169209), Koti, Hyderabad have
filed an application dt.21-04-2005 and sought clarification and advance
ruling on the following items under Section 67 of the APVAT Act,2005 read
1. To clarify the rate of tax on Pre-recorded Audio and Video Casettes
of songs and movies.
2. To clarify the rate of tax on Pre-recorded Audio and Video Compact
Discs of songs and movies.
The case was posted for hearing on 27-04-2005. Sri Harish Kumar
Harwani, Partner of the firm appeared and explained the case.
The issue has been been examined with reference to the provisions
of the APVAT Act and Rules and HSN Codes notified by Government vide
is given as under.
1. Pre-recorded Audio and Video Casettes of songs and movies
falls under Entry 39 of Schedule IV with HSN Code 8524, taxable @
4%.
2. Pre-recorded Audio and Video Compact Discs of songs and
movies falls under Entry 39 of Schedule IV with HSN Code 8524,
taxable @ 4%.

To
M/s. Supreme Music
Supreme House, 5-1-753,
Bank Street, Koti,
Hyderabad-500 095.
Copy to the Commercial Tax Officer, Sultan Bazar Circle.

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Sree Balaji Engineers & Contractors (TIN No.28610195144),

Yellareddyguda, Hyderabad have filed an application dt.08-06-2005 and
Rules,2005. The application is examined and found in order. Hence
admitted.
1) Whether Government Undertakings listed below are justified to

collect tax at source on par with Government or Local Authority as stated in
sub-section 7(v) of Section 4 of the Act.
1) Andhra Pradesh Health & Medical Housing & Infrastructure Dev.

Corpn.
2) Andhra Pradesh State Police Housing Corporation Ltd.,
3) Andhra Pradesh State Road Transport Corporation.
4) Andhra Pradesh Tourism Development Corporation Ltd.,
5) A.P. Genco Ltd.,
6) Andhra Pradesh Industrial Infrastructure Dev. Corpn. Ltd.,
7) The Singareni Collieries Company Ltd.,
2) Whether the applicant can get refund for any excess TDS made by
Central Government Departments/Organisations if 4% is deducted on gross
bills and if so the procedure to get such refund.
1 or 3
The case was posted for hearing on 20-06-2005. Sri P.H. Niranjan,
Manager of the firm appeared on behalf of the firm and presented the case.
According to the applicant, the Central Government Department and

Central Government Undertakings are deducting 4% tax at source even
though the rate of TDS is only 2% for all contracts executed for any
organization other than State Government or Local Authority. The applicant
also was expressing doubts regarding the status of State Government
Undertakings because they cannot be treated as either State Government
or Local Authority. The applicant was also expressing apprehensions
regarding excess TDS and the provisions under Rule 17(3)(h) where it is
specified that no refund will be given to the contractor for any TDS made if
the contractor is under composition.
After hearing the explanation of the applicant and after examining

the provisions of Section 4 and Section 22 read with Rule 17, the ruling is
given as under:
1. The Undertakings specified by the applicant are not covered under

“Government” or “Local Authority” as specified in sub-section 7(b) of
Section 4 to the Act. Therefore, the rate of tax of 4% shall not apply and
tax deduction at source shall be only 2% as specified under sub-section 4 of
2. As regards the works executed for Central Government Departments

and Central Government Undertakings or Central Government
Organisations, the provisions of sub-section 7(c) of section 4 and sub-
section 4 of section 22 of the Act shall apply.
3. Regarding the excess TDS made and eligibility of refunds to the

applicant, the sub-rule 3 of rule 17 is very clear to the extent where
contractor opts for composition @ 2% and TDS is also made at 2%, the
contractor shall not be eligible for refund. However, if any TDS is made in
excess of 2%, the portion exceeding 2% shall be credited to the account of
the contractor and the contractee can adjust this for the
2 of 3
subsequent bills while deducting tax for the subsequent bills. Alternatively,
if no subsequent bills are raised for the same contractee who made excess
deduction at source, the money shall be in the account of the contractor as
excess credit and he shall be eligible for refund like any other VAT dealer
either in the month of March,2007 or in the return for March every year
thereafter.
JT.COMMISSIONER
To
M/s. Sree Balaji Engineers & Contractors,
8-3-677/33, Sri Krishnadevaraya Nagar, Yellareddyguda,
Hyderabad-500 073.

Hyderabad.
Copy to the Commercial Tax Officer, Tarnaka Circle.
3 of 3
PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Vidyuth Control Systems (P) Ltd., (TIN No.28440292570), M.G.

Road, Secunderabad have filed an application dt.14-06-2005 and sought
the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005. The
Applicable rate of tax on Instrument Transformers and Electrical

Transformers.
The case was posted for hearing on 20-06-2005. Sri a. Sarath Babu,
Director of the firm appeared on behalf of the firm and presented the case.
According to the applicant, the items ‘Electrical and Instrument

Transformers’ fall under the Excise Tariff Code 8504 notified in the schedule
IV against Sl.No.7 for the entry 39. To prove his claim that the items fall
under Code 8504, few copies of the invoices issued by him were filed.
These invoices contain the Code 8504 printed on them.
1 of 2
After examining the facts of the case, it is established that

transformers are covered under Tariff Code 8504 and therefore, the ruling
is given as under:
Electrical and Instrument Transformers are taxable @ 4% covered

under Sl.No.7 for the entry 39 of Schedule IV to the Act.
JT.COMMISSIONER
To
M/s. Vidyuth Control Systems Pvt. Ltd.,
Flat No.406, Jade Arcade, M.G. Road,

Hyderabad.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Inox Air Products Ltd., (TIN No.28850278168), Autonagar,

Visakhapatnam have filed an application dt.02-05-2005 and sought
3. The rate of tax applicable on “Medical Olxygen I.P” and “Nitrous

Oxide I.P”.

Row, Advocate appeared and argued that the Entry 88 of Schedule-IV to
the Act specifies ‘drugs and medicines’ as defined under Section 3 of the
Drugs and Cosmetics Act, 1940 and the items “Medical Oxygen” and Nitrous
Oxide” are within the ambit of drugs as ‘defined in that Act’. The learned
Advocate also cited the following cases.
1. M/s Southern Gas Ltd., Vs. State of Karnataka – 137 STC 68

(Karnataka
High Court).
2. M/s. Jaycot Industries & Vimal Pharma Vs. State of A.P., - 35
APSTJ 120
(Sales Tax Appellate Tribunal, A.P., Hyderabad).
3. M/s. Indian Oxygen Ltd., - 79 STC 351 (Karnataka High Court).
1 of 2
After examining the facts of the case and the entries to the
Schedules to the Act and the HSN Codes notified by the Government, the
ruling is that items “Medical Oxygen I.P” and “Nitrous Oxide I.P” are
not present in the HSN Codes notified by the Government and even
according to common parlance, they cannot be treated as medicines
as specified in clause (b)(i) of Section 3 of Drugs and Cosmetics
Act, 1940. Therefore, these items will attract tax @ 12.5% under
the provisions of the Act.
JT.COMMISSIONER
To
M/s. Inox Air Products Ltd.,
Autonagar,
Visakhapatnam.

Hyderabad.
Copy to the Commercial Tax Officer, Gajuwaka Circle, Visakhapatnam.
2 of 2

PROCEEDING OF THE


2005.
***
O R D E R:
M/s. Twin Cities Hotels (P) Ltd., (TIN No.28520120263), Kachiguda,

1) The tax rate in respect of a Bar and Restaurant where the

turnover of sales of food is less than Rs.40 lakhs per
annum.
2) Whether he can be a TOT dealer.
The case was posted for hearing on 20-07-2005. Sri R.S.S. Reddy,
Manager appeared and explained the case.
After examining the provisions of the Act and the facts of the case
Sub-section (3) of Section 17 stipulates that every dealer

whose taxable turnover in the preceding three months exceeds
Rs.10 lakhs or in the preceding twelve months exceeds Rs.40 lakhs,
shall be liable to be registered as a VAT dealer. Sub-section (4) of
Section 17 stipulates that where the taxable turnover during
calendar year 2004 exceeds Rs.40 lakhs, such dealer shall be
registered as a VAT dealer. Sub-section (7) of Section 17 stipulates
that every dealer whose taxable turnover exceeds
1 of 2
Rs.5 lakhs in a period of twelve consecutive months shall apply for
registration as a TOT dealer. The definition of “taxable turnover” as
specified in sub-section (38) of Section 2 clearly specifies that
aggregate of sale price of taxable goods shall form part of the
taxable turnover. The Explanation-II to the definition of “exempted
turnover” under sub-section (14) of Section 2 of the Act specifies
that the sale price relating to second and subsequent sales of goods
specified in Schedule-VI shall not form part of taxable turnover. The
commodity “liquor” is covered under Schedule-VI to the Act and it
is taxable only at the point of first sale in the State. Any dealer
supplying food and liquor will have to compute the taxable turnover
representing only sales of food to decide whether he falls within
sub-section (7) of Section 17 or not. Once a dealer is required to
register as a VAT dealer under the provisions of Section 17 of the
Act, the tax liability shall be as applicable to a VAT dealer and the
benefit of 1% tax will not be available to such dealers. Sub-section
(9) of Section 4 stipulates that any dealer running a hotel and
supplying food and drink other than liquor can opt to pay tax by
way of composition @ 12.5% on 60% of the total amount charged
by such dealer for the supply of food and drink other than liquor. In
the instant case, the applicant is not liable for registration as a VAT
dealer but he is already possessing a Tax Payer Identification
Number and therefore the rate of 1% tax as a TOT dealer shall not
be applicable to him. Since the applicant already obtained voluntary
VAT registration, he is required to remain registered as VAT dealer
for 24 months from effective date of registration. The question
whether he is eligible for composition under sub-section (9) of
Section 4 of the Act shall depend upon whether he is supplying
liquor or not. In case he is not supplying liquor he is eligible for
composition and if he is supplying liquor he shall not be eligible for
composition.
JT.COMMISSIONER
To
M/s. Twin Cities Hotels (P) Ltd.,
3-3-67, Kachiguda,
Hyderabad-27.
Hyderabad.
2 of 2

PROCEEDINGS OF THE

***
O R D E R:
M/s. H.P.C. Electricals Limited, Hyderabad (TIN No.28370215813)

of Rs.1000/-.
i) Rate of tax applicable to works contract executed for APSPDCL,

APNPDCL, APCPDCL, APEPDCL.
ii) Claim for refund of excess tax deduction
iii) Tax liability on contracts executed prior to introduction of VAT A
ct, 2005 but payments received in April, 2005.
Sri C.V.S.R.K.Reddy, Accounts Manager appeared on behalf of the
The applicant claims to execute contracts to APSPDCL,
APNPDCL, APCPDCL, APEPDCL and is under the impression that they
are Government undertakings and seeks to know the rate of tax
under composition scheme. As per the provisions of A.P.VAT Act,
2005 the above mentioned undertakings are not treated as
Government departments. Therefore in accordance with the
amendment promulgated in Ordinance No.20 of 2005 Dt.29.8.2005
to the Section 22(1), tax @ 4% at source shall be deducted by the
Contractee. Contracts awarded prior to the promulgation of the
Ordinance shall attract tax @ 2% if the dealer has opted for
composition. In the present case the applicant seeks to know the
rate of tax applicable under composition basis. We hold that in
terms of the provisions of the Act, tax @ 4% shall be deducted at
source by the Contractee.
The applicant states that presently the Contractees are
deducting tax @ 2.8% and that for the period prior to the
promulgation of the Ordinance the tax deduction being 2%, the
applicant seeks to know how he can claim refund. It is clarified that
the excess tax collection for the period prior to the promulgation of
the Ordinance shall remain as credit in the dealers tax payment
account and he can claim refund in accordance with the procedure
of refund. Section 38(1)(d) stipulates that a VAT dealer may claim
refund of the excess credit available at the end of 2nd year after the
commencement of the Act. Rule 35 lays down the procedure for
claiming the refund. The applicant may therefore prefer claim for
refund in accordance with the provisions of the Act and Rules.
The applicant states that he executed contract worth Rs.2.63
crores in March, 2005 but received payment in April 2005 and seeks
to know whether any tax liability arises under the VAT Act also. It is
clarified that since the work was executed prior to the
commencement of the A.P.VAT Act, 2005 and that tax @ 2.8% was
also deducted and certificate was issued by the Contractee,
provisions of A.P.VAT Act, 2005 are not attracted though payment is
received in April 2005. Therefore there is no liability under the
A.P.VAT Act, 2005.
To
M/s. HPC Electricals Limited,

12-13-701/3/A&B,
Ashray Residency, Flat No.304,
Street No.13, Tarnaka,
Secunderaad – 500 017.

Hyderabad.

PROCEEDINGS OF THE

***
O R D E R:
M/s. S.A.S. Enterprises, Hyderabad (TIN No.28620293631) have

Rs.1000/-.
Rate of tax applicable to condemned / unserviceable goods.

2. Copy of reference issued by Directorate of Purchase and Stores,
Heavy Water Plant (Manuguru) Stores Unit, HVVP Aswapuram
Colony, Khammam alongwith Annexure of sale order.
3. Copy of the applicant’s registration certificate under VAT & CST.
Sri Shiva Kumar from the firm and Mr.K.H.Rao, Authorised
Representative appeared on behalf of the firm for hearing on 27-09-2005
is given as under:
Documents submitted by the application contain details of
sale order issued by the Directorate of Heavy Water Plant and
description of various items sought to be sold as condemned /
unserviceable items. Description of material sought to be sold
indicates that they are unserviceable bulldozers, pumps, engines,
motors etc., and as such they are treated as scrap of Iron and Steel.
Entry 71 of Schedule IV of the Act reads “Iron and Steel Scrap” and
sub entry (i) it reads Iron scrap. As the identity of unserviceable
items is same as that of Iron scrap we hold that it falls under Entry
71 of Schedule IV and therefore liable to tax @ 4%.
To
M/s. S.A.S.Enterprises,
5-4-764, Abids, Bhagvandas Bada,
Hyderabad.

Hyderabad.

PROCEEDINGS OF THE
***
O R D E R:
M/s. Spandrel, Hyderabad (TIN No.28880112297) have filed an

application on 9.09.2005 and sought clarification and advance ruling on the
i) Liability to tax if materials used in the execution of contract are

purchased from outside A.P. against C-Form.
ii) Liability to tax for works executed outside A.P.
iii) Liability to tax if material imported from outside India for
execution of works contract in A.P.
Sri S.Siva Sanker Reddy, Authorised Representative appeared on
i) The applicant claims that he is executing contracts and

paying tax by way of composition and buys materials from
outside A.P. against Form-C and seeks to know the
liability under A.P.VAT Act. It is clarified that the applicant
is liable to pay tax on the materials purchased from
outside the State and used in the works at the rate
applicable to the materials as per the Schedules under the
A.P.VAT Act, 2005 on account of the amendment issued to
Section 4 of the A.P.VAT Act by way of Ordinance of 20 of
2005, and the turnover relating to the value of goods
purchased from outside the State of A.P. shall be excluded
for the purpose of turnover on which the applicant pays
tax by way of composition.
ii) As regards the treatment of works contract executed
outside A.P., it is clarified that if the applicant purchases
material used in the execution of works contract in the
State (outside A.P.) where the Contract is executed, the
turnover does not form part of the output in the State of
A.P. and therefore falls outside the purview of A.P.VAT
Act, 2005.
iii) The applicant states that he may import material from
outside India for execution of works contract and opts to
pay tax by way of composition. In the circumstances he
shall be liable to pay tax on the value of such goods that
are imported and used in the works at the rate applicable
to them in the Schedules of A.P.VAT Act, 2005.
To
M/s. Spandrel,
H.No.8-1-402/3/A, Gulshan Colony,
Shaikpet,

Hyderabad.
Copy to the Deputy Commissioner (CT), Charminar Division

PROCEEDING OF THE


2005.
***
O R D E R:
M/S. Specific Laboratories (P) Ltd., (TIN No.28240296392),

Rasoolpura, Secunderabad have filed an application dt.04-06-2005 and
The applicant is seeking clarification on various items manufactured

by him whether they would fall under drugs and medicines under entry 88
of Schedule IV to the APVAT Act,2005. The items are as under:
S.No. Product Name

1 Sepsonil-DX III
2 Sidol +
3 Glycerin I.P.
4 Phenol
5 Chlorocleer
6 Lysol IP
7 Sepsonil
8 Escopal-CC
9 Formaldehyde Solution
10 Sidol
11 Benedicts Reagent
12 Sidol-NC
1 of 3
13 Sopal
14 Sphenyle (Disinfectant Black Fluid)
15 Sidol-BKC
16 Glutal
17 Microcleer
18 Bebzyl Benzoate Application I.P
19 Surgical Spirit BP
20 Hydrogen Peroxide Solution I.P. 6% w/v
21 Sepsonil-DX (Obstetric Cream)
22 Povidone-Iodine Cleaning Solution USP 7.5% w/v
23 Povidone-Iodine Solution IP
The case was posted for hearing on 15-06-2005. Sri P. Kameswara

Sarma appeared on behalf of the firm and explained the case. However,
they asked for some more time for filing material evidence, which is
furnished vide their letter dated 01-09-2005.
During the course of hearing, a copy of the relevant portion of Drugs

and Cosmetics Act,1940 with regard to the definition of “drug” and the
catalogue for various products dealt by him were also produced. Further,
copies of the licenses obtained from Drug Control Administration, A.P. for
the items manufactured were also submitted. After examination of the
documents, the products are verified with reference to the HSN Codes
notified against Entry 88 of the IVth Schedule. As seen from the definition
under Drug and Cosmetics Act,1940, the word “drug” includes all medicines
for internal or external use of human beings or animals and all substances
intended to be used for or in the diagnosis, treatment, mitigation or
prevention of any disease or disorder in human beings or animals. The
second limb of the definition covers such substances (other than food)
intended to affect the structure or any function of the human body or
intended to be used for the destruction of vermin or insects which cause
disease in human beings or animals.
All the products – that are medicated goods / medicaments

covered under HSN Codes – 3001 to 3004 except 3002.90.10 are
considered and accepted as falling under the drugs and medicines,
and other products for which documentary evidence could not be
produced to show that the products fall under drugs and medicines
are excluded for clarification under Entry 88 of the IVth Schedule.
Therefore, the following products are classified as drugs and
medicines liable to VAT @ 4% and other products for which HSN
Codes are not attributed, fall under residual entry of Vth Schedule
2 of 3
1. Sepsonil-DX III - 3003.20

2. Sepsonil - 3003.20
3. Sepsonil DX - 3003.20 (Obstetric
Cream)
4. Povidone-Iodine Solution IP - 3003.20
5. Povidone-Iodine Cleaning Solution - 3003.20
JT.COMMISSIONER
To
M/s. Specific Laboratories (P) Ltd.,
1-20-248, Umajay Complex, Rasoolpura,

Hyderabad.
3 of 3

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/100/ 2006. Dated 29- 09-2006.
O R D E R:
I. M/s. Anu Fastners (P) Limited, R.R.District(TIN.28280198647) have

Rs.1,000/-

The rate of VAT applicable for MS Washers, MS Spring Washers, MS
Split Pin
A write up on the issue involved in Advance rulings.
Mr. Rohit Gupta, Executive, appeared for hearing on 25-9-2006 and
explained the case.
Dept. dt.31-03-2005 as superceded in G.O.Ms.No. 1596, Rev.(CT.II) Dept,
dt.27-08-2005 and superG.O.Ms.No.1615, Rev. ue (CT.II) Dept.,dt.31-08-
2005 and the ruling is given as under:
The applicant is a manufacturer in hardware, bolts, nuts, M.S.

washers etc. The Government of A.P. have issued a G.O.Ms.No.795
Revenue (CT.II) Department,
dt. 29-6-2006 notifying entries 104-Bolts, Nuts and screws ------ and 105-
All hardware-----------under IV Schedule to the APVAT Act. The applicant
seeks to know whether, M.S. washers, M.S. Spring Washers, M.S. Split Pin,
dealt by them would attract tax @ 4% under entry 104 of the IV Schedule
or not.
Having regard to the nature of the commodities dealt by the

applicant and referring to HSN Code 7318 which reads as “Screws,
bolts, nuts, coach-screws, screw hooks, rivets, cotters, cotter pins,
washers, (including spring washers) and similar articles, of iron and
steel”, it is found that M.S. washers, including spring washers and
M.S. split pin of iron and steel fall under entry 104 of IV Schedule of
the APVAT ACT liable to tax @ 4% from 29-6-2006.
ruling.
To
M/s. Anu Fastners (P) Limited,
Dommarapochampalli (V),Dundigal A.F.A.-Post, Hyderabad. R.R.Dist.
Copy to the Commercial Tax Officer, I D A Gandhinagar Circle.

PROCEEDINGS OF THE

*****

O R D E R:
M/s. Balaji Traders, Agapura, Hyderabad (TIN.28600205394) have

Rate of tax applicable to preserved Karonda Cherry fruit and Amla
Murabba (fruit)
Karanda Candy, purchase invoice copy of Modern Food Products,
New Kolkata, West Bengal.
Murabba, Purchase invoice copy of Ganesh Food Products, Hahtras.
Mr.N.Vijay Kumar, C.A., appeared for hearing and explained
the case.
The applicant sought for clarification on the rate of tax

applicable on the goods viz. cherry fruit (Preserved Koranda) and
Amla Murabba. Government vide G.O.Ms No.795 Revenue (CT-II),
dated 29.6.2006 incorporated an entry 107 under Schedule IV of AP
VAT Act 2005 where in “ Processed meat, poultry, fish, processed or
preserved vegetables and fruits, including fruit jams, jelly, pickle,
fruits, squash, paste, fruit drink and fruit juice whether in sealed
container or otherwise” are mentioned. Hence “ cherry fruits” and
“Amla Murabba” if preserved in sealed containers and marketed
falls under the scope of entry 107 of IV Schedule to AP VAT Act,
2005 and liable to tax @ 4% w.e.f. 1-7-2006.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Balaji Traders,
Agapura, Hyderabad.

PROCEEDINGS OF THE

Sri K.Raghavaiah, Jt. Commissioner (Audit)
*****
O R D E R:
M/s. Liberty Rubber Products, Hyderabad (TIN.28840298118) have


Whether the dehusking rice rubber rollers come under parts of rice
mill machinery notified by G.O.Ms.No.795 dated. 29-06-2006 under HSN
Code 8437.90.10 exigible to tax @ 4% from 1.7.2006 or not?
1) Photostat copy of Invoice No.A/Exp/10/2005-06
2) Photostat copy of Highlights of the budget 2006-07 on relief
measures
3) Photostat copy of chapter 84 under machinery
4) Copies of ADC’s orders in Appl.No.184/89-90, dt.19-7-2000 and
decision of the STAT in TA No.193/82, dt.6-11-2005.
Mr.Madan Mallik and Mr.Nitin Parekh, Authorized Representative, appeared

The applicant states that rate of tax on rubber rollers was
reduced to 4% by a specific G.O.Ms.No.17 Rev. dated 8-1-1986 as
against normal rate applicable under entry 101 of the 1st schedule
up to 31-3-1995 and under entry 6012 up to 31-3-2005. They also
brought to our notice of the decision of the STAT, AP., Hyderabad, in
the case of M/s. Ganta Agencies Vs. State of A.P. (3 APSTJ,7)
wherein the said product was held as fall under entry 83 of the 1st
schedule to the APGST Act. In the VAT regime, the applicants have
been paying tax @ 12.5% under residuary entry up to 30-6-2006.
The Government by a notification in G.O.Ms.No.795, Revenue
(CT.II) Department dt.29-6-2006, inserted entry 102, machinery of
all kinds that is to say under IV schedule to APVAT Act, 2005, liable
to tax @ 4%. The applicant contents that rubber rollers are liable to
tax @ 4% under entry 102 of the IV Schedule with effect from 1-7-
2006.
The arguments putforth before this authority, are heard. The
Government, vide G.O.Ms.No.795 Rev.(CT.II) Department, dt.29-6-
2006 notified “machinery of all kinds, that is to say” in entry 102 of
the IV schedule. HSN codes notified in the said Government order
showed that HSN 8437 is notified at Sl.No.11, wherein HSN Code
8437.80.20 denotes “rice mill machinery.” and HSN Code
8437.90.20 “parts of rice mill machinery”. Since four digit code
8437 is notified against entry 102 of the IV Schedule, all parts of
rice mill machinery encompasses under the said entry. Therefore, “
dehusking rubber rollers”, if falling under HSN code 8437 are liable
to tax @ 4% w.e.f. 29-6-2006. Accordingly, it is clarified by this
authority.

To
M/s. Liberty Rubber Products, Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Mayur Agencies , Hyderabad. (TIN.28606074961) have filed an

The rate of tax applicable to PVC laminated sheets with H.S.N Code
3920.99.29 under APVAT ACT2005.
1) Copy of invoice cum challan issued by the consigner
2) Copy of Registration Certificate
3) Copy of clarification issued by Government of West Bengal.
4) Relevant extract of central excise and tariff .
5) Relevant extract of entry 90 of the IV schedule.
6) Product sample.
Sri Vinay Ahuja , Proprietor appeared for hearing on 27/9/2006 and
explained
the case.
dt.27-08-2005 and in G.O.Ms.No.1615, Rev.(CT. II) Dept., dt. 31-08-2005
The applicant is a consignee agent in PVC laminated sheets

and stated that the item falls under HSN CODE 3920.99.29 and
sought clarification on the rate of tax applicable to PVC laminated
sheets under APVAT ACT . On examination of the provisions of
APVAT ACT, the chapter code 3920 of Central Excise Act is notified
in IV schedule of APVAT ACT, 2005 vide G.O.MS NO.502, Rev.(CT.II)
Dept., dt 1.5.2006. Accordingly PVC laminated sheets are liable to
tax @ 4% from 1.5.2006.
ruling.
To
M/s. Mayur Agencies,
Hyderabad.
Copy to the Commercial Tax Officer, Maharajgunj Circle.
PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com / 83 / 2006. Dated 29- 09-2006.
O R D E R:
I. M/s. Nagarjuna Fertilizders & Chemicals Ltd, Kakinada

(TIN.2818077569)

Whether the applicant is eligible for ITC on purchase of items used in
business
Annexure on description of Items purchased and justification for use

in business,
IV. Sri A.C. Gangaiah C.A., appeared for hearing and explained the
case.
M/s. Nagarjuna Fertilizers and Chemicals Limited, Kakinada is a
dealer in fertilizers and chemicals. The applicant, submits that
certain goods purchased for use in the business are eligible for
“Input tax credit” or not. They are as follows:
i) Computers, laptops, Computer peripherals, combo drive, CD Rom,
Modems, servers, Computer spare parts, Computer printers,
Ribbons, Computer tables, Computer chairs.
ii) Boiler suits, Safety shoes, Safety helmets, Earplugs, Safety

goggles, Respirator, gloves and other personal protective
equipment.
iii) Televisions, projectors, speakers, Microphones, Audit & Video
cassettes, Cell
phones and EPBX
iv)Office stationery, items like white papers envelops, General clips,
computer stationery, pre-printed invoices, staplers, stapler pins,
toners, developers and drums for Xerox machines.
The applicant is entitled to input tax credit on purchase of the
items mentioned above if the said purchases are for use in the
business of the applicant under Sec.13 of APVAT Act ,2005 provided
they are not enumerated in the list of goods U/Rule 20 (2), as
ineligible goods.
Sd/- Sd/- Sd/-
Addl/Jt/Commis
sioner
ruling.
To
M/s Nagarjuna Fertilizers & Chemicals Ltd.,
Kakinada
Copy to the Assistant Commissioner L. T. U. Kakinada.
PROCEEDINGS OF THE
Present: Sri T. Yugandhar Reddy, Addl. Commissioner (VAT)

Sri P. Satyanarayana Reddy, Jt. Commissioner (Enft)
*****
O R D E R:
M/s. Super Pack, Malakpet, Hyderabad (TIN.28153738925) have

Rate of tax applicable to Master Batch which is used as input in
manufacturing of Polyproplene woven sacks.
Sri Dinesh Kumar, Branch Manager appeared for hearing on

27/9/2006 and explained the case.
The dealer is a manufacturer of Polyproplene woven sacks by
using master batches as input. The dealer sought clarification of
rate of tax applicable to Master batches with HSN code 3206.49.90.
The item has been noticed with HSN Code No.3206.90 in Entry 100
in Sl.no.125 of IVth Schedule by G/O.Ms.No.502 Rev.(CT.II)
Department, dt.1.5.2006 w.e.f.1.5.2006. The rate of tax applicable
to Master batches is @ 4% w.e.f. 1.5.2006.
Addl. Commissioner Jt.Commissioner Jt. Commissioner.
ruling.
To
M/s. Super Pack,
Malakpet, Hyderabad.
Copy to the Commercial Tax Officer,_Malakpet Circle.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Trident Powdertech Privatet. Limited ., IDA., Nacharam,
Hyderabad. (TIN.28860195944 ) have filed an application and sought

Whether Epoxy powder coatings with HSN Code 3907 liable to
Tax at 4%
w.e.f. 1.5.2006 or not ?

1) Invoice copies of Paramount powders Private Limited,
Gurgoan,Haryana.
2) Copy of Certificate of Registration.
Sri Sambhayya Managing Director appeared for hearing on 27/9/2006 and

explained the case.
The applicant is a manufacturer of Epoxy powder coatings

used for industrial purpose only and stated that the above item falls
under Code. 3907 and seeks to confirm the rate of tax applicable to
epoxy powder coatings w.e.f. 1.5.2006. The chapter code 3907 of
Central Excise Act is notified against Entry 100 of IVth Schedule at
S.NO 155 of APVAT 2005 by G.O. MS.NO. 502 dt 1.5.06. Hence they
are liable to tax @ 4% from 1-5-2006.

ruling.
To
M/s. Trident Powdertech Pvt.Ltd.,
Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Vamshi Rubber Limited, Banjara Hills, Hyderabad

of Rs.1,000/-
Whether the rate of tax of Cushion Gum with HSN Code 4002.92 of
Central Excise tariff reduced from 12.5% to 4% with the amendment of IV
schedule by G.O.Ms.No.502 dt.1.5.2006.
.
Sri B.Venkateswara Rao, Manager Accounts appeared for hearing on
27/9/2006 and explained the case.
.
The HSN code 4002 has been notified in IV Schedule of

APVAT Act,2005, by G.O.Ms.No.502 Revenue (CT.II) Department,
dt.1.5.2006. Hence, the Cushion Gum with HSN Code 4002.99.20 is
liable to tax @ 4%.
Addl. Commissioner Jt. Commissioner Jt. Commissioner
ruling.
To
M/s. Vamshi Rubber Limited,
Banjara Hills, Hyderabad.

Copy to the Commercial Tax Officer, Narayanguda Circle.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Viswanatha Transformers (P) Limited, Hyderabad

of Rs.1,000/-
Rate of tax applicable to CRGO core/Electrical lamination with HSN
Code 8504. 90.10 and Insulating oil or Transformer Oil used in the
manufacture of Transformers with HSN Code.27101990
Copy of the purchase Invoices of Viswanatha Transformers Private
Limited.
Sri K.Venu Gopal, Finance Manager appeared for hearing and

explained
the case.

Cold Rolled Grain Oriented Steel Sheet, also known as, Electrical
lamination used for core assembly in manufacture of transformers
with HSN Code 8504.90.10 and Transformer oil with HSN Code
2710.19.90.
The rate of tax applicable to CRGO core with HSN Code
8504.90.10 is @ 12.5% and Insulating oil / Transformer Oil with
HSN Code 2710.19.90 is also @ 12.5%.
Sd/- Sd/- Sd/-

Addl/Jt/ Commissioner
ruling.
To
M/s. Viswanatha Transformers (P) Ltd.,
Hyderabad.

PROCEEDING OF THE


Ref.CCT’S REF.NO.PMT/P&L/A.R.COM/2005, DATED -5-2005
***
O R D E R:
M/S Automotive Manufacturers Private Ltd., (TIN No.28050131175),

R.P.Road, Secunderabad have filed an application on 7-4-2005 and sought
the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005. along
with the fee application fee of Rs.1000/-. The application is examined and
1) Whether amounts collected at the time of sale of vehicle for “

Extended Service “ which is purely labour charge for availing
services at various intervals is liable to tax.
2) Whether insurance amount collected in bill at the time of sale of

vehicle is liable to tax under APVAT Act.
The case was posted for hearing on 25-4-2005. Sri k. Lakshmipathi

Rao, DGM, Accounts appeared on behalf of the company and explained the
issue.
1 of 2
1) & 2) Sub section (29) of Section 2 of the A.P. VAT Act
enunciates that ‘Sale Price’ means – (a) the total amount
set out in the tax invoice or bill of sale.
Therefore, any amounts collected towards ‘extended services’

and ‘insurance premiums’ in the tax invoice issued by the dealers
forms the part of sale price and liable to tax.
JT.COMMISSIONER
To
M/s Automotive Manufacturers Private Lt.,
P.O.Box No.1627, 8571, Rashtrapathi Road,
SECUNDERABAD-3

Hyderabad.
Division.
2 of 2

PROCEEDINGS OF THE

***
O R D E R:
M/s. Rane Brake Linings Ltd., (TIN No.28090100457), Tadbund,
To clarify the rate of tax on Brake Linings and Clutch Facings for
Tractors. The case was posted for hearing on 27-04-2005. Sri Murali,
Authorised Signatory of the company appeared on behalf of the company
and explained about the products.
is given as under.
Brake Linings and Clutch Facings for Tractors are taxable @
12.5%, as the G.Os mentioned above do not include HSN Codes for
the above items.
Addl.Commissioner Jt. Commissioner Jt. Commissioner
To
M/s. Rane Brake Linings Ltd.,

2-4-135, Lingareddy Mansion,
Block 2, Tadbund,
Copy to the Commercial Tax Officer, Bowenpally.
Copy submitted to the Deputy Commissioner (CT), Begumpet Division.

PROCEEDINGS OF THE

***
CCT’s Ref.No.PMT/P&L/A.R.Com/33 /2005 Dt:30-04-2005.
O R D E R:
M/s. Agastan Bio Cheme Pvt. Ltd., (TIN No.28390126540), Tilak

Road, Hyderabad have filed an application dt.25-04-2005 and sought
To clarify the rate of tax on Sorbitol I.P..
The case was posted for hearing on 30-04-2005. Sri M.S. Rao,
Authorised Signatory appeared on behalf of the company and explained
their products.
is given as under.
Sorbitol I.P. (HSN Code 2905.44.00) is taxable @ 12.5%.
To
M/s. Agastan Bio Cheme Pvt. Ltd.,

4-1-921/1, Ist Floor Tilak Road,
Abids, Hyderabad-500 001.
Copy submitted to the Deputy Commissioner (CT), Abids Division.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Almond House (TIN No.28610201643), Himayatnagar,
Hyderabad have filed on application dt.06.04.2005 and sought clarification
The applicant sought clarification on the following :

“Whether Sweets and Dry fruits purchased by VAT dealers during
Festivals for distribution to employees and customers are eligible for input
tax credit” ?
The case was posted for hearing on 26.04.2005. Sri
Nagarjuna Chowdary, Proprietor appeared on behalf of M/s. Almond House
Facts in brief:
The applicant claims that he is a reputed sweet shop and
1/3rd of the sales of sweets are to the corporate houses and that the latter
buy sweets and dry fruits from him for the purpose of distribution as gifts to
their customers and employees on occasions like festivals, accounting year
closing, target achievements, product launch, dealer conference, plant and
shop inauguration and the like. The applicant asserts that distribution of
sweets and a dry fruit as gifts is a normal business practice linked to the
Indian culture and tradition and that it is an ethical practice. The applicant
further states that he has to collect 12.5% tax being a VAT dealer from the
customers such as corporate and industrial establishments as opposed to
1% TOT which the TOT dealers charge on their sales, suggesting that the
difference being huge, business gets diverted to TOT dealers. According to
the applicant this entails revenue loss to Government. In the
circumstances, the applicant seeks a ruling to the effect that sweets and
dry fruits purchased by his customers are eligible for input tax credit.
Contents of the application have been examined with
reference to the provisions of AP.VAT Act & Rules, 2005.
On facts available on the application, there is no dispute that
the applicant is liable to pay tax of 12.5% on sales of Sweets and dry fruits.
The applicant, however, seeks clarification whether buyer can claim input
tax credit on such purchases as the subsequent distribution by way of free
gifts is a business practice of his corporate clients.
The question raised by the applicant is not so much as rate of
tax or liability of transaction or eligibility to claim input tax credit as it is on
the commercial aspect of his business. The applicant only apprehends that
if free distribution of Sweets and dry fruits by his corporate clients are not
treated as business practice, he will lose business and obliquely suggests
that even Government would stand to lose its VAT revenue.
Thus the point at issue is whether free distribution by the

applicant’s corporate clients can be construed as business practice so that
the applicant would be better off commercially vis-à-vis a TOT dealer.
Inasmuch as the ruling sought has no bearing on the applicant’s tax liability
or exigibility of transaction effected at his end, we are not inclined to
consider his request for ruling on an issue, which is primarily commercial,
from the applicant’s perspective. Any oblique reference to possible
reduction in VAT yield is extraneous to the applicant’s case. As the issue
revolves around the eligibility of input tax credit of the purchasing VAT
dealer, the applicant has no locus-standi in the matter save commercial
interest. Whether a dealer is eligible for input tax credit is a question that
can be urged by the dealer claiming the credit. Further, the dealer claiming
input tax credit alone can better discharge the onus of proving whether
distribution of sweets and dry fruits is a matter of business practice or not.
It requires examination of facts and circumstances surrounding the
transaction on case to case basis. The applicant, in trying to seek a blanket
ruling, is belaboring to pre-empt such scrutiny, which is not permissible.
Therefore, we are not inclined to entertain the application as valid within
the scope of the Section 67 of the Act under which this application is filed.
Accordingly the application is disposed off.
Addl.Commissioner(VAT) Jt.Commissioner(VAT)
Jt.Commissioner(Audit)
To
M/s. Almond House,
3-6-237, Lingapur Building,
Himayatnagar, Hyderabad-500 029.
Copy submitted to the Commissioner of Commercial Taxes, A.P.,Hyderabad.

Copy to the Commercial Tax Officer, Hyderaguda Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. Jaycot Industries, (TIN No.28830169852), Nampally,

Whether Absorbent Cotton Wool IP & BP, Absorbent Gauze Bandage
Cloth and Roller Bandages fall under Drugs and Medicines.
The case was posted for hearing on 26-04-2005. Sri P.V.S. Subba
Rao, Accounts Officer appeared on behalf of the company and explained
their products.
is given as under.
Absorbent Cotton Wool IP & BP, Absorbent Gauze Bandage
Cloth and Roller Bandages do not fall under Entry 88 of Schedule IV,
as the G.Os mentioned above do not list the HSN Codes for these
items.
To
M/s. Jaycot Industries,

19-2-239/16 & 17, Industrial Estate,
Chandulal Baradari,
Hyderabad-500 064.
Copy to the Commercial Tax Officer, Lord Bazar Circle.

PROCEEDINGS OF THE

***
Ref:- CCT’s Ref.No.PMT/P&L/A.R.Com/2005, Dt.13.4.2005.
O R D E R:
M/s. Optical Disc Marketing (India) Private Ltd., (TIN
No.28510200935), M.G. Road, Secunderabad have filed an application
dt.04-04-2005 and sought clarification and advance ruling on the following
items under Section 67 of the APVAT Act,2005 read with Rule 66(2)(i) of
To clarify the rate of tax on the following items.
1. Pre-recorded Audio Compact Discs.
2. Pre-recorded Video Compact Discs.
3. Pre-recorded Software/Data Compact Discs.
4. Pre-recorded DVD – Video.
5. Pre-recorded DVD – Audio.
The case was posted for hearing on 26-04-2005. Sri J.T. Sarma,
Marketing Manager appeared on behalf of the company and sought
clarification.
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005 and clarified
that
1. Pre-recorded Audio Compact Discs.
2. Pre-recorded Video Compact Discs.
3. Pre-recorded Software/Data Compact Discs.
4. Pre-recorded DVD – Video.
5. Pre-recorded DVD – Audio.
fall under I.T. Products (HSN Code 8524) and hence taxable
@ 4%.
To
M/s. Optical Disc Marketing (India) Private Ltd.,
Door No.5-4-187/1, C/o.TVS Tread Building,
M.G. Road, Secunderabad-500 064.

Copy to the Commercial Tax Officer, M.G. Road Circle.

PROCEEDINGS OF THE

***
Ref:- CCT’s Ref.No.PMT/P&L/A.R.Com/2005, Dt.13.4.2005.
O R D E R:
M/s. S.V. Large Format Digital Imaging Pvt. Ltd., (TIN

No.28470207791), Hyderguda, Hyderabad have filed an application dt.06-
04-2005 and sought clarification and advance ruling on the following items
1. What is the rate that should be charged to the customer if the dealer
opts for composition of works contract as per Section 4(7)(b) and 4(7)(c) of
the APVAT Act and what is the amount that is to be paid to the Department
in this case.
2. If composition is opted for, can goods be purchased from outside the
state.
3. What is the validity period of the composition.
The case was posted for hearing on 26-04-2005. Sri N. Sreedhar,
Managing Director has appeared on behalf of the company and explained
the products.
1. If the dealer is opting for composition under Section 4(7)(b)
of the APVAT Act,2005, 4% tax on the total value of the contract
can be charged to the customer and the same is to be paid to the
C.T. Department (either by way of TDS or by the dealer himself).
If the dealer opts for composition under Section 4(7)(c) of
the APVAT Act,2005, the dealer can charge 4% on 50% of the total
consideration (2% on the total value) and pay the same to the C.T.
Department (either by way of TDS or by the dealer himself).
2. The dealer under composition can purchase goods from
outside the State.
3. Composition opted under Section 4(7)(b) and 4(7)(c) of the
APVAT Act,2005 will be valid for the specific contract. Composition
opted under Section 4(7)(d) will be valid from the first of the month
in which the option for composition is made to the month in which
the option for composition is withdrawn.
To
M/s. S.V. Large Format Digital Imaging Private Ltd.,

3-6-168/7, Om Sai Towers, Ground Floor,
Hyderguda, Hyderabad-500 029.

PROCEEDINGS OF THE
Present:Sri T. Yugandhar Reddy, Addl.Commissioner(VAT)

Sri P.SatyanarayanaReddy,Jt. Commissioner (Enft.)
*****
O R D E R:
M/s. Advanta India Limited, Secunderabad (TIN 28300210448) have filed

Whether the applicant requires to issue a way bill in form 600 for
dispatching truthfully labeled seeds for sowing/agricultural purposes or not
The applicant submitted the following documents

1) A brief note of their nature of business.
Mr.Purushotham Rathi, on behalf of the firm appeared for hearing on

Act and Rules.The ruling is given as under:

commodity, at item No.44 of the 1st Schedule of the APVAT Act 2005
reads as—“seeds for sowing and gardening purposes’ are exempt
I of the Act. Thus we hold that when exempt goods listed in
of Way bill.
ruling.
To
M/s. Advanta India Limited,
Secunderabad.
Copy to the Commercial Tax Officer,S.D. Road Circle.

PROCEEDINGS OF THE
*****
O R D E R:
M/s. Elegant Chemical Entrprises (P) Limited,Habsiguda, Hyderabad

(TIN 28280132008) have filed an application and sought
clarification and advance ruling on the following items under Section 67
of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along

The rate of tax applicable to certain bulk drugs.

1) A brief note on the nature of the business
2) A letter from ESPIIndustries and Chemicals (P) Limited
3) A copy of licence issued under the Drugs and Cosmetics Act.
Mr.J.N.Sastry accountant, appeared for hearing on 25-5-2006 and
explained the case.
The applicants are manufacturers and dealers in

pharmaceutical formulations. They purchase inputs namely
Alluminium and Magnesium hydroxide paste from M/s. ESPI
Industries and Chemicals (P) Limited, Hyderabad. These are active
ingredients to their formulations namely, Polycrol Forte Gel. They
stated that M/s. ESPI Industries and Chemicals (P) Limited charged
VAT @ 4% on the inputs and later they issued a debit note towards
differential tax as the inputs in question do not fall under the
category of bulk drugs but they are inorganic chemicals. The
applicants seeks to know the correct rate of tax.
given as under:
Bulk drugs are notified at entry 16 of the IVth Schedule.
Against the said entry certain bulk drugswith certain HSN Codes are
notified through G.O.s referred supra. Verification of HSN Codes
notified reveal that chapter 28 of the Central Excise Tariff Act is not
included in jthe said G.O. Bulk Drugs that are covered in the HSN
Codes notified against entry 16 of the IVth Schedule alone are liable
to tax @ 4%. Hence, raising of debit notes by the supplier is in
order. However, in view of the G.O.Ms.No.502, dt.1-5-2006, bulk
drugs falling in chapter 28 are also liable to tax @ 4% w.e.f. 1-5-
2006.

ruling.
To
M/s. Elegant Chemical Enterprises (P) Limited
Habsiguda, Hyderabad.
Copy to the Deputy Commissioner (CT) _Secunderabad Division.
Copy to the Commercial Tax Officer,Tarnaka Circle.

PROCEEDINGS OF THE

*****

O R D E R:
M/s. Gemini Labs, Hyderabad (TIN 28360136920) have filed an

1) Whether input tax credit available on chemicals used in
developing film
2) Rate of tax applicable to silver
1) A brief factual note on the business activity.
2) A copy of the Supreme Court decision in the case of
C.K.JIDHEESH Vs. Union of India and others.
Sri V.Sudhakar, Accounts Officer, appeared for hearing on 25-5-
The applicant purchases negative film and positive film from

the local registered dealers. The negative films are sold to
customers and after use they are returned to the applicant for
developing. The applicant uses raw materials like chemicals
purchased from local registered dealers and also purchased from
the dealers of other states. The applicant also uses chemicals,
paper etc. in the printing of final negative. In the process, they also
generate raw silver and after due purification they sell to the
dealers in the state. In the context, the applicant seeks to know
whether ITC can be availed on the local purchases of chemicals and
the rate of tax applicable to the sale of silver.
G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005. The ruling is given
as under:
Having examined the facts of the case, it is observed that the

transactions in question squarely fall under ‘works contract.’ If the
primary object of the contract is carrying out work by bestowal of
labour and services and materials are incidentally used in execution
of such work, “works Contract” “includes any agreement for
carrying out…improvement, processing, modification…. of any
movable or immovable property.” If the applicant intends to pay tax
U/S.4 (7)(a), then he has to maintain correct accounts for value of
goods purchased and used in the execution of works and pay tax at
the rate applicable to the goods so used. They are eligible for ITC on
the goods/inputs purchased from local VAT dealers. They are not
eligible for ITC on purchases from outside the state.
The rate of tax applicable to sale of silver is @ 1% u/entry one of

Schedule III to the APVAT Act.
ruling.
To
M/s Gemini Labs,
Hyderabad.
Copy to the Commercial Tax Officer,_Jubilee Hills Circle.

PROCEEDINGS OF THE

*****

O R D E R:
II. M/s. Indu Priya Agenies, Amalapuram have filed an application

and sought clarification and advance ruling on the following items

Whether the applicant is liable to be registered for VAT on migration
from TOT dealer since, he was allotted a petrol bunk by the Reliance.
1) A brief factual note on the nature of the business

Sri M.Ramachandra Murthy, authorized Representative appeared for
The authorized representative stated that his client is holding

a TOT registration and doing business in lubricants. He intends to
purchase certain lubricants from other states. He is seeking a
clarification as to whether he is eligible for migration to VAT
registration or not.
APVAT Act and Rules. The ruling is given as under:
Clause (b) of sub-section 5 of Sec.17 stipulates that every

dealer registered or liable to be registered under the Central Sales
Tax Act,1956, or any dealer making purchases or sales in the course
of interstate trade or commerce, shall be liable to be registered
under APVAT ACT. Therefore, it is clarified that if the applicant falls
under this category, he is liable to be registered under VAT Act.
ruling.
To
M/s. Indu Priya Agencies,
Amalapuram..
Copy to the Deputy Commissioner (CT) Kakinada Division.
Copy to the Commercial Tax Officer,Amalapuram Circle.

PROCEEDINGS OF THE

Dr K. Raghavaiah, Jt. Commissioner(Audit)
Sri P.Sathyanarayana Reddy, Jt.Commissioner (Enft)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/489 / 2005. Dated 30- 05-2006.
O R D E R:
M/s. MET TRADE INDIA LIMITED

SECUNDERABAD(TIN.28620236401)
66(2)(i) of APVAT Rules, 2005 along with the application fee of
Rs.1,000/-
They sought clarification on the rate of tax applicable to discarded and

damaged scrap batteries.
1) A brief note on the nature of business

2) A copy of notification of Government of West Bengal
Mr.A. Chandrasekhar authorized representative, appeared for
G.O.Ms.No:398, Rev. (CT.II) Dept Dated 31-03-2005 and G.O.Ms.No:490,
Rev. (CT.II) Dept. Dated 15-04-2005 as superceded in G.O.Ms.No.1596,
Rev.(CT.II) Dept, dt.27-08-2005 and in G.O.Ms.No.1615 Rev.(CT.II) Dept.,
dt.31-08-2005 and the ruling is given as under:
The applicants are dealers in second hand and
discarded/damaged scrap batteries. They purchases from
registered dealers and sell to other registered dealers by charging
tax @ 12.5%. They areseeking to know the applicable rate of tax
under VAT Act. Entry 27 of the IVth Schedule covers only Ferrous
and non-ferrous metals and alloys and extrusions thereof. The
commodity dealt by the applicant does not fall in any of the entries
in I, II, IV, and VI Schedules to the Act.. Therefore, the commodity,
falls under residuary entry of Vth Schedule, taxable @ 12.5%
Addl.Commissioner Joint Commissioner JointCommissioner
To
M/s. MET TRADE INDIA LIMITED
Secunderabad.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: /A.R.Com/513/2005. Dated. 30.05.2006
O R D E R:
M/s. PRAAG DISTILLERIES PVT. LTD., a Unit of M/s Sarvaraya

Sugars Ltd., ( TIN. 28440173745) have filed an application and sought
Whether the transaction of transfer by way of sale of A unit of

Distillery, (one of the business units) to M/s. Prag Distillery Pvt. Ltd., under
an agreement, amounts to transfer of business as an ongoing concern and
exempt from payment of VAT under Rule 36 of the APVAT Rules,2005.

4) Form 570
5) Vakalatnama Form appointing Sri T.S.V. Diwakar, as an
Advocate.
6) List of Directors of M/s Prag Distillery Pvt. Ltd.,
7) Copy of Sale Deed of immovable property dated 15.12.2005.
8) Copy of Sale Letter dated 15.12.2005
9) A copy of transfer of D2 License to M/s Prag Distillery Pvt. Ltd.,
dated 16.01.2006.
10) Copy of Transfer Deed of rights on the property and business
dated 18.01.2006.
Sri T.S.V. Diwakar, Advocate of the company, appeared for hearing

G.O.Ms.No.398,Rev. (CT.II) Dept,dt.31-3-2005 and
G.O.ms.No.490,Rev.(CT.II)Dept,dt.15-4-2005 and the ruling is given
as under :
7) The applicant is a registered company under the

Companies Act, 1956. They are the manufacturers of
Sugar and Indian made liquor (IML). The business
consists of a unit in the name of Praag Distilleries which
manufactures Indian made liquor (IML) and other units
manufacturing various other items.
The applicant transferred, it’s Praag Distilleries unit situated

at Nallamilli Village, Rangampet Mandal, East Godavari District by
way of sale to M/s Prag Distillery Pvt. Ltd., (TIN 28483468381) as
on ongoing conern. Accordingly, the applicant transferred the
following by way of sale.
1) Land and building transferred as a part of sale deed dated 15-

12-2005.
2) Movable assets like plant and machinery equipment etc., D2

License of Prohibition & Excise Depatment relating to Distillery Unit,
are also transferred as a part of various agreements. All these
movable or immovable facilities pertaining to Distillery Unit was
transferred on ‘as is where is basis’. Thus, they stated that the
statute envisaged transfer of one unit of the business while
continuing with other businesses.
Sri. T. S. V. Diwakar, Advocate, appearing for personal

hearing has explained the terms and conditions laid down in the
contract and claimed that the transactions of transfer of one unit of
manufacturing facility by way of sale is exempt as a case of transfer
of business as a whole U/R.36 of the APVAT Rules. He referred the
following precedents:-
1) M/s Madras Petro Chemicals (103-STC-P56)

2) M/s Bobby Rubber Industries (108-STC P410)
3) M/s Coromandal Fertilizers Ltd., (112-STC-P1)
4) M/s Lohes Machines Ltd., (110-STC-P305)
He drawn the attention of this authority of the A.P. High

Court decision in the case of M/s. Coromandal Fertilizers Vs. State
of A.P. (112 STC.1), wherein it was held that if a dealer transfers
one of its several businesses as ongoing concern, it is still a transfer
of business and the goods involved therein can not be considered as
sold in the course of business but in the course of winding up of the
particular business unit. It was also held that goods involved in
transfer of cement business is in the course of winding up of
cement business and it is not necessary that the company should
have closed the fertilizer business as well in order to claim that the
transaction is in the course of closure of business.
The contentions of the applicant are examined with reference

to various agreements, and High Court decision referred herein and
found that Rule 36 of the APVAT Rules contemplates exemption on
the transfer of one unit out of the several businesses, as an ongoing
concern on as is where is condition along with the employees and
various assets and liabilities, ongoing contracts etc., Accordingly,
we hold that transfer of Distillery unit by way of sale as an ongoing
concern is not liable to VAT and exempted U/R.36 of the APVAT
Rules, 2005.
The clarification and advance ruling given herewith is subject

to the conditions prescribed in Rule 36. All the conditions applicable
in the circumstances, to the dealers are binding on the applicant
Sd/- Sd/- Sd/-

Addl/Jt.
Commissioner
ruling.
To
M/s. Praag Distilleries Pvt. Ltd.,
(A Unit of M/s Sarvaraya Sugars Ltd.,)
Nallamilli (Village), Rangampet (Mandal)
East Godavari Distt. A.P.

Copy to the Asst. Commissioner of (CT) (LTU), Kakinada Division.

PROCEEDINGS OF THE

*****
O R D E R:
M/s. Sri Lakshmi Press, Guntur (TIN 28490155863)
Whether the business of printing and supply of books, wedding,
cards, visiting cards, letter heads etc., fall under the category of “Works
Contract” or sale of goods.
1) A note on their nature of business
2) Form of Authorization
It is stated that the dealers are doing the business in Printing
works. The dealer purchases paper, Inks etc., from VAT registered
dealers in A.P. The dealers have been treating such business
transactions as “works contact: u/s. 4(7)(a) of the APVAT Act,
2005 and paying tax on the value of the goods used in the works.
The dealers are seeking clarification for the procedure to be
followed to arrive at the value of goods used in such works
contract.
APVAT Act and Rules. The ruling is given as under:
A contract of sale of goods is distinguished from a contract
for work and labour. A contract of sale is a contract, the main
feature of which is the transfer of the property in and the delivery
of the possession of a chattel as such to the buyer. Thus, transfer of
property in goods for a price is the linchpin of sale. Whether a
particular contract is one for ‘sale of goods or for work and labour’
depends upon the main object of the parties found out from an over
view of the terms of the contract, the circumstances of the
transaction and customs of the trade. It is the substance of the
contract document and not merely the form which has to be looked
into. If the primary object of the contract is carrying out of work by
bestowal of labour and services and materialse incidentally used in
execution of such work then the contract is one for work and
labour. If the things are delivered as any individual existence
before the delivery as the sole property of the party who is to
deliver it, then it is a sale.
Having examined all the facts enumerated by the applicant
and in the circumstances of the nature of transactions, we hold that
printing and supply of books, note books, wedding cards, visiting
cards, letter heads etc., amounts to ‘sale of goods’ liable to tax at
the rates enumerated in the schedules.

Tax Appellate
To
SreeLakshmi Press, Guntur.
Copy to the Deputy Commissioner (CT) Guntur Division.
Copy to the Commercial Tax Officer,Brodipet Circle.

PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Global Links (TIN No.28550127440) Hyderabad have filed an
The rate of tax applicable to Activated Charcoal.
i) Copies of purchase invoice issued by suppliers to the applicant.

ii) Copy of sale invoice issued by the applicant.
iii) Notes on the product downloaded from the internet
Sri Vikram Nagpal, Managing Partner of the firm has appeared for
is as under.
1 of page 2
Entry 69 of Schedule IV of the A.P.VAT Act, 2005 reads “Coal

including Coke in all its forms but excluding Charcoal”. Entry 7 of
Schedule I of A.P.VAT Act 2005 refers to Charcoal. The applicant’s
sale invoice describes the product as “Charcoal Activated”. In the
G.Os cited above, Govt., have notified HSN codes applicable to
certain entries in the Schedules. The HSN code 4402 is notified as
applicable to Entry 7 of Ist Schedule. The code refers to Wood
Charcoal. As the product sold by the applicant is not mere wood
charcoal the code is held as not applicable.
Entry 69 of Schedule IV specifies “coal including coke in all

its forms but excluding charcoal’. In the notes submitted by the
applicant, the product activated carbon or activated charcoal is
described as an amorphous form of carbon and that activated
charcoal is used as purifier of contaminated solutions or as
absorbent of gas or vapour.
Considering the nature of the product and its commercial

identity it is held as falling within the scope of entry 69 in the
Schedule IV and therefore liable to tax @ 4%.
Addl.Commissioner Jt. Commissioner Jt. Commissioner
To
M/s. Global Links,

49, Methodist Colony, Begumpet,

2 of page 2

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Cantronics Office Equipments (P) Ltd. (TIN.28340156547) have

Whether “the thermal transfer film ribbon” which is an essential
component of the Facimile Machine or Fax Machine falls under entry 39
grouped under HSN Code No.8517.21 or falls under Schedule V of A.P.VAT
Act,2005.
III The applicant submitted the following documents:
Copies of invoices
IV. Sri K.Hanumantha Rao, Authorised Representative, appeared for
VI. The applicant mentioned that the fax machines with HSN
Code 8517.21.00 are placed in entry 39 of the IV Schedule to APVAT
Act taxable @ 4% and hence Thermal Transfer Ribbons being a part
of Fax Machine & Electronic Printer attached to computer may also
be liable to tax @ 4%.
The item under Entry 39 of schedule IV to the Act do not
include Thermal Transfer Ribbon. The corresponding HSN
code 9612.10,90 is not notified by the Government for any
entries in schedule IV.
The ruling is therefore given that, the item “Thermal Transfer Ribbon”
shall attract tax @ 12.5%.
Sd/- Sd/- Sd/-

ruling.
To
M/s. Contronics Offie Equipments (P) Ltd.,
Basheerbagh,
HYDERABAD.

Copy to the Deputy Commissioner (CT) ,Abids Division.
Copy to the Commercial Tax Officer,_Basheerbagh Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s Dulichand Silk Mills Ltd., Sy.No.82, IDA, Jeedimetla,

Hyderabad(TIN 28360115192) have filed an application Dated 14-2-2006

Whether they are liable to Value Added Tax with reference to
Entry 52 and any other Entry applicable under AP VAT Schedules.
Sale Invoice showing Sales made to different dealers in
Hyderabad.
III. The case was posted for hearing on 13-6-2006, Sri M.Rama
Chandra Murthy, Chartered Accountant appeared for hearing on 13-6-2006
The applicant is a manufacturer of Man Made Fabrics like Sarees,
Shirting, Suitings and Sheeting cloth etc., in continuous length and
these products are liable to Additional Duties of Central Excise falling
under HSN Code 54.06.21, 54.06.22 and 54.06.23.
The applicant has stated that he is having 3 different types of
following transactions:
1) They purchase yarn and get it converted into grey cloth on job
work basis and the grey cloth is brought to their factory and
further process is done to get fabric in continuous form.
2) They purchase grey cloth in the open market and further process
is done in the factory to get man made fabric in continuous
length.
3) They do job work for others who bring grey cloth and get
converted into finished product
The applicant has sought clarification on the applicability of
value added tax on the above transactions
of the AP VAT Act and Rules and HSN Codes notified by the Government
vide G.O.Ms.No.398 Revenue (CT-II) Dept., dated 31-3-2005 and
G.O.Ms.No.490 Revenue (CT-II) Dept., dated 15-4-2005 and the
documents produced and oral submissions made at the time of hearing and
relevant provisions of APVAT Act, 2005 and Rules made there under and
The transactions referred to in the first and second

types above relate to Man Made Fabrics in continuous length which
are exempt from tax under Entry 45 of Schedule-I of AP VAT Act.
However, if the applicant makes and sells garments like bed sheets,
blankets or any made-ups as enumerated in Entry 52 of the IV
Schedule then liability @ 4% arises with effect from 18-8-2005. The
transaction in Sl.No.3 above falls under execution of works contract
which is liable to tax under Section 4(7) of the AP VAT Act, 2005.

ruling.
To
M/s Dulichand Silk Mills Ltd., Sy.No.82, IDA, Jeedimetla,
Hyderabad.
Copy to the Deputy Commissioner (CT) Hyderabad (Rural) Division.
Copy to the Commercial Tax Officer, Jeedimetla Circle, Hyderabad.
PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 19/ 2006 Dated 12-6-2006.
O R D E R:
I. M/s Uni Fab Engineering Works, #537, B.N.Reddy Nagar, Near

Ganesh Temple, Charlapally, Hyderabad (TIN 28220133465) have filed

Whether the dealers are eligible to claim input tax credit on
the main raw-material ie., M.S.Sheets supplied by the contractees.
Copies of Sale Invoice, Work Order, MOU with Contractees
etc.
III. Sri R.S.Subba Rao, Accountant of the firm appeared in person
IV. The applicant is executing works contracts for the

manufacture of STD, ISD, PCO and Coin Box Machines.
The applicant wanted clarification on as to whether they are eligible

to claim input tax credit on the main raw-material ie., M.S.Sheets
which is supplied by their contractees..

and the documents produced and oral submissions made at the time
of hearing and relevant provisions of APVAT Act, 2005 and Rules
made there under and the ruling is given as under.
As seen from the copies of agreements ie., Memorandum of
Understanding, entered into by the applicant with their contractees
it is noticed that the contractee is supplying the CRCA Sheets ( Iron
& Steel) to the applicant and using such sheets as main raw-
material. The applicant is manufacturing cabinets of given
specifications and receiving amount towards the work done. Under
these circumstances, there is no transfer of property in CRCA
Sheets by way of sale through a tax invoice from the contractee to
the applicant and hence the question of claiming input tax credit by
the applicant does not arise. Hence it is clarified accordingly.
ruling.
To
M/s Uni Fab Engineering Works, #537, B.N.Reddy Nagar, Near Ganesh
Temple, Charlapally, Hyderabad.
Copy to the Deputy Commissioner (CT) Hyderabad Saroor Nagar Division.
Copy to the Commercial Tax Officer, Nacharam Circle, Hyderabad.

PROCEEDINGS OF THE

*****
Ref:- CCT’s.Ref.No:A.R.Com/2005, Dated 13-04-2005.
O R D E R:
M/s. Gold Mohur Food & Feeds Ltd., Hyderabad (TIN.28280166734)


Whether it is necessary to issue waybills for transportation of Poultry
Feed, Cattle Feed and Aquatic Feed which are exempted from tax.
Sri.K.Sudhakar, Dy.General Manager , appeared for hearing and

explained the case.
given as under:
It is clarified that way bills are not necessary to be accompanied

with the consignment of goods which are exempted under APVAT
Act and this is clearly specified in the proviso to sub-rule (1) of Rule
55 of APVAT Rules 2005.
ruling.
To
M/s. Gold Mohur Foods & Feeds Ltd.,
Sanathnagar,
Hyderabad.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. H.P.C. Electricals Limited, Secunderabad. (TIN.

28370215813 ) have filed
1) Procedure of payment of VAT Tax and claiming of ITC for the works
contract not
under composition scheme.
2) Procedure for payment of VAT Tax in works contract under composition
scheme
3) Applicability of tax and payment of tax on interstate purchase of Raw
materials used in
works contract under composition and in manufacture of transformers.

1) Copy of agreement between HPC Electricals and Chief General Manager,
APSPDCL, Tirupati.
2) Copy of Notice issued by Chief General Manager, Projects to HPC
Elecvtricals Ltd., to proceed with the work.
3) Copy of schedule of prices issued by the CGM, Projects, Tirupati.
Mr.Ch. Jayarami Reddy, Chief Executive, appeared for hearing and
explained the case.
M/s. HPC Electricals Limited, Scunderabad is a dealer in

Electrical goods and also an Electrical contractor. The applicant
seeks to know whether transactions of following nature fall under
works contract or sales?
On examination of terms and conditions of the agreement

between the applicant and SPDC(AP) Ltd., it reveals that, the
contract is for supply of goods where some work is to be done as
incidental to the sale. The contract is for system improvement
project works for conversion of existing LT Net work into High
Voltage distribution system which includes
1) supply and erection of 3 phase 25 KVA/16 KVA copper wound

distribution
transformers.
2) Supply and erection of LT AB cable 3x16-25 sq.mm and

conversion of 3 phase
LT line into 11 KV (HVDS) lines, and
3) Replacing the existing 50/63/75/100 KVA distribution

transformers.
For each work, there is a price schedule, wherein quality, unit rate of
materials inclusive of all taxes is fixed while cost of labour, for erection and
commissioning, isseparately shown. This type of contract is a contact of
sale where goods are sold as chattel and the work done is only incidental to
such sale.
Thus, the main object is the transfer of property in a chattel as a chattel to
the buyer (SPDCL) and as work done is incidental to sale, it is a transaction
of sale of goods, liable to tax at 12.5% exclusive of labour charges.
Sd/- Sd/- Sd/-

ruling.
To
M/s. H.P.C. Electricals Limited,
Secunderabad.
Copy to the Deputy Commissioner(CT) _Secunderabad Division.
Copy to the Commercial Tax Officer,Tarnaka Circle.

PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 529/2005. Dated 30. 06 -2006.
O R D E R:
I. M/s. Margo Bio Controls (P) Ltd. , Hyderabad (TIN.28210131396)

Whether “Ecohume” falls with in the ambit meaning of “organic
manure” and is exempt from tax under entry 26 of I Schedule to APVAT
Act, 2005.
Literature on ‘Ecohume’ analysis issued by International Institute of

Biotechnology and Texicology ( II BAT)
IV. Mr.K.G.Prakash, Regional Manager, appeared for hearing and

explained the case.
G.O.Ms.No:398, Revenue
(CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue
(CT.II) Department Dated 15-04-2005as superceded in G.O.Ms.No.1596,
Revenue(CT-II) Dept. dt.27.08.2005 and in G.O.Ms.No.1615, Revenue (CT-
II), Dept. dt.31.08.2005 and the ruling is given as under:
VI. Organic Manure is exempt from tax as per entry 26 of I

Schedule appended to APVAT Act. Bio-fertilizers with Tariff Code
3101 have been notified to include in item 19 of IV Schedule
appended to APVAT Act by Act by Act No.23 of 2005 dt. 26-10.-2005
w. e f. 1-9-2005.
Therefore, it is clarified that the item “Ecohume” with Tariff

Code 3101 is liable to tax @ 4% w. e .f. 1-9-2005.… But it was
exempt under the entry Organic manure up to 31-8-2005.
ruling.
To
M/s. Margo Biocontrols (P) Ltd.,
Basheerbagh,
Hyderabad.

Copy to the Deputy Commissioner (CT) , Abids Division.
Copy to the Commercial Tax Officer, M.J. Market Circle.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s. Power Mak Pvt Limited (TIN 28280129389) have filed an

1) Whether hiring of the Generators is covered by the clause
“Levy of tax on transfer of right to use goods under APVAT
Act or not”.
Whether the hire chares received form part of the taxable turnover
or not.
1) Copy of Hire Agreement.
2) Copies of daily operation report.
IV. Mr.M.Ramachandra Murthy, Authorised Representative, appeared for
given as under:
VI As per subsection (8) of section 4 of APVAT Act every VAT dealer

who transfers the right to use goods taxable under the Act is liable
pay a tax for such gods at the rate specified in the Schedules on the
total mount realized or realizable on such transfer of right to use
goods.
As seen from the agreement between the owner and the hirer
clause (2) of Terms and conditions it is clearly mentioned that
APGST @ 8% of the invoice amount will be charged extra as per
Sec. 5E of APGST Act. VAT will be applicable w.e.f. 1.4.2005. Any
other taxes or levies imposed by any of the State or Central
authorities will be to the hirer’s account with retrospective effect.
Further in the preamble of the agreement it is clearly
mentioned that the Lesser (owner) is carrying on the business of
leasing of power generators.
Hence it is evident that the owner (Lessor) is in the business of
leasing power generators and there is a provision in the agreement
to collect tax as applicable from the hirer.
The ruling is that the transaction falls under the purview of sub
section (8) of section 4 of APVAT Act. The consideration received
for transfer of right to use goods is liable to tax at the rate specified
to the goods in the schedules to the Act.…
ruling.
To
M/s. Power Mak (P)Limited,
Shamshiri Estate, 240
Red Hills,
HYDERABAD.

Copy to the Deputy Commissioner (CT) _Punjagutta Division.
Copy to the Commercial Tax Officer, Khairtabad Circle.

PROCEEDINGS OF THE

Sri P. Sathyanarayana Reddy, Jt. Commissioner (Enft)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 481/ 2006. Dated - 00-2006.
O R D E R:
I. M/s. Ravindra Commercial Corporation, W.G.Dist.(TIN.

28970175635) have
Rs.1,000/-

Rate of tax applicable to (!) Organic Manure & (2) Bio-Fertilizers

Write up on the issue.
IV. Sri I.V.Ramana, Authorised Representative , appeared for hearing on

The applicant seeks to know the rate of tax applicable to (1)

Organic Manure and (2) Bio-Fertilizers is as follows :
Organic Manure falls under the 1st Schedule of APVAT Act,
2005 and exempted from tax.
Bio – Fertilizers are notified in the entry 19 of the IVth
Schedule and liable to tax @ 4% vide G.O.Ms.No.1596 Revenue
(CT.II) Department dt.27-8-2005 w.e.f. 1.9.2005.
ruling.
To
M/s. Ravindra Commercial Corportion,
West Godavari Dist.

PROCEEDINGS OF THE

*****
CCT’s Ref.No:PMT/P&L /A.R.Com/ 295 / 2005. Dated 30 -06 -2006.
O R D E R:
I. M/s. Sravya Textiles Ltd (TIN 28350192426) Hyderabad have filed

an
Whether Hand Processed Grey fabric falls under entry 45 of I
schedule to APVAT Act or not?
1) Notifications of Central Excise
2) E R 1 Returns
3) Copies of Invoices
IV. Mr. K. Hanumanth Rao authorized representative appeared
given as under:
VI. Additional Excise Duty is being levied in lieu of Sales Tax. The
rider in the explanation –I to the I schedule to APVAT Act is
placed to avoid levy of tax under APVAT Act. If the items
mentioned in I schedule to AED (Goods of Special importance )
Act 1957, are exempted by virtue of notification, but not
withdrawing the entries from the said schedule, the status of
those goods will not change and the exemption by virtue of
entry 45 is available to those goods. But if such goods are
withdrawn from First schedule to AED Act, 1957, such goods
become liable to VAT by virtue of explanation –I to I schedule.
ruling.
To
M/s. Sravya Textiles Ltd
Tarband, Secunderabad.

Copy to the Deputy Commissioner (CT) Begumpet Division.

PROCEEDINGS OF THE

*****
O R D E R:
I. M/s Amara Raja Electronics Private Limited, Diguvamagham village,

Thavanampalle Mandal, Chittoor District (TIN 28520168084) have filed
i) Clarification on the applicable taxes under AP VAT Act on
Xenon Home UPS which fall under the category of UPS.
III. The applicant filed documents relating to the nature and

functions of UPS manufactured by them.
of the AP VAT Act and Rules and HSN Codes notified by the Government
vide G.O.Ms.No.398 Revenue (CT-II) Dept., dated 31-3-2005 and
G.O.Ms.No.490 Revenue (CT-II) Dept., dated 15-4-2005 and the
documents produced and oral submissions made at the time of hearing.
The UPS (Uninterrupted Power Supply) manufactured

by the applicant fall under HSN Code 8504 and are liable to tax at
the rate of 4% under Entry No.39(Item 7) of Schedule-IV of the AP
VAT Act, 2005.
ruling.
To
M/s Amara Raja Electronics Private Limited,
Diguvamagham village, Thavanampalle Mandal, Chittoor District.

Copy to the Commercial Tax Officer-II Circle, Tirupathi.

PROCEEDINGS OF THE

*****
O R D E R:
M/s Maytas Hill Country Pvt.Ltd., 6-3-1186/5/A,III Floor, Amogh Plaza,

Begumpet, Hyderabad (TIN 28690270478) have filed an application
Dated 26-7-2006 and sought clarification and advance ruling on the
The applicant has submitted the following documents :
a) Note on the nature of transactions for issuing Advance Ruling.
b) Development Agreement-cum-General Power of Attorney.
c) Sale Deed and
d) Agreement of Sale.
Sri M.Ramachandra Murthy, Authorised Representative appeared for

The applicant has sought clarification as to whether the
following two categories of transactions fall under the ambit of
Section 4(7)(d) of the AP VAT Act, 2005.
The applicant is engaged in the business of constructing and selling
houses/flats. As explained by the applicant their business transactions are
of two categories..
1) On the land owned by the applicant, house is constructed and then
land along with the house is sold to the customer. In such a situation,
there would be only one sale deed.
2) In the second category a piece of land belonging to the applicant is
sold to the customer through a sale deed for the sale of land and
then through a separate construction agreement the applicant takes
up construction of a house on such land purchased by the customer.
In this situation there is a sale deed for the sale of land and also a
construction agreement between the applicant and the customer
which is also Registered with the Sub-Registrar.
3) The applicant has further stated that, in both the situations, (where
the land and house constructed thereon are sold through a single
deed or where the land is first sold and a construction agreement in
then entered into) the consideration received/receivable would be
the same and this is clearly laid down in the initial agreement of
sale.
The issue is examined with reference to the provisions of the AP VAT Act
and Rules and in particular with reference to sub-section (7) of Section
4 of the Act.
The tripartite agreements of sale entered into by the applicant with
the buyers have been examined. It is found that land owners, the
applicant as developer and buyers of individual units (houses) are
parties to the agreement. In clause 2(a), it is specified that developer
and the landowner have agreed to sell the property consisting of a
finished house for a total price specified in Schedule 2 of the agreement.
The specified price is found to be the total price for the land and
construction cost. In clause 6, it is specified that landowner and
developer shall construct in accordance with the specifications
mentioned in Schedule IV and they shall maintain common areas of
township without any additional charges till 31st December 2010. In
Clause 9, it is mentioned that purchaser can terminate the agreement
only when developer fails to construct the property within the period
stipulated and the given grace period and additional 8 months penalty
period.
All the terms and conditions in the agreement of sale clearly prove
that the transaction is for the complete execution for the total price
agreed upon.
Taking this into consideration, the ruling is given that ;
1) the applicant shall be eligible for composition under Section
4(7)(d) to pay tax @ 4% on 25% of the total consideration
originally agreed upon whether received in composite manner or in
separate portions towards land cost and construction cost.
2) the applicant is not eligible to opt to pay 4% of 25%
consideration received towards construction cost by excluding cost
of land though it could be registered separately at any stage.
3) if the property is registered only as a land through a sale
deed in the second category of transactions explained by the
applicant and there is no subsequent registration after completion
of construction, the applicant shall ensure payment of 1% of total
consideration received or receivable (as per initial agreement of
sale) by way of demand draft in favour of CTO/Asst.Commissioner
concerned at the time of execution of sale deed before Sub-
Registrar as prescribed in clause (i) of sub rule (4) of Rule 17 of
AP.VAT Rules, 2005.

ruling.
To
M/s Maytas Hill Country Pvt.Ltd.,
6-3-1186/5/A,III Floor, Amogh Plaza, Begumpet, Hyderabad.


PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/287 2005. Dated 30-08-2005.
O R D E R:
M/s. Sai Renewable Power (P) Ltd., West Godavari Dist.

(APGST.No.ELR/01/4/2987) have filed an application Dated 19-8-2005 and
67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along
The rate of tax on the sale of “waste palm oil bunch” by the registered VAT
dealers and whether it falls under Entry of the Ist Schedule or 26 of the
IVth schedule.
1. Copies of Sale invoices of Godrej Agrovet Ltd.,
2. Copies of agreement for procuring palm fresh fruit bunches.
Mr. V.S.Sivaram, authorised representative appeared for hearing on

25-8-2005 and examined the case.
Act and Rules and HSN Codes notified by Government vide G.O.Ms.No.398,
Revenue, Dt. 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II) Department
Dated 15-04-2005 and the ruling is given as under:
The applicant is a private company established for generating
power by using wastes or Rice husk or coal. They are not registered
under the VAT Act. They made agreement with certain other firms /
companies within the state and outside the state, to procure Empty
Palm bunches / fibres and Empty waste bunches at the rates
agreed upon. While lifting the goods, the seller of the goods, viz.,
M/s. Godrej Agrovet Ltd., a registered VAT dealer under the APVAT
Act has charged VAT @ 12.5% on the sale value of empty waste
bunches, which is said to be used as fire wood in the generation of
power.
Upon examination of the material papers and personal hearings, it
is understood that the goods under reference would fall in Entry 26
of Schedule IV – “fibres of all types and fibre waste” and therefore
liable to tax @ 4%. This order cannot be taken as an instrument to
interpret the classification of the goods with retrospective date as
the seller has already charged VAT @ 12.5% and paid to the State.

ruling.
To
M/s. Sai Renewable Power (P) Ltd.,
Plant Survey No.381/1, Kamavarapukota,
W.G.District.


PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 524 / 2005. Dated 30- 08-2006.
O R D E R:
M/s. P.H.Products Company,

Sanathnagar,Hyderabad(TIN.28080184524)

The rate of VAT applicable to PH electrodes, reference electrodes,
metallic electrodes, conductivity cells, ion selective electrodes, industrial
electrodes.

1) Copies of tax invoices issued in February,2006
2) Product brochures
3) A copy of the application made to Superintendent CE.
Sri T.Ramesh Babu, Advocate, appeared for hearing on 30-8-2006

The applicant is a dealer in electro chemical sensors and
trading in PH electrodes,m reference electrodes, ion selective
electrodes etc., that are suitable for measurements of PH redox, ion
and conductivity. These varieties of electrodes cater to all kinds of
analytical requirements in areas of research, education, industries
and processing plants. As per the declaration made before the
Central Excise Department, these products are classifiable under
heading No.90.33 of the Schedules to the Central Excise Tariff Act.
The authorized representative at the time of personal hearings
contends that the products dealt by the applicant fall under entry
24 of the IVth Schedule which reads as “Electrodes including
welding electrodes and welding rods”.
By Government order No.1615 Rev,(CT.II) dt.31-8-2005 HSN

Code, 8311 is assigned to entry 24 of the IVth Schedule, whereas
the HSN Code applicable to the products under the Central Excise
Tariff Act was declared as 90/33. By following the principle of the
test of ‘common parlance’ and noscitur a sociis, we clarify that
electrochemical sensors otherwise known as PH electrodes (not
welding electrodes and welding rods) fall under residuary entry
liable to tax @ 12.5%
ruling.
To
M/s. P.H.Products Company,
Sanathnagar, Hyderabad.
Copy to the Commercial Tax Officer,_Fathenagar Circle.

PROCEEDINGS OF THE
Sri P. Satynarayana Reddy, Jt.Commissioner
(Enft.)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 107 / 2006. Dated 30 - 08-2006.
O R D E R:
M/s. Sri T.Venkateswara Stone Crushers, Vijayawada (.GRN

U52/07/2/2912)have filed an application Dated 29-8-2006 and sought
1) Whether “Stone ballast” and “Stone boulders” fall under entry 43
of the IVth Schedule or under entry 92 of the IVth Schedule.
1) A brief note on the issue of clarification
2) Copy of the registration certificates under the Commercial Taxes
Department and
Mines and Geology Department
Sri P.Rattaiah, Proprietor, appeared for hearing on 30-8-2006 and
explained the case.
superceded in G.O.Ms.No.1596,Rev.(CT.II) Dept., dt.27-8-2005 and in
G.O.Ms.No.1615, revenue (CT.II) dt.31-8-2005 and the ruling is given as
under:
The applicant is a dealer in carrying on business in supply of
stone chips to various contractors and also to Railway Department
in future. The applicant extricates stone boulders and crushes into
different varieties of stone chips which are popularly known in the
market as stone ballast/chips. The applicant proposed to deal in
different sizes of stone ballast (Kankara) The applicant also submits
that stone boulder is assigned HSN Code 2516.90.20 and ballast is
not different from boulder. Since, ballast and stone boulders are not
different commodities, they encompasses into the entry of 43—
“Ores and Minerals”. They also cited several clarifications issued by
this authority and drawn our attention to the entry 230 of the
APGST Act and also made an anology that entry 43, ‘ores and
minerals’ includes stone boulders, stone ballast/chips of different
sizes. Therefore, liable to VAT @ 4% from 1st April,2005.
The issue is examined. As per the Oxford English Dictionary,

“Ore is a native mineral containing a precious or useful metal and
‘mineral’ is almost synonym of ore and it is any natural substance
which is obtained by mining”. Under Entry 43, no HSN Codes are
notified. Accordingly, this authority held “stone ballast” liable to tax
@ 12.5% in this office CCT Ref.No.PMT/P&L/AR.Com/152/2005,
dt.2-7-2005. However, the Government of A..P. Vide G.O.Ms.No
1564, Revenue (CT.II) Department, .dated 17-8-2006. included
entry 92 of IVth Schedule which reads as “River sand and grit and
stone chips”. Under the APGST Act also, entry 230 describes “stone
chips and sand” which encompassed all varieties of stone ballasts
and stone chips of different sizes. Therefore ,we clarify that entry
92 includes “stone ballast” of various sizes liable to VAT @ 4%.
ruling.
M/s. Sri Venkateswara Stone Crushers,

Vijayawada.
Copy to the Deputy Commissioner(CT) Vijayawada Division.
PROCEEDINGS OF THE

***
O R D E R:
M/s. Globe Surgicals, Hyderabad (TIN No.28530129995) have filed

i) Whether the applicant can accept Form-N from South Central

Railway Hospital and claim tax at concessional rate of 4% on sale
of surgicals / medical implants and instruments
ii) Rate of tax applicable to the items stated at Sl.No. (i) above.

Bill of entry for home consumption issued by Indian Customs
Department.
Sri B.Mohan Reddy, Proprietor appeared on behalf of the firm for

is given as under:
The applicant has raised two questions for consideration.
Firstly he seeks to know whether he can accept Form-N from
South Central Railway Hospital and claim concessional rate of tax
w.e.f. 1.4.2005 on sale of surgical / medical implants and
instruments. It is clarified that under the provisions of A.P.VAT Act,
2005 therein no facility of Form-N and concessional rate of tax @
4%. Therefore the applicant cannot claim concessional rate of tax @
4% and conversely the buying dealer / agency / hospital also
cannot issue such Form.
Secondly the applicant seeks to know the tax rate that he
needs to charge on sale of surgical / medical implants and
instruments. Bill of entry copies filed by the applicant shows that he
has imported orthopedic implants and equipments for physically
handicapped persons. As seen from the said document, the goods
imported by the applicant are covered under HSN code 9021.29.00.
In the G.O.Ms.No.1615 dt.31.8.2005 issued in supercession of
G.O.Ms.No.490, Revenue (CT.II) Department, Dt.15-04-2005, HSN
code applicable to aids and implements used by handicapped
persons under Entry 2 of Schedule I of the Act have been notified.
Under that Entry, 8 sub items have been identified and the
applicable HSN codes have been notified. The HSN code under
which the applicant has cleared goods from the customs has not
been notified in the said G.O. Therefore we hold that the applicant
is liable to pay tax @ 12.5% on all items that do not conform to the
HSN codes notified under Entry 2 of Schedule I of the Act.
To
M/s. Globe Surgicals,
Flat No.101, Street No.6,
3060502, Himayat Nagar,

Hyderabad.
PROCEEDINGS OF THE

***
ORDER:
M/s. Pendekanti Subbarayudu, Kadapa (TIN No.28540213738) have

Rs.1000/-.
Rate of tax applicable to Diancha Seed.

i) Copy of the decision of Supreme Court of India in Commissioner
of Sales Tax, U.P. Vs. Ram Chandra Asha Ram.
ii) Reference issued by Agricultural Officer, Mydukur addressed to
the President, Fertilizers Dealers Association, Mydukur.
iii) Copy of purchase invoice.
Sri G.N.Chetty, Authorised Representative appeared on behalf of the

is given as under:
The applicant claims that he is purchasing Diancha Seed used for
growing green manure in Mydukur and other areas and that the green
manure would be used for feeding the cattle. The applicant relying on a
decision of Supreme Court in Commissioner of Sales Tax, U.P. Vs. Ram
Chandra Asha Ram contends that any thing that is fed to the cattle falls
under the category of cattle fodder and therefore Diancha seed also falls
under that category. The applicant also contends that as per Entry 44 of
Schedule I of the A.P.VAT Act, 2005 seed used for sowing is exempt from
tax. Inasmuch as Diancha seed is sown to grow green manure, it must be
construed as a seed for sowing and exempt from tax, is the plea taken by
the applicant.
The applicant also contends that even construing that Diancha seed
is used for cattle feed, it is exempt from tax as per Entry 3 of Schedule I of
A.P.VAT Act, 2005.
Copies of purchase invoices submitted by the applicant show that
the applicant has purchased Diancha cattle feed from dealers located
outside the State.
The learned Counsel Sri G.Narendra Chetty, Advocate in the course
of hearing has also fairly conceded that the Commercial Tax Officer,
Prodattur initiated proceedings taking a view that Diancha seed is an
unclassified item and liable to tax @ 12.5%.
In view of the fact that proceedings have already commenced
before an Officer of the department the admissibility of the
application is hit by Section 67(2)(i). According to the said sub
section and clause, an application does not merit consideration
where the question raised in the application is already pending
before any officer of the department. Therefore, we refrain from
issuing a ruling on the question.
To
M/s. Pendekanti Subbarayudu,
Kadapa Road, Mydukur,
Kadapa District.

Hyderabad.
Copy to the Commercial Tax Officer-I, Proddatur Circle.

PROCEEDINGS OF THE

***
O R D E R:
M/s. S.S.G. Solutions (P) Limited, Hyderabad (TIN No.28280169547)

of Rs.1000/-.
Rate of tax applicable to Paper licenses issued for Software products.

Purchase and sale invoices.
Sri G.S.Ravikanth, Director appeared on behalf of the firm for
is given as under:
The applicant states that he is a reseller of Software products and
that he purchases software in the form of license from authorized national
distributors of various software companies like Microsoft, Oracle, Symantec,
Mcafee, Adobe etc. He seeks to know whether paper license issued for sale
of software products attract the same rate of tax as software products on
any media.
Perusal of purchase invoices show that the applicant had purchased
computer software licence and it is explained by the applicant that where
more than one CD is required for use by the customer, a paper licence is
issued and this is meant merely to enable the user to upload the software
into the computers at his end without violating the conditions of licence.
Such paper licence, according to the applicant serves as certification and
confers immunity to the consumer against unauthorized use or piracy. Thus
for all practical purposes a paper licence is same as software on any media.
We have considered the documentary evidence and the
contention of the applicant. A.P. VAT Act, 2005 specifies I.T.
products at Entry 39 of IV Schedule of the Act. Sub entry 14 of the
said entry refers to I.T. Software on any media. In the G.Os cited
above, HSN code for the entry as well as sub entries have been
notified. The product in question, I.T. software on any media, is
notified under the said entry under Schedule IV and it attracts VAT
@ 4%. The paper licence is meant merely to authenticate the
multiple use by the consumer at his end and by itself does not take
away the basic character of the product namely software on CD.
Therefore, we hold that paper licence issued by the applicant for
use by the end user are same as I.T. software and therefore liable
to tax @ 4%.
To
M/s. S.S.G.Solutions (P) Limited,

301, Hi-Line Complex, Road No.12,
Banjara Hills,
Hyderabad.
Copy to the Commercial Tax Officer, Jubillee Hills Circle.

PROCEEDINGS OF THE

Sri P. Satyanarayanareddy, Jt.Commissioner
(VAT)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/68 / 2006. Dated - 00-2006.
Ref:- CCT’s.Ref.No: PMT/P&L/A.R.Com/2005, Dated 2006.
O R D E R:
M/s S.P.M Telecom Nacharam, Hyderabad (TIN.286401105903)

have filed an application Dated 10.7.2006 and sought clarification and
of Rs.1,000/-

Rate of tax applicable to 1)Flat /submersible cable
2)Telephone and Switch board cables
3)PVC insulated sheathed and unsheathed bright annealed aluminium
wires.
4)Single core unsheathed 1100PVC insulated cables
5)Single and multicore flexible cables
6) Multicore flexible cables and 7)Jelly filled telephone cables and cable
joining kits .
The applicant submitted the following documents;- A write up on the
issue ..
Sri S.Dwarakanath Advocate, , appeared for hearing on 25-11-2006

of the APVAT Act and Rules and (HSN Codes notified by Government vide
G.O.Ms.No.490, Rev. (CT.II) Dept. dt. 15-4-2005 as superceded in
G.O.Ms.No.1596, Rev.(CT.II) Dept.,dt.27-08-2005 and in G.O.Ms.No.1615,
Rev.(CT.II) Dept., dt.31-08-2005 and the ruling is given as under:
The applicant sought clarification on rate of tax applicable to
the above items. The clarification is as follows . The HSN code 8544
relates to cables and wires which are not notified in IVth schedule
of APVAT ACT 2005.Hence the cables fall under residual entry of Vth
schedule and liable to tax at 12.5%except industrial cables (High
voltage cables Xlpe cables jelly filled cables optical fibre cables
which are notified under 38 of IVth schedule of APVAT ACT2005).
Further the CCT circular No AIII-(1)DT 22.9.2005 clarified that
Aluminium and copper cables excluding single core wire upto
6sqmm will be treated as industrial cables . That means all single
core cables upto 6sqmm will be taxable @12.5% w.e.f from
1.9.2005.
ruling.
To
M/s S.P.MTelecom.
Nacharam, Hyderabad.
PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Vijayalaxmi Cashew Company, (TIN No.28510297741)
Kasibugga, Srikakulam District have filed an application dt.30.5.2005 and
1. The applicant claims to purchase Cashew nut from farmers in

A.P. and process the same into Kernel in his units in A.P. and the
resultant Kernel is exported to foreign countries through
Tuticorin port in Tamilnadu and that all the documents are in the
name of the applicant only. In the circumstances the applicant
seeks clarification regarding the tax liability on the purchase of
cashew nuts and export of the kernel.
2. The applicant claims to purchase Cashew nuts from farmers in

A.P. and process the same into Kernels in his units in A.P. and
export to another VAT dealer in A.P. who inturn will export the
kernel to foreign countries. In the circumstances the exporting
dealer situated in A.P. will issue Form H. The applicant seeks
clarification regarding the tax liability on the purchase of nuts
and kernel sold in the course of export. 1 of page 3
3. The applicant claims to purchase cashew nut from farmers in

A.P. and process the same into kernel in his unit in A.P. and sells
the resultant kernel to the exporter who is a VAT dealer in other
states and seeks clarification whether the applicant is liable to
tax on the purchase of cashew nut and sale of kernel in the
course of export.
Sri K.Suryanarayana, Accountant appeared for hearing on 30-5-

As regards Issue No.1 a plain reading of sub section (4) of
Section 4 will make it clear that there is no purchase point tax
liability if the goods purchased are exported. As the applicant
claims that he obtains all the documents in support of export made
by him from ports outside A.P., the transaction may qualify for
export. In the said circumstances the provisions of sub section (4)
of Section 4 are not attracted and the applicant is not liable to pay
purchase point tax on cashew nuts.
As regards Issue No.2 the applicant claims that he sells
kernel to another VAT dealer in A.P. who inturn will export it to
foreign countries and that the exporting dealer in A.P. will provide
all documents including Form H. If this be so the applicant is not
liable to pay purchase tax in terms of sub section (4) of Section 4 of
A.P.VAT Act, 2005.
2 of page 3
As regards Issue No.3, the resultant kernel sold by the

applicant to the exporter who is a VAT dealer in other state who
inturn provides all documents including Form H in support of proof
of export to foreign countries will entitle the applicant to claim
immunity from tax liability at the point of purchase under sub
Therefore, subject to appropriate documentary evidence
necessary to support the claim of export either directly by the
applicant or through the dealers situated in this state or in the
other states, the applicant will be eligible to claim immunity from
tax liability under sub section (4) of Section 4 of A.P.VAT Act, 2005.

To
M/s. Vijaya Laxmi Cashew Company,
Kasibugga,
Srikakulam District.
Copy to the Deputy Commissioner (CT), Vizianagaram Division.
Copy to the Asst.Commissioner (CT) L.T.U., O/o.DC(CT), Vizianagaram.
3 of page 3

PROCEEDINGS OF THE

**
CCT’s Ref.No.PMT/P&L/A.R.Com/235 /2005 DT.31-8-
2005
O R D E R:
M/s. Avenir Power Technologies Pvt. Ltd., Hyderabad (TIN

No.28480126828) have filed an application dt 21.07.2005 and sought

Rate of tax applicable to Electronic Static Energy Meters
i) Copy of invoice issued by seller of component parts showing
Vat rate.
ii) Copy of invoice issued under Cenvat Credit Rules showing

excise tariff.
iii) Copy of the sale invoice issued by the applicant showing

Central Excise Chapter sub-heading and VAT rate.
Mr.P. Srinivas, M.D. appeared for hearing on 29-08-2005 and

explained the case.
is given as under.
The applicant seeks to know the rate of tax applicable on the
sales of Electronic Static Energy Meters cleared under Excise Tariff
Heading No.9028.90.10. The applicant contends that almost all
component parts that go into making Electronic Static Meters
attract 4% Vat in the State and therefore the end product viz.,
Electronic Static Energy Meter should attract the same rate of tax.
We have considered the documentary evidence and the

contention of the applicant. Though various component parts
attract 4% VAT as contended by the applicant and supported with
documentary evidence, it does not automatically follow that the end
product should also attract the same rate of tax. As seen from the
Excise Chapter Sub-heading available on the sale invoice issued by
the applicant, Electronic Static Energy Meters are cleared under
9028.30.10. This item has not been notified in the G.O. cited above.
Therefore it follows that this item falls outside the scope of all
schedules and in terms of the language in Schedule V of the APVAT
Act, 2005 it attracts 12.5% tax.

To
M/s Avenir Power Technologies Pvt. Ltd.,
5-246/5,1st Floor, H.P. Road, Moosapet,
HYDERBAD– 500 018.

Copy to the Deputy Commissioner (CT), Hyderabd (Rural) Division.

PROCEEDINGS OF THE

**
O R D E R:
M/s. Dr. B. Sanjeeva Reddy, Betamcherla, Kurnool Dist.have filed an

application, dt.10-8-2005 and sought clarification and advance ruling on the

i) Soap Stone Lumps/Steatite Lumps & Powder
ii) Dolomite Lumps & Powder.
iii) Quartz Lumps.
iv) White Shale & Powder.
Mr.Syed Iqbal Basha, Authorised representative appeared and explained

the case.
is given as under.

items mentioned at para 2 above. Entry 43 of Schedule IV to the
APVAT Act, 2005 refers to “Ores and Minerals”. In the G.O. cited
above, HSSN code applicable to Ores and Minerals have been
notified. The Entry takes in its purview all Ores and Minerals. The
items on which the applicant is seeking clarification fall under the
ambit of Ores and Minerals. Therefore we hold that 4% VAT is
applicable to the items stated in the application.

To
M/s Dr. B.Sanjeeva Reddy,

18-213, Banaganapalli Road,
Betamcherla– 518 599..
Kurnool Dist.

PROCEEDINGS OF THE

**
O R D E R:
M/s. Goutami Mineral Industries, Betamcherla, Kurnool Dist.have

filed application,dt.10-8-2005 sought clarification and advance ruling on the

ii) Soap Stone Lumps/Steatite Lumps & Powder
iii) Dolomite Lumkps & Powder.
iii) Quartz Lumps.
iv) White Shale & Powder.
Mr.Syed Iqbal Basha, Authorised representative appeared and explained

the case.
is given as under.

items mentioned at para 2 above. Entry 43 of Schedule IV to the
A.P.VAT Act, 2005 refers to “Ores and Minerals”. In the G.O. cited
above, HSN codes applicable to Ores and Minerals have been
notified. The Entry takes in its purview all Ores and Minerals. The
items on which the applicant is seeking clarification fall under the
ambit of Ores and Minerals. Therefore we hold that 4% VAT is
applicable to the items stated in the applicant.
To
M/s Gouthami Mineral Industries,

18-214, Banaganapalli Road,
Betamcherla– 518 599.
Kurnool Dist.


PROCEEDINGS OF THE

***
Dt.13.4.2005.
O R D E R:
M/s. Hindustan Colas Limited, Visakhapatnam (TIN
Rate of tax on Bitumen Emulsion & its allied products.
Product Literature.
Mr. B. Chandramouli , Marketing Manager appeared for hearing on 29-8-05
is given as under.
The applicant claims that he is engaged in the business of
manufacturing and trading of Bitumen and Emulsion of various
grades and allied products which go into road making.
The applicant states that Bitumen and Emulsion has always
been treated at par with Bitumen and therefore, should fall within
the scope of Entry 14 of Schedule IV to the APVAT Act, 2005.
We have considered the contention of the applicant. Entry 14
of Schedule IV refers merely to Bitumen. The item has also been
notified in the G.O. cited above as attracting HSN code 2714.90.20.
Therefore it must be construed that only Bitumen is liable to tax at
4% as the six digit code has been notified. Bitumen Emulsion does
not appear anywhere in the schedules under the APVAT Act, 2005.
Therefore we hold that it is liable to tax at 12.5% in terms of
language in Schedule V of the APVAT Act, 2005.

To
M/s. Hindustan Colas Limited,
Near HPCL Terminal – A, Malkkapuram,
Visakhapatnam– 530 011.

Copy to the Commercial Tax Officer, Gajuwaka Circle.
APPLICATION FOR VAT REGISTRATION FORM VAT 100
[ See Rule 4 (1) ]
Affix Passport Size
Submit in duplicate Photo of
Use separate sheet where space is not sufficient. Sole Proprietor.
In case Partnership
To firm/Companies/others
The Commercial Tax Officer, Affix photos of
VAT Registering Authority, responsible persons
on VAT 100B
___________________ Circle.
01. Name of the business to be registered:

02. Address of Place of business: Door No: Street
Locality Town/City
District Pin Code
Phone No: Fax No:
Email: Website/URL:
03. Occupancy Status: Owned/Rented/Leased/Rent-free/Others

04. Name & Address of the Owner Name:
of business Date of Birth:
(Residential Address of the Door No. Street
Person responsible ie., Managing Locality Town/City
Partner /Managing Director District Pin Code
for business). Phone No Fax No.
Email:
05. Status of business: (Mark “ = “ where applicable)
Sole Proprietorship Partnership Private Limited Co.,
Public Ltd Company Govt. Enterprise Others (Specify)
06. Nature of Principal business activities:
07. Principal Commodities traded:
08. Bank Account Details:

Bank Name : Branch & Code Account No.
1.
2.
3.
42
09. Income Tax Permanent Account Number: (PAN)
10. Address of additional places of business/ Branches/Godowns
(including those outside A.P): Use form VAT 100A
11. Particulars of owner/Partners/Directors etc.,:
Use Form VAT 100B
12. Language in which books are written:
13. Are your accounts computerized: YES NO
14. Date of first taxable sale Date Month Year
15. Turnovers of taxable sales of goods including zero rate in:
a) The last 3 months: Rs.
b) The last 12 months: Rs.
16. Anticipated turnovers of taxable sales of goods including zero rate in:
a) The next 3 months Rs.
b) The next 12 months Rs.
17. Anticipated Turnover of exempted sales of goods and
transactions in the next 12 months:
18. Are you applying for voluntary registration: YES NO
19. Are you applying for registration as YES NO
Start up Business:
20. Indicate your GRN Number, if any:
Have you applied for CST Registration YES NO
21. Registration Number (if any Under Profession Tax Act:)
22. Do you expect your input tax to
regularly exceed your output tax? If yes Why ? YES NO
23. Are you applying for registration in response to
a notice by the Tax Officer ? YES NO
If yes, indicate the Notice number.
24. Any other relevant information like are you availing Tax incentives ? If so write details.
Declaration:
I_____________________________S/o_________________Status_____________
of the above enterprise hereby declare that the particulars given are correct and true to the best of my
knowledge and belief. I undertake to notify immediately to the registering authority in the Commercial
Taxes Department of change in any of the above particulars.
Date of application Signature with Stamp
43
FOR OFFICE USE ONLY
25. Date of receipt of application
26. Activity/Commodity Code
27. Exempt Indicator
28. Voluntary Registration Indicator
29. Start up Business Indicator
30. CST Indicator
31. Refund Indicator
32. Works contract Indicator.
33. Suo motu Registration Indicator.
34. Special Rates – Schedule – VI goods Indicator
35.Tax Incentives Indicator
36. Date of issue of Registration Certificate
37. Effective date of Registration
38. Date of refusal of Registration
39. Taxpayer Identification Number (TIN):
Processing Authority Registering Authority

Name Name
Designation Designation
IMPORTANT:
a) Copy of Proof of Identity of the sole proprietor / managing partner / managing director/ responsible
person for the business like copy of passport, voter Identity card, Proof of bank account, Credit
Card, Ration Card, Driving license etc., must be enclosed.
b) Please fill in and enclose Form VAT 100A and 100B if found necessary.
25 to 39 : For office use only.
44
ADDRESSES OF ADDITIONAL PLACES OF
FORM VAT 100A
BUSINESS /BRANCHES /GODOWNS
IN ANDHRA PRADESH
Name of the business :
01 Address
Pin Code Telephone
Signature Date
02 Address
Pin Code Telephone
Signature Date
03 Address
Pin Code Telephone
Signature Date
Note:- Please see overleaf to fill in the details for Addresses of Branch/Godowns located outside Andhra
Pradesh.
45
ADDRESSES OF BRANCHES/GODOWNS LOCATED
OUTSIDE ANDHRA PRADESH
01 State
Address
Pin Code Telephone

R.C. Number under State Act:
R.C. Number under C.S.T. Act:
Signature Date
02 State
Address
Pin Code Telephone

Signature Date
03 State
Address
Pin Code Telephone

Signature Date
46
PARTICULARS OF PARTNERS /DIRECTORS/
FORM VAT 100B
PERSONS RESPONSIBLE (AUTHORISED)
FOR THE BUSINESS
Affix Passport size
Photo of
Name of the Business : Partner/Director/
1) Fill in the details for each Partner/Director/Responsible Person Person
Responsible
separately in the boxes provided for. Please use BLOCK LETTERS
and write clearly.
2) Strike off Partners/Directors/Responsible Persons whichever is not
applicable.
PARTNERS/DIRECTORS/ PERSONS RESPONSIBLE DETAILS
1. Full Name
2. Father’s/Husband’s Name
3. Date of Birth
4.Extent of interest in business (Partnership firm) /

Official Designation and date of joining in the present
capacity (in case of Directors in Limited Companies)/
Status & function of Person Responsible
(Authorised) for the business.
5. Other business interests in the State (Please specify)

6. Other business interests outside the State (Pl. specify)
7. Present Residential Address:
Telephone No:
e-mail:
8.Permanent Address:
Telephone No
9. Income Tax Permanent Account Number (PAN)
Date: Signature & Status
47
Affix Passport size
Photo of
Partner/Director/
Person
Responsible
PARTNERS/DIRECTORS/ PERSONS RESPONSIBLE DETAILS
1. Full Name
2. Father’s/Husband’s Name
3. Date of Birth
4.Extent of interest in business (Partnership firm) /

Official Designation and date of joining in the present
capacity (in case of Directors in Limited Companies)/
Status & function of Person Responsible
(Authorised) for the business.
5. Other business interests in the State (Please specify)
6. Other business interests outside the State (Pl. specify)
7. Present Residential Address:

Telephone No:
e-mail:
8.Permanent Address:
Telephone No
9. Income Tax Permanent Account Number (PAN)
Date: Signature & Status
48
FORM VAT 101
NOTIFICATION OF VAT REGISTRATION
Date Month Year

01.Tax Office Address:
_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
Receipt of your application for registration dated………………………is acknowledged

I am to notify you that your TIN is
You must use this number when you issue VAT invoices, on all documents related to VAT and in all
correspondence with the Commercial Taxes Department.
Your application has been accepted. Please find enclosed your VAT Certificate of Registration.
You should know that your registration for VAT is effective from _____________.
From that date you must charge VAT on all your taxable sales, and provide a VAT tax invoice to those of
your customers who are registered as VAT dealers.
If you have been charged VAT on goods including capital goods and assets which are in stock on
_____________ you should apply to this office for a form so that you can claim a VAT credit in your first
return.

VAT REGISTERING AUTHORITY,
__________________CIRCLE.
Encl: 1. Form VAT 105.

2. Leaflets 01,02 & 05.
49
FORM VAT 102
NOTICE OF REFUSAL OF VAT REGISTRATION
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
Receipt of your application for VAT registration dated ______________________is acknowledged.
Your application for VAT registration is refused because:

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________________________________________________________________________________
____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________________________________________________________________________________
You are requested to file written objections along with documentary evidence if any within 10 days of date
of this notice failing which rejection of your application will be confirmed without any further notice.

__________________CIRCLE.
50
FORM VAT 103
NOTIFICATION OF REJECTION FOR VAT REGISTRATION

[ See Rule 11 (2) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
You are advised by this office notice in Form VAT 102 dated____________ that your application for
VAT Registration has been refused.
a) Since you have not responded, I am unable to authorise your Registration.
b) I have considered your request and I am unable to authorise your Registration under the provisions
of AP VAT Act, 2005.
You have the right of appeal against this order within (30) days of date of receipt of this order.

__________________CIRCLE.
51
APPLICATION FOR VAT REGISTRATION AS A START
FORM VAT 104
UP BUSINESS PRIOR TO MAKING TAXABLE SALES
[ See Rule 9 (2) ]
Use separate paper where space is not sufficient
01 Name of business to be registered

02 Date on which business was created
03 Status of business
04 Planned business activities
05 Provide projected date of commencement of trading

06 Declare the amount of any VAT paid prior to this
application
07 DECLARATION:
I apply for VAT registration as a new business prior to making taxable sales.
I understand that if I am registered for VAT, I must abide by all the duties and obligations of a VAT
registered dealer, including the duty to keep proper books of accounts and file returns by the due dates.
I accept that I can only remain VAT registered as a new business not making taxable sales for a period
NOT EXCEEDING TWENTY FOUR MONTHS from the date of VAT registration.
Name of person making this declaration:________________________________________________
Status of the person in the business:____________________________________________________
Signature: ______________________ Date of declaration : _________________________
FOR OFFICE USE
Processing Authority Registering Authority
Name and Signature Name and Signature
52
COMMERCIAL TAXES DEPARTMENT FORM VAT 105
VALUE ADDED TAX REGISTRATION CERTIFICATE

[ See Rule 10 (a) ]
I hereby certify that_______________________________________________________________

Whose place of business is situated at:
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
is registered with VAT Registration Number with effect from _______day of ________200
Pursuant to and in accordance with the APVAT Act, 2005. The additional place of business/branch/
godown is situated at:
Given under my hand at_______________on the_______day of______________200 .
Your local Tax office is: TIN
* You are also registered under CST Act and the above VAT TIN must be quoted on all your inter-state
transactions.
__________________CIRCLE.
To
M/s. ________________________________
________________________________
________________________________
NOTE: The above Tax Payer Identification Number (TIN) must appear on all:
- Your Tax Invoices / invoices
- Correspondence with the C.T.Department.
- Your Tax returns.
You must conspicuously display this Certificate in your business premises. Separate Copy of Certificate
for each additional place of * business/branch/godown is enclosed. Please check if the above details are
correct.
(* Strike off if not applicable.)
53
FORM VAT 106
RESPONSE TO APPLICATION FOR VAT REGISTRATION

AS A START UP BUSINESS PRIOR TO MAKING TAXABLE SALES
[ See Rule 10(b) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
Receipt of your application for registration dated ___________ is acknowledged

You have been registered as a Start Up Business and you must abide by the following conditions:
§ You must keep proper books of accounts and records.
§ File VAT returns by the due date even if they are nil returns.
§ You can only remain registered as a Start Up Business for a maximum period of twenty four
months.

__________________CIRCLE.
Encl: Form VAT 105
54
FORM VAT 107
NOTIFICATION OF ENDING OF START UP BUSINESS STATUS

ON MAKING TAXABLE SALES
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02. TIN
03.Name :
Address:
I have to advise you that consequent upon the receipt of the VAT return for the period
______________________ on ______________and the taxable sales declared on that return, you
are no longer registered as a start up business.
You have complied with the conditions of your start up business registration and are now registered
under the normal VAT conditions.
YOU SHOULD CONTINUE TO MAINTAIN RECORDS, FILE RETURNS AND PAY VAT AS
REQUIRED BY THE A.P.VAT ACT 2005.

__________________CIRCLE.
55
FORM VAT 108
NOTICE OF CANCELLATION OF STARTUP BUSINESS STATUS
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02. TIN
03.Name :
Address:
I have to notify you that since you were registered as a start up business on _____________ , but
you have failed to make any taxable sales.
As TWENTY FOUR MONTHS have now elapsed since your registration as a start up business, I
propose to recommend cancellation of your registration.
You are therefore request to file your objections if any within 10 days of date of this notice failing which
your registration issued under AP VAT Act 2005 shall be cancelled without any further intimation to you
in the matter.

__________________CIRCLE.
56
FORM VAT 109
CANCELLATION OF START UP BUSINESS REGISTRATION
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02. TIN
03.Name :
Address:
You are advised by this office notice in Form VAT 108 (Notice of cancellation of Start up business
Status) dated _____________ that consequent on your failure to make taxable sales within prescribed
period, your registration is proposed to be cancelled.
Since you have not responded to the above notice, I confirm the cancellation of your registration as start
up business as well as VAT registration.

__________________CIRCLE.
57
FORM VAT 110
NOTICE OF LIABILITY FOR VAT REGISTRATION
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
Tax Office records indicate that you have a legal obligation to register for VAT. I am therefore, enclosing
a Form VAT 100 (Application for VAT registration) together with VAT leaflets 01 and 02 which explain
VAT registration requirements.
You must complete Form VAT 100 and return it to this Circle Tax Office within 10 days of the date of this
notification. Failure to do so will result in your business being compulsorily registered for VAT.
If you consider that you have no obligation to register, you should respond to this office in writing
specifying the reason you consider you are not required to register.

__________________CIRCLE.
58
FORM VAT 111
SUO MOTO VAT REGISTRATION

(See Rule 11(1)
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
You were advised on _____________ that you had a legal obligation to register for VAT. Since you have
neither replied to that letter nor applied for registration subsequently I am to notify you that you have been
registered with effect from_____________. You are required to account for VAT from that date.
Your Certificate of Registration is enclosed.

Your TIN is
You should use this TIN when you issue VAT invoices, on all documents related to VAT and in all
correspondence with the Commercial Taxes Department.
You have right to appeal against this order within 30 days of date of receipt of this order.

__________________CIRCLE.
59
FORM VAT 112
APPLICATION NOTIFYING CHANGES IN VAT REGISTRATION DETAILS
[ See Rule 13 ]

_____________________________________
_____________________________________
_____________________________________ 02. TIN
2(a).Name :
Address:
Present Proposed With effect from

03 Change in Name;

04 Change in
Address of Place
Of Business;

05 Change in address
of Branches/
godowns:

06 Change in Legal
Status:
( Use separate sheet to furnish the details of new persons & outgoing persons as applicable)
With effect from
07 Applied for CST Registration
* Use additional sheets wherever space provided is not sufficient
60
08 My business activities/ Principal Commodities traded have changed in the following respect:
a) Change in Business activities :___________________________
b) Principal Commodities now traded are: ______________________________
09 a) I commenced executing works contact for the State Government/local authorities from
_____________
b) I stopped executing works contact for the State Government / local authorities from
___________
10 My new Bank account details are herewith furnished
Bank Name:- _______________________________________________
Branch Name & Code :- _______________________________________________
Account Number:- ________________________________________________
11 Declaration:
I (Name)_____________________________Status (Title) ____________________________

of the above business hereby declare that the information given in this form is true and correct.
Date Month Year

Signature and Stamp ________________ Date of declaration
FOR OFFICE USE
12 Date of Receipt of Form VAT 112

13 Date of issue of VAT 110 (liability for new VAT registration)
(in case of proposal in box 6)
14 Date of issue of VAT 105 (VAT Registration Certificate)
(in case of proposals in boxes 3,4,5 & 7)
15 Date of recording in VAT registration and in the
VAT Dealer file.
ASST. COMMERCIAL TAX OFFICER, COMMERCIAL TAX OFFICER,

PROCESSING AUTHORITY, VAT REGISTERING AUTHORITY,
__________________CIRCLE. __________________CIRCLE.
61
FORM VAT 113
RESPONSE TO NOTIFICATION OF CHANGE IN VAT REGISTRATION DETAILS
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02. TIN
03.Name :
Address:
Your notification of change in registration details dated _______________ has been received.
I am to advise you as follows:
*(1) Your change in address has been noted, you should submit your VAT Registration Certificate to
this office so that an amended certificate can be prepared and issued.
*(2) Your change in name/legal status has been noted. I enclose herewith a Form VAT 121 to cancel
your current registration and a Form VAT 100 to apply for registration under your new name/legal
status.
*(3) I have received your notification of a change in composition of the partnership, director’s etc., but
have to advise you that cancellation of your registration is not appropriate. You must continue to
charge tax on your sales, file returns and pay VAT to the Tax Department.
*(4) Your change in business activities/ principal commodities traded has been recorded.
*(5) Your change in commencement / stopping of works contracts for the State Government and local
authorities has been recorded.
* (6) Your change in bank account details has been recorded.
* Strike off which is not applicable.

__________________CIRCLE.
62
CLAIM FOR CREDIT OF SALES TAX PAID FORM VAT 115
ON GOODS IN STOCK AT THE
COMMENCEMENT OF VALUE ADDED TAX ACT-2005
[ See Rule 37 (2)(b) ]
Date Month Year
_____________________________________
_____________________________________
_____________________________________ 02. TIN
03.Name :
Address:
04 Date of Stocktaking completed 05 Stock taken by

06 List of Goods in Stock at 01st April 2005 on which a credit claim made
Sl. Name of Description Quantity Invoice No. Value of the Rate of 90% in case Tax Sales Tax Sales tax
No. the supplier of goods on hand and Date goods held APGST value is Fraction Claimed credit
with Paid inclusive for refund Authorised
APGST of tax
RC No.
(Use separate sheets if the space is insufficient)

07 TOTAL CREDIT CLAIMED
08. DECLARATION
I ………………………… being ……………………….of ……………………………..
declare that the information given in this claim is true and correct.
Date Month Year
Signature & Stamp……………………………. Date of declaration
Complete in Duplicate
Please see notes on the reverse of this Form
64
FOR OFFICE USE ONLY
Date of claim received 09 Received by:

Name:…………………
Date of Official Stock check 10 Rank :…………………
Signature:
Result of Official Stock check 11 Checked by:
Name:…………………
Date of verification visit completed 12 Rank :…………………
Signature
Amount of credit authorized 13
Authorized by:
Date VAT 116 issued to VAT Dealer 14 Name:…………………
Rank :…………………
Claim refused, date of form 15 Signature
VAT 117 issued
NOTES FOR THE COMPLETION OF THE CLAIM FORM FOR SALES TAX CREDIT
Remember, if you are not registered for VAT, you are not eligible to make this claim
Box 01 Insert the name & Address of your tax office.
Box 02 Fill in your TIN number shown on your VAT Certificate of Registration.
Box 03 You should insert the name and address from your VAT Certificate of Registration.
Box 04 Insert the date your stock-taking.
Box 05 Insert the name of the person responsible for stock-taking.
Box 06 Complete the list of goods at stocktaking on which you wish to claim credit of tax. Each
column must be complete and you should continue on additional sheets if the space is insufficient.
Invoices should not be sent with the claim form but they must be retained and made available
for audit. Commercial Taxes Department Officers will visit your business to check the accuracy
of your stock-taking record. - see leaflet 20.
Box 07 Insert the total sum of credit claimed.
Box 08 Print the name of the PERSON signing the form, and add the TITLE of the person.
SIGN and DATE the declaration.
Box 09-15Are for completion by the Circle Tax Office.
Note: There are penal provisions for making a false declaration. This claim must be filed at the tax
office by 10th April 2005.
65
FORM VAT 116
NOTIFICATION OF SALES TAX CREDIT

[See Rule 37(2)(h)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02. TIN
03.Name :
Address:
Receipt of your claim in Form VAT 115 dated _____________ for credit of Sales Tax paid on goods in
stock at 01-04-2005 is acknowledged.
I am to advise you that you are authorized to claim a credit of _____________________. One sixth
of this sum should be claimed at box 08(b) of your VAT return for the month of August 2005 due to be
submitted in the month of September 2005. The balance should be claimed in five equal instalments in
the five following months.
You may only claim this amount if it is related to taxable VAT transactions.
(See VAT leaflet 04: What can I credit as Input Tax)

__________________CIRCLE.
66
CLAIM FOR CREDIT OF VAT PAID ON GOODS IN
FORM VAT 118
STOCK HAND AT THE TIME OF VAT REGISTRATION
[ See Rule 20 ]
Date Month Year
_____________________________________
_____________________________________
_____________________________________
02. TIN
03.Name :
Address:
04 Effective date of registration 05 Date stock-taking completed:
06. Name of the person responsible for stock-taking

07. List of goods on hand at the effective date of registration on which you wish to claim
credit of VAT already paid.
Sl Name of the Description Date of Purchase Rate of VAT credit

seller with of goods Invoice tax paid
No Quantity purchase Value claimed
TIN Number
(Use separate sheets if the space is insufficient)
08 TOTAL CREDIT OF VAT CLAIMED
68
09 DECLARATION
I…………………………………………status……………………………….of the above business
hereby declare that the information given in this claim is true and correct.
Date Month Year
Signature & Stamp………………… Date of declaration
FOR OFFICE USE ONLY

Date of claim received 10 Received by:
Name:………………………
Date of advisory / control visit 11 Rank:……………………….
Signature:
Result of visit 12
Checked by:
Name:……………………
Amount of credit authorized 13
Rank:…………………….
Date of VAT 119 issued to Signature
VAT dealer 14 Authorized by:
Name:…………………….
Date of VAT 120 issued to
VAT dealer 15 Rank:……………………..
Refusing claim Signature
Note: There are severe penalties for making a false declaration. This claim must be filed at
the tax office within 10 days from your date of notification of registration.
69
NOTIFICATION OF VAT CREDIT

[See Rule 20(1)]
01.Tax Office Address: Date Month Year

_____________________________________
_____________________________________
_____________________________________
02. TIN
03.Name :
Address:
Receipt of your claim in Form VAT 118 dated _____________ for VAT paid on goods in stock at the
effective date of your VAT registration is acknowledged.
I am to advise you that you are authorized to a VAT credit of Rs.______ as claimed by you.
This claim should be claimed at Box 08(b) of your first VAT return.

__________________CIRCLE.
70
APPLICATION FOR CANCELLATION OF VAT REGISTRATION FORM VAT 121
[ See Rule 14 (2) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN
03.Name :
Address:
I apply to cancel my VAT registration

with effect from 04 Date:
Reason(s) for the cancellation of registration: Delete (i) (ii) or (iii)

if not applicable)
(i) My business closed on: 05 Date:
(ii) The value of my taxable turnover over
the previous 3 calendar months was 06 Value:
And the value of my taxable turnover
over the previous 12 calendar months was 07 Value
(iii) I request to cancel my voluntary registration
which was registered with effect from. 08 Date:
The value of my taxable turnover over the
previous 3 calendar months was : 09 Value:
The value of my taxable turnover over the
previous 12 calendar months was: 10 Value:
The reasons for the application under (i), (ii) or (iii) above are:
……… ……
……… …………… ……
…… ……… ……… …………… …
…… ………………………………………………… ……………
……… ……………
……… ………………………………… …
…… …
… ……
…… ……
…… …………………… .
I undertake that I must account for VAT on any stock or assets on hand on which I have received refund
of input tax, and file a final tax return and pay the VAT due prior to the cancellation of my registration.
11 DECLARATION
I…………………………………………status……………………………….of the above
business hereby declare that the information given in this Form is true and correct.
Date Month Year
Signature & Stamp…………………………Date of declaration
Please see Notes on the Reverse of this Form
72
OFFICE USE ONLY
Date of application received 12
Checked arrears of VAT ...........................………………………………………………………...
Confirmation from Return Processing Section – Tax Arrears .……………...……………………….
Final Return issued .…………………………………………………....…………………………..
Final Return Received.……………………………………………………....……………………..
For Verification YES/NO
Date of cancellation from 13
Date of Form VAT 122 issued 14
Date of Form VAT 123 ( refusal of cancellation ) issued 15
Date of Form VAT 124 issued 16
ASST. COMMERCIAL TAX OFFICER, COMMERCIAL TAX OFFICER,

PROCESSING AUTHORITY REGISTERING AUTHORITY
________________ CIRCLE. __________________CIRCLE.
Box 01 Indicate name of the Tax Office.

Box 02 Insert the TIN number which you will find on your VAT Certificate of Registration.
Box 03 Insert the name and address shown on your VAT Certificate of Registration.
Box 04 Insert the date from which you are requesting cancellation of your registration.
Box 05 Insert the date of the business ceased.
Box 06 Insert the value of your taxable sales (excluding VAT ) for the previous 3 consecutive
calendar months.
Box 07 Insert the value of your taxable sales (excluding VAT) for the previous 12 consecutive
calendar months.
Box 08 Insert the date from which you were voluntarily registered.
calendar months if you were voluntarily registered.
calendar months if you were voluntarily registered.
Box 11 Insert the name and title of the person making the declaration. Finally sign and date of
declaration.
Box 12-16 ARE FOR COMPLETION BY THE TAX OFFICE.
73
FORM VAT 123
REFUSAL OF APPLICATION TO CANCEL VAT REGISTRATION

[ See Rule 14 (7) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN
03.Name :
Address:
Your application to cancel your VAT registration is refused because:

_______________________________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________
______________________________
You must continue to charge VAT on you sales, issue invoices when appropriate, maintain books and
records, file VAT returns and pay the tax due for each tax period.
You have the right to appeal against this order within 30 days of date of this order.

__________________CIRCLE.
75
FORM VAT 124
NOTIFICATION OF CANCELLATION OF VAT REGISTRATION

[ See Rule 14 (5) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN
03.Name :
Address:
1. * It is confirmed that your VAT registration has been cancelled with effect from ___________
You are reminded that should your taxable turnover exceed the registration limits in the future, you
must apply for registration.
2. *You are advised by this office notice in Form VAT 125 dated ___________ proposing cancellation
of your VAT registration indicating reasons therewith. Since you have not responded to the notice,
I am confirming the cancellation of your VAT Registration, which is effective from
______________.
You have the right to appeal against this order within 30 days of date of receipt of this order.

__________________CIRCLE.
76
NOTICE OF COMPULSORY CANCELLATION OF VAT REGISTRATION

[ See Rule 14 (8) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN
03.Name :
Address:
I have to advise you that your VAT registration is proposed to be cancelled with effect
from ____________ because: (Strike off statements not applicable / Tick appropriate boxes)
* You are not required nor entitled to apply for registration.
* You have not declared taxable sales since VAT registration over a period of three continuous
months.
* You have no fixed place of abode or business.
* You have failed to keep proper accounting records relating to your business activities.
* You have not submitted correct and complete VAT returns.
* You are required to file a final VAT return for the period ending ________________
enclosed herewith and account for VAT on any stock or assets on hand on which you have
received a refund of input tax.
* It is noted that you have arrears of VAT unpaid of________________payment of this
amount must be made with your final return.
YOU ARE REMINEDED THAT YOU MUST NOT CHARGE VAT
AND ISSUE TAX INVOICES AFTER _______________ You are requested to file written
objections if any along with documentary evidence within 10 days of date of this letter failing which
your VAT registration will be cancelled without any further notice.

__________________CIRCLE.
77
MONTHLY RETURN FOR VALUE ADDED TAX FORM VAT 200
(See Rule 23(1))
01 TIN 02 Period covered by this Return
From DD MM YY T o DD MM YY
03. Name of Enterprises:

Address :
Fax No. Phone No.
If you have made no purchases and no sales, cross this box. 04

If you have no entry for a box, insert '"NIL". Do not leave any box blank
unless you cross box 04.
Input tax credit from previous month
(Box 24 of 24(b) of your previous tax return) 05
PURCHASES IN THE MONTH Value excluding VAT
(INPUT) VAT (A) Claimed (B)
6 Exempt or non-creditable Purchases Rs
7 4% Rate Purchases Rs. Rs.
1
8 [14.5%] Rate Purchases Rs. Rs.
10 Special Rate Purchases Rs.
11 Total Amount of input tax (5+7(B)+8(B)+9(B) Rs.
SALES IN THE MONTH Value excluding VAT
(OUTPUT) VAT (A) Due (B)
12 Exempt Sales Rs
13 Zero Rate Sales - International Exports Rs.
14 Zero Rate Sales - Others (CST Sales) Rs.
15 Tax Due on Purchase of goods Rs. Rs.
16 4% Rate Sales Rs. Rs.
1
17 [14.5%] Rate Sales Rs. Rs.
18 Special Rate Sales
20 Total amount of output tax (15(B)+16(B)+
17(B) + 19(B) Rs.
21. If total of box 20 exceeds box 11 pay this amount Rs.
w.r.e.f. 15-1-2010.
427
22. Payment / Adjustment Details:
Details Challan / Date Bank/ Branch Amount
Instrument No. Treasury Code
Payment Details:
Adjustment
(Give Details in
22(a) )
Total
22(a). Adjustment Details:
Nature of Adjustment Details Amount
If total of box 11 exceeds total of box 20 (or the payment and adjustment in boxes 22 and 22(a) put
together exceed the tax due in box 21) and you have declared exports in box 13(A) and not adjusting the
excess amount against tax liability if any under the CST Act, you can claim a refund in box 23 or carry a
credit forward in box 24.
If you have declared no exports in box 13(A) you must carry the credit forward in box 24, unless you
have carried forward a tax credit and not adjusting the excess amount against the tax liability if any under
the CST Act.
Refund 23 Rs. Credit carried forward 24 Rs.

24(a) If you want to adjust the excess amount against the liability under
24(a) Rs.
the CST Act please fill in boxes 24(a) and 24(b) Tax due under
the CST Act and adjusted against the excess amount in box 24.
24(b) Net credit carried forward 24(b) Rs.
Declaration:
25. Name…………………………..being (title) ……………………… of the above enterprise do
hereby declare that the information given in this return is true and correct.
Signature & Stamp.......………. Date of declaration …………..………

Please Note:
1) This return and payment must be presented on or before 20th day of the following month mentioned in box 02.
2) In case the payment is made by a challan in the bank, please enclose a copy of the same.
3) You will be, as per provisions of the APVAT Act 2005, subject to penalties if you:
- Fail to file the VAT return at the Local Tax Office even if it is a nil return.
- Make a late payment of tax
- Make a false declaration.
FOR OFFICIAL USE ONLY:

Date of Receipt:
Amount of Tax Paid Rs.
Mode of Payment: Signature of Receiving Officer
With Stamp
91
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Division :
ANNEXURE TO VAT RETURN FOR THE MONTH OF

FORM VAT 200H
MARCH FOR THE PERIOD OF 12 MONTHS ENDING
MARCH FOR ADJUSTMENT OF SALES TAX RELIEF
This Form is to be filled up by VAT dealer having any of the following transactions, -
a) Sales of exempt goods (goods mentioned in Schedule I);
b) Stock transfers / consignment sales.
From DD MM YY To DD MM YY
03 Name of Enterprise ___________________________________________________________

Address ____________________________________________________________________
___________________________________________________________________________
Fax No: ____________________ Phone No: _____________
(i) Details of Turnovers
04 Amount of taxable sales – Sum of boxes – 13A,
14A,16A,17A & 19A of VAT 200 Rs.
05 Amount of sales of exempt goods in the 12-month period Rs.
06 Amount of exempt transactions in the 12-month period Rs.
(ii) Details of Sales tax relief / Transitional Relief (TR)

Inputs Amount of TR Eligible TR
approved (x) (y) = (x) x B/C
07 Amount of TR approved on Rs. Rs.
Form VAT 116
Note: To claim eligible sales tax relief, the following calculation is to be made:
A x B where A is value of sales tax relief approved on Form VAT 116
C B is value in box (04)
C is the sum of box (04), (05) and box (06)
(iii) Excess or balance Sales tax relief payable or eligible for the 12-month period ending
March
TR claimed in the TR eligible Excess (+) /
6 monthly returns as per (ii) Balance (-)
08 Sales tax relief (TR) Rs. Rs. Rs.
1. Any excess credit claimed in the monthly returns shall be paid back in the return for March by adding
it to the appropriate box in the out put column for the tax rate.
2. Any balance credit eligible in the monthly returns shall be claimed in the return for March by
adding it to the appropriate box in the input column for the tax rate.
Date: Signature of Dealer
102
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Division :
ANNEXURE TO MONTHLY VAT RETURN FOR

FORM VAT 200G
ADJUSTMENT OF SALES TAX RELIEF

03 Name of Enterprise _____________________________________________________________

Address ____________________________________________________________________
___________________________________________________________________________
Fax No: ____________________ Phone No: _____________
(i) Details of Turnovers in the tax period

04 Amount of taxable sales – Sum of boxes – 13A,
14A,16A,17A & 19A of VAT 200 Rs.
05 Amount of sales of exempt goods in the tax period Rs.
06 Amount of exempt transactions in the tax period Rs.
(ii) Details of Sales tax relief / Transitional Relief (TR)
Amount of TR TR eligible
as approved (x) (y) = (x) x B/C
07 Amount of TR approved on Rs. Rs.

Form VAT 116 to be claimed
in the tax period
Note: To claim eligible TR, the following calculation is to be made:

A x B where A is value of sales tax relief approved on
C Form VAT 116 for the tax period
B is value in box (04)
101
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Division :
ANNEXURE TO VAT RETURN FOR THE MONTH OF

FORM VAT 200F
MARCH FORTHE 12 - MONTH PERIOD ENDING MARCH
FOR ADJUSTMENT OF INPUT TAX CREDIT
[ See Rule 20(12) ]
This Form is to be filled up by VAT dealer having the following transactions, -
c) Turnover under composition
d) Exempt turnover of sub-contract under Rule 17(2)(j)
02 Period covered by this Form
01 TIN From DD MM YY To DD MM YY
(i) Details of Turnovers in the 12-month period

03 Amount of taxable sales -Sum of boxes – 13A, 14A, 16A, 17A & 19A of VAT
200(for box 16A exclude turnover under composition) Rs.
04 Amount of sales of exempt goods in the12-month period Rs.
05 Amount of exempt transactions in the period in the 12-month Rs.
06 Total turnover under composition Rs.
07 Exempt turnover of sub-contract under Rule 17(2)(j) Rs.
(ii) Details of Input tax paid, input tax credit claimed in the tax period
VAT paid on VAT Paid ITC eligible Total ITC

Inputs specific on common on common claimed
inputs (x) inputs inputs(y) 90% of (x+y)
08 1% rate purchases Rs. Rs. Rs.

10 12.5% rate Rs. Rs. Rs.
(4% portion) – 4/12.5 x value*
(8.5%portion)–8.5/12.5x value
* APPORTION 12.5% INTO 4 AND 8.5 PORTIONS ONLY IF YOU HAVE EXEMPT
TRANSACTIONS
1.Note: To claim eligible input tax credit (ITC eligible) for tax rates of 1%, 4% and 4% portion of 12.5%,
the following calculation is to be made:
A x B where A is value of common input for each tax rate
C is the sum of box (03), (04) , (05), (06) and (07)
99
2.Note: Where there are no exempt transactions in the tax period, apply the above formula for entire
12.5% for arriving at ITC eligible.
3.Note: To claim eligible input tax credit (ITC eligible) for tax rates of 8.5% portion of 12.5%, the
following calculation is to be made:
C B is sum in box (03) and (05)
C is the sum of box (03), (04) ,(05), (06) and (07)
(iii) Excess or balance Input tax credit for each tax rate payable or eligible for
the 12-month period ending March
ITC claimed in Difference between
Common inputs the 12 monthly ITC eligible as
(1) (3) and (4)
(2) returns per (ii)
Excess (+) /
(3) (4)
Balance (-)
13 12.5% rate purchases Rs. Rs. Rs.
1. Any excess credit claimed in the monthly returns shall be paid back in the return for
March by adding it to the appropriate box in the out put column for the tax rate.
2. Any balance credit eligible in the monthly returns shall be claimed in the return for
March by adding it to the appropriate box in the input column for the tax rate.
100
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Division :
ANNEXURE TO MONTHLY VAT RETURN FOR
FORM VAT 200E
ADJUSTMENT OF INPUT TAX CREDIT
[ See Rule 20(12) ]
This Form is to be filled up by VAT dealer having the following transactions, -
c) Turnover under composition
d) Exempt turnover of sub-contract under Rule 17(2)(j)
02 Period covered by this Form
01 TIN

03 Amount of taxable sales -Sum of boxes – 13A, 14A, 16A, 17A & 19A
of VAT 200 (for box 16A, exclude turnover under composition) Rs.
04 Amount of sales of exempt goods in the period Rs.
05 Amount of exempt transactions in the period Rs.
06 Total turnover under composition Rs.
07 Exempt turnover of sub-contract under Rule 17(2)(j) Rs.
VAT paid on VAT Paid on ITC eligible Total ITC
Inputs specific inputs common on common claimed
(x) inputs inputs(y) 90% of (x+y)

(4% portion) – 4/12.5 x value*
(8.5%portion)–8.5/12.5x value
*APPORTION 12.5% INTO 4 AND 8.5 PORTIONS ONLY IF YOU HAVE EXEMPT
TRANSACTIONS
C is the sum of box (03), (04), (05),(06) and (07)
2. Note: Where there are no exempt transactions in the tax period, apply the above formula for entire
12.5% for arriving at ITC eligible.
3.Note: Where exempt transactions are made in the tax period, total 8.5% portion of 12.5% can be
taken as ITC.
98
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Division :
DECLARATION BY A VAT DEALER SHOWING

FORM VAT 200D
BREAK-UP OF SALES AND INPUT TAX
(See Rule 20(4)(a))

(i) Details of Turnovers in the Tax period

03 Amount of taxable sales -Sum of boxes –
13A, 14A, 16A, 17A & 19A of VAT 200 Rs.
04 Amount of sales of exempt goods in theTax period Rs.
05 Amount of exempt transactions in the Tax period Rs.
(ii) Details of Input tax paid and claimed in the tax period
Inputs VAT paid on VAT Paid on Total
specific inputs common inputs eligible ITC
(x) (y) (x)+(y)
97
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Division :
FINAL RETURN ON CANCELLATION OF
VAT REGISTRATION FORM VAT 200C
[See Rule 23 (4)]
03.Name of Enterprises:
Address:
Fax No. Phone No.
If you have made no purchases and no sales, cross this box. 04

If you have no entry for a box, insert “NIL”. Do not leave any box blank unless you cross box 04.
Input tax credit from previous month (Box 24 or 24 (b) 05
of your previous tax return)
PURCHASES IN THE MONTH value excluding VAT VAT claimed

(INPUT) (A) (B)
6 Exempt or non-creditable Purchases Rs.
8 12.5% Rate Purchases Rs. Rs.
10 Special Rate Purchases Rs.
11 Total Amount of input tax (5+7(B)+8(B)+9(B)) Rs.
SALES IN THE MONTH value excluding VAT VAT due
(OUTPUT) (A) (B)
12 Exempt Sales Rs.
13 Zero Rate Sales – International Exports Rs.
14 Zero Rate Sales – Others (CST Sales) Rs.
15 Tax Due on Purchase of goods Rs. Rs.
17 12.5% Rate Sales Rs. Rs.
18 Special Rate Sales Rs. Rs.
19 1% Rate Sales Rs Rs.
20 Total amount of output tax (15(B)+16(B)+
17(B) + 19(B) Rs.
21 If total of box 20 exceeds box 11 pay this amount Rs.
95
22. Payment / Adjustment Details:
Details Challan / Date Bank/ Branch Amount
Instrument No. Treasury Code
Payment Details:
Adjustment
(Give Details in
22(a) )
Total
22(a). Adjustment Details:
Nature of Adjustment Details Amount
If total of box 11 exceeds total of box 20 (or the payment and adjustment in boxes 22 and 22(a) put
together exceeds the tax due in box 21) and you have declared exports in box 13(A) and not adjusting the
excess amount against tax liability if any under the CST Act, you can claim a refund in box 23 or carry a
credit forward in box 24.
If you have declared no exports in box 13(A) you must carry the credit forward in box 24, unless you
have carried forward a tax credit and not adjusting the excess amount against the tax liability if any under
the CST Act.
Refund 23 Rs. Credit carried forward 24 Rs.
24(a) If you want to adjust the excess amount against the liability under 24(a) Rs.
the CST Act please fill in boxes 24(a) and 24(b) Tax due under
the CST Act and adjusted against the excess amount in box 24.
24(b) Net credit carried forward 24(b) Rs.
Declaration:
25. Name…………………………..being (title) ……………………… of the above enterprise do

hereby declare that the information given in this return is true and correct.
Signature & Stamp…………. Date of declaration …………..……………
Please Note:
1) This return and payment must be presented on or before 20th day of the following month mentioned
in box 02.
2) In case the payment is made by a challan in the bank, please enclose a copy of the same.
3) You will be, as per provisions of the APVAT Act 2005, subject to penalties if you:
- Fail to file the VAT return at the Local Tax Office even if it is a nil return.
- Make a late payment of tax, - Make a false declaration.
FOR OFFICIAL USE ONLY: Date of Receipt:
Amount of Tax Paid Rs.

Mode of Payment: Signature of Receiving Officer
With Stamp
96
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Division :
ANNEXURE TO VAT RETURN FOR THE MONTH FORM VAT 200B

OF MARCH FOR THE 12 - MONTH PERIOD
ENDING MARCH FOR ADJUSTMENT OF INPUT TAX CREDIT
(See Rules 20(4)(b), (5)(c), (6), (7), (8)(b), (9)(b)

(i) Details of Turnovers in the 12-month period

13A, 14A, 16A, 17A & 19A of VAT 200 Rs.
04 Amount of sales of exempt goods in the12-month period Rs.
05 Amount of exempt transactions in the period in the 12-month Rs.
(ii) Details of Input tax paid, eligible input tax credit for the 12-month period
Inputs VAT paid VAT Paid ITC eligible Total

on specific on common on common eligible ITC
inputs inputs inputs (x)+(y)
(x) (y)
(4% portion) –
4/12.5 x value*
(8.5%portion)–
8.5/12.5x value*
* APPORTION 12.5% INTO 4 AND 8.5 PORTIONS ONLY IF YOU HAVE EXEMPT
TRANSACTIONS
93
12.5% for arriving at ITC eligiblity.
3.Note: To claim eligible input tax credit (ITC eligible) for tax rates of 8.5% portion of 12.5%, the following
calculation is to be made:
C B is sum in box (03) and (05)
(iii) Excess or balance Input tax credit for each tax

rate payable or eligible for the 12-month period ending March
(1) Common ITC claimed ITC eligible Difference between

inputs in the 12 as per (ii) (3) and (4)
(2) monthly Excess (+) /
returns Balance (-)
(3) (4) (5)
11 12.5% rate purchases Rs. Rs. Rs.
1. Any excess credit claimed in the monthly returns shall be paid back in the return for March by
adding it to the appropriate box in the output column for the tax rate.
2. Any balance credit eligible in the monthly returns shall be claimed in the return for March by adding
it to the appropriate box in the input column for the tax rate.
94
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Division :
ANNEXURE TO MONTHLY VAT RETURN

FORM VAT 200A
FOR ADJUSTMENT OF INPUT TAX CREDIT
(See Rules 20(6), (7), (8)(b), (9)(b))
This Form is to be filled up by VAT dealer having any of the following transactions -


13A, 14A, 16A, 17A & 19A of VAT 200 Rs.
04 Amount of sales of exempt goods in the period Rs.
05 Amount of exempt transactions in the period Rs.
Inputs VAT paid on VAT Paid on ITC eligible on Total ITC
specific inputs common inputs common inputs claimed
(x) (y) (x)+(y)
(4% portion) –
4/12.5 x value*
(8.5%portion)–
8.5/12.5x value*
* APPORTION 12.5% INTO 4 AND 8.5 PORTIONS ONLY IF YOU HAVE EXEMPT TRANSACTIONS
12.5% for arriving at ITC eligiblity.
3.Note: Where exempt transactions are made in the tax period, total 8.5% portion of 12.5% can be taken
as ITC.
92
DEMAND FOR UNPAID VALUE ADDED TAX

[ See Rule 24 (4) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
Tax Office record indicates that VAT which was due on the following dates remains unpaid.
DATE DUE ASSESSMENT/RETURN AMOUNT OUTSTANDING
You are requested to pay the above amount outstanding with in 15 days from the date of this notification.
You are reminded that any amounts of tax outstanding after the due date for payment shall be liable to a
penalty of 10 percent of the amount and interest will also be charged at the rate of 1% per month for each
day the payment is delayed.
YOU ARE REMINDED THAT THE APVAT ACT 2005 EMPOWERS THE TAX DEPART-
MENT TO CONFISCATE AND SELL YOUR GOODS TO RECOVER UNPAID TAX.

_________________CIRCLE
Note:- Complete in duplicate.
104
UNILATERAL ASSESSMENT FOR FAILURE TO FILE A VAT RETURN

(See Rule 25(1))
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
There is no record of the receipt in the Tax Department of a VAT Return for the period of_______________
due by _____________
The Tax Office has accordingly unilaterally assessed the tax payable by you for this period as
Rs.______________ In addition the law requires that you pay 50% of this amount as a penalty which is
Rs.___________________
Total tax due is Rs. __________________________
This amount must be paid by ______________unless you file the tax Return that is due and pay the tax
declared on the return. If you file the outstanding return at the Tax Office and pay the tax due by
______________ this unilateral assessment will be withdrawn.
IF YOU HAVE FILED A RETURN AND PAID THE TAX DUE YOU SHOULD NOTIFY THE TAX OFFICE WITHOUT
DELAY.
Failure to make payment of this unilateral assessment will result in recovery measures being taken as
provided for in the AP VAT Act 2005.
DO NOT ADJUST ANY FUTURE VAT RETURN TO ACCOUNT FOR THE TAX SHOWN ON THIS NOTICE OF
ASSESSMENT.

_____________________CIRCLE,
___________________DIVISION.
107
APPLICATION FOR UNDER / OVER
FORM VAT 213
DECLARATION OF VALUE ADDED TAX
[See Rule 23(6)(a)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
Examination of my records has shown that the correct amount of Value Added Tax in the return for tax
period __________ was * under declared / over-declared. Please find a true and correct summary of
my monthly Return as below. The errors were caused by _________
Tax Period Input Tax Output Input Tax Output Tax Under / Total
declared Tax found to Tax found Over - Amount
declared be correct to be declared Payable /
correct Creditable
I (Name) ___________________being (Title___________________________of the above business

do hereby declare that the information given on this form is true and correct.
Signature/Stamp Date of Declaration____________
PLEASE DO NOT ADJUST ANY FUTURE RETURN FOR THE TAX SHOWN ON THIS FORM.
Complete in Duplicate.
Signature &
Status
* Strike off which ever is not applicable
115
ANNEXURE TO MONTHLY VAT RETURN
FORM VAT 225
[See Rule 23(8)]
Return to be filled by VAT Dealers for special category of goods notified
by the Commissioner of Commercial Taxes / required by the
Dy.Commissioner(CT) concerned
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
04. Period from to
05 Purchases in the period Value
Sl. Name of the Dealer TIN No Invoice No Date Commodity Purchase Value
No from whom
purchased
Signature of VAT Dealer / Authorised person and status
116
1
FORM VAT 226A
QUARTERLY RETURN OF PURCHASES FROM VAT DEALERS

[See Rule 23(10)]
Return to be filed by VAT Dealers for each quarter furnishing the information relating to
purchases made from other VAT dealers in the state of Andhra Pradesh.
Date Month Year

01. Tax Office
Address:…………………………………
……………………………………………
……………………………………………
02 TIN
03. Name ____________________________________________________________________________

Address_____________________________________________________________________________
_____________________________________________________________________________
04. Period - Quarter ending March/June/ September/ December. Year
5. Purchases in the period
Sl. Name of the Dealer from whom TIN No of invoices Purchase Value
No purchased (in Rupees)
Excluding VAT
Signature of VAT Dealer /

Authorized person and status
* Data to be given for each tax rate separately.
1. Added by G.O.Ms.No. 517 Rev. (CT-II) Dept., dt. 23-4-2007, w.e.f. 1-4-2007.
1
FORM VAT 226B
QUARTERLY RETURN OF SALES TO OTHER VAT DEALERS

[See Rule 23(10)]
Return to be filed by VAT Dealers for each quarter furnishing the information
relating to sales made to other VAT dealers in the state of Andhra Pradesh.
01. Tax Office Address Date Month Year

…………………………………………
…………………………………………
…………………………………………
…………………………………………
02 TIN
03. Name _________________________________________________________________________________

Address ________________________________________________________________________________
___________________________________________________________________
04. Period - Quarter ending March/June/ September/ December. Year
5. Sales in the Quarter:
Sl. No Name of the Dealer to TIN No of invoices Sale Value

whom goods are sold (in Rupees)
excluding VAT

1
FORM VAT 227A
QUARTERLY RETURN OF PURCHASES FROM TOT DEALERS

[See Rule 23(10)]
Return to be filed by VAT Dealers for each quarter furnishing the information relating to purchases
made from TOT dealers in the state of Andhra Pradesh.
01. Tax Office Date Month Year

Address:………………………………..
…………………………………
…………………………………
02 TIN
03. Name ____________________________________________________________________________________

Address _________________________________________________________________________________
____________________________________________________________________________
04. Period from to
5. Purchases in the period
Sl. Name of the Dealer GRN No of invoices Purchase Value

No from whom (in Rupees)
purchased the goods

1
FORM VAT 227B
QUARTERLY RETURN OF SALES TO TOT DEALERS

[See Rule 23(10)]
Return to be filed by VAT Dealers for the each quarter furnishing the information relating to
sales made to TOT dealers in the state of Andhra Pradesh.
01. Tax Office Date Month Year

Address:……………………………
………………………………
…………………………………
02 TIN
03. Name _________________________________________________________________________________

Address __________________________________________________________________
__________________________________________________________________
04. Period from to
5. Sales in the period
Sl. Name of the Dealer to whom the GRN No of Sale Value

No goods are sold invoices (in Rupees) (Excluding VAT)

1
FORM VAT 228A
QUARTERLY RETURN OF SALES TO UN-REGISTERED DEALERS

[See Rule 23(10)]
Return to be filled by VAT Dealers for the each quarter furnishing the information relating
to sales made to un-registered dealers in the state of Andhra Pradesh.
Date Month Year

01. Tax Office Address:………….
…………………………………
…………………………………
02 TIN
03. Name _________________________________________________________________________________

Address ________________________________________________________________________________
_________________________________________________________________________________
04. Period from to
5. Sales in the period :
Sl. Name of the Dealer to whom No of invoices Sale Value

No the goods are sold (in Rupees) (excluding VAT)


APPLICATION OPTING FOR PAYMENT OF TAX
BY WAY OF COMPOSITION FORM VAT 250
[See Rules 17(2)(b), 17(3)(c), 17(4)(b) & 19(5)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
I / we carrying on business as a*works contractor /as a hotelier do hereby apply to pay sales tax by way
of composition.
* i) At the rate of 4% on the total value of the contract executed for the Government or local Authority
subject to such conditions as may be prescribed.
* ii) At the rate of 4% on 50% of the total consideration received or receivable for the contract other
than State Government and local authorities subject to such conditions as may be prescribed.
* iii) At the rate of 4% on 25% of the consideration received or receivable or the market value fixed for
the purpose of stamp duty whichever is higher, for the contract of constructing and selling of residential
apartments, houses, buildings or commercial complexes subject to such conditions as may be
prescribed.
* iv) At the rate of 12.5% on 60% of the total consideration charged for food and drink to such conditions
The details of contracts for which composition is opted for are given below:
Sl.No. Name & Address Nature of Contract Date of Full value of the
of the Contractee Contract Contract
Signature of the Dealer,

Stamp and Seal
(* Strike off whichever is not applicable)
117
APPLICATION FOR WITHDRAWAL FOR PAYMENT
OF TAX BY WAY OF COMPOSITION FORM VAT 250A
[Rules 17(3)(c),17(4)(c) & 19(5)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.TIN
03.Name :
Address:
I / We carrying on business as works contractor * involving contract to other than Government and local
authorities / construction and selling of residential apartments, houses, buildings or commercial complexes
etc., / hotelier, have opted for composition scheme for payment of tax vide my application in Form VAT
250 Dated ____________ and am/are accordingly paying the taxes regularly.
I / we intend to withdraw the option of composition with effect from _____________ (last day of the
month) which may please be accepted.
From ___________ (First day of the month) onwards I / we shall be accounting the VAT taxes due under
the provisions of Section ____ of APVAT Act 2005.
Signature of the Dealer,

Stamp and Seal
(* Strike off whichever is not applicable)
118
FORM VAT 305
ASSESSMENT OF VALUE ADDED TAX
[ See Rule 25(5) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN
03.Name :
Address:
Upon examination of your records on ____ and the issue of Form VAT 305A on ____ the correct amount
of VAT under the provisions of AP VAT Act 2005 has been determined as follows.
* This has resulted from : -
1. Your agreement at the time of visit on ______________
2. After consideration of your reply received in this office on ________________
3. Your failure to respond to the notice issued on Form VAT 305 A on ____________
The total amount payable by you is explained below:
Tax Particulars Tax Tax Tax Over Tax under Penalty Interest Total Due
Period (input tax / declared/ Found declared declared ……..% @ 1% of to Tax
output tax) net credit / to be due/ Due to Due to .. month(s) Department
Or Refund net credit/ dealer Tax
Claimed Or Refund Department
due
Total amount due to Tax Department

*Delete as appropriate
126
Explanation for the above proposals:
*A The amount of _________shall be paid within 30 days of receipt of this order. Failure to make the
payment will result in recovery proceedings under the AP VAT Act 2005.
*B Your refund claim is reduced to _________ and this amount will be refunded to you.
THE PROOF OF PAYMENT OF THE AMOUNT SPECIFIED AT ‘A’ ABOVE TOGETHER WITH
DUPLICATE COPY OF THIS ORDER AND PAYMENT BOXES COMPLETED SHALL BE
SUBMITTED WITHIN THE SPECIFIED TIME LIMIT.
An appeal against this order can be filed before the Appellate Deputy Commissioner within 30 days of
receipt of this order.

__________________CIRCLE.
ON DUPLICATE COPY OF THE ORDER

Payment details:
Challan/Instrument No. Date Bank / Treasury Branch Code Amount
127
NOTICE OF UNDER DECLARATION OF
FORM VAT 307
VALUE ADDED TAX
[See Rule 23 (6)(b)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
On examination of your application on Form VAT 213 Dated ____________ it is noticed that you have
under declared the VAT. The same is now considered and interest payable by you on such under declared
tax is calculated as shown below:
Tax Period Tax Declared Tax found to Tax Interest

on returns be correct as Under- @ 1% per
per your declared month
application
Total
The amount under-declared shall be paid along with interest calculated within 30 days of receipt of this
notice.
Failure to make payment will result in recovery proceedings under the AP VAT Act 2005.

__________________CIRCLE.
130
FORM VAT 308
NOTICE OF OVER-DECLARATION OF VALUE ADDED TAX
[See Rule 23 (6)(b)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
On examination of your application on Form VAT 213 Dated ___________ it is noticed that you have
over declared VAT due. The same is now considered and allowed to claim as credit as following:
Tax Period Input Tax Output Input Tax Output Tax Under / Total
declared Tax found to Tax found Over Amount
declared be correct to be declared Payable /
correct Creditable
You are requested to adjust the amount of credit due in the next VAT return due to be filed after the receipt
of this notice.

__________________CIRCLE.
131
FORM VAT 351
NOTICE OF CLAIM FOR REFUND BY A VAT DEALER.

(See Rule 35(9) (a))
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN
03.Name :
Address:
It is to inform you that an amount of Rs.________ (Rupees __________ ____ ) has been due from the
department as refund in pursuance of order of assessment / order passed in appeal or revision.
The above refund has been adjusted towards tax / penalty / interest for an amount of Rs._____________
( Rupees ________________________________________)
The total / balance amount of refund of Rs.__________ ( Rupees ___________ _____________ only)
is due from the department.
Therefore you are requested to confirm the above claim of refund within 15 days from the date of this
notice in Form VAT 352

Designation, Stamp & Seal
137
CONFIRMATION OF THE CLAIM OF REFUND
FORM VAT 352
(See Rule 35(9) (b))
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
Ref: Notice for claim of refund in Form VAT 351 Dated_________________________

I have received the notice cited in the reference and confirm that:
* The total Refund amount Rs. _________ ( Rupees ________________________

_________________________only) is due from the department.
* After adjustment of Rs.___________ ( Rupees __________________

______________________only) towards tax / penalty / interest the balance amount Rs. _________
( Rupees _________________only) is due from the department.
(* Delete which is not appropriate)
Signature of the Dealer

Status,Stamp & Seal
138
CONFIRMATION OF THE CLAIM OF REFUND
FORM VAT 352
(See Rule 35(9) (b))
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
Ref: Notice for claim of refund in Form VAT 351 Dated_________________________

I have received the notice cited in the reference and confirm that:
* The total Refund amount Rs. _________ ( Rupees ________________________

_________________________only) is due from the department.
* After adjustment of Rs.___________ ( Rupees __________________

______________________only) towards tax / penalty / interest the balance amount Rs. _________
( Rupees _________________only) is due from the department.
(* Delete which is not appropriate)

Status,Stamp & Seal
138
APPLICATION FOR CLAIM OF REFUND
FORM VAT 360
FOR THE TAX PAID ON SALES OR PURCHASES
OF GOODS SPECIFIED UNDER SECTION 4(2)
[ See Rule 35(10) (c) & (e) ]
Date Month Year
_____________________________________
_____________________________________
_____________________________________
02.TIN
03.Name :
Address:
I /We request that under the provisions of Rule 35(10) of the Andhra Pradesh Value Added Act, 2005, I/We
may be granted refund of the tax paid under the Act in respect of goods, the particulars of which are given
in the Schedule below:-
04 Serial Number
05 Name and address of the dealer who paid tax under
Section 4(2) of the Act
06 GRN of the dealer
07 Date of sale of goods by the dealer who paid the tax
under Section 4(2) of the Act
08 Description of the goods and Quantity
09 Amount of tax paid Rs.
10 Date of commencement of inter-State movement
or the date of inter-State sale
11 Amount for which the applicant sold the goods Rs.
12 Challan number and date of remittance of Central
Sales Tax paid in respect of the goods
Place: Signature
Date: Status & Relationship to the dealer
142
FORM OF APPEAL UNDER SECTION 31 FORM APP 400
[See Rule 38(2)(a) ]
01.Office Address: Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN/GRN
03.Name :
Address:
I wish to appeal against the following decision / assessment received from the tax office on_________
04. Date of filing of appeal
05. Reasons for delay (if applicable enclose a
separate sheet)
06. Tax Period / Tax Periods
07. Tax Office decision / assessment Order No:
Date/Authority who passed orders
08. Grounds of the appeal (use separate
sheet if space is insufficient)
09. If Turnover is disputed:
a) Disputed turnover Rs.
b) Tax on the disputed turnover Rs.
10. If rate of tax is disputed:
a) Turnover involved Rs.
b) Amount of tax disputed Rs.
11. 12.5% of the above disputed tax paid Rs.
(The payment particulars are to be enclosed if already paid along with the reasons on Form APP 400A)
10. Payment Details:
Challan / Date Bank / Treasury Branch Code Amount Instrument
No.
TOTAL
143
Declaration:
I hereby declare that the information provided on this form to the best of my knowledge is true and
accurate. Name_________________Being (title)_____________________
Signature of the Appellant

& Stamp. Date of declaration______________
Please Note: A false declaration is an offence.
Enclosure:- 1) Original Notice of Decision / Assessment
2) Proof of payment of disputed tax.

3) Reasons for delay (if applicable)
4) Reasons for not paying the disputed tax on Form APP 400A (if applicable)
144
DECLARATION FORM APP 400A
[ See under Section 31(1)] [ Rule38 (2)(d)]
Date Month Year
TIN/GRN
From To
______________________________________ ______________________________________
______________________________________ ______________________________________
______________________________________ ______________________________________
I/We ________________________ S/o, D/o, W/o ____________________________ appellant

named in the appeal preferred herein as ______________________________ (Dealer/Firm Name)
with TIN/GRN _______________________ hereby declare that
* the tax admitted to be due, or of such instalments as have been granted and the payment of 12.5% of the
difference of tax assessed by the authority have been paid, for the relevant tax period in respect of which
the appeal is preferred, the details of which are given below.
* no arrears are due from me for the relevant tax period for which appeal is preferred due to the reasons:
_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
________________________________________________________________________________________________________________________________________________________
Total Tax Paid:

a) Cheque/DD particulars : Number _______________ Date_________________
Bank _______________Branch_______________
b) Cash Particulars : Receipt No:_______________Date: __________________
c) Challan particulars : Challan No: _________________ Date________________
Name of the Treasury ___________________________
Signature
(* Strike off whichever is not applicable) Status and relationship to the dealer
145
REVIEW IN THE HIGH COURT OF ANDHRA PRADESH
FORM APP 405
AT HYDERABAD (APPELLATE SIDE)
Memorandum of Civil Miscellaneous Petitions
[ Under Section 35(4) ] [ See Rule 48 ]
Civil Miscellaneous Petition No.
Appellant Versus Respondent
Petition for review of the order of the High Court dated ______________ and passed in appeal against
Order No.
1 Number and date of the order of the

High Court now sought to be reviewed
2 Date of communication of the order
3 Question of fact decided by the High Court
4 Question of law decided by the High Court
5 Fresh facts which were not before the

High Court when it passed the original order
(state the fact without a narrative)
6 Question of fact now raised etc.,
7 Question of law now raised etc.,
(Signed) Authorised Representatives if any
151
REVIEW IN THE HIGH COURT OF ANDHRA PRADESH
FORM APP 404
AT HYDERABAD (APPELLATE SIDE)
Memorandum of Civil Miscellaneous Petitions
Civil Miscellaneous Petition No.
Appellant Versus Respondent
Petition for review of the order of the High Court dated and passed in Civil Revision
Petition No:
1. Number and date of order of the

High Court now sought to be reviewed
2. Date of communication of the order
Court (here formulate the decision of
High Court concisely)
4. Fresh facts which were not before the
High Court when it passed the original
Order (state the fact without a narrative)
5. Question of law now raised etc.,
VERIFICATION
I/We the _______________________________appellant(s) do hereby declare that what is stated above
is true to the best of my/our knowledge and belief.
Verified to day the _________day of_____________________200
Note: 1. The petition should be accompanied by a certified copy of the order of the High Court sought
to be reviewed.
2. The petition should (if preferred by a dealer) be accompanied by a fee of Rs.100/-
3. The petition should be written in English and should set forth concisely and under distinct heads,
the facts of the case, the findings arrived at by the Tribunal, and the questions of law, raised
consecutively. There should be no argument or narrative.
150
BEFORE THE HIGH COURT OF ANDHRA PRADESH AT HYDERABAD
(APPELLATE SIDE)
Memorandum of Appeal against Order FORM APP 403
[ Under Section 35 ] [ See Rule 47 ]
Appeal against the order of the (Commissioner of Commercial Taxes ) dated and passed in
1. Name, address and TIN/GRN No. of
the Dealer
2. Tax period / Tax periods
3 Authority passing the original order
4 State if the order was modified at any
time previously by any officer subordinate
to the (Commissioner of Commercial
Taxes) and if so in what manner
(state the results of modification briefly)
5 Date of communication of the order of the
(Commissioner of Commercial Taxes).
6 Address to which notice may be sent
to the Appellant
to the respondent
8 Relief claimed in appeal-
a) Taxable turnover determined by the
assessing authority Rs.
b) Taxable turnover modified prior
to Suo Motu by the
(Commissioner of Commercial Taxes) Rs.
c) Relief claimed Rs.
d) Grounds of appeal-
i) State the facts disputed briefly
ii) State the question of law raised for
decision by the High Court
VERIFICATION
I/We the ______________________ petitioner(s) do hereby declare that what is stated above is true to
the best of my/our knowledge and belief. Verified to day the ________day of___________________200
Note: 1. The appeal should be accompanied by a certified copy of the order of the (Commissioner of
Commercial Taxes) appealed against.
2. The appeal should be accompanied by a fee calculated at the rate of two percent of the
disputed tax and surcharge or penalty subject to a minimum of Rs.500/- and a maximum of
Rs.2,000/-
3. The appeal should be written in English and should set forth concisely and under distinct heads,
the facts of the case, the grounds of appeal and the points of law raised consecutively.
149
REVISED PETITION IN THE HIGH COURT OF
FORM APP 402
ANDHRA PRADESH AT HYDERABAD (APPELLATE SIDE)
Memorandum of Civil Revision Petition
Civil Revision Petition No:
Petitioner Versus Respondent

Revision petition presented to the High Court to revise the order of the Sales Tax Appellate Tribunal.
Date and passed in
1. Name, address and TIN/GRN No.

of the Dealer
3 The designation of the officer whose orders were
appealed against before the Appellate Tribunal
of the Appellate Tribunal.
5 Findings of the Appellate Tribunal (State
in serial and appropriate order the relevant
findings arrived at by the Tribunal).
6 Questions of law raised for decision
by the High Court (Here formulate
the questions of law raised concisely, etc.,
VERIFICATION
I/We the _____________ petitioner(s) do hereby declare that what is stated above is true to the best of
my/our knowledge and belief. Verified to day the ______day of_____200
Note:1. The petition should be accompanied by a certified copy of the order of the Appellate Tribunal.
2. The petition should (if preferred by a dealer) be accompanied by a fee of Rs.500/-
3. The petition should be written in English and should set forth concisely and under distinct heads the
facts of the case, the findings arrived at by the Tribunal, and the questions of law, raised consecutively.
There
148
FORM OF APPEAL MEMORANDUM
FORM APP 401
TO THE APPELLATE TRIBUNAL
[ Under Section 33 ] [ See Rule 44(1)(a) ]
In the Sales Tax Appellate Tribunal,
Andhra Pradesh
No. of 200
Appellant(s) Versus Respondent
1. Name, address and TIN/GRN

No. of the Dealer
3 Authority passing the original order
in dispute.
4 Appellate Deputy Commissioner of

Commercial Taxes passing the order
under Section ____or the Deputy
Commissioner or Joint Commissioner
(Commercial Taxes) Legal,
passing an order under Section_____

now appealed against

to the Appellant
7 Address to which notices may be
sent to the Respondent
8 Relief claimed in appeal:

a) Taxable turnover determined by the
assessing authority passing the
assessment order disputed.
b) Taxable turnover confirmed by
(Appellate Deputy Commissioner
of Commercial Taxes or by
Deputy Commissioner or Joint
Commissioner (Commercial Taxes)
as the case may be)
146
c) If taxable turnover is disputed
i) disputed taxable turnover
ii) tax due on the disputed taxable turnover
d) If rate of tax is disputed:
i) taxable turnover involved Rs.
ii) amount of tax Rs.
e) Specify, if any, other relief claimed
9 Grounds of appeal etc.,
VERIFICATION
I/We the appellant(s) do hereby declare that what is stated above is true to the best of my/our knowledge
and belief.
Verified to day the ________day of_______________________200
Note: 1. The appeal should be in quadruplicate and should be accompanied by our copies (at least one
of which should be original or an authenticated copy) of the order appealed against and also
three copies of the order of the assessing authority.
2. The appeal should be accompanied by a treasury receipt in support of having paid:
a) In case where the levy of tax or penalty is disputed a fee calculated at the rate of two
percent of the disputed tax or penalty subject to a minimum of Rs.100/- and a maximum
of Rs.2,000/-; and
b) In all other cases a fee of Rs.100/-
3. The appeal should be written in English and should set forth concisely and under distinct heads
the grounds of appeal without any argument or narrative and such grounds should be numbered,
consecutively.
147
CERTIFICATE OF TAX COLLECTION AT SOURCE
FORM 501
[See Rule 17(2)(d) & (2)(f) ]
Date Month Year
_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
I / We _________________________________ certify that a sum of Rs._____________ was collected
being the amount payable by M/s._________________________________
03.TIN / GRN towards Value Added Tax collected at the rate

of 4% on the total value of the contract and the amount has been paid to the sales tax (Major Head 040)
credit of Government of Andhra Pradesh.
04. Date of the Contract / supply order

05. Nature of Contract / Supply order
06. Full Value of Contract / Supply order
07. Bill No. / Voucher Cash Memo and Date
08. Amount paid in the bill and Date of payment
09. Amount of Value Added Tax Collected
@ 4% of Col.8 above
10. Remittance Particulars to the Government.
Signature of the Officer /Person responsible for

Collection of amount / remittance to Commercial
Taxes Department with Seal
154
CERTIFICATE OF TAX DEDUCTION AT SOURCE
FORM 501A
[See Rules 17(1)(f), 17(3)(e) & 18(1)(b) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
I / We ________________________________ certify that a sum of Rs._____________ was collected

being the amount payable by M/s._____________________________________________________
03.TIN / GRN towards Value Added Tax deducted at the rate of 2%
on the total value of the contract and the amount has been / will be paid to the sales tax (Major Head 040)
credit of Government of Andhra Pradesh.
04. Date of the Contract / supply order

05. Nature of Contract / Supply order
06. Full Value of Contract / Supply order
07. Bill No. / Voucher Cash Memo
08. During the month / year
09. Amount of Value Added Tax deducted
10. Remittance Particulars
Signature of the Officer / Person responsible

for deduction of amount / remittance to
Commercial Taxes Department with Seal
155
DECLARATION OF A VAT DEALER AVAILING
INDUSTRIAL INCENTIVES FORM 502
[ See Rule 67(4) ]
Date Month Year
_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
04. Tax period from to
05. Details of Industrial Incentives eligibility certificate:
06. Details of availment:
Total amount Incentives availed Incentive availed Balance Remarks

of eligibility up to last month in this month
1. 2. 3. 4. 5.
07. Declaration
Name ________________________ S/o / D/o ___________________________________being
(title)_________________________________________ of the above enterprise do hereby declare
that the information given on this document is true and correct.
Date of declaration ______________ Signature & Stamp ____________________
156
DECLARATION OF A VAT DEALER FOR
ADJUSTMENT OF ENTRY TAX / OTHER TAX FORM 503
[ See Rule 24(6) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
04. Nature of adjustment Entry Tax others

(Please Mark ‘=’ on the appropriate Box)
05. Details of Payment:

Sl. Commodity Purchase Amount of Payment Tax period Remarks
No. Invoice No.& Entry Tax mode for which
Date Paid Ch/DD/Cr. to be
& Date adjusted
06. Declaration
Name ________________________ S/o / D/o _____________________being
(title)_________________________________________ of the above enterprise do hereby declare
that the information given on this document is true and correct.
Date of declaration ______________ Signature & Stamp ____________________
157
APPLICATION FOR REFUND OF TAX TO AGENCIES
FORM 510A
OF U.N.O., ICRISAT ETC.,
[ See Rule 35(12) ]
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02.Name :
Address:
We have purchased the following goods in Andhra Pradesh during the period ________
Name of the Invoice
Dealer from
TIN / Com- Quantity Rate of Value VAT /
S.No. GRN Address No. &
modity Tax of the TOT Remarks
whom Date Charged Goods Paid
purchased
Total tax claimed as Refund
Therefore, we request you that the tax paid on the above purchases may be given as refund as per the
provisions of the AP VAT Act 2005.
Signature of Authorised Officer,

Name & Status. Officer Stamp
159
APPLICATION FOR CLARIFICATION
FORM 570
AND ADVANCE RULING
[See Rule 66 (2)(i)]
Date Month Year
_____________________________________
_____________________________________
_____________________________________ 02.TIN
03.Name :
Address:
I / We __________________ S/o. ____________ on behalf of M/s._________________ request that

a clarification and advance ruling may be given on the following:
i)
ii)
I am herewith enclosing the specified fees for an amount of Rs.____________ in favour of the Commissioner
of Commercial Taxes, A.P. Hyderabad. The details of fees payments are as below:
S.No D.D.No. Date Bank Branch Amount
175
FORM 555
NOTICE FOR PRODUCTION OF DOCUMENTS
AND INFORMATION
[ See Rule 61(1)(a) ]
Tax Office Address: Date Month Year

_____________________________________
_____________________________________
_____________________________________
To
Name :
Address:
Whereas your attendance is necessary to give evidence / whereas the following documents (herein describe
the documents in sufficient detail for proper identification with reasonable certainty) are required with
reference to an enquiry under the Andhra Pradesh Value Added Tax Act, 2005 (here enter briefly the
subject of the enquiry) now pending before me, you are hereby summoned to appear in person or through
an authorised representative to produce, or cause to produce, the said documents before me on the
______ day of _________________ at_________ O’ clock at (place)________________________
Without prejudice to the provisions of any other law for the time being in force, if you intentionally omit or
fail to attend and give evidence or to produce the books of accounts registers, records / or other documents,
as required, a penalty upto Rs._______________ (Rupees __________________________________
only) may be imposed upon you under Section ______ of the AP VAT Act, 2005.
Given under my hand and seal this _______ day of ___________
Signature
Official Designation
Seal :
172
REGISTER OF STOCKS
FORM 525
[ See Rule 34(4)(b) ]
Opening Stock Quantity Received
Date Kapas Lint (ginned Cotton Seed Kapas Lint (ginned Cotton Seed
cotton) cotton)
Boras Weight Bales Weight Bags Weight Boras Weight Bales Weight Bags Weight
1 2(a) 2(b) 2(c) 3(a) 3(b) 3(c)
Quantity Despatched Closing Stock
Kapas Lint (ginned Cotton Seed Kapas Lint (ginned Cotton Seed
cotton) cotton)
Boras Weight Bales Weight Bags Weight Boras Weight Bales Weight Bags Weight
4(a) 4(b) 4(c) 5(a) 5(b) 5(c)
170
REGISTER OF KAPAS GINNED AND
FORM 524
DESPATCHED OF LINT & SEED
[See Rule 34(4)(a)]
Date Name & address TIN/GRN. No No. of boras Signature of Name and
of the party from and Weight the person who address of
whom received bought the the person to whom
stock despatched
1. 2. 3. 4. 5. 6.
Quantity Despatched
TIN/GRN.No Lint (Ginned Cotton) Seed Vehicle No. Way Bill No.
No. of bales / No. of bags/
weight weight
7 8 9 10 11
169
ACCOUNT TO BE MAINTAINED BY
FORM 523
SELLING / BUYING AGENT ON
BEHALF OF NON-RESIDENT PRINCIPALS
[See Rule 34(3)]
Date Name & TIN of Tax Commodity Quantity Value Transportation

Address of NRP Invoice Details
Non-resident or Invoice
Principal No./Date
issued /
received
(1) (2) (3) (4) (5) (6) (7) (8)
168
AUTHORISATION BY A RESIDENT
FORM 522A
PRINCIPAL TO HIS AGENT
[See Rules 34(2)(b) & (c) ]
I / We carrying on business in the name of M/s.__________________________________

with TIN / GRN ___________________________________________ hereby authorise my /
our agent M/s.____________________________________________________ to transact
on my / our behalf and:
*(i) to issue my / our invoices numbering from ___________ to _________

for the period _______________.
*(ii) to issue his invoices bearing the stamp and seal of M/s_____________
________ ____________ for the period _____________.
Date:
Place:
Signature of the Resident Principal
* Strike off whichever is not applicable
167
A.P. Value Added Tax Rules, 2005 483
DECLARATION BY THE RESIDENT AGENT TO 1

FORM 522B
THE RESIDENT PRINCIPAL
This is to certify that we M/s ……………….. …………………………

resident agent with TIN …………….. have received goods from our Resident
Principal M/s. ………… ………………………………….. with TIN
……………………. the goods mentioned below and sent the same to our
non-resident agent during the tax period ………………………………………
Details of Goods received from the Resident Principal and the details
of transfer of goods to non resident agent.
Sl. No. Name of Bill / Delivery Quantity of the Fair market
the goods Challan & Date goods received Value of the
of the Principal from the goods received
principal from the
principal
1 2 3 4 5
Bill delivery challan Quantity of the Fair Market ‘F’ Form

No. goods dispatched Value of the No/date
and Date of to the non goods dispatched
Dispatch to non- resident agent to the non -
resident Agent resident agent
6 7 8 9
1. The copy of ‘F’ Form/Forms mentioned shall accompany with this

form.
Date:
Place: Signature :
Name of the Resident Agent:
Address :
1. Added by G.O.Ms.No. 597, Rev. (CT-II) Dept., dt. 2-5-2007, w.r.e.f. 1-4-2005.
482 A.P. Value Added Tax Rules, 2005
ACCOUNT TO BE MAINTAINED BY SELLING/ FORM 522

BUYING AGENTS ON BEHALF OF RESIDENT
PRINCIPAL OTHER THAN AGRICULTURIST
PRINCIPAL
[See Rule 34(2)(a)]
Date Particulars of the Date of Tax Description Value Particulars

Principal on whose transaction Invoice/ & Qty. of of Buying/
behalf sale/ Invoice Goods Selling
purchase is made No. Dealer
(Name, Address, (Name,
TIN/GRN Address,
TIN/GRN)
1 2 3 4 5 6 7
AUTHORISATION BY A RESIDENT PRINCIPAL

TO HIS AGENT
[See Rules 34(2)(b)&(c)] FORM 522A
I/We carrying on business in the name of M/s. .........................................

with TIN/GRN ............................................ hereby authorise my/our agent
M/s. .......................................... to transact on my/our behalf and :
*(i) to issue my/our invoices numbering from ...................... to ..............
for the period ....................................
(ii) to issue his invoices bearing the stamp and seal of M/s. ....................
...................................... for the period ...........................
Date :
Place :
Signature of the Resident Principal
* Strike off whichever is not applicable.

——
ACCOUNT TO BE MAINTAINED BY SELLING
FORM 521
AGENT ON BEHALF OF AGRICULTURIST
PRINCIPALS / UNREGISTERED / TOT DEALER
[ See Rule 34 (1) ]
Date Name & Commodity Quantity Value Name & Regn No.
Address of Sold Address (TIN / GRN)
Agriculturist of Buying of Buying
Principal / Dealer dealer
Un/Registered /
TOT Dealer
(1) (2) (3) (4) (5) (6) (7)
165
FORM OF WAY BILL FORM X or
[See Rule 33 (1)(d) & 55(1) & (4)] FORM 600
1. Office of issue
Date Month Year

2. Date of issue of Way Bill by consignor
3. Name and address of the Dealer/Person Registration Number
Consigning the goods
Name _______________________ TIN/GRN
Address ______________________
_____________________________ State
4. Full Address of Place (a) From which consigned (b) to which consigned.
Name Name
Address Address
5. If the consignor is transporting goods:

(a) In pursuance of sale for purpose of delivery to the buyer ; or
(b) After purchasing them; or
(c) From one of the shops or godown to an agent for sale:
(d) From shop or godown to another shop or godown for purpose of storage or sale; or
(e) To his principal, having purchased them on his behalf ; or
(f) To his agent for sale on consignment basis
(Mark “ = “ whichever is applicable)
THE NAME AND ADDRESS OF THE DEALER/PERSON TO WHOM THE GOODS ARE
CONSIGNED OR FROM WHOM GOODS WERE PURCHASED
……………………………………………..
(Buyer or self or Agent or Principal) Registration Number
Name TIN/GRN
Address
State
6. Description, quantity and value of goods.
Sl.No. Commodity Invoice No./Date Quantity Value of Goods
1.
2.
3.
4.
5.
6.
7. Name and address of the owner of the goods vehicle or vessel by which the goods are consigned
Name Vehicle/Vessel Number
Address
Declaration:
I / We certify that to the best of my / our knowledge the particulars furnished here are true and correct.
Signature of the Consignor
176
DECLARATION FOR OBTAINING A TRANSIT PASS
FORM 615
[ See Rule 58 (1) ]
To
______________________________,
______________________________
Sri ____________________________________S/o. _________________________ resident of
_____________________________________ (full address) hereby declare that I am the owner/driver/
person-in-charge of the goods vehicle bearing No:_______________________ belonging to
_______________________________ (Name and full address of the owner/transport agency).
2) I hereby declare that the consignments detailed in the Annexure being carried by the above vehicle
are for delivery in other States. These goods will not be unloaded or delivered anywhere in the
State of Andhra Pradesh.
3) I also declare that my vehicle will cross Andhra Pradesh border through the last check post at
_______________________ on or before _____________ (date) by _______________ hours.
4) I further declare that the information furnished in this declaration including the Annexure is true and
complete to the best of my knowledge and belief.
Place: Signature
Date: Status
ANNEXURE
Sl.No. Particulars
1. Description of goods
2 Quantity
3 Value
4 Name and full address of the Consignor with TIN
5 Name and full address of the consignee with TIN
6 Sale Bill No. and Date
7 Way Bill/ Delivery note/Stock transfer Memo No.
8 L.R No. and Date
9 Permanent address of the driver with driving
licence No:
10 Name and full address of the Head Office/
Branch of the transport agency in Andhra Pradesh
11 Name and full address of the Head Office of
the transport agency in the States
Signature
Status
186
APPLICATION FOR SALE PROCEEDS WITH
FORM 608
REFERENCE TO ORDER OF APPEAL OR REVISION
[ See Rule 53(16) ]
01 Name & Address ________________________________________________________

__________________________________________________________________________
__________________________________________________________________________
Date Month Year

__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
03 TIN/GRN
Ref:- 1) Goods seized specified in Form 603 Dated _____________

2) Goods seized / detained put for sale in open auction as per
Form 604, Dated _______________
****
As per the references cited you have been

* i) seized / detained the goods
* ii) goods seized / detained have been sold in the open auction.
But as per the orders of the appeal or revision Dated _______ given by _____________ the detention
has been set a side:
Therefore I request
* i) to release the seized / detained goods
* ii) the sale proceeds should be paid to me deducting the admissible expenses.
Signature
* Strike off whichever is not applicable Status
184
FORM 606
AUCTION NOTICE
[ See Rule 53(8) ]
Date Month Year

_____________________________________
_____________________________________
02 TIN/GRN
_____________________________________
Where as on inspection of your office / shop / godown / vehicle / vessel and other place of business etc.
M/s. ________________________ TIN /GRN____________________ the following goods have been
seized / detained:
Sl.No. Description of goods Quantity Value of goods
It is informed that the above goods will be sold in open auction on _____________ _____________ hrs
At ________________________________.
The sale will commence at ___________A.M. and the property will knocked down to the highest bidder
without reserve for ready cash. The purchaser will not be permitted to carry away any part of the
property until he has paid for the same in full.
The sale will be subject to the powers of revision by the ________________________.
If the purchaser fails to pay the purchase money, the property will be resold, and the defaulting purchaser
will be liable for any loss arising as well as for the expenses incurred on the resale.

182
FORM 606
AUCTION NOTICE
[ See Rule 53(8) ]
Date Month Year

_____________________________________
_____________________________________
02 TIN/GRN
_____________________________________
Where as on inspection of your office / shop / godown / vehicle / vessel and other place of business etc.
M/s. ________________________ TIN /GRN____________________ the following goods have been
seized / detained:
It is informed that the above goods will be sold in open auction on _____________ _____________ hrs
At ________________________________.
The sale will commence at ___________A.M. and the property will knocked down to the highest bidder
without reserve for ready cash. The purchaser will not be permitted to carry away any part of the
property until he has paid for the same in full.
The sale will be subject to the powers of revision by the ________________________.
If the purchaser fails to pay the purchase money, the property will be resold, and the defaulting purchaser
will be liable for any loss arising as well as for the expenses incurred on the resale.

182
FORM 605
ORDER OF CONFISCATION OF THE GOODS
[ See Rule 53(4) ]
Date Month Year

_____________________________________
_____________________________________
02 TIN/GRN
_____________________________________
03.Name :
Address:
Ref:- 1. Seizure of goods in Form 603 Dated _____________

2. Reply from M/s.________________ Dt: ___________
On inspection of your office / shop / godown / vehicle / vessel and other place of business etc., a notification
seizing the following goods was issued vide reference 1st cited.
Goods Seized:
* a) Though the opportunity was provided, you have neither replied nor paid the security to consider
to take action accordingly.
* b) The reply furnished by you was considered but not tenable due to the following reasons
1) ______________________________________________________________
2) ______________________________________________________________
3) ______________________________________________________________
4) ______________________________________________________________
Therefore the good seized as mentioned above have been confiscated under Section 43 of AP VAT Act,
2005 read with Rule 53(4) of AP VAT Rules 2005.
* Strike off whichever is not applicable

181
FORM 604
ORDER OF RELEASE OF THE GOODS
[ See Rule 53(2) ]
Date Month Year
_____________________________________
_____________________________________
_____________________________________ 02 TIN/GRN
03.Name :
Address:
Ref:- Seizure of goods in Form 603 Dated _____________

On inspection of your office / shop / godown / vehicle / vessel the goods seized under reference cited are
hereby released on receipt of the amounts paid by you the details of which are mentioned below:
Goods Released:
Payments received:
Instrument No. & Amount Paid towards

Date Security Tax Penalty Interest

180
FORM 603
NOTIFICATION OF SEIZURE OF GOODS
[ See Rule 53(1)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 TIN/GRN
03.Name :
Address:
Whereas on inspection of your office / shop / godown /vehicle /vessel any other place of business as per
the authorisation given by ______________ the following irregularities have been identified.
1) _______________________________________________________________________
2) _______________________________________________________________________
3) _______________________________________________________________________
Therefore, your goods have been seized under Section 43 of AP VAT Act, 2005 read with Rule 53(1) of
AP VAT Rules 2005.
Details of goods Seized:

1.
2.
3.
4.
You are requested to reply to this order within 10 days of the date of this order along with the security
in cash to the value of goods to consider to release the goods.

179
REGISTER OF WAY BILLS
FORM 601
[ See Rule 55(5) ]
Name _________________________________________________________________________
Address__________________________________________________________________________
______________________________________________________________________
TIN/GRN
Circle Division Month
Sl. No. Way Bill Details Invoice/DC Details Consignee Details

Number Date Number Date Name & Address TIN/GRN
Vehicle Number Name of the Commodity Quantity of goods Value of goods
Total for the month

NB: Where a single Way Bill covers more than one Commodity the name of that commodity the value of
which is the highest shall be mentioned in “commodity” column.
177
FORM OF WAY BILL FORM X or
[See Rule 33 (1)(d) & 55(1) & (4)] FORM 600
1. Office of issue
Date Month Year

2. Date of issue of Way Bill by consignor
3. Name and address of the Dealer/Person Registration Number
Consigning the goods
Name _______________________ TIN/GRN
Address ______________________
_____________________________ State
4. Full Address of Place (a) From which consigned (b) to which consigned.
Name Name
Address Address
5. If the consignor is transporting goods:

(a) In pursuance of sale for purpose of delivery to the buyer ; or
(b) After purchasing them; or
(c) From one of the shops or godown to an agent for sale:
(d) From shop or godown to another shop or godown for purpose of storage or sale; or
(e) To his principal, having purchased them on his behalf ; or
(f) To his agent for sale on consignment basis
(Mark “ = “ whichever is applicable)
THE NAME AND ADDRESS OF THE DEALER/PERSON TO WHOM THE GOODS ARE
CONSIGNED OR FROM WHOM GOODS WERE PURCHASED
……………………………………………..
(Buyer or self or Agent or Principal) Registration Number
Name TIN/GRN
Address
State
6. Description, quantity and value of goods.
Sl.No. Commodity Invoice No./Date Quantity Value of Goods
1.
2.
3.
4.
5.
6.
7. Name and address of the owner of the goods vehicle or vessel by which the goods are consigned
Name Vehicle/Vessel Number
Address
Declaration:
I / We certify that to the best of my / our knowledge the particulars furnished here are true and correct.
Signature of the Consignor
176
INTIMATION BY CASUAL TRADER
[ See Rule 23(7) (a) ] FORM CAT 001
Tax Office Address: Date Month Year

_________________________________
_______________________________________
_______________________________________
I intend to conduct sale of goods as a casual trader as per the following details:
1. Name and Address

2. Venue where sale is proposed
to be conducted.
3. Duration of Sale
4. Nature of Goods.
5. Sale value of goods brought
for sale.
6. Estimated Sales Turnover.
7. Tax due on the estimated sale
at prescribed rate.
I enclose herewith a payment of Rs.___________ (Rupees __________________

_________________________) Vide_______________________________________ being the
50% of the estimated tax on the goods proposed to be sold.
DECLARATION:
I___________________________________S/o___________________________ state that the

information furnished herein is true & correct to the best of my knowledge and belief. I further undertake
to file a final declaration of my total sales and pay the due tax in full along with form CAT 002.
Signature
188
FINAL RETURN BY A CASUAL TRADER
[ See Rule 23(7) (b) ] FORM CAT 002

__________________________________________
_______________________________________
_______________________________________
02 Period from to
03. Name : __________________________________________________________________

Address : _________________________________________________________________
___________________________________________________________________________________
04. Goods sold taxable at:

Sl.No Rate of Tax Turnover Tax Due
a) 1%
b) 4%
c) Standard
Total :
05 Tax paid along with Form CAT 001 .. .. Rs. ________

06 Balance.. .. .. Rs. ________
07 Mode of payment
DECLARATION:
I _________________________________S/o_______________________ state that the

information furnished herein is true and correct to the best of my knowledge and belief.
Signature
189
STATEMENT OF THE GOODS STORED IN FORM 515
COLD STORAGE 1[OR WAREHOUSE OR
GODOWN OR ANY OTHER SUCH PLACE]
[See Rule 32(2)]

01. Tax Office Address : Period for which statement is filed :
..........................................
TIN/GRN
..........................................
..........................................
02. Name : .........................................................................................................
Address : .....................................................................................................
......................................................................................................................
....................................................................................................................
I, ................................................ S/o,D/o,W/o. .................................................
on behalf of M/s. ................................................... (name and address of the
cold storage) furnish hereunder the statement of the goods entrusted to us
for storage by the persons other than the registered dealers and farmers
in the month of .....................................................
Sl. Name & Nature of Quantity Date of Sl.No. in

No. Address of goods stored Storage Form 520
the person
1 2 3 4 5 6
Signature and Designation of the authorised

person on behalf of cold storage
468
REGISTER OF GOODS KEPT IN COLD FORM 520
STORAGE 1[OR WAREHOUSE OR GODOWN
OR ANY OTHER SUCH PLACE]
[See Rule 32(1) & (3)]

Sl. Name Nature No. of Date of Is the If the If the person
No. and full of goods bags and entry in person person is a is a farmer,
address quantity the cold registered registered the details of
of the storage dealer/ dealer his his land
person farmer/ TIN or holding
who has others GRN (Sy.No.
kept Village and
stocks in extent of
the cold land)
storage
1 2 3 4 5 6 7 8
Name, Date of No. of Whether If so, the If the goods If, so, the
Address and removal bags and the goods name, removed are name,
RC No. of of quantity removed address not weighed address TIN
the selling goods removed are and TIN and sold in the or GRN of
agent of the weighed or GRN of cold storage the selling
farmer if and sold in the premises agent to
any the purchaser whether they whose shop
premises are taken to the stocks are
of the cold market yard taken to
storage
9 10 11 12 13 14 15
469
FORM 610
COMMERCIAL DEPARTMENT
NOTICE OF DETAINING THE GOODS AT CHECKPOST
[See Rule 56(1)(a)] Date Month Year

01. Office Address :
..........................................
Vehicle
..........................................
.......................................... (A) Outgoing (B) Incoming
02. Name & Address : ........................................................................................
.....................................................................................................................
03. TIN/GRN :
04. Sl.No. in the register of check of vehicle :
05. Date and hour of check :
06. Vehicle/Vessel Number :
07. Name of Driver with Address :
08. Name and Address of the Owner of the goods (Consignor) :
09. Name and Address of the Consignee :
10. Nature of goods :
11. Quantity :
Total value of the goods :
Whereas on inspection of your vehicle/vessel the following irregularities
have been identified.
(a)
(b)
(c)
You are therefore directed to :
(1)
(2)
(3)
In view of the above, the goods mentioned above are hereby detained under
sub-section (6) of Section 45 of AP VAT Act, 2005 read with Rule 56
of AP VAT Rules, 2005 and you are requested to reply to this notice
arranging the discharge of tax and other amounts due under the provisions
of the Act as stated above.
Officer-in-charge
Commercial Taxes Checkpost
——
FORM 615
1
[x x x]
——
1. Omitted by G.O.Ms.No. 29, Revenue (CT. II) Dept., dt. 10-1-2007.
499
500
GOVERNMENT OF ANDHRA PRADESH 1
FORM 616
TRANSIT PASS
[See Rule 58(1) & (2)]
TRANSIT PASS TRANSIT PASS TRANSIT PASS

Original Duplicate Triplicate
(As per Section of APVAT Act 2005 Read (As per Section of APVAT Act 2005 Read (As per Section of APVAT Act 2005 Read
with Rule 58(2) of APVAT Rules 2005) with Rule 58(2) of APVAT Rules 2005) with Rule 58(2) of APVAT Rules 2005)
Date Month Year Date Month Year Date Month Year
Tax Office Address: (Entry Checkpost) Tax Office Address: (Entry Checkpost) Tax Office Address: (Entry Checkpost)
1. Time of entry: (Hrs./Min./Sec.) 1. Time of entry: (Hrs./Min./Sec.) 1. Time of entry: (Hrs./Min./Sec.)
2. Number of the Goods vehicle: 2. Number of the Goods vehicle: 2. Number of the Goods vehicle:
3. Consignor Details 3. Consignor Details 3. Consignor Details
(a) TIN/CST No. (a) TIN/CST No. (a) TIN/CST No.
(b) Name: (b) Name: (b) Name:
(c) Address: (c) Address: (c) Address:
4. Consignee details : 4. Consignee details : 4. Consignee details :
(a) TIN/CST No. (a) TIN/CST No. (a) TIN/CST No.
(b) Name: (b) Name: (b) Name:
(c) Address: (c) Address: (c) Address:
5. Total No. of Invoices/DCs in vehicle: 5. Total No. of Invoices/DCs in vehicle: 5. Total No. of Invoices/DCs in vehicle:
6. Sale Bill/DC Details: 6. Sale Bill/DC Details: 6. Sale Bill/DC Details:
Document No. ................ Date ................. Document No. ................ Date ................. Document No. ................ Date .................
7. Description of the goods: 7. Description of the goods: 7. Description of the goods:
8. Quantity: 8. Quantity: 8. Quantity:
9. Value: Rs. 9. Value: Rs. 9. Value: Rs.
1. Subs. by G.O.Ms.No. 29, Revenue (CT. II) Dept., dt. 10-1-2007.

11. L.R.No. and Date: 11. L.R.No. and Date: 11. L.R.No. and Date:
12. Name and address of the owner/transport 12. Name and address of the owner/transport 12. Name and address of the owner/transport
agency/Hirer agency/Hirer agency/Hirer
Name: Name: Name:
H.No. ............ dt., Pin: H.No. ............ dt., Pin: H.No. ............ dt., Pin:
Phone No.: Phone No.: Phone No.:
Fax: Fax: Fax:
13. Name of the last check post in the State to 13. Name of the last check post in the State to 13. Name of the last check post in the State to
A.P. Value Added Tax Rules, 2005

be crossed by the vehicle with the time and be crossed by the vehicle with the time and be crossed by the vehicle with the time and
date within which it should cross: date within which it should cross: date within which it should cross:
Check Post Name: Check Post Name: Check Post Name:
Time: Date: Time: Date: Time: Date:
I declare that the information furnished in I declare that the information furnished in I declare that the information furnished in
this form is true and complete to the best of this form is true and complete to the best of this form is true and complete to the best of
my knowledge and belief. my knowledge and belief. my knowledge and belief.
Signature of the Lorry Owner/Driver/ Signature of the Lorry Owner/Driver/ Signature of the Lorry Owner/Driver/
Person Incharge Person Incharge Person Incharge
Signature of the officer incharge of the Signature of the officer incharge of the Signature of the officer incharge of the
checkpost (with seal) checkpost (with seal) checkpost (with seal)
Received Transit Pass in Duplicate Received Transit Pass in Duplicate Received Transit Pass in Duplicate
Signature of the Lorry Owner/ Signature of the Lorry Owner/ Signature of the Lorry Owner/
Driver/Person Incharge Driver/Person Incharge Driver/Person Incharge
Transhipment Transhipment Transhipment
New Vehicle Number (1) New Vehicle Number (1) New Vehicle Number (1)
(2) (2) (2)
Signature of the concerned CTO (with seal) Signature of the concerned CTO (with seal) Signature of the concerned CTO (with seal)
This is to certify that the above Vehicle This is to certify that the above Vehicle This is to certify that the above Vehicle
crossed this exit checkpost at (hours) ................. crossed this exit checkpost at (hours) ................. crossed this exit checkpost at (hours) .................
on (date) ................. on (date) ................. on (date) .................
501
Signature of the Officer-in-charge Signature of the Officer-in-charge Signature of the Officer-in-charge
of the exit checkpost (with seal) of the exit checkpost (with seal) of the exit checkpost (with seal)
502
Instructions to the Driver/person in Instructions to the Driver/person in Instructions to the Driver/person in
charge of the Goods Vehicle charge of the Goods Vehicle charge of the Goods Vehicle
1. The driver/person-in-charge of goods vehicle 1. The driver/person-in-charge of goods vehicle 1. The driver/person-in-charge of goods vehicle
shall verify all details set-out in Form 616 shall verify all details set-out in Form 616 shall verify all details set-out in Form 616
before affixing his signature on the TP before affixing his signature on the TP before affixing his signature on the TP
2. He shall obtain two copies of the Transit 2. He shall obtain two copies of the Transit 2. He shall obtain two copies of the Transit

pass in Form 616 (Original & Duplicate) pass in Form 616 (Original & Duplicate) pass in Form 616 (Original & Duplicate)
after giving his Acknowledgement on the after giving his Acknowledgement on the after giving his Acknowledgement on the
original. original. original.
3. He shall surrender the Original at the Exit 3. He shall surrender the Original at the Exit 3. He shall surrender the Original at the Exit
Check post and shall obtain the seal & Check post and shall obtain the seal & Check post and shall obtain the seal &
signature of authorized person at Exit signature of authorized person at Exit signature of authorized person at Exit
Checkpost on duplicate copy which he shall Checkpost on duplicate copy which he shall Checkpost on duplicate copy which he shall
retain for all future purposes. retain for all future purposes. retain for all future purposes.
4. Failure to surrender TP at exit check post 4. Failure to surrender TP at exit check post 4. Failure to surrender TP at exit check post
invites Assessment to tax on the sale Value invites Assessment to tax on the sale Value invites Assessment to tax on the sale Value
of Goods Transported on the Transporter/ of Goods Transported on the Transporter/ of Goods Transported on the Transporter/
owner of the Transport Vehicle or/Hirer as owner of the Transport Vehicle or/Hirer as owner of the Transport Vehicle or/Hirer as
per the provision of Section 47 read with per the provision of Section 47 read with per the provision of Section 47 read with
Rule 58 of APVAT Act & Rules. Rule 58 of APVAT Act & Rules. Rule 58 of APVAT Act & Rules.
Transhipment Transhipment Transhipment
5. In case of Transhipment, an endorsement 5. In case of Transhipment, an endorsement 5. In case of Transhipment, an endorsement
from the CTO having jurisdiction over the from the CTO having jurisdiction over the from the CTO having jurisdiction over the
place of Transhipment shall be obtained on place of Transhipment shall be obtained on place of Transhipment shall be obtained on
the TP. the TP. the TP.
—— —— ——
DEMAND FOR UNPAID TAX.

[See Rule 24(4)]
Date Month
Year
Tax Office record indicates that TOT that was due on the following dates remains
unpaid.
DATE DUE ASSESSMENT/RETURN AMOUNT

OUTSTANDING
You should contact the Tax Office, within 15 days to arrange payment for the total
amount outstanding.
You are reminded that any amounts of tax outstanding after the legal date for payment
shall be liable to a penalty of ____ percent of the amount of the late payment and
interest will be charged at the rate of 1% per month for each day that the payment is
delayed.
YOU ARE REMINDED THAT THE APVAT ACT 2005 EMPOWERS THE TAX
DEPARTMENT TO CONFISCATE AND SELL YOUR GOODS TO RECOVER THE
UNPAID TOT.
You have the right to appeal against this decision.

DEPUTY COMMERCIAL TAX OFFICER,
___________________CIRCLE,
________________DIVISION.
Note: - Complete in duplicate.

UNILATERAL ASSESSMENT FOR FAILURE TO FILE A TOT RETURN.

[See Rule 25(3)]
Date Month
Year
There is no record of the receipt in the Tax Department of your TOT Return for the
quarter year ending ______________due by _____________.
The Tax Office has accordingly unilaterally assessed the tax payable by you for this
period as ____________ . In addition the law requires that you pay ___% of this
amount as a penalty____________________
Total due to the Tax Office Rs.______________
This tax must be paid by ______________ unless you file the tax Return that is due and
pay the tax declared on the return. If you file the outstanding return in the Tax Office
and pay the tax due by ______________, this unilateral assessment will be withdrawn.
IF YOU HAVE ALREADY FILED A RETURN AND PAID THE TAX DUE YOU
SHOULD NOTIFY THE TAX OFFICE WITHOUT DELAY.
Failure to make payment of this unilateral assessment will result in collection measures
being taken as provided for in the APVAT Act 2005.
DO NOT ADJUST ANY FUTURE TOT RETURN TO ACCOUNT FOR THE TAX SHOWN ON
THIS NOTICE OF ASSESSMENT.
DY. COMMERCIAL TAX OFFICER,

__________________CIRCLE,
________________ DIVISION.

RETURN OF TURNOVER TAX (QUARTERLY)
(Please read the notes on the reverse of the form)
( See Rule 23 (2) )
Period covered by Return
03. From To
04. Name : ____________________________________________________________________________________
Address: ___________________________________________________________________________________
_____________________________________________________________________________________
05. Taxable Turnover for the period mentioned at Sl.No: 03 above
06. Turnover tax @ 1%
07. Adjustments, if any, with details:
08. Payment made
09. Details of payment:

Challan /Instrument No. Date Bank/Treasury Branch Amount
Code
Please Note:
This return shall be filed quarterly along with tax due on or before end of the month following the quarter
ending June, September, December and March of every year.
NOTES FOR COMPLETION OF FORM
Box 01. Write the office address of your Tax office.
Box 02. Insert your General Registration Number as mentioned on your

Notification of General Registration.
Box 03. Enter the period in months covered for the calendar quarter.
Box 04. Enter the name and address as shown on your Notification of General
Registration.
Box 05. Enter the taxable turnover of your business for the period. Your taxable
turnover is the value of your sales excluding sales which are exempt under the
APVAT Act, 2005.
Box 06. Enter the tax due for the period at 1% of the taxable turnover.
Box 07. Enter if any adjustments are there like advance payments already made,
etc., and enter the details
Box 08Enter the balance of tax due for the period that is due for payment.
Box 09. Enter the payment details.
Box 10. Enter the name of the person with status and sign the declaration with
date.
SUO MOTO REGISTRATION FOR TURNOVER TAX

[See Rule 11(1)]
Date Month
Year
Please refer to this office notice for General Registration issued in Form TOT 006
on ________________. We have not received any reply from you against the proposal
for General Registration.
This letter is to advise that you have been registered for Turnover Tax. Enclosed
herewith is your TOT Registration Certificate and your General Registration Number is
:
You should note that you are required to make quarterly returns and pay tax at the rate
of 1% of your quarterly taxable turnover.
I also enclose VAT leaflet 03 which explains Turnover Tax and your obligations.
If you require further information or wish to register voluntarily for VAT you should
contact this office.
You have right to appeal against this order within 30 days of date of receipt of this
order.
ASST. COMMERCIAL TAX OFFICER,
TOT REGISTERING AUTHORITY,
___________________CIRCLE,
Encl: 1. TOT Registration Certificate.

2. Leaflet 03.
TOT REGISTRATION CERTIFICATE

[ See Rule 10(c) ]
This is to confirm that M/s

_______________________________________________________
is registered for turnover tax under Sub-Section 7 of Section 17 of the Andhra

Pradesh Value
Added Tax Act 2005 in the ________________________Circle

___________________Division
His General Registration Number is
His place of business is situated at:

__________________________________________________
_____________________________________________________________
His additional place of business is:

__________________________________________________
_____________________________________________________________
This certificate is valid from___________________.
Date of Issue _______________________________.

___________________CIRCLE,
NOTICE OF COMPULSORY CANCELLATION OF TOT REGISTRATION.

[See Rule 15(5)]
Date Month
Year
I have to advise you that it is proposed to cancel your TOT registration with effect
from ____________ because:
* You have no fixed place of abode or business.
* You are not, in the opinion of the CT Department, a fit and proper person to be
registered for TOT.
* Specify any other reasons________________________________
* You are required to file a final TOT return in form TOT 007 for the period ending
_____________ and pay the TOT due.
You are requested to file your written objections, if any along with documentary
evidence within 10 days of date of the notice failing which the proposal as stated above
will be confirmed without any further notice in the matter.

___________________CIRCLE,

*FORM TOT 060A
QUARTERLY RETURN OF PURCHASES BY TOT DEALERS

[See Rule 23(10)]
Return to be filed by TOT Dealers for each quarter furnishing the information relating to
purchases made from the dealers in the state of Andhra Pradesh.
Date Month Year

01. Tax Office
Address:………………………………
.…………………………………
…………………………………
02 GRN
03. Name of the dealer____________________________________________________________________

Address __________________________________________________________________
__________________________________________________________________
04. Period from to
5. Purchases from VAT dealers:
Sl. Name /address of the Dealer from whom the goods TIN No of Purchase Value
No are purchased invoices (Excluding VAT)
6. Purchases from TOT dealers:
Sl. Name /address of the Dealer from whom the goods GRN No of Purchase Value
No are purchased invoices
7. Purchases from Un registered dealers:
Sl. Name /address of the Dealer from whom the goods are purchased No of invoices Purchase Value
No
Signature of TOT Dealer/

* Added by G.O.Ms.No. 517 Rev. (CT-II) Dept., dt. 23-4-2007, w.e.f. 1-4-2007.
*FORM TOT 060B
QUARTERLY RETURN OF SALES BY TOT DEALERS

[See Rule 23(10)]
Return to be filed by TOT Dealers for each quarter furnishing the information relating to
sales made to the dealers in the state of Andhra Pradesh.
Date Month Year

01. Tax Office
Address:………………………………
.…………………………………
…………………………………
02 GRN
03. Name of the dealer____________________________________________________________________

Address __________________________________________________________________
__________________________________________________________________
04. Period from to
5. Sales made to VAT dealers:
Sl. Name /address of the Dealer from whom the goods TIN No of Sales Value
No are sold invoices
6. Sales made TOT dealers:
Sl. Name /address of the Dealer from whom the goods GRN No of Sales Value
No are sold invoices
7. Sales made to Unregistered dealers:
Sl. Name /address of the Dealer from whom the goods are sold No of invoices Sales value
No
* Note: In case of sales to the consumers name and the address of the consumer need not be mentioned.
Signature of TOT Dealer /

* Added by G.O.Ms.No. 517 Rev. (CT-II) Dept., dt. 23-4-2007, w.e.f. 1-4-2007.
FORM TOT 016
REFUSAL OF APPLICATION TO CANCEL TOT REGISTRATION

[See Rule 15(4)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 GRN
03.Name :
Address:
Your application vide Form TOT 014 to cancel your TOT registration is refused because:
_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
_____________________________________________________________________________.
You must continue to charge TOT on your sales, issue invoices when appropriate, maintain books and
records, file TOT returns and pay the tax due for every calendar quarter.

__________________CIRCLE.
22
FORM TOT 017
REFUSAL OF REGISTRATION FOR TURNOVER TAX

[See Rule 11(2)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________
02 GRN
02.Name :
Address:
I acknowledge your application for Registration for Turnover Tax under APVAT Act’ 2005.
On scrutiny of your application, it is noticed that you are not entitled for General Registration for the
following reasons _________________________________________________
_____________________________________________________________________________
______________________________________________________________________
Accordingly, I refuse to register you under APVAT Act 2005.

__________________CIRCLE.
23
COMMERCIAL TAXES DEPARTMENT FORM TOT 025
ASSESSMENT OF TURNOVER TAX
[See Rule 25(6)]
Date Month Year

_____________________________________
_____________________________________
02 GRN
_____________________________________
03.Name :
Address:
Following examination of your records on _____________________ and the issue of Form TOT 025A
on ______________ the correct amount of TOT under the provisions of AP VAT Act 2005 has been
established as follows.
*This has resulted from : -
1. Your agreement at the time of visit on ______________
2. After consideration of your reply received in this office on ________________
3. Your failure to respond to the notice issued on Form TOT 025 A on ___________
The total amount payable by you is explained below:

Period Tax declared Tax Found Tax Over Tax under Interest @
declared Penalty Total Due to
(Quarter Particulars / net credit to be due/ declared 1% of….. Tax
of tax claimed net Due to Due to Tax ……..% month(s)
ending) Department
credit due dealer Department
25
* A The amount of ____________________shall be paid within 30 days of receipt of this order.Failure

to make the payment will result in recovery proceedings under the AP VAT Act 2005.
* B Your refund claim is reduced to _________ and this amount will be refunded to you.
THE PAYMENT OF THE AMOUNT SPECIFIED AT ‘A’ ABOVE MUST BE MADE

TOGETHER WITH DUPLICATE COPY OF THIS ORDER AND PAYMENT BOXES ON
THAT COPY COMPLETED.
An appeal against this order can be filed before the Appellate Deputy Commissioner within 30 days of
receipt of this order.

__________________ CIRCLE.
ON DUPLICATE COPY OF THE ORDER

Payment details:
Challan/ Date Bank / Treasury Branch Code Amount Instrument No.
*Delete as appropriate
26
FORM TOT 025A
NOTICE OF ASSESSMENT OF TURNOVER TAX
[See Rule 25(6)]
01.Tax Office Address: Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 GRN
03.Name :
Address:
Examination of your records on __________ has shown that the correct amounts of Turnover Tax have
not been declared in the TOT returns listed below. Under the provisions of APVAT Act 2005 the following
tax amounts are proposed to be assessed for the tax periods shown below.
Tax Tax Found Tax Over Tax under Total Due to

Period Interest @
Particulars declared / to be due/ declared declared Penalty Tax
(Quarter 1% of…..
of tax net credit net Due to Due to Tax ……..% Department
ending) month(s)
claimed credit due dealer Department
If you have any objections to the assessment proposed above, your are requested to file written objec-
tions along with documentary evidence if any, within 7 days of date of this notice failing which orders will
be passed without any further notice in the matter.

__________________CIRCLE
27
CLAIM FOR REFUND BY TOT DEALER FORM TOT 030
[See Rule 35(1)]

_____________________________________ Date Month Year
_____________________________________
_____________________________________ 02 GRN
03.Name :
Address:
I / We _______________________________________________ claimant(s) of refund do hereby

declare that the refund is sought:
(Tick whichever is applicable)
1) in pursuance of an order of assessment
i. Number and date of order of assessment
ii. Date of notice of final assessment and refund order
iii. Amount of refund order.
2) in pursuance of an order passed in appeal or revision
i. Number and date of order of the appellate or revisional authority.
ii. Date of revised notice of final assessment and refund order
iii. Amount of refund due.
3) on cancellation of registration
Declaration:
I (Name)_____________________________ Status (Title) __________________ of the above
business hereby declare that the information given in this form is true and correct.
Signature of the claimant
Signature of the authorised
Representative if any. ____________________ Date of declaration ___________
VERIFICATION
I / We _______________________________________________ claimant(s) of refund do hereby

declare that what is stated herein is true to the best of my / our knowledge and belief. Verified today the
_____ day of_____________ 200
Signature of the claimant

Signature of the authorised representative if any.
28
APPLICATION FOR NOTIFYING CHANGES FORM TOT 051
IN TOT REGISTRATION
[ See Rule 13(1) & 13(3) ]
Date Month Year

_____________________________________
_____________________________________
02 GRN
_____________________________________
2(a)Name :
Address:

03 Change in Name:

04 Change in
Address of
Place Of
Business:

05 Change in
address of
Branches/
godowns:

06 Change in
Legal Status:
( Use separate sheet to furnish the details of new persons & out going persons as applicable)
* Use additional sheets wherever space provided is not sufficient
07 My business activities/ Principal Commodities traded have changed in the following respect:
a) Change in Business activities :_______________________________
b) Principal Commodities now traded are: ________________________
32
08 My new Bank account details are herewith furnished
Bank Name:- ____________________________________________
Branch Name & Code :- ____________________________________________
Account Number:- ____________________________________________
09. Declaration:
I (Name)_________________________Status (Title) ________________________
of the above business hereby declare that the information given in this form is true and correct.
Date Month Year
Signature and Stamp _____________________________ Date of declaration
FOR OFFICE USE

10. Date of Receipt of Form TOT 051
11. Date of issue of Form TOT 001 (liability for new TOT registration)
(in case of proposal in box 6)
12. Date of issue of Form TOT 003 (TOT Registration Certificate)
(in case of proposals in boxes 3,4,& 5)
13. Date of recording in TOT registration and in the TOT Dealer file.
ASST. COMMERCIAL TAX OFFICER

TOT REGISTERING AUTHORITY
33
FORM TOT 015
NOTICE OF CANCELLATION OF TOT REGISTRATION
[See Rule 15(3)]
Date Month Year

_____________________________________
_____________________________________
_____________________________________ 02 GRN
03.Name :
Address:
It is confirmed that your TOT registration has been cancelled with effect from _____________ You are
reminded that should your taxable turnover exceed the registration threshold limits in the future, you must
apply for registration.

___________________CIRCLE
21
REFUND VOUCHER FORM 500 REFUND VOUCHER FORM 500
COUNTER FOIL FOIL

COMMERCIAL TAXES REFUNDS
COMMERCIAL TAXES REFUNDS
BOOK No: VOUCHER No:
HEADOFFICE_________ DIVISION_________
BOOK No: VOUCHER No:
CIRCLE:___________ DISTRICT__________
HEAD OFFICE:___________ DIVISION___________
Counter foil for the refund of _______________
CIRCLE______________ DISTRICT____________
Tax / Penalty / Interest / Others (Tick (=) which
Order for refund of __________________________ Tax / Penalty /
is applicable)
Interest / Others
Refund payable to ________________________

Payable at the Treasury within Three months of the date of issue.
Refund sanctioned in pursuance of excess input tax To

credit / Assessment / Appeal / Revision / Purchases
made by agencies of UNO/ Government. The Treasury Officer __________________________
Notification / On cancellation Registration.
etc.,__________________________________
1. Certified that, with reference to this office record in pursuance of
___________________ (excess input tax credit / Assessment /
Date of sanction Order ___________________ Appeal/Revision Purchases made by agencies of UNO/Govt.
Notification / On cancellation of Registration etc., ___ Sanction
Amount of Refund Rs.____________________ Order No: _________ Dated ________ a refund of
Rs._________ (Rupees __ _________________) is due to
(Rupees _______________________________) ______________________________
Particulars of amount ( Tax / Penalty / Interest / 2. Certified that the Tax / Penalty / Interest / Others ____________
Others ) and date of collections according to the which this refund is given has been credited in the Treasury.
office record.
3. Certified that no refund order regarding the sum now in question
..............................................................................
has been previously been granted and this order has been entered
in the Original file of this office record under my signature.
..............................................................................
Please pay to _____________________________ the sum of
Rs._______________ (Rupees _________________________)
.............................................................................. on account of the above refund.
.............................................................................. Date _________ Signature of the Officer,
Initials of Issuing Authority: Place:_________ Designation, Stamp & Seal
Signature of the recipient on the voucher …………

Receipt payment ….. Pay Rs. …………................………….only.
Date of encashment in the Treasury ……………….
Received payment ....………………………………….……………….
Claimant’s Signature ....………………………………….……………….
153
*FORM 501B
CERTIFICATE OF TRANSFER OF TAX DEDUCTION AT SOURCE BY THE
CONTRACTOR TO THE SUB CONTRACTOR
(See Sec 22 (4) & Rules 18 (1)(e)
Date Month Year
02. TIN of the Contractor
I/We__________________________________ being the contractors certify that a sum of Rs.

___________________ was deducted as tax at source by the contractee from the amount payable
to me. An amount of Rs.____________ out of tax deducted at source is hereby authorized to be
utilized by the sub contractor.
03 Name and address of the sub contractor
04 TIN of the sub contractor
05 Name and address of the contractee/ Employer
06. Name and address of the (main) contractor
a) Date of the Contract/ supply order
b) Nature of Contract/ Supply order
c) Full Value of Contract/Supply order
d) Amount paid as consideration.
e) Month and year in which the amount is paid
d) Bill No./Voucher Cash Memo
g) Amount of tax deducted at source
h) Remittance Particulars
i) Unique No of 501/501A
07 a) Date of the subcontract/supply order
b) Full Value of the subcontract/ Supply order
c) Amount being paid as consideration to the
subcontractor
d) Amount of tax deducted at source being
transferred to subcontractor.
The particulars furnished above are true and correct. I / We shall be held responsible in
case the tax deducted is not correct in any manner and I/We shall be liable for penal action as per
the provisions of the APVAT Act
Signature of the contractor / person responsible
for transfer of amount
*FORM 501C
APPLICATION FOR QUANTIFICATION OF TAXABLE TURNOVER FOR THE
PURPOSE OF TAX DEDUCTION AT SOURCE
(See Sec 22 (3) & Rules 18 (1)(f)
Date Month Year
02. Name of the Contractor :

03. TIN of the Contractor :
I/We __________________________________ have undertaken the execution of works contract,

the details of which are given below. I/We declare that the taxable turnover for the purpose of
deduction of tax at source by the contractee is estimated as below.
01 Name and address of the contractee

02 Name of the works contract
03 Nature of the works contract*
04 Total Value of the contract Rs.
05 Estimated deductions (total of (a) to (f) below) Rs.
.
(a) Labour charges Rs.
(b) Hire charges of machinery and tools Rs.
(c) Cost of consumables Rs.
(d) Cost of establishment relatable to labour and Rs.
services
(e) profit relating to labour and services Rs.
(f) Value of goods purchased or obtained from Rs.
outside the Statem directly in relation to the
agreement for execution of works
06 Taxable turnover (Value in Col. 4 less value in Col. Rs.
5
07 Taxable turnov er as % of total value of the contract Rs.
. (Value of Col.6 as % of value in Col.4)
08 Percentage of tax to be deducted from the total Rs.
. value of the contract as per sub clause (i) or (ii) of
clause (b) of sub rule (1) of rule 18)
I/we request you to issue the suitable order so as to communicate it to the contractee for making
deduction of tax from the amounts payable to me/us. It will be construed as this application is
approved if any thing is not heard from you in this case within 60 days from the filing of this
application.
The particulars furnished above are true and correct. I/We shall be held responsible in case the tax
deducted is not correct in any manner and I/We shall be liable for penal action as per the
provisions of the APVAT Act.
Person authorized to sign the agreement. :
Signature of the contractor/ Person
Authorized to sign the agreement :
Place :
Date :
* Nature of work to be categorized as falling under sub clause (i) or (ii) of clause (b) of sub rule
(1) of rule 18.
*FORM 501D
APPROVAL OF THE APPLICATION FOR QUANTIFICATION OF TAXABLE

TURNOVER FOR THE PURPOSE OF TAX DEDUCTION AT SOURCE
(See Sec 22 (3) & Rules 18 (1)(f)
Date Month Year
02. Name of the Contractor :

03. TIN of the Contractor :
Upon examination of your application in Form 501C filed on ______________________

In this office, it is certified that the correct rate at which tax deduction at source shall be made is
as arrived below.
01 Name and address of the contractee

02 Name of the works contract
03 Nature of the works contract
04 Total Value of the contract Rs.
05 Total deductions (total of (a) to (e) below) Rs.
.
(a) Labour charges Rs.
(b) Hire charges of machinery and tools Rs.
(c) Cost of consumables Rs.
(d) Cost of establishment relatable to labour and Rs.
services
(e) profit relating to labour and services Rs.
(f) Value of goods purchased or obtained from Rs.
outside the State directly in relation to the
agreement for execution of works
06 Taxable turnover (Value in Col. 4 less value in Col. Rs.
5)
07 Taxable turnover as % of total value of the contract Rs.
. (Value of Col. 6 as % of value in Col. 4)
08 Percentage of tax to be deducted from the total Rs.
. value of the contract as per sub-clause (i) or (ii) of
clause (b) of sub-rule (1) of rule 18)
The authority to deduct the tax at source is hereby requested to make the deduction at the rate of
______________% (as per column 8 above) from % of the amount payable every time and to
remit the tax so deducted to the Government treasury within fifteen days from the date of the
deduction of tax at source.
Place: Assistant Commissioner/

Date : Commercial Tax Officer
______________ Circle.
Note:- 1. The Deducting Authority/ Employer is required to deduct the tax as mentioned above,
each time the amount is released to the contractor.
Illustration:
Taxable turnover % determined in Col.7
for the particular work : 60%
Rate of TDS as per Col. 8 : 4%
Amount being released : Rs.5,00,000
Taxable Turnover is (60% of Rs.5,00,000) : Rs.3,00,000
TDS amount (4% of Rs.3,00,000) : Rs.12,000]
FORM 502
DECLARATION OF A VAT DEALER AVAILING
INDUSTRIAL INCENTIVES
[See Rule 67(4)]
Date Month Year

03. Name ………………………………….. Address ……………………
……………………………………………………………………………...
04. Tax period …………………. From …………………. To …………...
05. Details of Industrial Incentives eligibility certificate :
06. Details of availment :
Total Incentives Incentive Balance Remarks

amount of availed up to availed in
eligibility last month this month
1 2 3 4 5
PROCEEDING OF THE
Present : Sri T.Yugandhar Reddy, Additional Commissioner (Policy)

Dr. Sri K.Raghavaiah, Joint Commissioner (DMU & All Acts)
Sri P. Satyanarayana Reddy, Joint Commissioner(Legal)
***
CCT’s Ref.No.A.R.Com/205/2006 Dt: 24-4-2007

***
O R D E R:
M/s. Tirupati Trading Company, Hyderabad (TIN No.28150197843) have

filed an application and sought clarification and Advance Ruling under Section 67
of the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with
the application fee of Rs.1000/-. The application is examined and found in order.
Hence admitted.
The applicant is seeking clarification regarding the rate of tax on Iron
scrap.
The case was posted for hearing on 31.3.2007. Sri Jagdish Kumar, STP of
the firm appeared and explained the case.
G.O.Ms.No.398 Rev.(CT.II) Dept, dt.31.3.2005 and G.O.Ms.No.490 Rev.(CT.II)
Dept, dt.15.4.2005 as superceded in G.O.Ms.No.1596 Rev.(CT.II) Dept,
dt.27.8.2005, G.O.Ms.No.1615 Rev.(CT.II) Dept dt.31.8.2005 and G.O.Ms.No.502
Rev (CT.II) Dept, dt.1.5.2006 and G.O.Ms.No.656 Rev. (CT.II) Dept. dt. 6.6.2006
and G.O.Ms.No.795 Rev (CT.II) Dept, dt.29.6.2006.
The applicant explained that they are engaged in trading business of Iron
scrap and they are allotted a tender by M/s.Midhani for lifting of Iron scrap and
tax at 12.5% is charged by them. It is the contention of the applicant that the
1
item falls under Iron scrap and is taxable only at 4%. A copy of the delivery
order issued by MSTC on behalf of M/s.Midhani was also enclosed. In this
particular delivery order, the description given for the item is “Unserviceable CI
moulds / slag boxes / bottom plates.
The issue has been examined with specific reference to Entry 70 and
Entry 71 of Schedule IV to the Act. Entry 70 reads as under ;
“Iron and steel that is to say:
i) Pig Iron, Sponge Iron and cast iron including ingot moulds and bottom
plates.
ii) Steel semis, ingots, slabs, blooms and billets of all qualities, shapes and
sizes.
iii) Skelp bars, tin bars, sheet bars, hoe-bars and sleeper bars
iv) Steel bars, rounds, rods, squares, flats octagons and hexagons, plain and
ribbed or twisted in coil form as well as straight length
v) Steel structural, angles, joints, channels, tees, sheet piling sections, Z
sections or any other rolled sections
vi) Sheets, hoops, strips and skelp, both black and galvanized, hot and cold
rolled, plain and corrugated in all qualities, in straight lengths and in cold form as
rolled and in revitted condition.
vii) Plates, both plain and chequered in all qualities
viii) Discs, rings, forgings and steel castings
ix) Tool, alloy and special steels of any of the above categories
x) Steeel tubes, both welded and seamless of all diameters and lengths
including tube fittings
xi) Tin-plates, both not dipped and electrolytic and tin free plates
xii) Fish plate bars, bearing plate bars, crossing sleeper bars, fish plates,
bearing plates, crossing sleepers and pressed steel sleepers, rails – heavy and
light crane rails
xiii) Wheels, tyres, axies and wheel sets
2
xiv) Wire rods and wires rolled, drawn, galvanized, aluminized, tinned or
coated such as by copper”
Entry 71 reads as under :

“Iron and Steel scrap, that is to say;
i) Iron scrap, cast iron scrap, runner scrap and iron skull scrap
ii) Steel melting scrap in all forms including steel skull, turnings and borings
iii) Defectives, rejects, cuttings or end pieces of any of the categories of item
(i) to (xiv) of Entry 70”.
The item in question is given the description “Unservicable CI moulds /

slag boxes / bottom plates” Sub item (iii) of Entry 71 specifies “Steel welding
scrap in all forms”.
Taking the above into consideration, the ruling is given that the
items in question appear to be unserviceable iron and steel items
meant only for the purpose of melting. Therefore the applicable tax
rate shall be 4%.
Sd/- Sd/- Sd/-

To
M/s.Tirupathi Trading Compnay,
Kutbullapur, Hyderabad.
Copy submitted to the Commissioner of Commercial Taxes, A.P., Hyderabad.

3
PROCEEDING OF THE

***

***
O R D E R:
M/s. M.R.F. Limited, Medak District (TIN No.28620142408) have filed an

application and sought clarification and Advance Ruling under Section 67 of the
APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with the
application fee of Rs.1000/-. The application is examined and found in order.
Hence admitted.
1. Is VAT payable under Section 4 of the AP.VAT Act, 2005 on recoveries
from salary of workmen towards meals provided as per the wages agreement
with the workmen? The petitioner purchases meals from a VAT registered dealer
who charges tax on the sale of goods to the company.
2. If VAT is payable on the recoveries from salary of workmen as sale of
good, can the petitioner take input tax credit of tax paid for purchase of food, if
the petitioner opts to pay VAT under Section 4(9) of the AP.VAT Act, 2005.
The case was posted for hearing on 15.3.2006. Sri S.Sridharan, Chartered
Accountant and Sri Mohan Abraham, Manager, Company Affairs appeared and
explained the case.
The applicant is a manufacturer of Tyres / Tubes Tread rubber with
factory at Medak in A.P. It was explained that the company is required to provide
meals to the workmen as per the wages agreement entered into with the
workmen. A copy of the relevant page of the agreement was filed. It is explained
that the company is not running a canteen and no food / drinks are made
1
available for sale to workmen other than the provision of meal during lunch
break in each of the shifts. It is further explained that 30% of the total cost of
the food served is to be borne by the workmen who opt for this arrangement
and the balance 70% is borne by the company. As a result of this, a monthly
fixed amount is recovered by the workmen based on attendance to meet the
cost.
The learned representative cited the following judgments :
1. State of A.P. Vs. Hotel Sri Lakshmi Bhavan, Visakhapatnam 33 STC 444
(1974)
2. M/s.Woodlands Hotel (P) Ltd. Vs. State of Karnataka 97 STC 251 (1995)
3. State of Tamilnadu Vs. Binny Limited 49 STC 17 (SC)(1982)
4. State of Tamilnadu Vs. Burmah Shell Oil Storage and Distributing Co. 31
STC 426 (SC)(1973)
5. The case of BSNL 145 STC 91.
It is the contention of the applicant that he is not running a canteen for
the workmen / staff to purchase and consume food. The food is provided as part
of the wages and fixed amount is deducted based on attendance from the wages
of the workmen who have opted to take the meals provided. It is contended that
the relationship between the parties is not in the nature of seller and buyer of
goods but it is in the nature of an employer and employee.
The applicant furnished a copy of the invoice raised by the catering
contractor for the month of January, 2007. As seen from this tax invoice, an
amount of Rs.19,22,586.50 was charged based on quantity of breakfast, lunch,
dinner, extra food items and beverages supplied for the month. The supplying
contractor also charged service tax on 60% of the turnover and VAT at 7.5%
was also charged. While the applicant is taking the stand that the recoveries
made from salaries of workmen towards meals provided do not constitute “sale”
under the provisions of the Act, he is also raising the issue whether he is eligible
for the benefit of input tax credit based on the tax invoice issued by the catering
contractor in case the transaction in his hands is treated as a sale.
Sub section (4) of Section 13 of the Act specifies that a VAT dealer is not
entitled for input tax credit in respect of purchase of such taxable goods as may
2
be prescribed. Sub rule (2) of Rule 20 enumerates certain items on which the
input tax credit is not available. Clause (d) in this sub rule (2) specifies “any
goods purchased and used for personal consumption”. The proviso attached to
this sub rule says that “when any goods mentioned above are subsequently sold
without availing any input tax credit, no tax shall be levied and recovered from a
VAT dealer having been denied the input tax credit at the time of purchases.
Taking the provisions of sub section (4) of Section 13 and the list of
ineligible items under sub rule (2) of Rule 20 into consideration, the ruling is
given as under :
1. From the information made available by the applicant, the
recovery of money towards 30% of the cost for the meals provided to
workmen do not prima facie appear to be in the nature of ‘sale’ and
therefore do not attract the provisions of liability to tax.
2. The applicant is denied the benefit of input tax credit under

clause (d) of sub rule (2) Rule 20 with regard to the tax paid on food
supplied by catering contractor. One of the important principles of the
system of Value Added Tax is that if the output is taxable, the benefit
of input tax credit is available. In the present situation, the price of
purchase is higher as compared to the money recovered from the
workmen. Having been denied the benefit of input tax credit as a result
of clause (d) in sub rule (2), no tax can be levied on the money
recovered from workmen. The applicant shall neither claim the benefit
of input tax credit nor be liable to pay any tax for the money recovered
from workmen / employees.
Sd/- Sd/- Sd/-

ADDL.JT.COMMISISONER
To
M/s.M.R.F.Limited, Sadasivapet, Medak District.

Copy to the Asst.Commissioner (CT)(LTU), Nizamabad Divin.
3
PROCEEDING OF THE

CCT’s Ref.No.A.R.Com/22/2006 Dt:23-4-2007

***
O R D E R:
M/s. Hyderabad Chemical Products Limited, Hyderabad (TIN

No.28760163808) have filed an application and sought clarification and Advance
Ruling under Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i) of
APVAT Rules,2005 along with the application fee of Rs.1000/-. The application is
1. Whether Diesel purchased for use in Hot oil system is eligible for input tax
credit.
2. Whether purchase of coal used to produce Steam from boilers is eligible
for input tax credit.
The case was posted for hearing on 7.3.2007. The applicant did not
appear for the hearing. The case was again posted on 15.3.2007. There is no
response from the applicant. The case is therefore disposed on merits.
Section 13 reads with provisions relating to the input tax credit. In sub
section (1) of Section 13, it is clearly mentioned that no input tax credit shall be
allowed in respect of the tax paid on the purchase of goods specified in Schedule
VI. Schedule VI specifies all Liquors, Petrol, Aviation motor spirit, Aviation turbine
fuel and all kinds of Diesel oil. Sub section (4) of Section 13 specifies that the
VAT dealer shall not be entitled for input tax credit in respect of purchases of
such taxable goods as may be prescribed. Sub rule (2) of Rule 20 prescribed
certain items not eligible for input tax credit. Clause (h) mentions natural gas,
naphtha and coal.
1
Taking the above provisions into consideration, the ruling is given as
under :
1. Diesel is not eligible for the benefit of input tax credit. Therefore
the applicant cannot claim the benefit of input tax credit with regard to
the tax paid on purchases of Diesel.
2. Coal is specifically included in the negative list in sub rule (2) of
Rule 20 and it is given retrospective effect from 1.4.2005. Therefore
the applicant is not eligible to claim the benefit of input tax credit
irrespective of the usage.
This ruling is subject to provision under sub rule (9) of Rule 66 extracted
below :
Sub rule (9) of Rule 66 of A.P.VAT Act, 2005 :
“Where on the date fixed for hearing or any other day to which the
hearing may be adjourned, the applicant or the officer concerned does not
appear in person or through an authorized representative when called on for
hearing, the authority may dispose of the application exparte on merits:
applicant specified in sub rule (3), applies within fifteen days of receipt of the
order and satisfies the authority that there was sufficient cause for his non-
appearance when the application was called upon for hearing, the authority may,
after allowing the opposite party a reasonable opportunity of being, make an
order setting aside the exparte order and restore the application for fresh
hearing”.
Sd/- Sd/- Sd/-
ADDL/JT.COMMISISONER
To
M/s.Hyderabad Chemical Products Limited, Balanagar, Hyderabad.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Hy-Power Associates, Jabalpur, Madhya Pradesh have filed an

Hence admitted.
The applicant is seeking clarification regarding tax deduction at source by
A.P.GENCO in respect of certain repairs done by the applicant. In view of the
claim the applicant is not a local resident and he is not a dealer registered under
the provisions of the Act, the case is therefore disposed on merits.
It is claimed by the applicant that they are registered dealers in Madhya
Pradesh and they have undertaken work for repairs i.e. dismantling, overhauling,
cleaning, assembling and painting of turbine generators, butterfly valves at
Upper Sileru Power House, Visakhapatnam for A.P.GENCO. It is mentioned by
the applicant that the work is purely a labour contract and all the material is
supplied by A.P.GENCO including paint and electrodes. It is the contention of the
applicant that small quantity of consumables like cotton waste, kerosene etc. are
used for cleaning and no material is transferred or incorporated. The applicant
contended that tax deduction at source is not applicable.
As seen from the copy of the agreement filed, bulk of the work prima
facie appears to be in the nature of cleaning and maintenance but Item No.10
specifies replacing of pipe lines and certain rates are also mentioned thereunder.
1
By Act No.5, 2007, the provisions relating to tax deduction at source have been
amended and certain procedure regarding quantification of TDS is also
prescribed in amended Rule 18 of the Rules. A provision is also made in Rule 18
regarding application to be made to the CTO concerned and the quantum of TDS
to be determined by the CTO concerned. In view of this, the ruling is given as
under :
The applicant shall follow the procedure prescribed in Rule 18 by
filing the relevant application form for quantification of TDS and the
CTO concerned shall examine the terms of the contract and determine
the quantum of TDS required.
below :
hearing”.
Sd/- Sd/- Sd/-
To
M/s.Hy-Power Associates, MIG-149, Anand Nagar, Adhartal, Jabalpur-482004.MP
2
PROCEEDING OF THE


***
O R D E R:
M/s. Vakkal Impex (P) Limited, Hindupur (TIN No.28760105899) have

Hence admitted.
The applicant is seeking clarification regarding requirement of advance
waybill in respect of Aluminum scrap procured from within the State or outside
the State.
appear and requested for adjournment . The applicant was contacted again on
20.12.2006 and there was no response from him. The case is therefore disposed
on merits.
The issue has been examined with reference to Rule 55 and the
notification issued thereunder. The proviso contended to sub rule (2) of Rule 55
prescribes that any consignee dealer who desires to import goods notified by
Commissioner of Commercial Taxes to be sensitive, from other States or Union
Territory shall send any advance waybill in duplicate to the consignor. Vide
Ref.JC(Enft)/D2/723/2005, Dt.15.6.2005, the Commissioner(CT) issued a
notification specifying certain goods to be sensitive for the purpose of sub rule
1
(2) of Rule 55. Item 12 in this list mentions “Aluminum products other than
conductors and utensils”. There is no mention of “Aluminum scrap” in this list.
The ruling is therefore given as under :
1. There is no requirement of advance waybill in respect of
Aluminum scrap purchased from outside the State.
2. There is no requirement of advance waybill in respect of any
goods procured within the State. In respect of such movement within
the State, if the consignor is not a registered dealer, it becomes
necessary for the consignee to use his own waybill. But this is not an
advance waybill.
Sd/- Sd/- Sd/-

To
M/s.Vakkal Impex (P) Limited,
IDA, Thumakunta.
Hindupur, Ananthapur District.

Copy to the Deputy Commissioner (CT), Ananthapur Division.
Copy to the Commercial Tax Officer, Hindupur Circle.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Vani Chemicals & Intermediates Limited, Hyderabad (TIN

The applicant is seeking clarification regarding exemption on sale of
business as a whole.
The case was posted for hearing on 3.11.2067. Sri Ch.Sarma, Advisor
Finance of the firm appeared and explained the case.
It was explained that they are selling one of the manufacturing units to
M/s.Porus Drugs & Intermediates Pvt. Limited as an ongoing concern and it
amounts to transfer of business and is eligible for exemption as prescribed under
Rule 36 of A.P.VAT Rules, 2005. The applicant also referred to a decision of
Hon’ble High Court in the case of M./s.Coromandel Fertilisers.
The issue has been examined with specific reference to Rule 36 of
A.P.VAT Rules, 2005. According to this Rule, the transfer of a business from one
VAT dealer to another VAT dealer is exempt from VAT and certain conditions
have been laid down thereunder. The basic objective of providing exemption for
transfer of business from one VAT dealer to another VAT dealer is that the
1
buying VAT dealer is anyhow eligible for the benefit of input tax credit to the
extent of tax charged by the selling dealer.
The ruling is therefore given that the transfer of a business from
one VAT dealer to another VAT dealer is exempt subject to the
conditions prescribed in Rule 36.
Sd/- Sd/- Sd/-

ADDL/JT COMMISSIONER
To
M/s.Vani Chemicals & Intermediates Limited,

2
PROCEEDING OF THE


***
O R D E R:
M/s. Arunodaya Electro Power Technologies (P) Limited, Hyderabad (TIN

The applicant is seeking clarification regarding the tax rate applicable on
sale of kits containing resistors, capacitors, transistors, integrated chips, and
some other electronic items.
The case was posted for hearing on 31.3.2007. Sri K.V.Subba Raju,
Advocate and Authorized Representative of the firm appeared and explained the
case.
1
It was explained that the applicant is a Private Limited Company with the
main objective of giving training on Live projects to Engineering students to
attain their projects. It was stated that in the process of the training, the
applicant supplies kits containing electronic items and therefore they wanted to
seek clarification regarding rate of tax applicable. The applicant did not furnish
any technical specifications or HSN codes applicable to the items. The issue
therefore is examined with reference to the entries in the Schedules to the Act.
Entry 39 of Schedule IV deals with I.T. products and several sub items with HSN
code are specified thereunder. Sub item 18 specifies electrical capacitors, sub
item 19 specifies electrical resistors and sub item 24 specifies electronic
integrated circuits and micro assembles. Similarly there are certain other sub
items. The question here is whether the applicant is selling his items put
together as a single entity in the shape of a kit or he is selling items separately.
The applicant did not also furnish the commercial or technical identity of the final
products sold by him and the relevant HSN Codes applicable. In the absence of
this, the ruling is given as under :
1. If the applicant is selling kit as a single entity and if it is not
falling within the ambit of the sub items specified under Entry 39 of
Schedule IV to the Act, the tax rate shall be 12.5%.
2. If the items are sold as individual items falling within the scope
of sub items for I.T. products specified in Entry 39 of Schedule IV to the
Act, the tax rate shall be 4%.
Sd/- Sd/- Sd/-
To
M/s.Arunodaya Electro Power Technologies Pvt. Ltd,
Kapra, Kamalanagar, Hyderabad.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Manjeera Constructions Limited, Hyderabad (TIN No.28800257250)

have filed an application and sought clarification and Advance Ruling under
Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005
The applicant is seeking clarification regarding the eligibility to opt for
composition of tax under sub section (7)(d) of Section 4 of the Act with regard to
the construction of residential units for Central Government Employees Welfare
Housing Organization (CGEWHO), New Delhi.
The case was posted for personal hearing on 8.3.2007. Sri
M.Ramachandra Murthy, Chartered Accountant and authorized representative of
the firm appeared and explained the case.
The applicant explained that CGEWHO, New Delhi called for tenders from
builders to construct houses/residential units on “Turnkey Housing Project” basis.
According to them, the scope of work includes procuring the land with the
consent of CGEWHO and after the approval of building plans, the houses have to
be constructed and handed over with all infrastructure facilities. It was also
stated that the land has to be initially registered in the name of CGEWHO before
the commencement of construction work and the total consideration is payable
on the basis of Sq.ft. basis for the constructed area and this includes the cost of
1
land also. They have enclosed a copy of the letter on 9.12.2005 issued by
CGEWHO in respect of Turnkey Housing Project at Bhuvaneswar. It is the
contention of the applicant that a similar project will be taken up for the same
organization in A.P. at Visakhapatnam. They have therefore requested for
clarification whether they are eligible for composition to pay tax at 4% of the
25% of the total consideration received from CGEWHO.
The letter of intent issued by CGEWHO in respect of Housing Project at
Bhuvaneswar was perused. As per the terms of agreement, the land shall be
transferred in favour of CGEWHO within a span of two months from date of issue
of letter of intent and the amount of consideration to be paid at various stages
was also specified. It was also specifically mentioned that the Turnkey contract
envisages a fully functional housing complex to be constructed by the
Organization.
The issue has been examined with reference to clause (d) of sub section
(7) of Section 4 of the Act. The words used are “any dealer engaged in
construction and selling of residential apartments, houses, buildings or
commercial complexes may opt to pay tax by way of composition at 4% of 25%
of the consideration received”. As seen from the terms of the contract, the land
is required to be purchased by the developer / applicant and it is required to be
registered in favour of CGEWHO. In a normal contract for construction, the
immovable property is already owned by the contractee / employer and the
person executing the work will not have any hold on the property. In the
transaction explained by the applicant, it is a comprehensive work which involves
acquiring and transferring land and also construction of fully developed housing
units. The total consideration is also not split on the basis of land and
constructed area separately. The consideration is on the basis of the total
constructed area in Sq.ft. and certain norms are fixed for the number of dwelling
units to be constructed per acre. Taking all these factors into consideration, the
ruling is given as under :
2
The applicant shall be eligible to opt for composition under sub
section (7)(d) of Section 4 of the Act to pay tax at 4% of 25% of the
total consideration received from the customer. Such tax shall be paid
as and when the payments are received from CGEWHO because the
individual units are not registered by the applicant as a vendor. The tax
liability therefore shall be discharged by the applicant from time to
time on the basis of total consideration received which shall include
the cost of land.
Sd/- Sd/- Sd/-

ADDL/JOINT COMMISSIONER
To
M/s.Manjeera Constructions Limited,
No.304, Aditya Trade Centre, Ameerpet, Hyderabad.

3
PROCEEDING OF THE


***
O R D E R:
M/s. Infosys Technologies Limited, Hyderabad (TIN No.28490189037)

S.Dwarkanath, Advocate appeared and explained the case. The applicant is
seeking clarification regarding the applicability of tax on Software testing and
analytical services and also maintenance and repair services for Software.
1
The applicant submitted a letter dt.29.8.2006 in response to the
letter issued by this Authority dt.7.8.2006 stating that the department
served a notice of assessment in Form VAT 305A for the period June,
2005 to December, 2005 proposing to levy tax on entire sales treating
them as Software sales and without bifurcation regarding different
services provided by them. According to sub section (2) of Section 67
to the Act, no application shall be entertained where the question
raised in the application is already pending before any Officer or
Authority of the department. Therefore, the application cannot be
taken up for consideration. It is therefore rejected.
Sd/- Sd/- Sd/-

ADDL/JOINT COMMMISSIONER
To
M/s.Infosys Technologies Limitd,
Survey No.210, Manikonda Village,
Lingampally, Hyderabad.

2
PROCEEDING OF THE


***
O R D E R:
M/s. Esveeaar Distilleries Private Limited, Renigunta Mandal (TIN

The applicant is seeking clarification regarding the following :
a) The sale of liquor by our distillery to APBCL is exempt from tax or not
b) The provisions under Section 4(4) of the Act is applicable to our
industry
c) The provisions under Section 4(4) is also applicable to the packing
materials purchased by our company.
d) If we purchase packing materials and consumables in A.P. from a TOT
dealer what will be the liability under VAT Act.
S.V.Raghavendra Rao, Advocte appeared and explained the case.
The applicant is a distillery manufacturing liquor and supplying to A.P.
Beverages Corporation Limited (APBCL). It is explained that packing materials
are purchased from dealers not registered as VAT dealers in the State and such
packing materials are used for bottling liquor which inturn is supplied to APBCL.
The question mainly raised is whether transactions of sale in their hands is
1
treated as exempt from tax and if so provisions of sub section (4) of Section 4
are attracted and consequently purchase tax is payable by them in respect of
Bottles purchased from TOT dealers. Entry (I) of Schedule VI to the Act specifies
“all liquors, bottled and packed as per the provisions of A.P. Excise Act, 1968” to
be taxed at the point of first sale in the State. Explanation I in the Schedule VI to
the Act specifies that when any distillery sells liquor to APBCL the sale by APBCL
shall be deemed to be the first sale. Similarly, Explanation II in the same
Schedule specifies that sale of liquor by any distillery to APBCL shall be exempt
from tax under the Act. Sub section (4) of Section 4 of the Act stipulates that tax
on the purchase price of goods is payable at 4% in certain situations. Clause (i)
specifies that if goods purchased from a dealer not registered as a VAT dealer
are used as inputs for goods which are exempt from tax under the Act, the
buying VAT dealer shall be liable to pay tax at 4% on the purchase price of such
goods.
The ruling therefore is given as under ;
By virtue of the wordings in sub section (4) of Section 4 of the
Act read with Explanation II in the Schedule VI of the Act, the
applicant becomes liable to pay tax at the rate of 4% on the purchase
price of packing materials or any other materials because the finished
goods sold in his hands i.e., liquor is exempt from tax under the Act.
Sd/- Sd/- Sd/-

To
M/s.Eseeaar Distilleries Private Limited,
Renigunta, Kadapa Road, Karakambadi Village, Renigunta Mandal.
Copy to the Deputy Commissioner (CT), Chittoor Division.
Copy to the Commercial Tax Officer, Tirupati-II Circle.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Pidilite Industries Limited, Hyderabad (TIN No.28690180171) have

Hence admitted.
sales of Student colours sold under various brand and trademarks in small boxes
containing assorted colours.
appear for hearing. It was again posted for hearing 24.1.2007. Sri J.K.Rao,
Chartered Accountant and authorized representative of the firm appeared and
explained the case.
1
The applicant produced copies of the invoices and the brochures /
catalogues for the products marketed by him. As seen from the invoices and
brochures / catalogues, the items are found to be specifically meant for students
and kids for the purpose of using in drawing and art. In these brochures, it was
also mentioned specifically that they are non-toxic, safe and washable items. As
seen from the entries in the Schedules to Act, Entry 68 of Schedule IV specifies
“writing instruments, writing ink, geometric boxes, colour boxes, pencil,
sharpners and erasers”. The reading of the entry clearly gives the impression
that the items are basically meant for students and children. The items marketed
by the applicant are specifically meant for this category. The ruling is therefore
given as under:
The items specified by the applicant “student colours, sold under
various brand and trademarks” fall within the scope of Entry 68 of
Schedule IV to the Act taxable at 4%.
Sd/- Sd/- Sd/-

To
M/s.Pidilite Industries Limited,
Punjagutta, Hyderabad.

2
PROCEEDING OF THE


***
O R D E R:
M/s. Gurana Sadhurao Traders (P) Limited, Vizianagaram (TIN

The applicant is seeking clarification regarding the liability to tax in respect
of Tobacco products.
The case was posted for hearing on 25.1.2007 but the applicant did not
appear for hearing. The case was again posted for hearing on 1.3.2007 and Sri
A.Sarveswara Rao, Advocate and authorized representative of the firm appeared
1
Entry 47 in Schedule I to the Act specifies Tobacco and explanation to the
Schedule mentions that the items in Entries 45, 46 and 47 of the Schedule shall
be goods included in the relevant heads and sub heads of the Ist Schedule to the
Additional Duties of Excise (Goods of Special Importance) Act, 1957 but does not
include goods where no additional duties of excise are levied under that
Schedule. The issue is regarding the exemption given by Central Government
w.e.f. 1.3.2006 regarding levy of additional duty of excise. The principle involved
is whether the State Government is empowered to levy Sales tax / VAT on the
products which are originally included in additional duty of excise and the State
Governments are given share in respect of the revenue realized by way of excise
duty. In respect of certain goods under Ist Schedule to the Additional Duties of
Excise Act, Government of India have granted exemption but raised the basic
excise duty. The principle of giving additional share in lieu of sales tax continues
to be in force. As a result of this, the States cannot levy any Sales tax / VAT in
respect of the goods included in Ist Schedule to the Additional Duty of Excise
Act, 1957. However, there is some change in the statutory position w.e.f.
1.4.2007. The ruling is therefore given as under :
The items falling within the scope of additional duty of excise
cannot be subjected to VAT upto 31.3.2007.
Sd/- Sd/- Sd/-

To
M/s.Gurana Sadhurao Traders (P) Limited,
Bikkavolu Street, Vizianagaram.

Copy to the Deputy Commissioner (CT), Vizianagara Division.
Copy to the Commercial Tax Officer, M.G.Road(West) Circle.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Prahallada Agencies, Kadiri (TIN No.28720190161) have filed an

Hence admitted.
sales of Glucose-D powder.
The case was posted for hearing on 25.1.2007. Sri P.Janardhan Reddy,
STP and authorized representative of the firm appeared and explained the case.
The item, Glucose-D is not found in any of the entries in the Schedules to
the Act. It cannot be classified as falling under entries Entry 88 in Schedule IV to
the Act which specifies “Drugs and medicines”. Liquid Glucose (non medicinal),
dextroces syrup are notified with HSN code 1702 under Entry 100 in Schedule IV
1
to the Act which specifies “industrial inputs-. The item specified by the applicant
cannot come under this category also because it is in powdered form and also it
contains other ingredients. The ruling therefore is given as under:
Glucose-D powder falls under the category of residual items
falling within the scope of Schedule V to the Act and therefore is
taxable at 12.5%.
Sd/- Sd/- Sd/-

To
M/s.Prahallada Agencies,
Mitta Complex, Kadiri

Copy to the Deputy Commissioner (CT), Ananthapur Division.
Copy to the Commercial Tax Officer, Dharmavaram Circle.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Big Apple Manufacturing, Secunderaad (TIN No.28450115092) have

Hence admitted.
The applicant is seeking clarification regarding availment of Mod VAT in

respect of Additional Customs duty paid on parts and accessories of computers
to be adjusted against VAT payable under A.P.VAT Act.
The case was posted for hearing on 24.2.2007. Sri Prabhu Dayal
During the course of hearing, it was informed by the applicant that a

notice in Form 305 is issued by CTO, Begumpet Circle. The issue in question is
also examined with reference to the provisions of the Act and no provision for
availment of credit for the additional customs duty is found either in the Act or in
the Rules. Sub section (2) of Section 67 of the Act stipulates that no application
1
shall be entertained where the question raised in the application is already
pending before any Officer or Authority of the Department or Appellate Tribunal
or any Court.
In view of the above the application cannot be entertained and it

is therefore rejected.
Sd/- Sd/- Sd/-

To
M/s.Big Apple Manufacturing,
S.D.Road, Secunderabad.

2
PROCEEDING OF THE


***
O R D E R:
M/s. Conveyor India Fabrication Private Limited, Chennai have filed an

Hence admitted.
The applicant is seeking clarification regarding the tax liability in respect of
works contracts to be executed for M/s.Bharat Petroleum Corporation Limited for
providing RVI elements at their retail outlets in A.P.
The case was posted for hearing on 8.3.2007. Sri Mathew Kuncheria,
Director of the firm appeared and explained the case.
The applicant explained that they are in the process of quoting for tender
floated by M/s.Bharat Petroleum Corporation Limited, Southern region for
providing RVI elements at their retail outlets in A.P. on annual rate contract basis
which includes fabrication, transportation, installation and commissioning. It was
further explained that the work involves giving a face lift to the existing Canopy
by providing Aluminum Composite Material (ACM) of desired colours imported
from Japan. It was also stated that Canopy frames are made out of MS square
tubes / GI channels fabricated and sent from Chennai to the retail outlet. The
applicant further stated that 35-40% of the cost is towards materials and the
balance cost is incurred towards labour, transportation, supervision etc. The
1
applicant was particularly seeking to know whether any additional liability would
arise for the materials obtained from outside the State in case he opts to pay tax
by way of composition at 4% on the total consideration.
The transaction in nature as explained by the applicant falls completely
within the scope of works contract in sub section (7) of Section 4 of the Act.
There are two options available for payment of tax in respect of works contract.
Clause (a) allows payment of tax on the basis of the value of the goods at the
time of incorporation of such goods in the works executed at the rates applicable
to the goods under the Act. If the dealer is registered as a VAT dealer, he is also
eligible for the benefit of input tax credit to the extent of 90% of the related
input tax as specified in sub section (7) of Section 13 of the Act. Clause (c) of
sub section (7) of Section 4 provides the option of paying tax by way of
composition at 4% of the total consideration. However, clause (e) in the same
sub section specifies that if any goods are purchased or received from outside
the State, the tax shall be paid on such goods at the rates applicable to them
and such value shall be excluded for the purpose of computation of turnover on
which tax by way of composition at 4% is payable.
Taking the above provisions relating to the works contract in the charging
Section 4 and also the tax rates applicable to the goods in the Schedules to the
Act into consideration, the ruling is given as under :
1. As furnished in the documents, the HSN code 7606 applicable to
Aluminum Composite Materials is notified by the Government for Entry
27 in Schedule IV to the Act and therefore the applicable tax rate is
4%. Similarly MS square tubes / GI channels and Aluminum angles are
also taxable at 4% under the Act.
2. The applicant is eligible to opt for composition to pay tax at 4%
on the total consideration. If any goods used in such works contract
are obtained from outside the State and if such goods are taxable at
4% under the Act, it would make no difference because composition
rate is 4%. In case any goods obtained from outside the State for use
2
in such works contract are taxable at 12.5%, the applicant is required
to make payment of difference between 12.5% and 4% which is 8.5%.
3. In case the applicant does not opt for composition under clause
(c) of sub section (7), he can pay tax on the value of the goods at the
time of incorporation at the rates applicable to such goods under the
Act and he is also eligible for the benefit of input tax credit to the
extent of 90% for the inputs purchased from VAT dealers registered in
the State. In such a case he is also eligible for deduction from total
consideration regarding cost of labour, establishment, planning etc.
Sd/- Sd/- Sd/-

To
M/s.Conveyor India Fabrications Private Limited,
64, II Main Road, Ambattur Industrial Estate,
Chennai – 400 058.

3
PROCEEDING OF THE


***
O R D E R:
M/s. Asa Bhanu Technical Services Limited, Hyderabad (TIN

various types of machine tools, measuring tapes and hand tools and certain
other items which are listed below :
S.No. Particulars HSN codes
1. Machine tools
Hex keys 8201.40.00
Screw drivers 8205.40.00
Pliers 8203.20.00
Tool pouch 3926.90.99
Bits 8205.10.00
Wrenches 8204.11.20
Socket 8207.90.90
Levels 8205.59.10
Hand Riveter 7326.90.99
1
2. Measuring tapes & Hand tools
Measuring tapes 9017.80.10
Angle meter 9033.00.00
Hand saw 8202.10.20
Cutter knives 8211.93.10
Handsaw blades 8202.91.20
Cutter blades 8211.94.00
Digital calipers 7 gauges 901730
3. Semi conductors (Electronic goods) 8541.50.00
4. IC Drivers 854200
5. Parts for traction motor (machined castings) 8482.91.11
6. Vaccum cleaner – 1600W 850910
7. Distance measuring wheel 9017.80.90
The case was posted for hearing on 8.3.2007. Sri B.Phani Raj, Accounts
Executive of the firm appeared and explained the case.
On verification of the HSN codes furnished by the applicant for
the items on which clarification is sought, it is observed that except the
following 7 items, all other items are notified by the Government
against entries in Schedule IV to the Act. The 7 items which do not find
place in the notifications are as under :
2
S.No. Particulars HSN codes
1 Hex keys 8201.40.00
2 Tool pouch 3926.90.99
3 Angle meter 9033.00.00
4 Cutter knives 8211.93.10
5 Cutter blades 8211.94.00
6 Parts for traction motor (machined castings) 8482.91.11
7 Vaccum cleaner – 1600W 850910
The ruling is therefore given as under :

Excluding the 7 items not notified by the Government and
mentioned para supra, all other items mentioned by the applicant are
taxable at 4%. The 7 items fall under the category of “Residuary items
within the scope of Schedule V to the Act and taxable at 12.5%.
Sd/- Sd/- Sd/-

To
M/s.Asa Bhanu Technical Services Limited,
Kamalapuri Colony, Hyderabad.

3
PROCEEDING OF THE


***
O R D E R:
M/s. Lamtuf Plastics Limited, Hyderabad (TIN No.28590161324) have filed

an application and sought clarification and Advance Ruling under Section 67 of
the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with the
Hence admitted.
The applicant is seeking clarification regarding the eligibility of input tax

credit on the purchases of coal consumed for the purpose of running Boiler to
generate steam.
The case was posted for hearing and Sri V.Parandhama Reddy, Accounts
Manager of the firm appeared and explained the case.
The issue has been examined. It is noticed that the issue in question was
already raised with regard to the claim of the application in respect of transitional
relief for the sales tax paid on closing stocks at the time of introduction of
A.P.VAT Act, 2005. The claim made by the applicant was rejected and
subsequently this application has been filed in respect of the purchases of coal
made after 1.4.2005 i.e., introduction of VAT Act.
1
Sub section (2) of Section 67 of the Act stipulates that no
application shall be entertained where the question raised by the
applicant is already pending before any Officer or Authority of the
Department or Appellate Tribunal or any Court. In view of this the
application cannot be entertained and therefore it is rejected.
Sd/- Sd/- Sd/-

To
M/s.Lamtuf Plastics Limited,
6-3-853,

2
PROCEEDING OF THE


***
O R D E R:
M/s. Jagadamba Mills, Kothagudem (TIN No.28410231073) have filed an

Hence admitted.
The applicant is seeking clarification regarding the TDS amount deducted

by Panchayat Raj Department in respect of supply of RCC pipes and whether
such amount can be adjusted towards arrears of APGST. The applicant filed
certificate for deduction of sales tax issued by Executive Engineer, Panchayat
Raj, Bhadrachalam, copy of the waybill used by him for transportation of RCC
pipes and the copy of invoice issued by him in favour of Executive Engineer,
Panchayat Raj Department. The applicant also subsequently filed Form 570
which indicates that he is registered as a VAT dealer.
The case was posted for hearing on 25.1.2007. The applicant sought an
adjournment and it was subsequently posted on 15.3.2007. The applicant did not
appear and therefore the application is disposed on merits.
The issue has been examined with reference to the documents filed. The
applicant was a TOT dealer initially and subsequently he obtained VAT
1
Registration w.e.f. 1.10.2005. The invoice in question is dt1.7.2005 issued in
favour of Executive Engineer, Panchayat Raj Department and no tax is
specifically charged but it is mentioned that the price includes tax. The Certificate
of tax deduction indicates that the transaction is supply of goods and there was
no involvement of execution of works contract. The ruling is therefore given as
under :
1. The transaction in question is in the nature of sale of goods and

not in the nature of works contract and therefore it does not attract
provisions of TDS under sub section (3) of Section 22 of the Act.
2. The tax so deducted can be credited to the account of dealer

either for adjustment of any arrears of APGST or for future liability. The
applicant is however liable to pay turnover tax at 1% upto the
effective date of VAT registration.
below :

2
hearing”.
Sd/- Sd/- Sd/-

To
M/s.Jagadamba Mills,
Kothagudem, Khammam Dist.

Copy to the Commercial Tax Officer, Khammam Circle.
3
PROCEEDING OF THE


***
O R D E R:
M/s. Prairie Engineering Inc India Project Office, Hyderabad (TIN

1. Whether the tax withholding has to be done by the Applicant (the Main
Contractor) u/s. 22(4) on the portion of the work sub-contracted by him to
another contractor in case the Applicant has opted for composition under the
A.P.VAT Act?
2. Applicant is under composition under Section 4(7)(c). The contractee is
deducting/collecting tax at source at 4% of the contract value. The contractor
gives part of the work to the sub contractor. The sub contractor is exempted
from tax as per the proviso to Section 4(7). If such sub contractor purchases
material from outside the State for use in the contract, he is liable to pay tax on
the purchase value of the goods. In such a case whether the Applicant i.e., main
contractor will get deduction of such outside purchases value out of the total
contract value or not. Otherwise it amounts to double taxation on these
purchases once in the hands of the sub contractor and once again in the hands
of the main contractor.
1
The case was posted for hearing on 28.6.2006. Sri S.Ananthnarayanan,
Chartered Accountant and Authorised Representative of the firm appeared and
explained the case.
It was explained that the applicant is a company registered under the
Laws of USA and has obtained an order to construct a Sead Processing Facility
for M/s.Monsanto India Limited in A.P. The applicant submitted a copy of the
contract agreement between him and M/s.Monsanto. According to this
agreement, the total contract is for a price of $ 55,93,082. The contract involves
site development construction, management, procurement, commissioning, start
up and testing. It was cited by the applicant that major part of the work will be
sub-contracted and orders have already been placed on few sub contractors. The
applicant seeks to know whether any withholding tax is required to be deducted
by them on payment made to sub contractors in case they opt to pay tax by way
of composition. Copies of the showcause notice issued by CTO, Begumpet
proposing rejection of composition and subsequently accepting composition and
consequent proceedings were filed. The CTO obviously verified the terms of the
contract and determined that the transaction is in the nature of execution of
works contract. The applicant is also referring to the provision which stipulates
that the sub contractor is exempted subject to the condition that he agrees to
pay tax on goods purchased from outside the State or from Non-VAT dealers in
the State at the rates applicable to such goods. The applicant seeks to know
whether deduction of the turnover is allowed in the hands of the applicant.
The issue is examined with reference to the provisions of sub section (7)
of Section 4 of the Act as existed prior to Act No.5 of 2007 and the modified
provisions as a result of the decision of the Hon’ble High Court in Writ Petition
Nos.12124 of 2006(L&T) and 1278 of 2006. Act No.5, 2007 is given effect from
1.9.2006. The observations and findings of the Hon’ble High Court which
necessitated amendment to sub section (4) are also to be taken into
consideration. The following position emerges as a result of all this.
2
Clause (c) of sub section (7) of Section 4 stipulates that any dealer
executing works contract other than for Government and Local Authority may opt
to pay tax by way of composition at 4% of the total consideration received or
receivable. The second proviso in the sub section stipulates that no tax shall be
payable on the turnover relating to the consideration received as a sub
contractor if the main contractor opted to pay tax by way of composition. The
condition in the proviso is that the sub contractor shall pay tax in respect of any
goods purchased or received from outside the State of India or from any person
other than a VAT dealer in the State on the value of such goods at the rates
applicable to them under the Act. The Hon’ble High Court of A.P. examined the
provisions relating to charging section in respect of works contract and gave a
finding that the transaction of a works contract can be taxed only once either in
the hands of main contractor or in the hands of sub contractor. By Act No.5,
2007, clause (g) and clause (h) were added to sub section (7) of Section 4 of the
Act. Clause (h) stipulates that the turnover relating to the amounts paid by a sub
contractor as consideration is to be excluded for the purpose of determining the
turnover in the hands of the main contractor liable to tax. Rule 18 was also
amended and a new procedure is prescribed for transfer of any TDS from main
contractor to the sub contractor. The changed provisions are notified as coming
into effect from 1.9.2006. Taking these provisions in the Act and Rules into
consideration, the ruing is given as under :
1. In respect of the taxable events completed upto 1.9.2006, the main
contractor is liable for tax totally in case he opted for composition. The sub
contractor is fully exempt and there is no need for TDS to be made by main
contractor eventhough the sub contractor may or may not have purchased any
goods either from outside the State or from Non-VAT dealers in the State. The
liability in such a situation would be totally on the part of the sub contractor and
if goods purchased are in 4% category no further liability would arise. However if
the sub contractor purchased goods attracting 12.5% tax rate, he shall be
required to pay the different between 12.5% and the composition rate of 4%.
3
This means the sub contractor shall pay tax at 8.5% on the value of the goods
purchased from outside the State or from non VAT dealers in the State.
2. With regard to the taxable events occurring after 1.9.2006, the main
contractor is not liable to pay any tax on the consideration paid to the sub
contractor. The sub contractor can either opt for composition or may pay tax
under clause (a) of sub section (7) of Section 4 of the Act. The main contractor
can transfer proportionate TDS based on the rates prescribed in the Rules in
favour of the sub contractor for all the amounts paid as consideration to the sub
contractor. In case the sub contractor opted for composition he shall be required
to pay tax on the goods purchased from outside the State or from Non-VAT
dealers in the State to the extent of 8.5% if such goods are taxable at 12.5%
under the Act because 4% tax component is already taken care of in the
composition tax rate. There is no requirement or scope for the main contractor
to quantify such tax in the hands of the sub contractor and make any deduction
at source.
Sd/- Sd/- Sd/-

To
M/s.Prairie Engineering Inc India Project Office,
15, Jabbar Building, Hyderabad.

4
PROCEEDING OF THE


***
O R D E R:
M/s. Becton Dickinson India Private Limitd, Hyderabad (TIN

The applicant is seeking clarification regarding certain medical items listed
below :
S.No. Description of goods HSN code Remarks
1 Insulin lancet 9083100 Prick for blood sample
2 Alchohol swabs Cotton alchohol for cleaning injecting
site
3 Pen needles 90183220 Needle used in insulin pen for
injecting insulin
4 Thermometer Digital thermometer for measuring
body temperature
5 Connecta 90183990 3 way stop cock used with IV
catheters to inject drugs to patient
6 Epidural kit 90189090 Kits used in anesthesia contains LOR
syringe, epidural catheter spinal
itroducer
7 Vaccutainers 90189099 Glass/Plastic tubes to collect blood for
samples
8 Microtainers 90189099 Glass/Plastic tubes to collect blood for
samples`
9 Vaccu needles 90189099 Vaccu needle to prick & collect blood
1
The case was posted for hearing on 13.3.2006. Sri B.Ch. Narsi Reddy, STP
and authorized representative of the firm appeared and explained the case.
The applicant furnished copies of bills of entry to determine the
appropriate HSN code applicable to the goods in question.
The issue has been examined with reference to the entries in the
Schedules and the HSN code notified by Government from time to time. Entry 88
of Schedule IV was amended w.e.f. 18.8.2005. Certain items like Hypodermic
syringes, Hypodermic needles, Catheters etc. were added w.e.f. 18.8.2005.
The Government have notified HSN codes 9018.31, 9018.32 and 9018.39.
As seen from the details furnished by the applicant, some of the items on which
clarification is sought are outside the scope of HSN codes notified. The ruling is
therefore given as under :
1. Only two items, as at Sl.No.1 and 3 fall within the nomenclature
“Hypodermic syringes, Hypodermic needles or within the scope of
9018.31, 9018.32 and 9018.39, the rate applicable shall be 4%.
2. Other items falling outside the scope of the nomenclature and
HSN code notified shall attract at 12.5%.
Sd/- Sd/- Sd/-

To
M/s.Becton Dickinson India Private Limited,
Laxminagar, Hyderabad.

Copy to the Commercial Tax Officer, Vengalaraonagar Circle.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Sri Dhanalaxmi Rice Mills, Bapatla (TIN No.28240166800) have filed
an application and sought clarification and Advance Ruling under Section 67 of
the APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,2005 along with the
Hence admitted.
The applicant is seeking clarification regarding the eligibility for sales tax
credit in respect of secondary purchases of goods at the time of introduction of
VAT.
appear for hearing. The case was posted on 8.3.2007. There was no response
from the applicant. Therefore the case is disposed on merits.
The issue has been examined with reference to the provisions relating to
sales tax relief as provided in sub section (2) of Section 13 and Rule 37. This
particular provision was a transition provision and the entire process is required
to be completed within a given time frame. The applicant was required to submit
application for the sales tax relief in Form 115 and the claim was required to be
approved in Form 116 or if partly refused or reduced orders were to be passed in
Form 117. The issue cannot be opened or resolved at this stage.
1
In view of the fact that the applicant did not appear for the
hearing and there was a provision to seek remedy by filing an appeal
against any order passed by the prescribed Authority, this application
is disposed as rejected.
Sd/- Sd/- Sd/-

To
M/s.Sri Dhana Laxmi Rice Mills,
Bapatla, Guntur District.

Copy to the Commercial Tax Officer, Bapatla Circle.
2
PROCEEDING OF THE


***
O R D E R:
M/s. Sri Raghavendra Agro Tech, Kadapa (TIN No.28420421031) have

Hence admitted.
The applicant is seeking clarification regarding purchase tax under sub
section (4) of Section 4 of the Act in respect of purchases of Bengal gram and
other Pulses from agriculturist in the State as well as outside the State and after
processing them to convert as seeds and supply to A.P. Cooperative Oil Seed
Growers Federation Limited.
The case was posted for hearing on 31.3.2007. Sri G.Narendra Chetty,
Advocate and Authorised Representative of the firm appeared and explained the
case.
The learned representative explained that the applicant is intending to
purchase Bengal gram and other pulses from Ryots within A.P. and also outside
A.P. and after processing the same, the resultant goods are to be sold as seeds
to A.P.Cooperative Oil Seed Growers Federation Limited. A reference was also
made to Entry 44 of Schedule I to the Act which specifies “Seeds for sowing and
gardening purpose”. It was contended that cleaning and grading do not come
1
under the purview of manufacturing or consumption. A reference was also made
to the advance ruling given vide CCT’s Ref.A.R.Com/236/2005, dt.4.9.2005 in the
case of Rashtriya Ispat Nigam Limited. It is the contention of the applicant that
the provisions of purchase tax under sub section (4) of Section 4 are not
attracted in the hands of the applicant. A reference was also made to a decision
of Hon’ble High Court of A.P. (1997) 24 APSTJ 150 where provisions under
Section 6A of APGST Act were questioned.
The issue has been examined with reference to sub section (4) of Section
4 of the Act and Entry 44 of Schedule I to the Act. The goods purchased by the
applicant do not qualify to be accepted as falling under Entry 44 of Schedule I to
the Act. Therefore the goods purchased by the applicant are taxable goods under
the Act. It is the contention of the applicant that the goods sold by him are seeds
falling under Entry 44 of the Act and therefore exempt. This cannot be examined
and any conclusive finding cannot be given by this Authority. It is a matter of
verification of facts and the appropriate Authority needs to examine and
determine the issue. The ruling is therefore given as under :
1. The goods purchased by him are not exempted goods falling

under Entry 44. They fall under Schedule IV and the taxable at 4%.
2. If the goods sold by him are exempted goods falling under Entry
44 of Schedule I to the Act, the applicant is liable to pay purchase tax
under sub section (4) of Section 4 of the Act because clause (i) of sub
section (4) specifies that any taxable goods purchased from a person
or a dealer not registered as a VAT dealer shall be liable to purchase
tax at 4% if after such purchases, the goods are used as inputs for
goods which are exempt from tax under the Act.
3. If the goods sold by the applicant do not qualify to be treated as
falling under Entry 44 of Schedule I to the Act, the sale in the hands of
the applicant becomes liable to tax at 4% (pulses) and in such a case,
2
no purchase tax is payable under sub section (4) of Section 4 of the Act
because the output in the hands of the applicant is taxable.
Sd/- Sd/- Sd/-

To
M/s.Sri Raghavendra Agro Tech,
D.NO.1/370-1, Hanumanagutti Road,
Yerraguntla, Kadapa District.

Copy to the Deputy Commissioner (CT), Kadapa Division.
Copy to the Commercial Tax Officer, Kadapa-II Circle.
3
PROCEEDING OF THE


***
O R D E R:
M/s. Albany Molecular Research Hyderabad Research Centre Private

Limited, Hyderabad (TIN No.28300223640) have filed an application and sought
clarification and Advance Ruling under Section 67 of the APVAT Act, 2005 read

1. Whether the purchasing VAT dealer is entitled to claim input tax credit in
respect of the tax charged by the seller in the tax invoice issued by the seller.
2. The purchasing VAT dealer is responsible to restrict the same to the rate
applicable to such goods as per the provisions of the A.P.VAT Act, 2005 and the
schedules there under particularly when the seller is obliged to deposit the tax
collected with the authorities.
The case was posted for hearing on 31.3.2007. Sri T.Vinod Kumar,
case.
1
It was stated by the applicant that they are purchasing various chemicals
for use in research activity and also for export of pharmaceuticals. It is also
stated that the suppliers of these chemicals are charging VAT at different rates
either 4% or 12.5%. The applicant contended that they are claiming input tax
credit on the basis of tax invoice issued by the suppliers and they wanted to seek
clarification whether the claim is correct.
The issue has been examined with reference to provisions relating to input
tax credit mechanism under Section 13 of the Act and Rule 20 of the Rules. Sub
section (1) of Section 13 specifies that an input tax credit shall be allowed to the
VAT dealer for the tax charged in respect of all purchases of taxable goods made
by that dealer during the tax period if such goods are for use in the business of
the VAT dealer. Sub rule (3) of Rule 20 prescribes that where all the sales of a
VAT dealer for that tax period are taxable, the whole of the input tax may be
claimed as credit excluding the tax paid on the purchases of any goods
mentioned in sub rule (2). Sub rule (2) of Rule 20 specifies certain items which
are not eligible for input tax credit. Clause (d) prescribes that any goods
purchased and used for personal consumption are not eligible for input tax
credit. Clause (f) prescribes that any goods purchased and accounted for in the
business but utilized for the purpose of providing facilities to the employees
including residential accomodation are not eligible for input tax credit. Taking the
above provisions into consideration, the ruling is given as under :
1. The applicant is entitled to claim input tax credit based on the

quantum of tax charged in the tax invoice issued by a registered VAT
dealer in the State.
2. The applicant shall restrict input tax credit as prescribed in sub
rule (2) of Rule 20.
3. The applicant may ask the supplying dealer to seek clarification
by way of advance ruling if there is any ambiguity regarding applicable
tax rates on the goods sold by them.
2
4. The CTO concerned of the applicant shall cause verification of the
purchases made by the applicant and take up necessary verification at
the other end to ensure that excess tax charged in the invoice issued to
the applicant is paid to the department or not. If for any reason is
appropriated by the dealer himself, suitable action may be initiated by
the CTO concerned.
Sd/- Sd/- Sd/-

To
M/s.Albany Molecular Research Hyd. Research Centre Pvt. Ltd,
Shameerpet Mandal,
Rangareddy District,
Hyderabad – 78.

3
PROCEEDING OF THE


***
O R D E R:
M/s. Cyberabad Convention Centre Private Limited, Hyderabad (TIN

1. Whether the purchasing VAT dealer is entitled to claim input tax credit in
respect of the tax charged by the seller in the tax invoice issued by the seller.
2. The purchasing VAT dealer is responsible to restrict the same to the rate
applicable to such goods as per the provisions of the A.P.VAT Act, 2005 and the
schedules there under particularly when the seller is obliged to deposit the tax
collected with the authorities.
The case was posted for hearing on 31.3.2007. Sri T.Vinod Kumar,
case.
It was explained that the applicant is purchasing various food items to
cater to their customers and the suppliers are charging VAT at 12.5% on 60% of
the value but some of the suppliers are charging 12.5% on full value of the
goods. It was also stated that they purchase some raw materials for preparation
of food items and suppliers are found to be charging different rates of tax for the
1
same items. It is contended by the applicant that they are claiming input tax
credit on the basis of the tax component in the invoice. They are seeking to
know whether the buying VAT dealer is required to restrict the claim of input tax
credit on the basis of the correct rate of tax applicable to the goods purchased
eventhough the supplier charged higher rate and deposited such tax to the tax
department.
The issue has been examined with reference to provisions relating to input
tax credit mechanism under Section 13 of the Act and Rule 20 of the Rules. Sub
section (1) of Section 13 specifies that an input tax credit shall be allowed to the
VAT dealer for the tax charged in respect of all purchases of taxable goods made
by that dealer during the tax period if such goods are for use in the business of
the VAT dealer. Sub rule (3) of Rule 20 prescribes that where all the sales of a
VAT dealer for that tax period are taxable, the whole of the input tax may be
claimed as credit excluding the tax paid on the purchases of any goods
mentioned in sub rule (2). Sub rule (2) of Rule 20 specifies certain items which
are not eligible for input tax credit. Clause (d) prescribes that any goods
purchased and used for personal consumption are not eligible for input tax
credit. Clause (f) prescribes that any goods purchased and accounted for in the
business but utilized for the purpose of providing facilities to the employees
including in residential accommodation are not eligible for input tax credit.
Taking the above provisions into consideration, the ruling is given as under :
1. The applicant is entitled to claim input tax credit based on the
quantum of tax charged in the tax invoice issued by a registered VAT
dealer in the State.
2. The applicant shall restrict input tax credit as prescribed in sub
rule (2) of Rule 20.
3. The applicant may ask the supplying dealer to seek clarification
by way of advance ruling if there is any ambiguity regarding applicable
tax rates on the goods sold by them.
2
4. The CTO concerned of the applicant shall cause verification of the
purchases made by the applicant and take up necessary verification at
the other end to ensure that excess tax charged in the invoice issued to
the applicant is paid to the department or not. If for any reason is
appropriated by the dealer himself, suitable action may be initiated by
the CTO concerned.
Sd/- Sd/- Sd/-

To
M/s.Cyberabad Convention Centre Private Limited,
ANR Centre, Banjara Hills,
Hyderabad.

3
PROCEEDING OF THE

***

***
O R D E R:
M/s. Soutron Corporation, Secunderabad (TIN No.28047943911) have

Hence admitted.
1. Tax payable in respect of Works contract where material is coming largely
from outside the country and to some extent from outside the State and only
local civil work is executed in A.P.?
2. Whether the civil work involved is incidental and therefore exempt from
tax in view of the ruling of Supreme Court in the case of Kone Elevators (India)
Limited Vs. State of A.P.?
3. If tax is payable, the method applicable and tax rate thereon?
Sri Lt.Col.VSRK Sarma (Retd) Regional Head(South) of the company and
Sri J.K.Rao, Chartered Accountant and authorized representative of the firm
appeared on 1.3.2007 and explained the case.
At the time of hearing they have filed a copies into contract agreement
between the Central Water Commission (CWC) and the applicant company with
office at New Delhi. They have also filed the technical and price proposal
submitted by Sutron Corporation, Virginia, USA, to the Executive Engineer,
1
Central Water Commission dt.7.7.2004. After the first hearing on 1.3.2007 the
applicant was asked to produce documentary evidence in respect of material
dispatched, from USA by their company located in USA. These documents were
also filed.
As seen from the acceptance of tender communicated by Central Water
Commission, Government of India dt.6.12.2005, the work for supply, installation,
testing, commissioning and maintenance of real time data acquisition network on
turn key basis for collection, transmission and processing of hydro meterological
data, gauging equipment, satellite telemetry and associated systems including
hardware, software and peripherals, VSAT communication links between existing
Digital Direct Readout Ground Station facilities located at Burla (Orissa) and
Jaipur (Rajasthan) and various locations in Krishna & Godavari Basin
organization, Mahanadi and Eastern rivers organization, Lower Ganga basin
organization and Yamuna Basin organization and maintenance for four years
after warranty period of two years was awarded to the applicant company for an
amount of Rs.20,95,86,961/-. A list of various stations under different river
basins was also attached. The applicant explained that the initial tender itself
was filed by their company located in USA and the main equipment is dispatched
from USA clearly showing CWC as the customer. A copy of the commercial
invoice dt.27.7.2006 raised by the applicant company located in USA for an
amount of $ 1,65,568.50 was filed. Similarly the copies of a bill of entry for home
consumption were also filed showing United States as origin and the applicant
company at New Delhi as receiver of the goods imported. These bills of entry
indicate that basic customs duty and countervailing duty were also collected on
these transactions. It was also explained that Executive Engineer, CWC at
Hyderbad is shown as the authority for the entire work to be executed at various
places in India. The applicant stated that tax deduction at source cannot be
applied for the entire value of the work on account of the fact that large
quantum of goods are imported from outside the country and certain other items
are supplied from New Delhi by charging CST. It was also stated that Declaration
2
Form-D is being obtained in respect of the supplies made from their office at
New Delhi treating it as an interstate sale. The contention of the applicant is that
only civil work incidental or ancillary is the quantum of work executed locally. A
statement showing cost break up of works in A.P. was furnished at the time of
hearing. It contained the following details :
1. Imported material : 2,45,89,308/- (65%)
2. Indigenous material : 68,13,637 /- (18%)
3. Civil work : 33,36,823 /- (9%)
4. Installation & Commissioning : 29,28,150/- (8%)
It was also contended by the applicant that tax applicable and payable to
the extent of civil works done locally will be paid in all the 15 States involved and
the service tax applicable will be paid on the installation and commissioning
charges to the concerned authorities at Delhi. The main contention of the
applicant is that TDS is not applicable on the entire money released by the
Executive Engineer located at Hyderabad in respect of the works executed
outside A.P. and also TDS is not applicable on the total value in respect of the
work executed in A.P.
The issue has been examined with reference to the documents furnished.
It is clearly evident that the entire work undertaken by the applicant includes
multiple sites which includes the locations in A.P and certain other sites outside
A.P. Eventhough the payment authority is located in Hyderabad, certain
transactions remain to be totally outside the purview of A.P. Other question is
regarding the material coming from outside the country as well as from outside
the State. An important aspect to be taken into consideration is a recent
amendment by Act No.5 of 2007 published in Gazette dt.22.1.2007. In this
amendment certain provisions relating to works contracts in charging Section 4
of A.P.VAT Act, 2005 have been made. Clause (g) of sub-section (7) is the most
relevant provision applicable in this case.
Clause (g) of sub-section (7) of Section 4 reads as under :
3
“Notwithstanding any thing contained in the clauses (a) to (f), no tax shall
be leviable on the turnover of transfer of property in goods whether as goods or
in some other form involved in the execution of works contract, if such transfer
from the contractor to the contractee constituted a sale in the course of
interstate trade or commerce under Section 3 or a sale outside the State under
Section 4, or a sale in the course of import or export under Section 5 of the
Central Sales Tax Act, 1956.”
In addition to the amendment to the Act, Rule 18 is also amended with
regard to quantum of TDS applicable and a provision is given for determination
of TDS.
Taking the facts of the case into consideration and the latest amendments
made to the charging Section 4 of the Act and Rule 18 of the Rules, the ruling is
given as under :
1. TDS cannot be made in A.P. under the provisions of A.P.VAT Act
in respect of the turnover of works executed outside the State of A.P.
2. As a result of the clause (g) to sub section (7) of Section 4 of
A.P.VAT Act, 2005, supply of any goods from the contractor to the
contractee in the course of import under Section 5 of CST Act 1956
cannot be subjected to tax and such value needs to be excluded from
total value of the works contract. similarly any transactions of supply
of goods in the course of interstate trade under Section 3 of CST Act
are also to be excluded as per this clause. Therefore the turnover or
value representing such interstate supply or supply in the course of
import needs to be excluded from taxable turnover.
3. Where the dealer contractor is of the opinion that quantum of
TDS shown in Rule 18 is not applicable, he has the option to specifically
apply for determination of quantum of TDS and the Commercial Tax
Officer concerned is required to pass an order to determine the
quantum of TDS to be made. It is therefore necessary that the
applicant submits an application to the CTO concerned and the CTO
4
concerned will take into account the material evidence and quantify
the TDS.
The issues raised by the applicant regarding civil work whether it
is incidental or ancillary to the work and installation & commissioning
portion of the work attracts service tax can also be examined so as to
quantify the approximate value of the goods procured in A.P. and used
in the work for the site located in A.P. and TDS applicable could be
quantified accordingly.
Sd/- Sd/- Sd/-

To
M/s.Sutron Corporation,
Abhinav Colony, Padmarao Nagar,
Secunderabad.

5
PROCEEDING OF THE

***

***
O R D E R:
M/s. Indian Oil Corporation Limited, Hyderabad (TIN No.28650127372)

The applicant is seeking clarification regarding the applicability of Entry
tax on interstate purchases of Bitumen by the contractors for the purpose of use
in execution of works contract.
The case is disposed on the basis of merits as per the information
available on record.
The issue has been examined. Firstly, the issue relating to Entry tax
cannot be taken up by this Authority unless it is relatable to adjustment of Entry
tax against VAT payable under the A.P.VAT Act, 2005. Secondly, the issue raised
is in respect of Entry tax liability in the hands of the contractor who is likely to
buy Bitumen from outside the State. The applicant is a company registered
under the Act and the issue raised therefore is not regarding any liability in their
hands within the jurisdiction of Andhra Pradesh.
1
The ruling therefore is given as under :
This Authority cannot entertain the application and therefore it is

rejected.
Sd/- Sd/- Sd/-

Addl./Jt.Commissioner
To
M/s. Indian Oil Corporation Limited,
Himayat Nagar, Hyderabad.

Copy to the Asst.Commissioner (CT)LTU, Secunderabad Divn.
2
PROCEEDING OF THE

***

***
O R D E R:
M/s. Sri Datta Sai Cement Concrete Products, Kurnool (TIN

The applicant is seeking clarification regarding Inclusion or Exclusion of
Transport charges from the taxable turnover for levy of VAT in respect of pre-
stressed cement concrete poles (PSCC) supplied to APCPDCL.
The issue has been examined based on the documents filed and the facts
involved. It is observed that CTO, Tadipatri (Kadiri circle) issued notice of Form
305A dt.23.2.2007 and confirmed the assessment by notice in Form 305
dt.11.4.2007. As seen from this order the issue relating to the inclusion of
transport charges was already examined and the turnover relating to delivery
charges was included in taxable turnover and assessed to tax.
The copy of the agreement between the applicant and CPDCL for the
supply of PSCC poles was examined. As per clause 9, the material shall be
deemed to pass to APCPDCL ownership only at the destination stores where they
1
are delivered and accepted. Clause No.12 indicates that the applicant will be
charged certain amount for the delay in delivery at the destination. Clause 9 also
mention about replacement of defective materials if any during the course of
transit or due to defective packing. The ruling is therefore given as under :
The transport charges collected in addition to basic price will

form part of the taxable turnover and therefore is liable to tax under
the Act.
Sd/- Sd/- Sd/-

To
M/s. Sri Datta Sai Cement Concrete Products,
Prasant Towers, Opp: Raj Theatre
R.S.Road, Kurnool.

Copy to the Deputy Commissioner (CT), Krunool Division.
Copy to the Commercial Tax Officer, Tadapatri Circle.
2
PROCEEDING OF THE

***

***
O R D E R:
M/s. Mahavir Enterprises (I) Private Limited, Hyderabad (TIN

The applicant is seeking clarification regarding rate of tax on Cello range
of household products like Water jugs, water bottles, Tiffin boxes and ice boxes
made of plastic with insulated technology.
Sri K.Ramanuja Chary, Authorized representative of the firm appeared and
explained the case.
It was explained that they are charging 12.5% VAT on these goods and
the advance ruling was also obtained vide A.R.Com.69/2005, dt.16.5.2005
wherein the rate of tax of 12.5% was confirmed. The applicant submitted that
they have received an order passed by the Commissioner of Appeals, Central
Excise and Customs, Daman in respect of the manufacture of Cello home
products confirming that the items in question fall under HSN code 3923.10. It is
the contention of the applicant that the HSN code 3923 is notified under A.P.VAT
Act, 2005 for Entry 90 in Schedule IV to the Act. They are seeking fresh orders
1
based on the orders of the Commissioner of Appeals, Central Excise
dt.25.3.2004.
The order of Commissioner of Appeals, Central Excise is not binding on
this Authority. The issue therein was levy of excise duty whether based on MRP
or not. As seen from the Central Excise Duty Chapters, tableware, kitchenware,
other household articles and toilet articles of plastic are specified with HSN code
3924. The sub item 3924.10.10 specifies insulated ware. This particular code is
not specified for Entry 90 in Schedule IV to the A.P.VAT Act, 2005. The ruling is
therefore given as under :
The items specified by the applicant do not fall within the scope
of Entry 90 dealing with “All kinds of packing material”. Therefore the
items fall under the residuary category in Schedule V to the Act and
taxable at 12.5%.
Sd/- Sd/- Sd/-

To
M/s. Mahavir Enterprises (I) Pvt. Ltd,
Tilak Road, Hyderabad.

Copy to the Commercial Tax Officer, M.J.Market circle.
2
PROCEEDING OF THE

***

***
O R D E R:
M/s. Indian Oil Corporation Limited, Hyderabad (TIN No.28650127372)

1. Whether the sales of HFHSD, Furnace oil and HSD is located in Special
Economic Zone recognized under SEZ Act, 2005 is exempt from the tax under
the VAT Act.
2. What are the documents to be filed before the Assessing authority
alongwith returns or otherwise to substantiate the claim for exemption.
The issue has been examined with reference to the provisions of the Act.
Schedule II of the APVAT Act specifies under Entry 3 that “Sales of goods to any
unit located in SEZ” as one of the transactions zero rated and eligible for input
tax credit. No specific forms or procedures are prescribed for this purpose.
The ruling is given as under :
1
The sales made by the applicant to a unit located in SEZ is zero-
rated which means no tax is chargeable on that transaction and at the
same time he is eligible for the benefit of input tax credit. It is the
responsibility of the applicant to prove that the transaction is really
made to a unit in SEZ by obtaining confirmation from the unit, copy of
the certificate issued by the competent authority of SEZ to prove that
the unit is registered in SEZ, the proof of payment and proof of
transportation if any. These details need to be furnished as and when
required by the authorities prescribed under the Act.
Sd/- Sd/- Sd/-

To
M/s. Indian Oil Corporation Limited, Himayat Nagar, Hyderabad.

Copy to the Asst.Commissioner (CT)LTU, Secunderabad Divn.
2
THE ANDHRA PRADESH TAX ON PROFESSIONS, TRADES,
CALLINGS AND EMPLOYMENTS, THE ANDHRA PRADESH TAX ON
ENTRY OF MOTOR VEHICLES INTO LOCAL AREAS, THE ANDHRA
PRADESH RURAL DEVELOPMENT, AND THE ANDHRA PRADESH TAX ON
ENTRY OF GOODS INTO LOCAL AREAS, ACTS (AMENDMENT) ACT, 2006
[Act No. 4 of 2006]1
the assent of the Governor on the 30th December, 2005 and the said assent
is hereby first published on the 2nd January, 2006 in the Andhra Pradesh
An Act further to amend the Andhra Pradesh Tax on Professions,
Trades, Callings and Employments Act, 1987, The Andhra Pradesh Tax
on Entry of Motor Vehicles into Local Areas Act, 1996, The Andhra Pradesh
Rural Development Act, 1996 and the Andhra Pradesh Tax on Entry of
Goods into Local Areas Act, 2001.
Pradesh in the Fifty-sixth Year of the Republic of India, as follows:–
called the Andhra Pradesh Tax on Professions, Trades, Callings and
Employments, the Andhra Pradesh Tax on Entry of Motor Vehicles into
Local Areas, the Andhra Pradesh Rural Development, and the Andhra
Pradesh Tax on Entry of Goods into Local Areas, Acts (Amendment) Act,
2006.
(3) 2[(i) sub-clauses (b) and (c) of clause (ii) of sub-section (2) of
Section 5 shall be deemed to have come into force with effect on and from
the 2nd January, 2006 ; and
(ii) the remaining provisions shall be deemed to have come into force
with effect on and from the 1st April, 2005.]
2. Amendment to Act 22 of 1987:– In the Andhra Pradesh Tax on
Professionals, Trades, Callings and Employments Act, 1987, in the First
Schedule, for Serial Number 9, the following shall be substituted, namely,–
"9. Dealers registered or liable to be registered under the Andhra
Pradesh Value Added Tax Act, 2005 (Act 5 of 2005) (other than those
mentioned in item 19) whose total turnover in any year ranges:
(a) upto Rs. 5,00,000 – Nil
(b) from Rs. 5,00,001 to Rs. 10,00,000 – Rs. 800/- PA
(c) from Rs. 10,00,001 to Rs. 25,00,000 – Rs. 1200/- PA
(d) from Rs. 25,00,001 to Rs. 50,00,000 – Rs. 1500/- PA
(e) from Rs. 50,00,001 and above – Rs. 2500/- PA.".
x x x
——
1. Pub. in the A.P. Gaz., Pt. IV-B, Ext. No. 4, dt. 2-1-2006.
2. Subs. by Act 30 of 2006, dt. 19-9-2006.
755
THE ANDHRA PRADESH TAX ON PROFESSIONS,
TRADES, CALLINGS AND EMPLOYMENTS
(AMENDMENT) ACT, 2006
[Act No. 7 of 2006]1

the assent of the Governor on the 31st December, 2005 and the said assent
is hereby first published on the 3rd January, 2006 in the Andhra Pradesh
An Act further to amend the Andhra Pradesh Tax on Professions,
Trades, Callings and Employments Act, 1987.
Pradesh in the Fifty-sixth Year of the Republic of India as follows:–
called the Andhra Pradesh Tax on Professions, Trades, Callings and
Employments (Amendment) Act, 2006.
(3) It shall come into force on such date2 as the Government may,
by notification, appoint.
2. Amendment of First Schedule:– In the First Schedule of the
Andhra Pradesh Tax on Professions, Trades, Callings and Employments Act,
1987 (Act 22 of 1987), in item 17, after sub-item (iv), the following sub-
item (v) and the entries relating thereto shall be added namely,–
"(v) Village Level Societies Rs. 150/- per annum.".
——
1. Pub. in the A.P. Gaz., Pt. IV-B, Ext. No. 7, dt. 3-1-2006.
2. 1-4-2006, vide G.O.Ms.No. 182, Rev. CT-IV, dt. 15-2-2006, Pub. in A.P. Gaz. Pt.
No. 109, dt. 28-2-2006.
756
APPOINTMENT OF COLLECTION AGENTS IN
VARIOUS DEPARTMENTS
*[G.O.Ms.No. 610, Revenue (CT-IV), dt. 30-5-2006]
Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987
(A.P. Act 22 of 1987) and in super-session of the orders issued in G.O.Ms.No.
801, Revenue (CT. III) Department, dated 18-7-2003, the Governor of
Andhra Pradesh hereby appoints the officers, mentioned in column (3) of
the Table given below, as Collecting Agents in respect of the Departments
mentioned in column (2) for collection of Profession Tax from the category
of persons mentioned in column (4) of the Table given below in their
respective jurisdiction as provided under the First Scheduled to the said
Act, 1987.
Sl. Name of Name of Collection Responsible for
the Dept. Agent collecting tax from
1 2 3 4
1. TR & B RTOs/Deputy Commissioners Lorry/Bus Drivers and Lorry/
Department (Transport)/Jt. Commissioner Bus Owners.
(Transport), Hyderabad City.
2(a) Education District Educational Officer Schools and School Teachers

Department. in Private Sector.
2(b) Education Regional Joint Director, Colleges and College

Department (Higher Education). Lecturers in Private Sector
2(c) Education Regional Joint Director, Polytechnic Colleges in

Department. Polytechnic). Private Sector and Lecturers
therein.
3. Works/ Pay & Accounts Officer Works Contractors.

Engineering concerned.
Department
Like I &
CAD,
TR & B
Department
4. Municipal City Planning Officers/ Municipality works contractors,

Administra- Town Planning Officers Land Developers, realtors and
tion Builders.
Department
* Pub. in A.P. Gaz. Part I, Ext. No. 325, dt. 8-6-2006.
757
1 2 3 4
5. Co-operation Dist. Co-op. Officer Co-operative Banks/

Department. Co-operative societies and
their employees working
therein.
6. Commissioner Asst. Director (Marketing) Agricultural Market Committees/

Marketing Cold storage units and the
Department employees, working therein.
7(a) Excise Depot Manager, Wine/Liquor Shops

Department APBCL.
7(b) Excise Asst. Excise Toddy Shops/Distilleries

Department Superintendent
8. Endowments Executive Officers of the Employees and others, who

Department Temples/Asst. Commissioners are associated with Endow-
(Endowments) ments Dept. but not directly on
the Departmental rolls.
9. Registration Sub-Registrar. Chit Fund Companies and

& Stamps employees, working therein.
Department
2. The Officers, appointed as Collecting Agents therein, shall, for the

purposes of collection of the Tax, have all the powers of assessing authority
and shall collect the Tax from the assessees mentioned in column (4) above
and credit the proceeds of the collection of profession tax to the Treasury
under the Head 0028 – Other Taxes on Income & Expenditure, 107 Tax
on Profession, Trade, Calling & Employment, 01 – Tax Collection.
3. The Officers who are appointed as collecting Agents for the
Government shall maintain necessary records and furnish a statement of
Professional Tax collected and remitted to the relevant Head of Account
every month to the Deputy Commissioner of Commercial Taxes concerned.
4. The concerned Departments shall take necessary action accordingly.
——
PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 59 / 2006. Dated 15 - 05-2007.
O R D E R:
M/s. Ghanta foods Private Limited, S.P.Road, Secunderabad (TIN.28890102241)

have filed an application and sought clarification and advance ruling on the following
items under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,
Whether sweet meats and savouries sold by him are taxable at the rate of 7.5% of
the Gross turnover under sub-section (9) of Section(4) of the APVAT Act w.e.f. 24-12-
2005.
1) A brief note on the issue
2) Form 565
Sri M.Ramachandra Murthy, Authorised representative, appeared for hearing and
explained the case.
The issue has been examined with reference to the provisions of the APVAT Act
and Rules and HSN Codes notified by Government vide G.O. Ms. No 398, Rev.(CT.II)
Dept.,Dt.31-03-2005 and G.O.Ms.No.490, Rev.(CT.II) Dept. dt.31-03-2005 as superceded
in G.O. Ms .No. 1596, Rev.(CT.II) Dept, dt.27-08-2005 and in G.O.Ms.No.1615, Rev.(CT.
II) Dept.,dt.31-08-2005 and the ruling is given as under:
The applicant states that, consequent to amendment to sub-section (9) of Sec.4 of
APVAT Act, 2005 every dealer running any restaurant, eating house, catering
establishment, hotel, coffee shop, sweet shop or any establishment by whatever name
called and any club, who supplies by way of or as part of any services or any other
manner whatsoever of goods, being food or any other article for human consumption or
drink shall pay tax @ 12.5% on 60% of the taxable turnover. Thus, all sweet shops have
been paying tax @ 7.5% on the total sale value/consideration. The applicant draws
analogy between them and sweetmeat shops and contends that sweet meats and savories
manufactured and sold by them, are also taxable @ 7.5% on value of such goods.
Under sub-clause (f) of clause 29 A of Article 366 of the Constitution of India,
tax can be levied on the 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…………and such transfer, or delivery or supply of any goods shall be
deemed to be a sale of those goods. This sub-clause is incorporated in explanation V to
sub-sec.28 of sec.2 of the APVAT Act as’ sale’ definition. Sub-section (9) of Sec.(4) of
the APVAT Act was amended w.e.f. 24-12-2005 where by “coffee shop, sweet shop or
any establishment” are included. Therefore, any establishment catering service and
supply or delivery of food and drink alone are eligible to pay tax U/sub-sec.9 of sec.4 of
the APVAT Act but not all other traders or manufacturers or dealers who make exclusive
purchase and sales.
Therefore, this authority hereby clarify that items sold by the applicant as
marketable commodity are liable to tax @ 12.5% under residuary entry of V Schedule.
Sd/- Sd/- Sd/-
Addl. Commissioner Jt. Commissioner Jt. Commissioner
M/s Ghanta foods Private Limited, Secunderabad..

PROCEEDINGS OF THE
Present: Sri G. Lakshmi Prasad, Addl.Commissioner(VAT)(FAC)

Sri K. Raghavaiah, Jt. Commissioner(AA & DMU)
*****
CCT’s Ref.No: A.R.Com/ 15 / 2007. Dated 30-6 -2007.
O R D E R:
I M/s. Crown Beers International Ltd., Banjara Hills, Hyderabad (TIN.28299462761)

II. They sought clarification, as to whether the transaction of transfer by way of sale
of manufacturing unit as an on going concern to M/s Crown Beers (India) Ltd., under a
sale deed/agreement amounts to transfer of business as ongoing concern and exempt from
payment of VAT under Rule 36 of the APVAT Rules,2005?

1. Form 570
2. Vakalatna ma in the name of Sri D. Harikishan, Advocate.
3. Copy of the sale deed of immovable property dated 26.3.2007.
4. Copy of the sale deed cum letter of movable property, dated 26.3.2007.
5. Copy of the B2 license issued by the Commissioner of Prohibition &
Excise, A.P., Hyderabad.
6. Copy of the resolution passed at the Board of Crown Beers India Ltd.,
meeting held on 2.3.2007 at 1401, Babukhan Estate, Basheerbagh,
Hyderabad at 10.30 AM.
IV. Sri D.Harikishan, Advocate and Authorised Representative , appeared for hearing
and Rules and the ruling is given as under:
VI. The applicant dealer is a registered company under the Companies Act. They are
also registered under the APVAT Act engaged in the business of manufacture and sale of
IMFL and beer on the rolls of the Commercial Tax Officer, Jubilee Hills, Hyderabad.
The applicant company transferred its manufacturing unit situated at S.No. 301,
Mallapally (V), Kondapur (M), Medak District as ongoing concern to M/s Crown Beers
India Ltd. They effected the transaction of sale of immovable property in sale deed
dated 26.3.2007, vide document No. 1901/book-I before the Sub-registrar, Sadasivpet,
Medak District and movable properties vide sale deed-cum- letter of movable property
dated 26.3.2007. The transferee company also obtained licence for manufacture of beer
in Form B2 in licence No. 3, dt. 29.3.2007 from the Commissioner of Prohibition and
Excise, Andhra Pradesh, Hyderabad for the years 2007-08.
Land property, admeasuring 28 acres and 34.5 guntas along with RCC building
having total plinth area of 25000 Sq.feet and shed zinc roof total area of 40000 Sq.feet
located in the said property has been transferred as scheduled property as per sale deed
dated 26.3.2007. Movable properties/assets like Budweiser equipment, Misc.brewing
equipment, vehicles, mi house, pasteurizer, water treatment plant etc., and also brewery
plant & machinery, bottling equipments, etc. and also licence to construct the brewery are
transferred through the sale deed cum letter of movable property dated 26.3.2007.
All these movable and immovable properties/facilities of the unit was

transferred on as is where is basis. The Advocate, appearing for personal hearings
explained the terms and conditions laid down in the contract and contended that the
transactions of transfer of the unit consisting of plant and machinery, infrastructure of
manufacturing unit, and immovable property of land and buildings, sheds ,plant &
machinery and other equipment, as a case of transfer of business as a whole, under Rule
36 of the APVAT Rules. He also drawn the attention of the authority to the A.P. High
Court decision in the case of M/s Coramandal Fertlizers Vs State of Andhra Pradesh (112
STC,1), wherein it was held that if a dealer transfers its business as ongoing concern, it is
still a transfer of business and the goods involved therein cannot be considered as sold in
the course of business but in the course of winding up of the business unit. They also
referred to the decisions of various courts decided in the cases of M/s Madras Petro
Chemicals (103 STC,56), M/s Bobby Rubber Industries (108 STC,410), M/s Lohia
Machines Ltd (110 STC,305) and proceedings of the Advance Rulings issued earlier in
proceeding No. AR.Com/513/2005, dt. 30.5.2006 and AR.Com./10/2006, dt. 3.7.2006.
The representation of the applicant is examined with reference to the

various documents in the instant case and High Court decision in the case of M/s
Coromendel Fertilizers Ltd. Vs State of A.P. and found that rule 36 of the APVAT Rules
2005 provides for exemption on the transfer of unit as an ongoing concern on as is where
is condition along with the employees, assets and liabilities.
Therefore, we hold that in the case of appellant the transfer of business

as an ongoing concern on “slump sale basis” as per the agreement was for sale of
entire unit as a whole consisting of movable and immovable properties in as is where
condition and exempt from VAT under Rule 36 of the APVAT Rules. However all
conditions prescribed under Rule 36 are applicable and binding on the applicant
Sd/- Sd/- Sd/-
To
M/s.Crown Beers International Ltd.,
No.8-2-309/8/6, Road No. 14, Banjarahills,
Hyderabad.
Copy to the Deputy Commissioner(CT), Punjagutta Division.
COMMERCI AL TAXES DEPARTMENT.
PROCEEDI NGS OF THE

AUTHORI TY FOR CLARI FI CATI ON AND ADVANCE RULI NG
Present: Sri G.Lakshmi Prasad, Addl.Commissioner( VAT) ( FAC)

Sri K. Raghavaiah, Jt. Commissioner( A.A & DMU)
Sri P.Satyanarayana Reddy, Jt.Commissioner ( Legal )
*****
CCT’s Ref.No: / A.R.Com/ 237 / 2006. Dated 30- 6- 2007 .
Ref:- CCT’s.Ref.No: PMT/ P&L/ A.R.Com/ 2005, Dated 13- 04- 2005.
O R D E R:
M/s. Premier Explosives Limited, Secunderabad ( TIN. 28720263105) have

Whether the transaction of transfer by way of sale of Mushroom division unit,
(one of the business units) to M/s. Inventaa Chemicals Limited under an agreement,
amounts to transfer of business as an ongoing concern and exempt from payment of
VAT under Rule 36 of the APVAT Rules,2005.
1) Form 570
2) Authorization Form appointing Sri D.Harikishan, as an Advocate.
3) A copy of Business Transfer agreement between the applicant and
M/s.Inventaa Chemicals Limited, dt.20-02-2007.
Sri D.Harikishan, Advocate and Sri Y.Krishna Rao,General Manager Accounts of
M/s Premier Explosives Ltd., appeared for hearing on 25.6.2007 and explained the
case.
and Rules and the ruling is given as under :
The applicant is a registered company under the Companies Act.

They are the dealers dealing in manufacture and trading of explosives and
mushrooms. The business is sub- divided into the follow ing business
segments namely –
1) Explosives division
2) Mushrooms division
The applicant transferred, it’s mushrooms division unit situated at

Kallakal ( V) , Toopran ( Mandal, Medak District, by w ay of sale to M/ s
I nventaa Chemicals Limited ( TI N 28240158264 ) as an ongoing concern.
Accordingly, vide business transfer agreement dated 20- 2- 2007, the
applicant transferred the follow ing units by w ay of sale.
Land, building and movable assets like plant and machinery

equipment etc., employees, all contracts, relating to mushroom division
unit, are also transferred as part of the agreement. All these movable or
immovable facilities pertaining to mushroom division unit w as transferred
on as is w here is basis. Thus, they stated that the statute envisaged
transfer of one unit of the business w hile continuing w ith other businesses.
The Advocate, appearing for personal hearing has explained the

terms and conditions laid dow n in the contract and claimed that the
transactions of transfer of one unit of manufacturing facility by w ay of sale
is exempt as a case of transfer of business as a w hole U/ R.36 of the APVAT
Rules. He also draw n the atte ntion of this authority of the A.P. High Court
decision in the case of M/ s. Coromandal Fertilizers Vs. State of A.P. ( 112
STC.1) , w herein it w as held that if a dealer transfers one of its several
businesses as ongoing concern, it is still a transfer of business and the
goods involved therein can not be considered as sold in the course of
business but in the course of w inding up of the particular business unit. I t
w as also held that goods involved in transfer of cement business is in the
course of w inding up of cement business and it is not necessary that the
company should have closed the fertilizer business as w ell in order to claim
that the transaction is in the course of closure of business.
The contentions of the applicant are examined w ith refe rence to

various agreements, and High Court decision referred herein and found
that Rule 36 of the APVAT Rules contemplates exemption on the transfer of
one unit out of the several businesses, as an ongoing concern on as is
w here is condition along w ith the employees and various assets and
liabilities, ongoing contracts etc., Accordingly, w e hold that transfer of
mushroom division unit by w ay of sale as an ongoing concern is not liable
to VAT and exempted U/ R.36 of the APVAT Rules, 2005.
The clarification and advance ruling given herew ith is subject to the
conditions prescribed in Rule 36. All the conditions are applicable in the
circumstances, to the applicant and also to the dealers acquiring the unit of
business.
Sd/- Sd/- Sd/-
Addl./ Jt.Commissioner
NOTE:- An appeal against this proceedings can be filed before the Sales Tax
To
M/s.Premier Explosives Limited,
No.2-3-134 ( 199/A) Nallagutta,
Ramgopalpet, Secunderabad.
Copy to the Deputy Commissioner(CT), Begumpet Division.
PROCEEDINGS OF THE
Present:Sri G.Lakshmi Prasad, Addl.Commissioner(VAT)FAC

Sri K. Raghavaiah, Jt. Commissioner(A.A&DMU)
Sri P. Satyanarayana Reddy, Jt. Commissioner (Legal)
*****
CCT’s Ref.No: PMT/P&L/A.R.Com/ 16/ 2007. Dated 30.6.2007.
O R D E R:
I. M/s. Pioma Industries (TIN. 28510169216) have filed an application and

sought clarification and advance ruling on the following items under Section 67 of
APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the
II. They sought clarification on the rate of VAT applicable on “ Rasna Brand Fruit
based products” such as (1) Rasna Utsav Mango (2) Rasna Juc fit orange (3) Rasna
instant Mango (4) Rasna Booster Mango (5) Similar Products with different flavours
manufactured and marketed by the applicant.
(1) Application for clarification & Advance ruling in Form 570.
(2) A write up on the nature of the products dealt by them.
(3) Proceedings of the Authority for clarification and Advance Rulings Under
Section 60 of the Karnataka VAT Act 2003.
(4) Clarification proceedings of the Commissioner (VAT) Policy Branch,
New Delhi on rate of tax on Fruit powder and Fruit/ Vegitable extracts
based Rasna Products.
(5) Copy of Phytosanitary Certificate issued by the A.O of Ministry of
Agriculture, Government of India, New Delhi.
(6) Copy of experts opinion by University Department of Chemical
Technology, University of Mumbai.
(7) Copy of Certificate issued by Institution of Hotel Management, Catering
Technology & Applied Nutrition, Ahmadabad.
(8) Extract of chapter 20 of Central Excise Tariff Act.
(9) Copy of Invoice No. 362 , dt. 10.3.2006 and No. 224, dt. 8.5.2007 issued
in favour of Pioma Industries, Secunderabad.
(10)Statement of self declaration of Pioma Industries, dt. 20.6.07 before
Authority for clarification & Advance Ruling.
(11)Clarificatory letter issued by Principal Secretary, Finance Department,
West Bengal.
(12) Report on sample of Rasna Rosava Amrit” given by Food and Drugs
Laboratory, Vadodara, Gujarath State.
III. Mr. D. Harikishan, Advocate and tax consultant appeared for hearing and
explained the case.
IV. The issue has been examined with reference to the provisions of the APVAT
Act and Rules , and the ruling is given as under:
VI. M/s Pioma Industries, Nallaguntta, Ramgopalpet, Sec’bad is a registered dealer

under the APVAT Act 2005, with TIN 28510169216 on the rolls of the CTO, Mahankali
Street Circle, Sec’bad Divn. They are engaged in manufacture and sale of fruit drinks
and fruit concentrates, under a brand name ‘Rasna’, like Rasna Utsav (different flavours),
Rasna Juc fit (various flavours), Rasna instant mango, Rasna booster mango, and similar
products of different flavours. They sought clarification on the rate of VAT applicable
on sale of the said products under the APVAT Act,2005.
The contentions putforth by the Authorised Representative are as follows:
1. That the applicant owns a manufacturing unit at 1/5 GIDC Sajkoloi, North
Gujarat and “ Rasna fruit based concentrates” manufactured are stock transferred to
various branches in the respective states for sale in the local market. The applicant deals
in fruit based products as enumerated supra, are of the nature and character of fruit
squash and/or in powder form or fruit paste form. The fruit originally used in the
processing activity are mango, orange, pineapple, fruit pulp/fruit squashes with the
addition of water in chemical process and permissible essences, glucose and
preservatives.
2. Ingredients of fruit based products of ‘Rasna’ brand includes mango juc fit,
ascorbic acid, vitamines, minerals permitted synthetic food colours and added flavours.
The ingredients of Rasna utsav (different flavours) include, powder, liquid, fruit
juice/fruit powder, permitted food acids, glucose, lactose, stabilizers, emulsifiers, natural
orange oil, preservatives, minerals, Vitamin ‘c’ etc., These products are same as fruit
squash and just water is added to make it ready to drink.
3. Further, the applicants understanding is that it is a product of fruit and

is governed by the fruit product order issued by the Government of India, Ministry of
Food and Agriculture and have obtained a licence for manufacture of fruit juice and that
in terms of conformity with the statutory requirements and appropriate standards of
quality and composition specified in the scheme attached there to and also to comply with
various other stipulations as to packing, labeling etc., of the container and that the licence
number allotted to fruit product control order is to be mentioned on each pack. All such
products fall within the category of “ processed fruit and vegetable” fruit squash, paste,
fruit drink and fruit juice whether in sealed container or otherwise.
4. They also brought to our notice that these products have the characteristics to
Conform with the requirements of “fruit and vegetabled products”assessable under the
Central Excise Tariff Act under chapter 20 relating to fruits and vegetable preparations.
5. The Authorised Representative, in support of his arguments, also invited

attention of this authority to the clarifications issued by the respective authorities of
different States such as Karnataka, New Delhi, West Bengal, Maharastra, Assam, Orissa,
Kerala, and Gujarat. In these clarifications these products are classified under processed
fruits and vegetables which includes fruit jam, fruit squash, paste, fruit drink, fruit juice
in sealed container or otherwise, that are liable to VAT @ 4%.
6. In support of their contention, the applicant also reiterated that the products are
governed by fruit product order passed by Government of India, Ministry of Agriculture,
and obtained license for manufacture of fruit juice paste/powder in conformity with
statutory requirement of the products. In common parlance also the products are known
as fruit drink in the name of orange, mango, pineapple fruit based rasna products, being
marketed in different forms like fruit powder/fruit and vegetable extract/fruit juice/fruit
pulp concentrates etc.
7. The authorized representative also brought to our notice the treatment of these
products for VAT levy in different states viz. ,states of Delhi, Karnetaka, Harayana, West
Bengal, Maharastra, Assam, Orissa, Kerala, Gujarath, Karnataka, wherein the said
products are taxable @ 4% under VAT notified schedule rate. The copies of the
Advance ruling and clarifications issued by the States of Karnataka, Delhi and Gujarath
are placed before this Authority along with the expert opinion of the Chemical and
Technology Department, University of Mumbai and phytosamitary Certificate issued by
the Ministry of Agriculture and Government of India, in support of his contention on the
rate of tax applicable to these products.
8. Finally, in the light of these contentions, the Authorised Representative affirms

that the products for clarification fall under Entry 107 of the IV schedule to the APVAT
Act liable to VAT @ 4% only.
The contentions and arguments putforth by the applicants representative,

are carefully examined, analyzed and the ruling is given as under:
By G.O.Ms.No. 795 Revenue (CT-II) Dated 29.6.2006 entry 107 has been
included in the IV schedule of the APVAT Act, with effect from 1.7.2006 which reads
as under:
“ processed meat, poultry, fish, processed or preserved
vegetables and fruits, including fruit jams, je lly, pickle, fruit squash,
paste, fruit drink and fruit juice whether in sealed container or
otherwise”
Entry 3 of III schedule to KVAT 2003 of Karnataka State read as
All processed fruit and vegetables including fruit jams, jelly,

pickle, fruit squash, paste, fruit drink and fruit juice (whether in sealed
container or otherwise).
Perusal of the entries stated above and perusal of samples produced before the
authority at the time of hearing shows that predominant ingredients in the products are
fruit concentrated fruit pulp/fruit squash with added flavours, which are incidental to the
main ingredients. These fruit concentrates are sold in liquid as well as squash and
Powder form, and consumed by adding water to the requirement. These items, do
contain fruit and vegetable extract with added flavours and some quantity of
glucose/fructose .
Therefore in view of the foregoing facts and circumstances and following the
common parlance in the commercial circles and having regard to the nature of
products with reference to the entry 107 of the IV schedule to APVAT Act, the
products such as (1) Rasna Utsav Mango (2) Rasna Juc Fit Orange (3) Rasna
Instant Mango and (4) Rasna Booster Mango squarely fall within the description
of entry 107 of the IV schedule liable to VAT @ 4% with effect from 1.7.2006.
Sd/- Sd/- Sd/-

To
M/s. Pioma Industries,
No. 2-3-134 (199/A), Nallagutta,
Ramgopalpet, Secunderabad.

Copy to the Deputy Commissioner(CT), Secunderabad Division.
Copy to the Commercial Tax Officer, Mahankali Street Circle.
COMMERCI AL TAXES DEPARTMENT
PROCEEDI NG OF THE
Present : Sri T.Yugandhar Reddy, Additional Commissioner ( VAT)

Dr. Sri K.Raghavaiah, Joint Commissioner ( Audit)
Sri P. Satyanarayana Reddy, Joint Commissioner( Legal)
CCT’s Ref.No.PMT/ A.R.Com/ 129/ 2006 Dt: 04- 06- 2007
Ref: CCT’S Ref.No.PMT/ P&L/ A.R.COM/ 2005, Dt:13- 4- 2005.

***
O R D E R:
M/s. My Home Industries Limited, Hyderabad (TIN No.28870149513)

1. Whether the tax paid on the purchases of capital equipments
required for setting up a new unit can be claimed as input tax
and adjusted against output tax payable in respect of existing
units?
2. Whether such input tax paid on capital goods used for setting up
a new unit needs to be carried forward and adjust against tax
payable on outputs generated from the new unit at a later date?
Sri M. Ramachandra Murthy, Charted Accountant, authorized

representative of the firm appeared for personal hearing and explained
the case.
1
The issue has been examined. Though the applicant has not specifically
mentioned, it must be the case where the applicant is entitled for a benefit of tax
deferment in one of the existing units and input tax paid on purchases of capital
goods for the proposed new units reduces the deferment claim of the existing
unit. After examining the case, the ruling is given as under:
1. A VAT dealer files only one VAT return for a given month and the total
input tax he is entitled to, needs to be adjusted against total output tax
for the month. In this process, the excess credit carried forward from the
earlier month also reduces the output tax liability of the VAT dealer. There
is no mechanism to file separate VAT returns based on individual
manufacturing units of the same dealer. Only in cases where specific
manufacturing unit requires specific type of inputs there is a provision to
work out separately the eligible input tax based on the formula specified
in Rule 20 and after such exercise for all the business units, the total
eligible input tax for the month should be reflected as one lumpsum in the
VAT return to be filed. There is no provision to carry forward excess input
tax credit of one unit as a separate entity while claiming the output tax of
another unit as deferment.
2
2. There is no requirement for the applicant to carry forward the input tax
relating to the capital goods purchased for the new unit and to be adjusted only
against the tax payable on the outputs likely to be manufactured and sold from
the proposed new unit. In the result, the tax paid on purchases of capital goods
for the proposed new unit will have to be adjusted against output tax payable in
respect of all the sales made by the applicant.
Sd/ - Sd/ - Sd/ -
ADDL.COMMI SSI ONER JT.COMMI SSI ONER JT.COMMI SSI ONER

ADDL/ JOI NT COMMMI SSI ONER
To
M/s.My Home Industries Limited,
4th Floor, Greenlands,
Hyderabad.

Copy to the Assistant Commissioner (CT) L.T.U Nalgonda.
3
PROCEEDINGS OF THE
Present: Sri G. Lakshmi Prasad, Addl.Commissioner(Policy FAC)

Dr. K. Raghavaiah, Jt. Commissioner(All Acts & DMU)
*****
CCT’s Ref.No: /A.R.Com/ 37 /2007. Dated 28 - 07- 2007.
O R D E R:
I. M/s India Food Exports Tuni,(TIN28280158877.) have filed an application and


The applicant purchase raw cashew nuts from the Farmers and process the same
into cashew kernel. While processing the raw nuts, they obtain cashew husk and cashew
shell. The resultant bye products are sold in the State of A.P. The applicant requested to
specify Rate of tax on the cashew husk and cashew shell under the VAT Act.
2005.
III Mr. Jayaseelan Manager of the firm appeared for hearing and explained the
case.
IV. The issue has been examined with reference to the provisions of the APVAT Act
and Rules and HSN Codes notified by Government vide G.O.Ms.No:398, Revenue
(CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II) Department
Dated 15-04-2005as superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept.
dt.27.08.2005 and in G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005 and the
G.O’s issued till date and the ruling is given as under:
V. Entry No. 115 was inserted vide G.O. Ms No.1291 dt. 7.09.2006, brining the
commodities, Cashew nut and Kernel in to IVth Schedule, liable to tax @ 4% w.e.f.
1.09.2006. All entries in IVth Schedule are specific and strictly interpreted to cover
commodities so enumerated.
The Commodities “ Cashew husk and cashew shell” are not enumerated in either
in Ist or IVth Schedule, to the APVAT ACT 2005. Where as “Husk of pulses, paddy,
groundnut and wheat bran” are exempted vide entry 41 of the I Schedule to the APVAT
Act 2005 , in which husk of Cashew and cashew shell do not find place.
Therefore, it is hereby clarified that the rate of tax applicable to “ CASHEW

HUSK AND CASHEW SHELL” is @ 12.5%, under residuary entry to the
Schedule V of the APVAT Act 2005.
Sd/- Sd/- Sd/-

Addl/Jt. Commissioner
To
M/s.India Food exports,
Tatagunta, Tuni, E.G.Dist.

Copy to the Commercial Tax Officer, Tuni Circle.
PROCEEDI NG OF THE
Present : Sri G.Lakshmi Prasad, Additional Commissioner ( Policy FAC)

Dr. Sri K.Raghavaiah, Joint Commissioner ( Audit)
Sri P. Satyanarayana Reddy, Joint Commissioner ( Legal)
CCT’s Ref.No.PMT/ A.R.Com/ 155/ 2006 Dt: 22- 08- 2007
Ref: CCT’S Ref.No.PMT/ P&L/ A.R.COM/ 2005, Dt:13- 4- 2005.

***
O R D E R:
M/s. Sha Nathmal Mangilal & Company,( TIN 28730132381) Vijayawada

The applicant sought clarification on the following:
1. Taxability of Narrow Woven Fabrics
2. Taxability of Narrowfabrics.
Sri. V. Venkateswara Rao Advocate appeared for the personal hearing and
explained the case.
The applicant has filed the following documents:
1. Copy of Invoice.
2. Notifications/Orders issued by the States of Mumbai, West Bengal,
Gujarat, Rajasthan, and Madhya Pradesh.
3. Write up relying on various Judgements.
1
The applicant is seeking clarification regarding Narrow Woven Fabrics and

Narrow Fabrics as to whether tax is leviable under A.P.VAT Act, 2005 if the
goods are covered under additional duty of excise.
The case has been examined and it is noticed that the applicant
could not authentically produce any documents to prove that the
products dealt by him are covered under the purview of additional duty
of excise. This authority has earlier given rulings in similar cases
clarifying that items of textiles falling w ithin the purview of additional
duty of excise are exempted from levy of tax under the A.P.VAT Act.
This ruling applies to the present applicant also. I f the product of the
applicant is covered under additional duty of excise but exempted by a
specific notification, it w ill be deemed as covered under additional duty
of excise and not exigible to levy tax under A.P.VAT Act. I n case it does
not fall under Additional duty of Excise, the tax rate of 4% is
applicable.
Sd/- Sd/- Sd/-

To
M/s.Sha Nathmal Mangilal & Company,
11-54-1/B, Nandipativari Street,
Vijayawada.

Copy to the Deputy Commissioner (CT), Vijayawada I Division.
Copy to the Commercial Tax Officer, Sivalayam Street Circle.
2
PROCEEDINGS OF THE

*****
A.R.Com/ 1 /2007. Dated 014 -09 -2007.
O R D E R:
I. M/s Soorya Industries, Secunderabad(TIN 28570197441.) have filed an

application and sought clarification and advance ruling on the following items under
Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along

Rate of tax on (1) Sodium Hypochlorite and (2) Bleach Liquor

1) Write up on the products,
2) Affidavit stating that they deal in above commodities.
3) Copy of Tax Invoice cum Challan .
IV.Sri K.Hanumanth Rao Advocate, appeared for hearing and explained the case.
Dated 15-04-2005 as superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept.
dt.27.08.2005, in G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005,
G.O.Ms.No.502, Rev. (CT-II) Dept., dt.1-5-2006 w.e.f. 1-5-2006, G.O.Ms.No.656,
Revenue (CT-II), Dept. dt.2.06.2006 G.O.Ms.No.795, Revenue (CT-II), Dept.
The applicant has filed an affidavit in support of confirmation stating that they
are manufacturers and marketers of “ Sodium Hypo chlorite and Bleach Liquor “ and
filed a copy of Tax Invoice Cum Challan issued by M/s The Andhra Sugars Limited to
M/s Dr. Reddy Laboratories Ltd, wherein the H S N Code 2828.90.19 for Sodium
Hypochlorite is mentioned.
VI. Bleach Liquor is Classified in the IV Schedule at entry 100 under the list of “
Industrial inputs “ inserted vide G.O.Ms.No. 502 Rev. (CT-II) Dept. Dt 1.5.2006
w.e.f. 1.5.2006, at Sl.No. 58 taxable @ 4% from 1.5.2006. Again the original entry “
Bleach Liquor” is substituted and added “ Hypochlorites, Commercial calcium
hypochlorites; Chlorites; hypobromites” under Chapter Heading 2828, vide
G.O.Ms No. 656. Rev.(CT-II) Dept. Dt. 2-6-2006 w.e.f. 1.5.2006 liable to tax @
4%.Therefore both the Commodities namely, “ Bleach Liquor and Sodium
Hypochlorites” are taxable @ 4% w.e.f.1.5.2006.
Sd/- Sd/- Sd/-
To
M/s. Soorya Industries,
D.No. 8-5-196, Mallikarjuna Colony,
Old Bowenpally,Secunderabad.

Copy to the Deputy Commissioner (CT) Hyderabad Rural Division.
PROCEEDINGS OF THE

*****
CCT’s Ref.No: PMT/A.R.Com/ 146 / 2006. Dated 7 -09 -2007.
O R D E R:
M/s. Houseware Distributors Net Work, Nagarkhana Road, Begum Bazar, Hyderabad
(TIN 28740156469) have filed an application Dated 4-10-2006 and sought clarification and
advance ruling on the following items under Section 67 of APVAT Act, 2005 read with Rule
They sought clarification with regard to rate of tax on the following :

Rate of tax applicable to Kitchen Knives, Kitchenware, Kitchen Tools/implements,
Cutlery, Water Filter.
1) A write up on issue.
2) Brochures on Kitchen Knives, Tools etc.,
Mr. V.N. Rao, C.A., appeared for hearing and explained the case.
The issue has been examined with reference to the provisions of the APVAT Act and
Rules and HSN Codes notified by Government vide G.O.Ms.No:398, Revenue (CT.II)
Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II) Department Dated 15-04-
2005as superceded in G.O.Ms.No.1596, Revenue(CT-II) Dept. dt.27.08.2005 and in
G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005 and the G.O.s issued till date, and the
Entry 7 of the IV Schedule only enumerates “ all utensils including pressure cookers
and pans………..”. No HSN codes are notified against the said entry . Therefore as per the
common parlance and by nomenclature of “utensils” alone fall under entry 7 of the IV
Schedule. But Cutlery, suc h as spoons, forks, ladles, skimmers, cake-servers, fishknives,
butter-knives, sugar tongs and similar kitchen or table ware do not fall under entry 7of the
IV Schedule, but fall under residuary entry of V Schedule, liable to 12.5% tax. Earlier
rulings, given on Kitchenware, are applicable only to those specific cases.
Sd/- Sd/- Sd/-

Addl. Commissioner. Jt.Commissioner Jt.Commissioner
To
M/s. Houseware Distributors Net Work,
Nagarkhana Road, Begam Bazar, Hyderabad.

Copy to the Deputy Commissioner (CT) Chartminar Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 40 /2007. Dated 07- 09 -2007.
O R D E R:
I. Vijetha Earthing System (TIN28450154377.) have filed an application and sought

clarification and advance ruling on the following items under Section 67 of APVAT Act,
2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the application fee of
Rs.1,000/-

Whether Safe Earthing Electrodes falls under entry 24 of IV Schedule?

1) Brocher- writeup on Earthing and a copy of clarification issued by the
TamilNadu State.
IV. Sri K.H.Rao, Advocate, appeared for hearing and explained the case.
V. The issue has been examined with reference to the provisions of the APVAT
dt.2.06.2006 G.O.Ms.No.795, Revenue (CT-II), Dept. dt.29.06.2006 and the
VI. Entry 24 of the IV Schedule enumerates “ Electrodes including welding

electrodes and welding rods”. Where as the applicant deals with “safe
earthing electrodes” which consists of crystalline conductive mixture,
outer electrode and inner electrode made up of metal conductor. There
fore electrodes covered under Heading 8311 refers to only welding
electrodes normally used for electric arc welding. Therefore Safe earthing
electrodes do not fall under entry 24 of the IV Schedule, but fall under
residuary entry of the V Schedule liable to tax @ 12.5%.
Sd/- Sd/- Sd/-

Addl/Jt.Commissioner
To
M/s. Vijetha Earthing System,
21-1-464, Ricab Gunj, HYDERABAD.

Copy to the Commercial Tax Officer, Lord Bazar Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 9 /2007. Dated 07-09 -2007.
O R D E R:
I. Arunodaya Note Book Manufacturers Pvt. Ltd., (TIN 28030235095) have filed an

“ Whether the job work undertaken by them , in which no property in the material
would be transferred, would amount to works contract as per sub-Section (45) of Section
2 and the amount received towards labour charges i.e., printing charges are liable to any
tax either under sub-Section (7) or under sub-Section (1) of Section 4 of the APVAT Act,
2005”

1) Copy of Agreement (2) Copy of letter from the Director A.P Govt. Text Book
Press in connection with the proof of Paper supplied by Govt. to them. (3) copies of Tax
Invoices.
IV. Sri K.Hyder Vali Authorised representative, appeared for hearing and explained the
case.
VI If the applicant executes works on the materials, supplied by the contractee,

such transactions amo unt to works contracts and in the absence of the applicant
opting for composition under Section 4 (7) (b), the transactions are liable to tax
under Section 4 (7) (a). In case the transactions are for contractees other than the
Government or local authority, the applicant has the choice of opting for
composition under Section 4 (7) (c) in lieu of payment of tax under Section 4 (7) (a)
of the AP VAT Act’ 2005.
Sd/- Sd/- Sd/-

To
M/sArunodaya Note Book Manufacturers Pvt. Ltd,
D.No.33-5-9, Papaiah Street, Seetharampuram,
Vijayawada

Copy to the Deputy Commissioner (CT) Vijayawada II Division.
Copy to the Commercial Tax Officer, Suryarao Pet Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 8 /2007. Dated 07-09 -2007.
O R D E R:
I. Arunodaya Printing Press (TIN 28040123674.) have filed an application and


2005”

Press in connection with the proof of Paper supplied by Govt. to them.
case.
(CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT. II) Department
VI. If the applicant executes works on the materials, supplied by the contractee,
such transactions amount to works contracts and in the absence of the applicant
Government or local authority, the applicant has choice of options for composition
under Section 4 (7) (c) in lieu of payment of tax under Section 4 (7) (a) of the AP
VAT Act’ 2005.
Sd/- Sd/- Sd/-

To
M/sArunodaya Printing Press,
Vijayawada

PROCEEDINGS OF THE

*****
A.R.Com/ 30 /2007. Dated 07- 09 -2007.
O R D E R:
I. Subhani Seeds Kurnool,(TIN 28402058715) have filed an application and sought

clarification and advance ruling on the following items under Section 67 of APVAT Act,
2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the application fee of
Rs.1,000/-

1) Whether the seed in question fall within the purview entry 44 of the
First Schedule to the A.PVAT Act, 2005
2) Whether or not they entitled for exemption on the ground nuts and
seeds of pulses which were sold to A.P Seed Corporation, and which
ultimately distributed the same to the ryoths for sowing purpose;
3) The purchases of ground nuts and pulses which have been sold by them
for sowing purpose to the above Corporation will Attract Contingent
purchase tax under sub-Section (4) of Section 4 of the VAT Act?

1) Copy of letters issued by the A.Pstate Seeds Development Corporation Ltd.
IV. Sri K.Hyder Vali Authorised representative, appeared for hearing and explained
the case.
The A.P State Seeds Development Corporation, Hyderabad placed orders to the
applicant to supply ground nuts and seeds of pulses for being supplied to A.P State
agricultures for sowing purpose, with a condition for the supply of these agricultural
seeds is that they should be processed and truthfully labeled in the presence of the Seed
Officer of the Corporation.
VI . 1. The goods purchased by the applicant are not exempted falling

under Entry 44 of 1st Schedule. They fall under Schedule I V and the
taxable at 4% .
2. I f the goods sold by him are exempted goods falling under Entry
44 of Schedule I to the Act, the applicant is liable to pay purchase tax
under sub section ( 4) of Section 4 of the Act because clause ( i) of sub
section ( 4) specifies that any taxable goods purchased from a person
or a dealer not registered as a VAT dealer sha ll be liable to purchase
tax at 4% if after such purchase of the goods are used as inputs for
goods w hich are exempt from tax under the Act.
3. I f the goods sold by the applicant do not qualify to be treated as

the applicant becomes liable to tax at 4% ( pulses, groundnuts) under
I V Schedule and in such a case, no purchase tax is payable under sub
section ( 4) of Section 4 of the Act because the output in the hands of
the applicant is taxable.
Sd/- Sd/- Sd/-

To
M/s. Subhani Seeds,
D.No. 18-24 (5) K.G. Road,
Nandikotkur

Copy to the Commercial Tax Officer, II Kurnool Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 8 /2007. Dated 07-09 -2007.
O R D E R:
I. Arunodaya Printing Press (TIN 28040123674.) have filed an application and


2005”

Press in connection with the proof of Paper supplied by Govt. to them.
case.
(CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT. II) Department
VI. If the applicant executes works on the materials, supplied by the contractee,
such transactions amount to works contracts and in the absence of the applicant
Government or local authority, the applicant has choice of options for composition
under Section 4 (7) (c) in lieu of payment of tax under Section 4 (7) (a) of the AP
VAT Act’ 2005.
Sd/- Sd/- Sd/-

To
M/sArunodaya Printing Press,
Vijayawada

PROCEEDINGS OF THE

*****
A.R.Com/ 31 /2007. Dated 07- 09 -2007.
O R D E R:
I. M/s. Rabbani Seeds Kurnool,(TIN 28320148529) have filed an application and

I II. They sought clarification on the following:

1) Whether the seed in question fall within the purview entry 44 of the
First Schedule to the A.PVAT Act, 2005
2) Whether or not they entitled for exemption on the ground nuts and
seeds of pulses which were sold to A.P Seed Corporation, and which
ultimately distributed the same to the ryoths for sowing purpose;
3) The purchases of ground nuts and pulses which have been sold by them
for sowing purpose to the above Corporation will Attract Contingent
purchase tax under sub-Section (4) of Section 4 of the VAT Act?

1) Copy of letter issued by the A.Pstate Seeds Development Corporation Ltd.
IV. Sri K.Hyder Vali Authorised representative, appeared for hearing and explained
the case.
The A.P State Seeds Development Corporation, Hyderabad placed orders to the
applicant to supply ground nuts and seeds of pulses for being supplied to A.P State
agricultures for sowing purpose, with a conditions for the supply of these agricultural
seeds is that they should be processed and truthfully labeled in the presence of the Seed
Officer of the Corporation.
VI . 1. The goods purchased by the applicant are not exempted falling

under Entry 44. They fall under Schedule I V and the taxable at 4% .
2. I f the goods sold by him are exempted falling under Entry 44 of

Schedule I to the Act, the applicant is liable to pay purchase tax under
sub section ( 4) of Section 4 of the Act because clause ( i) of sub section
( 4) specifies that any taxable goods purchased from a person or a
dealer not registered as a VAT dealer shall be liable to purchase tax at
4% if after such purchase of the goods are used as inputs for goods
w hich are exempt from tax under the Act.
3. I f the goods sold by the applicant do not qualify to be treated as
the applicant becomes liable to tax at 4% ( pulses) under I V Schedule
and in such a case, no purchase tax is payable under sub section ( 4) of
Section 4 of the Act because the output in the hands of the applicant is
taxable.
Sd/- Sd/- Sd/-

To
M/s. Rabbani Seeds,
D.No. 22-41
Seshasayana Reddy Nagar,
Nandikotkur- Kurnool.

COMMERCI AL TAXES DEPARTMENT.
PROCEEDI NGS OF THE

Present: Sri G.Lakshmi Prasad, Addl.Commissioner( VAT FAC)

*****
CCT’s Ref.No: / A.R.Com/ 220/ 2006. Dated 15 - 10 - 2007 .
Ref:- CCT’s.Ref.No: PMT/ P&L/ A.R.Com/ 2005, Dated 13- 04- 2005.
O R D E R:
I M/s. R.K.Projects, Hyderabad ( TIN. 28490156930) have filed an application

and sought clarification and advance ruling on the following items under Section 67
of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005 along with the
Rate of tax on ammonium nitrate, covered under excise tariff Heading No.
3102.30.
a) An application in Form 570
b) A write up of facts on the issue.
c) Copy of the invoice cum challan depicting excise tariff code 3102.30
d) Invoice copies issued by the applicant.
IV. Sri T.Ramesh Babu, Advocate and Sri D.Ravikumar, Managing Partner,
and Rules and HSN Codes notified by Government vide G.O.Ms.No. 398, Revenue
(CT-II) Department Dated 31.3.2005 and G.O.Ms.No. 490, Revenue (CT-II)
Department Dated 15.4.2005 as superceded in G.O.Ms.No. 1596, Revenue (CT-II)
Dept., dt. 27.8.2005 and in G.O.Ms.No. 1615, Revenue (CT-II) Dept., dt. 31.8.2005
and G.O.s issued till date and the ruling is given as under:
VI The applicant represents that they are dealers in trading of ammonium nitrate.
They purchase prilled ammonium nitrate / ammonium nitrate prills from the
manufacturers of outside the State and as well within the state and resell in the State
of Andhra Pradesh. They are charging VAT @ 12.5% on such sales, while some of
the competitors are only charging 4% on sale of ammonium nitrate.
They also brought to our notice that ammonium nitrate, with HSN Code
3102.30 is notified against entry 19 of the IV schedule, “chemical fertilizers”.
Thus, they contended that prilled ammonium nitrate should fall under entry 19 of the
IV schedule.
The issue has been examined w ith reference to the provisions of the
APVAT Act and Rules 2005 and HSN Codes notified against the entry 19 of
the I V schedule under chapter 31 – Fertilizers ; four digit code 3102 –
“Mineral or chemicals Fertilizers, nitrogenous” is notified for the entry 19 of
the I V schedule. Therefore, it is clarified that ammonium nitrate, w hether
or not in aqueous solution falls under entry 19 of the I V schedule liable to
VAT @ 4% .

To
M/s.R.K. Projects,
8-3-166/7/4, Opp: Telecom Exchange,
Erragadda,
Hyderabad.
Copy to the Deputy Commissioner(CT), Punjagutta Division.
Copy to the Commercial Tax Officer, Vengalraonagar Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 217 /2006. Dated 07-10 -2007.
O R D E R:
I. M/s Arch Pharmalabs Limited Medak Dist. (TIN 28130235803) have filed an

Whether hiring of generators is covered by the clause levy of tax “ on transfer of
right to use goods” under the AP VAT Act or not?

Copy of Hire agreement made between M/s. Power Mak (P) Ltd., and M/s. Arch
Pharmalabs Ltd.
IV. Mr. U.V. Pawan Kumar Advocate, appeared for hearing and explained the case.
dt.29.06.2006 and the G.O.s issued till date and ruling is given as under:
VI. The applicant is a lessee wherein he has taken power generators on lease from
lessor, namely M/s, Power Mak (P) Ltd. The lessor has sought for an advance
ruling before this authority. Accordingly, they were issued an advance ruling and
clarification vide ref. PMT/P&L/A.R.Com./ 590/ 2005, dt. 30.6.2006. The same
clarification holds good to the applicant also.
Sd/- Sd/- Sd/-

NOTE:- An appeal against this proceedings can be filed befo re the Sales Tax Appellate
To
M/s. Arch Pharmalabs Ltd.,
Sy. No. 323, Gundlamachnoor (V),
Hathnoora Mandal,
Medak Dist.

Copy to the Deputy Commissioner (CT) Nizamabad Division.
Copy to the Commercial Tax Officer, Medak Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 29 /2007. Dated 06-10 -2007.
O R D E R:
I. M/s Tulip Foods Hyderabad (GRN No. ABS/04/0/1135) have filed an application
and sought clarification and advance ruling on the following items under Section 67 of

Whether the paste of Garlic and Ginger exempted or exigible to tax?

Write up on the paste of Garlic and Ginger.
IV. Mr. U.V. Pawan Kumar Advocate , appeared for hearing and explained the case.
VI. The applicant is a dealer in garlic and ginger. They also purchase raw garlic and
ginger and convert them in to garlic paste and ginger paste. They state that no other
ingredients or any other goods are added while converting garlic and ginger into paste
except salt, which is used as a preservative. The applicant contends that paste of garlic
and ginger is not different from garlic and ginger and hence not liable to tax under item
19 of the 1st Schedule to the AP VAT Act.
The representation of the dealers is examined with reference to the Act &
Rules, and hereby clarify that all entries in Schedule I, II, III,IV and V are to be
understood as “ that is to say” and the interpretation of fiscal laws should be
interpreted strictly in accordance with description of entries in the Schedules. Any
liberal interpretations are permissible under law. Therefore, “garlic paste” and
“ginger paste” are liable to tax @ 12.5% under the residuary entry of V Schedule
to the AP VAT, Act 2005.
Sd/- Sd/- Sd/-

To
M/s. Tulip Foods.
5-5-57/12,
Darusalam,
Hyderabad.

Copy to the Commercial Tax Officer, Aghapura Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 45 /2007. Dated 06-10 -2007.
O R D E R:
I. M/s K.C.P.Sugar and Industries Corporation limited, Vuyyur (TIN 28130136281)

Rate of Tax on “DENATURED ANHYDROUS ALCHOL ( ETHANOL)
Write up on the commodity “ DENATURED ANHYDROUS ALCOHOL” HSN
Code 2207.20. and copies of Invoices
IV. Mr. C.K. Vasanth Rao, Sr. Dy.G.M Finance, appeared for hearing and explained the
case.
dt.29.06.2006 and the G.O s issued till date and ruling is given as under:
VI. The applicant is a dealer in Sugar and other by-products. Molasses a by-product
of sugar is further processed in Fermentation and Distillation, to produce “ Rectified
Spirit “ , which is commonly known as “ Ethyl Alcohol”. Entry 93 enumerates “ Extra
Neutral Alcohol (ENA) and rectified spirit”. Vide G.O.Ms.No.1564 Rev.(CT-II)
dt. 18.8.2005 and taxable @ 4%. Entry 100 Industrial Inputs that is to say”……. Also
includes at Sl.No. 6 of the said entry “ Denatured Ethyl Alcohol of any strength covered
with HSN Code 2207.20 is liable to tax @ 4%. W.e.f. 1-05-2006.. The main 4 digit
heading 2207 describes “ Un-denatured Ethyl Alcohol of any Alcoholic strength by
volume of 80% of EOL or higher; Ethyl Alcohol and other Spirits denatured ethyl Ethyl
Alcohol in Strength. So sub heading 2207.20.00 specifically enumerates “ Ethyl Alcohol
and other Spirits Denatured of any strength”. Since this 8 digit code is fully tallied with
the enumeration of entry 100 of the IV Schedule of AP VAT Act, 2005, it is here by
clarified that if “ Ethyl Alcohol is covered by HSN 2207.20.00, it is liable to tax @4%.
W.e.f. 1-5-2006. However as seen from the invoices issued by the applicant the Chapter
Heading given in the invoices is 2207 with 4 digits, which is not notified under entry 100
of the IV Schedule, except the specific sub-Code 2207.20.00. Hence Ethyl Alcohol
falling under a specific 8 digit code 2207.20.00, is alone exigible to tax @ 4%.
Sd/- Sd/- Sd/-

To
M/s. K.C.P.Sugar and Industries Corporation Ltd.,Vuyyur, Krishna Dist.,

Copy to the Deputy Commissioner (CT) Vijayawads II Division.
Copy to the Assistant Commissioner L T U Vijayawada II Division
PROCEEDINGS OF THE

*****
A.R.Com/ 52 /2007. Dated 06-10 -2007.
O R D E R:
I. M/s Dinesh General Stores Kurnool.(TIN 28380273075) have filed an application


Whether “Snuff” a preparation of powdered tobacco to be chewed, placed against
the gums or inhaled through the nostrils, si liable to tax or eligible for exemption as
“tobacco” as per entry 47 of the First Schedule read with Section 7 of the AP VAT Act,
2005.

Write up relying on H.C.Judgement and Dictionary meanings
IV. Sri K. Hyder Vali Authorised representative, appeared for hearing and explained
the case.
VI. The Government of India vide notification No.1/2007-CST F.No. 34/135/2005

ST dt.29.3.2007 ( Taxation Laws amendment Act 2005) has omitted item 9 i.e. un-
manufactured tobacco and tobacco refuse w.e.f. 1-4-2007 from Sec. 14 of the CST Act.
The entry, tobacco at entry 47 of the First Schedule to the AP VAT Act was substituted
by G.O. Ms. No. 397 dated 31.3.2007 as under:
(a) “Un- manufactured tobacco covered under tariff heading No. 2401 of the Central
Excise Tariff Act, 1985 ( 5 of 1986) (b) Bidis (biris) covered under tariff item no.
24031031, 24031039,24031090, of the Central Excise Tariff Act, 1985 (5 of 1986)”
Again by G.O. Ms. No. 933 Rev.(CT_II) Dept. dt. 3-07-2007 w.e.f. 06-07-2007 ,
the entry 47 was substituted as follows: “ Tobacco and manufactured Tobacco but
excluding Cigarettes containing Tobacco with excise Code 2402.20 and also excluding
Cigarettes with Tobacco substitutes with Excise Tariff Code 2402.90.10”.
Again the Government vide G.O.Ms.No.1129 Rev.(CT_II) Dept. Dt. 22.8.2007
inserted entry 6 in the VI Schedule which reads, “ Tobacco Products including Gutkha,
Khara masala, Khimam, Zarda, Sukha, Sukti except those goods specified in Schedule I
and Cigarettes. However, the effective date for implementation of the G.O is yet to be
issued.
The commodity, “Snuff” as per Chapter 24 of the Central Excise Tariff Act,
1985, is enumerated at H S N Code 2403.99.40, inder the Head 2403, which enumerates
“all other unmanufactured Tobacco and manufactured tobacco substitutes; homogenized
or re-constituted Tobacco; Tobacco extracts, and essences.
Therefore, the HSN Code 2403.99.40 is not notified against any commodity of
tobacco or un-manufactured tobacco, included in entry 47 of the Ist Schedule to the
AP VAT Act. Hence, “ Snuff” fall under “ manufactured tobacco substitutes”,
liable to tax @ 12.5%, under the residuary entry of the V Schedule to the AP VAT
Act. Therefore it is clarified that “Snuff” is taxable @ 12.5% w.e.f. 1.4.2007.
Sd/- Sd/- Sd/-

To
M/s.Dinesh General Stores,
D.No. 13/250,
Main Bazar, KURNOOL

PROCEEDINGS OF THE
Present:Sri G. Lakshmi Prasad , Addl.Commissioner (Policy FAC)

Sri P.Sathyanarayana Reddy, Jt. Commissioner (Enft)
*****
Ref.No: A.R.Com/136/ 2006. Dated 30 -11-2007.
O R D E R:
I. M/s. M/s. SOLUTION, Ranigunj, Secunderabad-3 (TIN.28280250736) have

filed an application Dated 14-09-2006 and sought clarification and advance ruling on the
following items under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of
Rate of tax applicable to the following items
PARTS HSN CODE
1) EOT/HOT CRANES 8426
2) ELECTRIC CHAIN HOISTS 8426
3) ELECTRIC JIB CRANES 8426
4) ELECTRIC WINCH MACHINES 8425
5) CHAIN PULLEY BLOCKS 8483.90
(without chains)
6) MONO RAILTROLLEYS
7) ELECTRIC WIRE ROPE HOISTS 8426
8) HAND CRAB WINCHES 8425
9) GOODS LIFTS
10) GANTRY CRANES 8426
11) GARAGE CRANES 8426
12) RATCHET HOISTS0
13) PULLING 7 KLIFTING MACHINES 2428.90
14) SHEAVE PULLEY BLOCKS 8483.90
15) INDUSTRIAL ROLLER CHAINS 7315
16) INDUSTRIAL REMOTE CONTROLS 8425, 8426, 8431
17) M.S., S.S. & ALLOY STEEL CHAINS 7315
18) STEEL WIRE ROPE 7312.50
19) CRANE SPARES SAFE TRACK D.S.L. 8544, 8537, 7308
SYSTEM
20) ELEVATOR PARTS 8483, 8431, 8501, 7325
21) ELECTRIC CRANE DUTY MOTOR 8501
22) M.S. FABRICATION 7308
The applicant submitted the following documents: --
Mr. Rakesh Panchal, partner, appeared for hearing on and explained the case.
and Rules and HSN Codes notified by Government vide G.O.Ms.No.398, Rev.(CT.II)
Dept. dt.31-03-2005 and G.O.Ms.No.490, Rev. (CT.II) Dept. dt. 15-4-2005 as superceded
in G.O.Ms.No.1596, Rev.(CT.II) Dept.,dt.27-08-2005 and in G.O.Ms.No.1615,
Rev.(CT.II) Dept., dt.31-08-2005 and the G.O.s issued so far and the ruling is given as
under:
The applicant is a manufacturer having show room of reputed brands for

Chains, Chain Pulley Block & Wire Rope etc., The applicant sought for clarification of
rate of tax on the above items under APVAT Act,2005.All the commodities / goods
/items noted above with HSN codes mentioned against such commodity are not
notified in any entries of the IV schedule. Hence, all the above items mentioned by the
applicant are liable to tax @ 12.5% under the residual entry of the V Schedule of
APVAT Act,2005.
. Sd/- Sd/- Sd/-

To
M/s. Solutions,
5-5-102/1/1,
Ranigunj, Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 177 /2006. Dated 11 -12 -2007.
Ref:-1) CCT’s.Ref.No: PMT/P&L/A.R.Com/2005, Dated 13-04-2005
2) CCT’s Ref No. PMT/P&L/A.R.Com/235/2006 Dt. 2-06-2007
O R D E R:
I. M/s Neminath Agencies, Feelkhana Hyderabad

(TIN 28760123068 ) have filed an application and sought clarification and advance ruling
on the following items under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of

1) Domestic Kitchen made of Stainless Steel,Copper,Brass etc. (Cutlery)
2) Hand operated Domestic kitchenware made of Stainless Steel etc.

Copies of Brouchers:
IV. Mr. Umesh Vyas Proprietor ,appeared for hearing and explained the case.
dt.29.06.2006 and the G.O.s issued till date and the ruling is given as under:
VI. It is brought to our notice that the A.C.(CT) VAT-II Charminar Division has
issued a notice of assessment to the applicant in form 305- A on 1-7-2006. It is
pertinent to observe here that the applicant has filed his application before this
authority on 29.11.2006. Section 67 (2) stipulates that no application shall be
entertained by this authority if the question raised in the application is already
pending before any officer or authority of the Department. Since, the Assistant
Commissioner (CT) VAT –II Charminar Division has already issued a notice of
assessment of value added tax under Rule 25(5), before filing VAT Form 570 in this
office, this Authority cannot interfere with the proceedings of the Assessing
Sd/- Sd/- Sd/-

To,
M/s. Neminath Agencies,
15.-8-512/F-10, Aziz Plaza, Feelkhana,
Hyderabad 500012.

Copy to the Asst. Commissioner VAT-II Charminar Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 218 /2006. Dated 30-11- -2007.
O R D E R:
I. M/s Tranz Bio Technologies Private Ltd Hyderabad (TIN28370231721) have


Whether the product “ BIOFFER” manufactured from plant extracts for use in
agriculture crops to develop resistance to Drought and Diseases in crops and to increase
yield, is exempted or exigible to tax ?

Write up on the product “Biofer”.
IV. Mr. G. Anil Reddy, Managing Director , appeared for hearing and explained the
case.
The applicant is a manufacturer of Organic Plant Based product ( trade name
BIOFER ) by using Oleoresin of leaves as raw material, used for agriculture crops to
develop resistance from Drought and Diseases and to increase yield.
VI. Having regard to the nature of the product manufactured and marketed
by trade name “BIOFER” , and on due consideration of the documents,
produced before us , it is clarified that the goods in question, do fall
under bio-fertilizers under entry 19 of the IV Schedule of the AP VAT
Act 2005, and liable to tax @ 4%. W.e.f.27.8.2005.
Sd/- Sd/- Sd/-

To
M/s. Tranz Bio Technologies Pvt. Ltd,
58, Madhapur,
Hyderabad. 500033

PROCEEDINGS OF THE

*****
A.R.Com/ 39 /2007. Dated 30 -11 -2007.

**
O R D E R:
I. M/s Surya Industrial Equipments, Hyderabad (TIN 28040125808 ) have filed an


Rate of tax on the following machinery Items: HSN CODE
1)Machinery used in plant/laboratory equipment for the treatment 84108910
Of materials by a process in which chemical reaction takes place
Including heating, cooking, roasting, distilling, rectifying,
steaming, drying, evaporating, vaporizing,condencing, cooling,etc.
2) Hydrogenators 84198910
3) Heat Exchangers/Condensers 84195010
4)Blenders used for Power Mixing-double cone & ribbon type 84198910
5)Dryers for product drying-Rotary Cone Vaccum type 84198910
6)Filtersfor Liquid Filtration like Leaf Filters, Nutsche Filters etc 84198910
7) Evaporators for multi effect evaporation, falling film, risingfilm. 84198910
8)StorageVessels for liquid raw material, intermediate storage 84198910
9) Distallation Columns 84198910
10) Product Receivers used in the process treatments of materials 84198910
Write up on Chemical Plant Equipment.
IV. Mr. V.Rama Raju Proprietor, appeared for hearing and explained the case.
V The issue has been examined with reference to the provisions of the APVAT Act
(CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II)
Department Dated 15-04-2005 as superceded in G.O.Ms.No.1596, Revenue(CT-II)
Dept. dt.27.08.2005, in G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005,
VI The applicants are manufacturers of Reactors, pressure

reactors,chemical storage tanks, etc. As per the returns filed before the Central
Excise Department by the applicant the HSN Codes noted in the invoices is
8419.89.10. The applicant have paid tax @ 12.5% on goods mentioned above
upto 31.8.2006. From 1.9.2006, the applicants have paid tax @ 4%. The
contentions of the applicant have been examined with reference to the record,
and the HSN codes notified in the G.O.Ms.No. 795 Revenue (CT) Department dt.
29.6.2006.
The items mentioned by the applicant from serial numbers 1 to 10 except item
No. 3 i.e. Heat Exchangers are not notified in the category of goods (
machinery)items taxable @ 4% under Schedule IV of the AP VAT Act 2005.
However, Heat exchange units are specifically notified under HSN Code 8419.50.
Therefore, it is clarified that, Heat Exchange units alone are taxable @ 4%
and all other nine (9) items as quoted supra are liable to tax @ 12.5% under
residuary entry of the V Schedule of AP VAT Act 2005.
Sd/- Sd/- Sd/-

Addl./Jt. Commissioner
To
M/s. Surya Industrial Equipments,
Shed No.F-1, Phase 1- Road No.18,
IDA Jeedimetla, Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 63 /2007. Dated 30- 11- 2007.
O R D E R:
I. M/s K. K. Proteins Pvt. Ltd, Adilabad,(TIN 28241941512.) have filed an


Whether purchase tax under Section 4 (4) of the AP VAT Act, 2005 is payable on
the value of Soya seeds purchased from farmers in State?

Write up on the Product.
IV.Mr. M. Ramachandra Murthy, Chartered Accountant, appeared for hearing and

explained the case.
G.O.s issued so far and ruling is given as under:
VI. The applicants are manufacturers of vegetable oils. He purchases Soya bean
seeds from the farmers and uses in the manufacture of Soya oil. During the
process, Soya de-oiled cake is also obtained. Soya oil is sold either within the
State or to other States and VAT or CST is paid. The bye-product i.e. Soya de-
oiled cake is sent to the agents in the other States for sale on consignment
basis.
In this circumstances, the applicant seeks clarification as to whether any
purchase tax is payable on the value of Soya bean seeds purchased from
farmers within the State. and the bye-product, Soya de-oiled cake sold in
other states. The applicant relied upon the decision of APSTAT in the
case of M/s. Ch.Ranchod Lal Jethalal Vs State of A.P. ( reported in 2
APSTJ 42)
The word” input” used in sub-section (4) of Section 4 must not be
construed in the restricted meaning of ‘raw material’, used in the
manufacture of goods. When the Soya bean seed is used as input to
produce two categories of goods, namely (i) taxable goods and (ii) goods
not taxable, it constitutes a common input, giving rise to two different
outputs with one, being taxable and the other, being not taxable. Hence
when a part of the output or outputs are not taxable and as a result, the
corresponding portion of the input also escapes from the liability of tax in
circumstances, envisaged under Section 4 (4), it is always appropriate to
apportion the value of the input or inputs in the ratio of the taxable and
non-taxable outputs and subject to tax such portion of input, relatable to
the non-taxable output. It is here the loaded expression, “ used as inputs
for goods”, not taxable by virtue of the nature of the transaction, assumes
importance. It means that the proportion of the input or inputs, in so
far as it is relatable to the goods, not taxable, are liable to tax under
Section 4 (4) of the Act.
Therefore, the ruling is that the purchase tax will attract @ 4% on the
value of Soya bean seed, corresponding or relatable to the output, i.e.
Soya de -oiled cake , not taxable due to dispatch of the same outside
the State other than by way of interstate sale
Sd/- Sd/- Sd/-

To
M/s.K.K.Proteins Private Limited,
Adilabad

Copy to the Deputy Commissioner (CT) Adilabad Division.
Copy to the Commercial Tax Officer, Adilabad Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 64 /2007. Dated 30 -11 -2007.

**
O R D E R:
I. M/s Lyophilization Systems (I) Pvt. Ltd Kukatpally, Hyderabad .,

(TIN 28060164187 ) have filed an application and sought clarification and advance ruling
II. They sought clarification of rate of tax on the following:

1) Lyophilizers ; HSN Code 8419.50.
2) Parts ; HSN Code 8419.90

1) Writeup on the products
2) Copies of Invoices
3) Brouchers
IV. Mr. T.Ramesh Babu Advocate and Tax Consultant, authorized representative ,
G.O.s issued till date and the ruling is given as under:
The applicants are the manufacturers of industrial goods i. e. Machinery for

plant and Laboratory and its parts namely “Lyophilizers” and “Parts” and sell
the goods under the brand name of “LYOPHILIZERS”. The inputs used to
manufacture the goods are imported and also purchased with in the country,
such as compressors, heat extinguishers, SS Sheets etc.
They contended that the goods manufactured are cleared under the Chapter
heading of “Heat Exchange Units”, and the goods, so manufactured, are put to
use for the purpose of steaming, cooling, evaporating and condensing the
pharma/drug products. They also contended that the goods Dryers having
HSN Code 8419.50 and parts HSN Code 8419.90 are classified in entry No.
102 under IV Schedule to the AP VAT Act.
VI. The contentions of the applicants are examined with reference to the facts of
the case. The , copies of invoices, filed, reveal that they sold Machinery for
plant and Laboratory ( Dryers) under the Brand name “Lyophilizer” and
mentioned HSN Tariff Code 8419.50 and its parts HSN Tariff Code is
mentioned 8419.90 .
As per G.O.Ms.No. 795 Revenue (CT) Department dt. 29.6.2006, entry
102 is included in the IV Schedule to the AP VAT Act, as ” Machinery of
all kinds that is to say….”. The sub entry 2 (f) of entry 102 of the IV
Schedule enumerates “Heat Exchange Units” with HSN Tariff Code
8419.50 and sub entry 2 (k) enumerates “Parts” with HSN Tariff Code
8410.90 .
Therefore the goods “ Lyophilizers ” and “ Parts “ fall under the
category of heat exchange units and parts under entry 102 , sub entry 2
(f) and 2(k) respectively under Schedule IV of the AP VAT Act, 2005 and
taxable @ 4%.
Sd/ Sd/- Sd/-

To,
M/s. Lyophilization Systems (I) Pvt. Ltd
Plot No. 26/27, Aleep industrial Estate,
Kukatpally, Hyderabad.

Copy to the Commercial Tax Officer, I D A Gandhinagar Circle.
PROCEEDI NG OF THE
Present : Sri G. Lakshmi Prasad, Additional Commissioner ( Policy FAC)

Dr. Sri K.Raghavaiah, Joint Commissioner ( DMU & All Acts)
Sri P. Satyanarayana Reddy, Joint Commissioner( Legal)
***
CCT’s Ref.No.A.R.Com/ 179 / 2006 Dt: 12- 11- 2007
Ref:1) CCT’S Ref.No.PMT/ P&L/ A.R.COM/ 2005, Dt:13- 4- 2005.

2) CCT’s Ref.No.A.R.Com/ 179 / 2006 Dt: 08.02.2007
3) Hon’ble STAT Order in Appeal No. 325/ 2007 dt. 23.8.07
***
O R D E R:
M/s. Sree Rayalaseema Alkalies and Allied Chemicals Limited, Kurnool

(TIN No.28960200435) have filed an application and sought clarification and
Advance Ruling under Section 67 of the APVAT Act, 2005 read with Rule 66(2)(i)
of APVAT Rules,2005 along with the application fee of Rs.1000/-. The application
is examined and found in order. Hence admitted and the Ruling was given vide
reference 2nd cited supra.
Aggrieved on the clarification issued by this authority vide reference 2nd
cited, they preferred an appeal before the STAT in T.A.No.325/2007. The
Hon’ble STAT in their order dt. 23.8.2007 held that the appeal of the applicant
was allowed and requested to issue clarification on the issues sought for within
two (2) months of the receipt of the STAT’s order.
Consequently a notice was issued to the applicant requesting them to
appear before this authority for hearings on 4.10.2007.,Accordingly Mr.
A.C.Gangaiah C.A. authorized representative of the applicant, appeared before
this authority and explained the case.
The applicant’s representative raised the following points for clarification
and advance ruling.
1) They requested to clarify whether the deferment of tax should be on
‘monthly basis’ or ‘yearly basis’ as a specific reference to the period is absent in
the relevant Act and Rules.
2) They also requested to clarify on the value of goods involved in the
branch transfers while calculating for restriction of input tax credit as provided
under Rule 20.
The issues raised by the applicant are examined with reference to the Act
and Rules of APVAT Act, and the ruling is given as below:
1) Sub- rule ( 3) pf Rule 67 of the AP VAT Act, 2005- Rules,

prescribes that, the tax payable on the tax to be claimed as deferment
for each period shall be the net tax ( i.e. Out put tax less I nput tax) and
it shall be debited to eligibility amount of deferment.
Sub- Section ( 36) of Sec. 2 of the AP VAT Act 2005, defines, “ tax
period” means a calendar month or any other period as may be
prescribed . Therefore, in the absence of any notification regarding any
other period prescribed, it is hereby clarified that tax period means a
calendar month. Therefore, any VAT dealer w ho is availing deferment
shall file a declaration in Form VAT 502 for every tax period i.e. every
month in addition to the return in Form VAT 200.
2) Sub- Rule ( 8) of Rule 20 of the AP VAT Rules prescribes that if
a VAT dealer is making sales of taxable goods and also exempt
transactions of taxable goods in a tax period, for the purchases of
goods taxable @ 12.5% , the tax to the extent of 8.5% portion can be
fully claimed in the same tax period , by applying a formula and also
the purchases of goods taxable @ 4% and for the 4% tax portion in
respect of goods taxable @ 12.5% , a formula A X B/ C shall be applied
for each tax period. The I nput tax credit can be claimed for each tax
period i.e. every month w hile furnishing an additional return in
VAT200A for each month besides the return in Form VAT 200.
I f the adjustment of I nput tax credit is for a period of 12 months

ending March, every year a return in Form VAT 200 B shall be filed. For
the purpose of the Rule the w ord “C” of sub- rule ( 8) of Rule 20 denotes
the total turnover, w hich includes value of exempt transactions. For
the purpose of calculating the eligible I nput tax credit in Form VAT
200A for every tax period, the value of exempt transactions is the
assessable value as prescribed in the Central Excise Act, w hen the
such goods are removed from the bonded w arehouse, and transferred
to the branches or agents outside the state ‘ for sale’.
Sd/- Sd/- Sd/-

To
M/s. Sree Rayala Seema Alkalies and Allied Chemicals Ltd,
40-304, 2nd Floor, K.J.Complex,
Bhagya Nagar, Kurnool. 518 004

Copy to the Assistant Commissioner(CT) LTU, Kurnool Division..
PROCEEDINGS OF THE

*****
A.R.Com/ 227 /2006. Dated 30 -11 -2007.

**
O R D E R:
I. M/s Good Luck Plastic Industries Hyderabad, (TIN 28250114452 ) have filed an

Rate of tax on the following Goods:
1) Cellulosic Acetate Moulding Powder HSN Code No. 3912.11.20
2) Plastic Buttons HSN Code No. 9606.21.00
3) Melamine Table Ware
1) Write up / Facts of the case.
IV. Mr. N. Vijay Kumar, authorized representative , appeared for hearing and
explained the case.
The applicants are manufacturers of Cellulosic acetate moulding powder
by using chemicals of Formal dehyde liquid, Melamine powder wit h Wood
pulp.
The goods “Cellulose Acetate Moulding Powder with HSN Code No.
3912” is included at sub-entry160 of entry 100 of IV Schedule vide
G.O.Ms.No. 502 Rev. (CT-II) Dept. dt. 1-5-2006 w.e.f.1-5-2006 and “ Plastic
Buttons with HSN Code No. 9606.21.00” is included at sub-entry 230 of entry
100 vide G.O.Ms. No.656,Rev.(CT-II) Dept. dt. 2.6.2006 w.e.f. 1-6.2006.
But the goods “ Melamine Table Ware” is not notified in any Schedules to the
AP VAT Act, 2005, hence it will fall under the residuary entry under V
Schedule and liable to tax @ 12.5%.
Therefore the ruling is that the goods “ Cellulose Acetate Powder with
HSN Code No. 3912.11.20, and “Plastic Buttons with HSN Code No.
9606.21.00” are taxable @ 4% w.e.f. 1.5.2006 and 1.6.2006 respectively
and “ Melamine Table Ware” is taxable @ 12.5% w.e.f.1-4-2005.
Sd/- Sd/- Sd/-
To
M/s. Good Luck Plastic Industries,
21-4-278, Gulab singh ki Bowli, Hyderabad

Copy to the Commercial Tax Officer, Lad Bazar Circle.
PROCEEDI NGS OF THE

Present: Sri G.Lakshmi Prasad, Addl.Commissioner( VAT)

CCT’s Ref.No: A.R.Com/ 183 / 2006. Dated - 1 0 -2007 .
Ref:- CCT’s.Ref.No: PMT/ P&L/ A.R.Com/ 2005, Dated 13-0 4 -2005.
O R D E R:
M/s. Parry Enterprises India Limited, Hyderabad (TIN. No. 28310103683) have
along with the application fee of Rs.1,000/-. The application is examined and found in
The applicant is seeking clarification on the following items:

1. Agro meshes, Poultry meshes for sericulture, Bird protection net etc.
2. Meshes for Garden fencing, square meshes and tree guard meshes etc.
3. Meshes for insect protection
4. Miscellaneous items like packaging nets, fruit bags etc.
The case was posted for personal hearing on 15.3.2007. Sri V.Chandrasekhar,
Chartered Accountant and Sri S.Sarkar, Deputy Manager (Sales) appeared and explained
the case.
Act and Rules and (HSN Codes notified by Government vide G.O.Ms.No:398, Revenue
Dated 15-04-2005 as superceded in G.O.Ms.No. 1596 Rev. (CT -II) Dept., dt. 27.8.2005,
G.O.Ms.No. 1615 Rev.(CT -II) Dept., dt. 31.8.2005 and G.O.Ms.No. 502 Rev.(CT -II)
Dept., dt. 1.5.2006 and G.O.Ms.No. 656 Rev.(CT -II) Dept., dt. 6.6.2006 and G.O.Ms.No.
795 Rev.(CT -II) Dept., dt. 29.6.2006.
It is stated that they are in the business of manufacturing and marketing of

extruded polymer meshes, knitted fabrics, fibre glass screen of various sizes and allied
products. It is also stated that the manufacturing unit is based at palej, Bharuch
District, Gujarat. It is also explained that the applicable tariff code for the items is
3926.90.99 and copy of the invoice was also produced. It is contended that these
products are received from their factory by the branch office in A.P. and they are sold by
charging VAT. They have in particular made a reference to two entries in Schedule IV
to the Act. The first reference was to Entry 100 in Schedule IV to Act dealing with
iindustrial inputs under which sub item 207 with HSN Code notified 3926, specified
“Plastic fabrics of the type used for making plastic and woven sacks”. The second
reference is to Entry 105 in Schedule IV to the Act which specified ‘All hardware of base
metal or alloys and other hardware items like locks, woven wire nettings, mesh, cloth,
sieves and chain link of all metals”.
We have considered the documentary evidence and also the contention of the
applicant. The applicants Tuflex (I) Division makes/distributes Netlon insect screen Ivy
Polynox Ivy etc., of various sizes, mostly classified and used as insect screens, interior
screens, fencing or similar barriers, which may be fixed on the windows/doors with the
help of belco tapes. Thus as per the test of common parlana, these goods insect screens,
perimeter screens, meshes for insect protection, meshes for gardening, agro meshes etc.,
also satisfied, the common parlance test of a articles/products – “Plastics and articles
there of “ under chapter 39 of the customs tariff Act. The four digit 3926 heading reads
as “Other Articles of plastics and articles of other materials of headings 3901 to 3914”.
The eight digit code they relived up on is 3926.90.99 – which refers to 3926.90 – other
and 3926.90.99 – other. Thus, by nature and character and also by common parlance,
goods under reference fall under plastics and articles there of but not:
(1) industrial inputs, that is to say – heading No. 3926 – “ Plastic fabrics of the
type used for making plastic woven sacks and plastic woven sacks” there by they would
not encompass other articles of plastics except enumerated commodities, and (2) entry
105 of the IV schedule, which reads “all hardware of base metal or alloys and other
hardware items like locks, woven wire nettings, mesh, cloth, sieves and chain link of all
metals”, also would not include insect screens, meshes for insect protection, meshes for
gardening etc.,
Therefore, we hold that, the commodities viz., insect screens, perimeter screens,
meshes for insect protection, meshes for gardening agro meshes etc., made up of plastic
and articles thereof would not fall in any entries of IV schedule and therefore, liable to
tax @ 12.5% under residuary entries of the V schedule.
To
M/s. Parry Enterprises India Limited,
IDA Nacharam,
Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 216 /2006. Dated 31- 12- 2007.
O R D E R:
I. M/s. Shree Ganesh Chemical Corporation, Kattedan, R.R.Dist., (TIN

28480222470 ) have filed an application and sought clarification and advance ruling on
the following items under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of
Rate of tax on the following goods:
1) Paraffin Wax HSN Code.2712.20.90

2) Resudeo Wax HSN Code 2712.90.90
3) Waxy Oil HSN Code 2712.90.90
4) Rubber Process Oil HSN Code 2712.90.90
5) Slag ( Slack) Wax HSN Code 2712.90.90
Produced copies of invoices at the time of hearing.
IV. Mr. Sundarlal Agarwal appeared for hearing and explained the case.
The applicant is a trader, dealing in the goods mentioned above. He is charging
tax @ 4% on Paraffin Wax and @12.5% on the rest of the five goods and sought
clarification on the rate of tax, applicable to all the above goods.
VI Sub-entry 189 of Entry 100 of the IV Schedule read with HSN Code 2712.20
enumerates “Paraffin Wax containing by weight less than 0.75% of oil; Normal paraffin;
not being micro crystalline petroleum wax.” The said entry was included vide
G.O.Ms.No.656Rev. (CT-II) dt. 2-6-2006 w.e.f. 1-6-2006. The rest of the above five(5)
goods are not notified in any of the Schedule s of the AP VAT Act, 2005 and hence fall
under Schedule V of the Act.
Therefore , it is hereby clarified that only “Paraffin Wax less than weight
0.75% of oil “ is taxable @ 4%. The other goods “Resudeo Wax, Waxy Oil, Rubber
Process Oil, and Slag Wax” are taxable @ 12.5% under residuary entry of the V
Schedule of the AP VAT Act, 2005.
Sd/- Sd/- Sd/-
Addl.Commissioner Jt.Commissioner Jt.Commissioner
To
M/s. Shree Ganesh Chenmical Corporation,
D.No. 8.1.207/a Mailar devpally, R.R.District.

Copy to the Deputy Commissioner (CT) Saroornagar Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 61 /2007. Dated 31- 12- 2007.
O R D E R:
I. M/s Diamond Steels, Musheerabad, Hyderabad, (TIN 28360275048.) have filed

an application and sought clarification and advance ruling on the following items under

Rate of tax on Scrap/Unserviceable items such as:
Multiple poured ingots, M.S. Steel Strips, Coils, Wire Ropes, Sample cut pieces,
MS Scrap, Turning, Cobbled Wires& Rods Mixed with strips, Melting Slag embedded
with Solidified molten Metal and Refractory Bricks.

Copies of invoices.
IV. Mr. J.P.Naidu, Advocate, Authorised Representative, appeared for hearing and
explained the case.
dt.29.06.2006 and G.O.s issued so far and the ruling is given as under:
The applicant is engaged in the business of trading Iron & Steel, Iron Scrap
ferrous & Non-ferrous Metals. He was successful bidder in the auction by tender,
conducted by M/s. Mishra Dhatu Nigam Limited, and lifted unserviceable Iron Scrap
and Steel Scrap items and Refractory Bricks mentioned supra and contended that all the
Iron and Steel scrap items falls under the entry 70 & 71 and Refractory Bricks fall under
entry 3 of the Schedule IV of the AP VAT Act, 2005. But the MIDHANI is charging tax
@ 12.5%.on the above scrap from the applicant and hence he sought clarification on the
rate of tax, applicable to the above Items of Scrap.
VI. It is hereby clarified that the goods, namely, Refractory Bricks are notified
under entry 3 of the Schedule IV of the APVAT Act and the goods, namely, the
Items of Iron & Steel Scrap are notified under entry 70, & 71 of the IV Schedule of
the AP VAT Act, 2005 and hence these goods are liable to tax @ 4% only.
Sd/- Sd/- Sd/-

To
M/s. Diamond Steels, 1-4-847,
Bakaram, Musheerabad,Hyderabad

PROCEEDINGS OF THEAUTHORITY FOR CLARIFICATION AND ADVANCE

RULING

*****
A.R.Com/ 68 /2007. Dated 31- 12- 2007.
O R D E R:
I. M/s Technova Imaging Systems (P) Ltd,. Begumpet, Hyderabad (TIN

28840206744) have filed an application and sought clarification and advance ruling on
Rate of tax on Pre Sensitised Aluminium Plates ( PS Plates)/Lithographic Plates/ Thermal

plates with HSN Code 8442.50.20 which are used for printing.
Copies of invoices and notifications of other states such as Maharashtra, Cochin

and Broucher.
IV. Mr.N.V.Rajgopal, Advocate, authorized representative, appeared for hearing and

explained the case.
dt.29.06.2006 and G.O.s issued so far and the ruling is given as under:
VI. The applicants are engaged in the business of selling Plates of Pre Sensitised
Lithographic, Aluminium and thermal plates with HSN Code No.8442.50.20 which are
used in printing industry. He is selling the said goods to major news paper printers.
Sub-entry 17 of entry 102 of the IV Schedule with four digit HSN Code 8442
enumerates “Machinery, apparatus and equipment for type founding or type setting, for
preparing or making printing blocks, plates, cylinders and lithographic stone, prepared for
printing purposes (planned, grained or polished). This entry was added by G.O. Ms. No,.
795 Rev.( CT-II ) Dept. dt. 29-6-2006 w.e.f.1-7-2006.
Therefore, it is hereby clarified that the Plates of

Aluminum/Lithographic/Thermal used for printing with HSN Chapter Heading
Code 8442 do fall under sub-entry 17 of entry 102 of the IV Schedule of the AP VAT
Act, 2005 and liable to tax @ 4%. w.e.f. 1-7-2006.
Sd/- Sd/- Sd/-

To
M/s.Technova Imaging Systems (P) Ltd,
Plot No. 79, Chikoti Garden,
Begumpet, Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 56 /2007. Dated 27- 12- 2007.
O R D E R:
I. M/s Mining Associates Pvt. Ltd, Atwal Nagar, S.B. Gorai Road, Asansol, West
Bengal have filed an application and sought clarification and advance ruling on the
following items under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of

1) Whether Contract for Drilling Earth for the purpose of handing over the same
to the Atomic Mineral Department for the testing of soil is liable to AP VAT Act,
2005 ?
2) Whether the work of Drilling the earth , which is purely labour oriented one,
do attract the provision of deduction of tax at source by the contractee?

1) Write up (2) Copy of agreement from the Dept. of Atomic Energy, G O I
IV. Mr. Tej Prakash Toshniwal, Advocate, authorized representative appeared for
VI. The applicant is engaged in the business of execution of contract of Drilling Earth
and hand ing over the resultant soil to the Atomic Mineral Department (G O I ) for the
testing. He contended that the work done is purely labour oriented one, and no delivery
of goods is involved and hence do not fall within the definition of sale of goods.
The contention of the applicant is examined with reference the agreement made
with Atomic Mineral Departme nt ( G O I ), and as per AP VAT Act. The
transaction of Drilling Earth and handing over the soil extracted by drilling at
various levels in the ground to a Government of India Department, i.e. Atomic
Mineral Department for testing of soil, without involvement of transfer of any
goods, does not fall within the definition of sale of goods and hence, not liable to AP
VAT Act, 2005. Consequently the question of deduction of tax at source by the
contractee does not arise.
Sd/- Sd/- Sd/-
To
M/s. Mining Associates Pvt. Ltd,
Atwal Nagar, S.B.Gorai Raod, ASANSOL, WEST BENGAL

PROCEEDINGS OF THE
Present: Sri G. Lakshmi Prasad, Addl.Commissioner(Policy)( FAC)

*****
A.R.Com/ 83 /2007. Dated 24- 01- 2008.
O R D E R:
I. M/s Data Systems, S.D.Road, Secunderabad (TIN 28560208370.) have filed an


Rate of tax on “ Unshielded twisted pair ( UTP) Cables “

Notifications of other states, such as Karnataka , Maharashtra and Goa.
IV. Sri. R. Mishra C.E.O, appeared for hearing and explained the case.
(CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II)
Department Dated 15-04-2005 as superceded in G.O.Ms.No.1596, Revenue(CT-II)
Dept. dt.27.08.2005, in G.O.Ms.No.1615, Revenue (CT-II), Dept. dt.31.08.2005,
VI The applicant is dealing in unshielded twisted pair cables used for computers and
paying tax @ 12.5% . They have filed notifications of other states of Karnataka,
Maharastra, and Goa where in the said goods are taxable @ 4%, hence sought
clarification regarding the rate of tax in our state.
Entry 38 of the IV Schedule enumerates “ Industrial cables, ( High voltage cables,
XL, PE cables, Jelly Filled cables, optical fibre cable)”. But U T P cables are not notified
in any schedules of the AP VAT Act, 2005. Hence taxable @ 12.5% under residuary
entry of the V Schedule.
Therefore it is clarified that “ Unshielded twisted pair (UTP) cables “ are
taxable @ 12.5%, under residuary entry of V Schedule to the AP VAT Act, 2005.
Sd/- Sd/- Sd/-

To
M/s.Data Systems,
314, 3rd Floor, Minerva Comples,
S.D.Road, Secunderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 50 /2007. Dated 16- 01- 2008.
O R D E R:
I. M/s.Shakti Met Dor Limited Bowenpally, Hyderabad, (TIN28510123335) have


Rate of tax on Steel Doors and Windows.
1) Writeup 2) Copies of Invoices.
IV. Mr. M.Rama Chandra Murthy, Chartered Accountant, appeared for hearing and
explained the case.
G.O.s issued so far and the ruling is given as under:
The applicants are the manufacturers of steel Doors and Windows, classified
under Central Excise Tariff Code No. 7308.30.00. The applicants contended that
the goods fall under sub-entry 21 of Entry 70 of the IV Schedule and liable to tax
@ 4%.
VI Sub-entry 21 of entry 70 of the IV Schedule with HSN Tarrif Chapter
heading 7308 enumerates” Structures ( excluding prefabricated buildings of
heading 9406) and parts of structures ( for example, bridges and brid ge-sections,
lock gates, towers, lattice masts, roofs, roofing frame-works, doors and window
and their frames and thresholds for doors shutters, balustrades, pillars and
columns), of iron or steel; plates rods, angles, shapes, sections tubes and the like
prepared for use in structures, of iron or steel.
Therefore the ruling is given that the goods “ Steel Doors and
Windows dealt by the applicant covered by HSN Tariff Code7308.30 do fall
under sub-entry 21 of entry 70 the IV Schedule to the AP VAT Act, 2005 and
liable to tax @ 4%.
Sd/- Sd/- Sd/-
To
M/s.Shakti Met Dor Limited,
Plot No.4, Sy.No. 22,
Sai Nagar Colony, Picket Secunderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 89 /2006. Dated 21- 02- 2008.
O R D E R:
I. M/s Philips Electronics India Ltd,. Hyderabad (TIN 28510197734.) have filed an

Rate of tax on the following:
1) CD/DVD player (DVD3020/ DVPs
106K/DVP3026/DVP3028/DVP3046) vide Excise Tariff HSN code:
85.19 & 85.21 90. 20 & radio/ Transistors under HSN code 85.27.
2) Packet size radio cassette recorders HSN code 85.27.10.
Copies of Broachers
IV. Sri. D. Mahesh Depot Manager, appeared for hearing and explained the case.
VI. The applicants are dealers in CD/DVD Players, Pocket size radio cassette
recorders etc. They are paying tax @ 12.5%, while some of their competitors are
charging tax @ 4%, they sought for the rate of tax on these items.
The sub- item 13 of entry 39 of the IV Schedule to the AP VAT Act, 2005
enumerates as ” prepared unrecorded media for sound recording or similar recording of
other phenomena, video and Audio CD’s cassettes and DVD’s ( recorded and
unrecorded)”. Therefore, CD’s, and DVD’s Players & Pocket size radio cassette
recorders are not notified in entry 39 of the IV Schedule of the AP VAT Act, 2005.
Video and audio CD’s, DVD’s and cassettes alone are taxable @ 4%, under sub-entry
13 of entry 39.
Therefore the ruling is that, the CD & DVD players and Packet size radio
cassette recorders , are taxable @ 12.5% under residuary entry of the V Schedule of
the AP VAT Act, 2005.
Sd/- Sd/- Sd/-

To
M/s. Philips Electronics India Ltd.
3/A, I D A Uppal,
Hyderabad.

Copy to the Assistant Commissioner (CT) L T U Begumpet Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 236 /2007. Dated 29-- 02- 2008.
O R D E R:
I. M/s Good will Trade Lines, Markapur, (TIN 28480178044.) have filed an
Rate of tax on “ Liquid Blue”.
1) Literature from their purchaser i.e.M/s Oswal Udyog

2) Purchase invoice of their supplier I,e. M/s Oswal Udyag. HSN Code 3204.29.
3) Copies of sales invoices of the applicant.
IV. Sri. M.V.J.K. Murthy, Advocate, authorized representative of the applicant,

VI. The applicant is manufacturer of Liquid Blue which is mainly used for increasing
whiteness of clothes and commonly known as washing blue. The applicant uses “ Acid
Violet” a kind of acid dyes for preparation of liquid blue. The authorized representative,
sri. M.V.J.K.Murthy at the time of personal hearings contended that, “Acid Violet”, main
raw material is purchased from M/s. Oswal Udhyog, Mumbai, and liquid blue is prepared
by mixing acid violet powder in hot water, and filling them in plastic bottles of various
capacities using funnel and measuring glass. He also brought to the notice of this
authorities the decision of the special bench, CEGAT, New Delhi in the case of M/s
Jyothi Laboratories Vs Collector of Central Excise, where in the appeal of the appellant
was allowed on the ground that there was no process of manufacture in the preparation
of “ Ujala”, a washing blue liquid. Accordingly, he contested that, liquid blue dealt by
his client also falls under HSN code 3204.29.In support, the applicant also produced
invoices issued by M/s, Oswal Udhyog , Mumbai.
In G.O.Ms.No. 502, Revenue (CT-II) Dept. dt.1-5-2006, notified HSN Code

3204 against sub-entry 121 of entry 100 of IV Schedule, which enumerates as “ Industrial
inputs” that is to say- where in sub-entry 121 of entry100 of IV Schedule to the AP VAT
Act, 2005, with H S N Code 3204 enumerates as “ Synthetic organic colouring matter,
Whether or not chemically defined: preparations based on synthetic organic colouring
matter as specified in Note 2 to this Chapter: synthetic organic products of a kind used as
fluroscent brightening agents or as luminophores, whether or not chemically defined
excluding catechu or gambiar”.
Therefore, the ruling is that, the product LIQUID BLUE, a kind washing
blue dealt by the applicant falls under sub-entry 121 of entry 100 of the IV
Schedule to the AP VAT Act, 2005 liable to tax @ 4%.
Sd/- Sd/- Sd/-

To
M/s. Goodwill Trade Lines
7/308,G-1 Steriline Apartment,
Nehru Street,
Matkapur.

Copy to the Deputy Commissioner (CT) Nellore Division.
Copy to the Commercial Tax Officer Markapur Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 43 /2007. Dated 21 -02 -2008.

**
O R D E R:
I. M/s N. P .Ribbons & Hankies (P) Ltd., Hyderabad, (TIN 28150105402 ) have
filed an application and sought for clarification and advance ruling on the following
issues under Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules,
2005.

Whether ‘Ribbons’ made from man- made yarn falling under the “Narrow
Woven Fabric ” and subjected to tax under the AP VAT Act, 2005 or not

Writwe up on Narrow Woven Fabrics, Copies of invoices, and letter from the
Central Excise Dept. Surat, Gujarath State.
IV. Mr. Popli, authorized representative, appeared for hearing and explained the case.
Revenue (CT. II) Department Dated 15-04-2005 as superceded in
VI. The applicant is a dealer in buying and selling of Nylon Ribbons made from
man-made Narrow Woven Fabric. Docume ntary evidence furnished i.e. Bill of
Entry for Home Consumption shows that the applicant importing Nylon Ribbon (
Narrow Woven Fabrics of Man made) with HSN Code 5806.32.00.
It is clarified that if the product of the applicant is covered under additional

duty of excise but exempted by a specific notification, it will be deemed as covered
under additional duty of excise and not exigible to levy tax under AP VAT Act. In
case it does not fall under Additional duty of Excise, the tax rate of 4% is applicable.
Sd/- Sd/- Sd/-

To
M/s. N.P.Ribbons & Hankies (P) Ltd,
15-8-391/6, Begum Bazar,
Feelkhana,
Hyderabad.

Copy to the Commercial Tax Officer, Begum Bazar Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 204 /2006. Dated 12 - 02- 2008.
O R D E R:
I. M/s Hyderabad Dental Depot., Abids, Hyderabad (TIN 28940109676.)

have filed an application and sought for clarification and advance ruling on
66(2)(i) of APVAT Rules, 2005.
Rate of tax on the following medical Dental Materials, and medical

Instruments & Equipment:
Dental Materials:
1) Dental Filling Cements
2) Endodontic Root Canal Instruments & Materials
3) Orthodontic Brakets, Wires, and attachments
4) Denture Resins, artificial teeth etc.
5) Dental Plasters.
6) Impression materials.
7) Disposable Gloves, Masks, Syringes, Needles etc.
Dental Instruments
8) Dental Extraction Forceps elevators etc.
9) Dental Instruments for Diagnostics
10) Air Turbine Handpieces.
Dental Equipments
11) Dental Chair & Unit
12) Dental X- Ray Unit
13) Dental Scalers
14) Dental Laboratory Equipments
15) Dental Micro Motor for laboratory and clinical use.
Copy of Proceeding of the Advance Ruling Authority of Karnataka Govt.
IV. Sri. D. Hari Kishan Advocate, Authorised Representative , appeared for

Revenue (CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue
(CT.II) Department Dated 15-04-2005 as superceded in G.O.Ms.No.1596,
Revenue(C T-II) Dept. dt.27.08.2005, in G.O.Ms.No.1615, Revenue (CT-II), Dept.
dt.31.08.2005, G.O.Ms.No.502, Rev. (CT-II) Dept., dt.1-5-2006 w.e.f. 1-5-2006,
G.O.Ms.No.656, Revenue (CT-II), Dept. dt.2.06.2006 G.O.Ms.No.795, Revenue
(CT-II), Dept. dt.29.06.2006 and the G.O.s issued till date and ruling is given as
under:
VI. M/s Hyderabad Dental Depot, Abids, Hyderabad is a registered dealer under
the APVAT Act 2005 bearing TIN 28940109676, on the rolls of the Commercial Tax
Officer Charminar Circle, Charminar Division.
VII. The applicant has filed a detailed list of medical equipment, implants and
other materials dealt by him. The Authorized Representative contended that the
applicant is liable to VAT @ 4% on the dental materials, medical equipments and
instruments, under entry 111 of the IV Schedule to the AP VAT Act, which reads as
follows – “medical equipments, devices and implants”. The authorized representative
also drew the attention of the Authorities of the Advance Ruling to the clarification,
given by the Authority for Clarification and Advance Ruling of the Karnataka State.
The Entry No. 61 of Schedule IV of the Karnataka VAT Act is similar to the Entry
111 of the Schedule IV of the APVAT Act. It also reads as “Medical equipments,
devices & implants”. Under the Central Excise Tariff Act these surgical and dental
equipments fall under Chapter 9018, 9021, 9022 & 9402. The other entry which deals
with medical implants disposables and similar articles fall under entry 88 of the IV
Schedule which includes – “hypodermic syringes, hypodermic needs, catguts, sutures,
surgical cotton, dressings, plasters, catheters, cannulas, bandages and similar articles”.
Therefore, after examination of the nature of the goods dealt by the applicant the
following goods are clarified as eligible to fall under either Entry 88 or Entry 111 of
the IV Schedule:
1) Dental equipments which includes dental chairs units, dental X-ray units,
dental laboratory equipments, dental micro motors for clinical use do fall
under “ medical equipment” under entry 111 of the IV Schedule .
2) Dental materials & devices such as dental filling cement, endodontic root
canal equipments and materials, orthodontic brackets, wires and
attachments, denture resins, artificial teeth, dental plasters, impression
materials, and dental instruments such as dental extractions forceps,
elerators, air turbine hand pieces etc. do fall under medical devices and /
or implants under entry 88 of the IV Schedule.
3) Medical disposables such as disposable gloves, masks, syringes, need les
etc. do fall under entry 88 of the IV Schedule under medical implants and
articles.
Therefore, it is hereby clarified, in effect, that the goods enumerated

supra, fall either under entry 88 or 111 of the IV Schedule liable to VAT @ 4%.
Sd/- Sd/- Sd/-
To
M/s. Hyderabad Dental Depot,
4-1-1229, Bogulkunta, Abids, Hyderabad.

Copy to the Commercial Tax Officer, Charminar Circle.
PROCEEDINGS OF THE
Present: Sri G.Lakshmi Prasad, Addl. Commissioner (Policy)( FAC)

Sri K. Raghavaiah, Jt. Commissioner (Audit))
Sri P.Satyanarayana Reddy, Jt. Commissioner (Enft.))
***
.No: A.R.Com/ 168/ 2006. Dated: 2.02.2008.
Ref: - CCT’s Ref.No: PMT/P&L/A.R.Com/2005, Dated 13-04-2005.
O R D E R:
I. M/s. Pramod Kumar Rajesh Kumar (TIN. 28400139085) Hyderabad have filed an
application and sought for clarification and advance ruling on the following items under
II. Sri M. Ramachandra Murthy, C.A. appeared for hearing and explained the case.
III. The applicant stated that it intends to business in Soyabean de-oiled cake by
purchasing the same from outside the State. It is further stated that “De-oiled cakes” are
specified against entry No.87 of the IV Schedule to APVAT Act.
The applicant has stated that under APGST Act “de-oiled cakes” were taxable at
4% under entry 29 of First Schedule of the Act and “Poultry feed and Cattle feed” were
liable to tax @ 1% upto 31.03.1995 under entry 80 of First Schedule of APGST Act, 57.
It is further stated that when departmental authorities sought to levy tax @ 4% on Soya
bean de-oiled cake on falling under entry 29 of First Schedule to APGST Act 1957 the
STAT in the case of Kasireddy Gurual Reddy and Company, Warangal Vs. State of
AP(14 APSTJ 77) held that Soya bean de-oiled cake is liable to tax at the rate of 1%
only as cattle or poultry feed, in spite of specific entry for de-oiled cases. The applicant
contended that, on the same analogy, under AP VAT Act, 2005, “Soya bean de-oiled
cake” falls under poultry or cattle feed, and is exempt under entry 3 of Schedule I of AP
VAT act and sought confirmation of the same.
IV. The issue has been examined with reference to the provisions of the APVAT Act
dt.29.06.2006 and also on the case law (14 APSTJ 77) relied on by the applicant.
V. It is seen that the Hon’ble STAT in its orders (14 APSTJ 77) has observed that
“the appellant placed reliance on a decision reported in 9 APSTJ 230 State of A.P. Vs.
Alved Pharma, Azampura, Hyderabad, wherein the Hon’ble High Court of A.P. held that
poultry feed supplement also falls within entry 80 of the First Schedule to APGST Act.
Relying on the view taken by the Tribunal in T.A. Nos.971/88 & 972/88
dt.8.2.1991 the Tribunal held that Soya bean de-oiled cake is liable to tax @ 1.65% only.
Under the AP VAT Act entry 3 of the Ist Schedule enumerates “ Aquatic feed,
Poultry feed, Cattle feed, including grass, hay, or straw and feed supplements or
nutrients” and exempted from VAT.
Entry 87 of the IV Schedule describes “ Oil Cakes or de-oiled Cakes” liable to
VAT @ 4%.
The applicant who prima facies, is a dealer in specific goods viz,. “ Soyabean de-
oiled Cakes”.
The enumeration of the entry 87 implies that all “ Oil Cakes or de-oiled Cakes”
irrespective of the nature of oil seed or end use, are liable to tax under the said entry.
Hence, “ Soya bean de-oiled Cake” dealt by the applicant, falls under entry 87 of
the IV Schedule, taxable @ 4%.
Sd/- Sd/- Sd/-

To
M/s.Promod Kumar Rajesh Kumar
Maharajgunj, Hyderabad.

Copy to the Commercial Tax Officer, Maharajgunj Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 195 /2006. Dated 2 -02 -2008.

**
O R D E R:
I. M/s R-9000 ( R.S.BROTHERS) Hyderabad, (TIN 28960201017 ) have filed an

application and sought for clarification and advance ruling on the following items under
Section 67 of APVAT Act, 2005 read with Rule 66(2)(i) of APVAT Rules, 2005.
1) Whether MS Plates, MS Channells, MS angles, Tiles, etc, used for the
interior construction of buildings which is used or the business purposes is
eligible to claim for the Input tax credit ?
2) Whether Airconditioning units used for the business purpose is eligible to
claim for I T C?
3) Whether Alluminium Sheets, gypsum board, wood, plywood Laminated
Sheets, hardwares Neon Sign boards, etc. used or the making of interiors
and furnitures ( Capital Assets) for the business purpose is eligible to
claim for the I T C?
4) Whether U P S for invertor & Power Saving Equipments installed and
used for the business purpose is eligible to claim for the I T C?
5) Whether electrical cables, bulbs used for the electrical wiring for the
purpose of business is eligible to claim for the input tax credit?
Copies of purchase and sales invoices
IV. Mr. K.V. Sarma authorized representative, appeared for hearing and explained the
case.
VI. The applicant is a dealer in ready made garments and textiles. The ‘ business
premises’ of the applicant is improved with interior decoration. In the process certain
materials, are purchased and used for interior decoration of the business premises. The
applicant’s quarries are examined with reference to the facts of the case and Act & Rules
1) Whether M.S. Channels, M.S.Plates, M.S.Angles, Tiles etc., which are purchased
from the registered VAT dealers and used for interior construction of the building of
business eligible for Input Tax Credit.?
Sub-rule (2) of rule 20 prescribes that certain items not eligible for Input Tax
Credit as specified in sub-sec.( 4 ) of Sec. 13.
Clause (i) of sub-rule (2) of rule 20 prescribes that “ any input used in
construction or maintenance of any buildings including factory or office buildings, unless
the dealer is in the business of executing works contracts and has not opted for
composition.”
Hence, under Sec. 13 (4) read with Rule 20 (2) (i) they are not eligible for
Input Tax Credit on any inputs used in construction of any building including
business premises.
2) Whether air conditioning units used for business purpose is eligible for I T C?
In view of clause © of sub-rule (2) of rule 20 of the AP VAT rules, “ air

conditioning units” are not eligible for I T C as specified in sub-sec. (4) of Sec.
13.
3) Whether aluminium sheets, gypsum-board, wood plywood, laminated sheets,

hard wares etc., for making interiors are eligible for I T C.
As clarified at point No. 1 above.
4) Whether U P S for invertors & power saving equipments used for business
purpose are eligible for I T C.
Sec. 13 (1) reads that “ an input tax shall be allowed to the VAT dealer for
the tax chaged in respect of all purchases of taxable goods,. if such goods are
for use in the business of the VAT dealer., Sub-sec. (8) of Sec. 13 also reads
that “ where goods purchased by a VAT dealer are partly for business use and
partly for other than business use, the amount of Input Tax Credit shall be
limited to the extent of Input Tax Credit relates to the goods used in his
business.
If the purchase of U P S are for use in business, they are eligible

for Input Tax Credit.
5) Whether electrical cables , bulbs used for purpose of business is eligible for
calim of input tax credit?
As clarified at point No. 4.
Sd/- Sd/- Sd/-

To
M/s.R-9000, ( R.S.Brothers),
opp. Osmania Medical College,
Kothi, Hyderabad.

Copy to the Commercial Tax Officer, Sultan Bazar Circle.
PROCEEDINGS OF THE
Present: Sri G. Lakshmi Prasad, Addl.Commissioner(Policy)(FAC)

*****
A.R.Com/ 80 /2007. Dated 2 - 02- 2008.
O R D E R:
I. M/s Kakati Karshak Industries Pvt. Ltd I D A Nacharam Hyderabad, (TIN

28640260812.) have filed an application and sought for clarification and advance ruling
APVAT Rules, 2005.
Rate of tax on the following Goods. H S N CODE
a) Vaccum pumps 8414.10.00
b) Spares/ Accessories of vaccum pumps 8414.90.19
c) Pre-Water separator pumps 8479.89.00
d) Spares / Accessories of pre-water separator pumps 8479.90.90
e) Gear Pumps 8413.60.10
f) Spares / Accessories for Gear Pumps 8413.91.90
Copies of invoices and Broucher
IV. Sri J. Siva Sanker Reddy Advocate along with Sri S.P.Kasturi, Manager Finance ,
VI. The applicant is a dealer in Vaccum pumps, its Spares/Accessories, Pre-Water
separator pumps and its Spares/Accessories and Gear Pumps, its Spares/Accessories.
The entry 17 of the IV Schedule after 18.8.2005 reads as follows:
“ Centrifugal, monoblock, submersible pump sets, starters of electricmotors and
pumpsets, parts and accessories thereof”. Earlier the Govt. Vide G.O.Ms.No. 490 Rev.
Dept. dt. 15.4.2005 have notified under HSN codes of the commodities that come under
entry 17 of the IV Schedule. Later, the said entry is substituted and the HSN codes
notified are omitted Vide G.O.Ms No. 1564 Rev. dt. 17.8.2005. Thus after 18.8.2005, no
HSN code is attributed against entry 17 of the IV Schedule. Thus the entry has to be
understood as per the nomenclature and normal understanding of the entry with reference
the common parlance test.
The issue has been examined. All entries in IV Schedule have to be
understand as enumerative and exhaustive but not inclusive. Hence Vaccum
pumps, & its parts, Pre-Water separators pumps & its parts, Gear Pumps & its
parts do not fall under entry 17 of the IV Schedule, but fall under residuary entry
Sd/- Sd/- Sd/-
To
M/s.Kakati Karshak Industries (P) Ltd.
I D A Nacharam

Copy to the Deputy Commissioner (CT) Hyd. Rural Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 41 /2007. Dated 12 - 02- 2008.
O R D E R:
I. M/s Jubilant Organosys Ltd, Basheerbagh, Hyderabad (TIN 28860159472.)

have filed an application and sought for clarification and advance ruling on the
following issues under Section 67 of APVAT Act, 2005 read with Rule 66 (2) (i) of
APVAT Rules, 2005.

Whether VAT is applicable in the following cases or not.
a) Skill & technical services and labour cha rges incurred for manufacturing of
the semifinished products.
b) Handling & transport charges paid by the applicant to the job worker towards
transportation of such finished products upto the inland container/ export
depot.
c) Cost of consumables, water and catalyst elements for processing of chemicals
into finished products, paid by the applicant.
d) The cost of packing materials and packing charges incurred by job-worker for
packing of finished product belonging to the applicant for export to the
Foreign countries.
e) Whether the packing material us ed by the job-worker for packing of the
semifinished products for export amounts to sale in the course of export under
Section 5 (3) of the CST act read with Sec 8 of the APVAT Act ?.
f) Whether the job-worker is eligible to issue tax invoice and claim the input tax
credit to the extent of 90% or full on tax paid on the purchase of packing
materials by the job-worker.

1) Copy of D E P B Pass Book Scheme( Post export)
2) Copy of shipping Bill for Export
3) Copies of Commercial invoices
4) Certificate of Import-Exporter Code , issued by Ministry of
Commerce, G O I.
Revenue (CT.II) Department Dated 31-03-2005 and G.O.Ms.No:490, Revenue
(CT.II) Department Dated 15-04-2005 as superceded in G.O.Ms.No.1596,
Revenue(CT-II) Dept. dt.27.08.2005, in G.O.Ms.No.1615, Revenue (CT-II), Dept.
dt.31.08.2005, G.O.Ms.No.502, Rev. (CT-II) Dept., dt.1-5-2006 w.e.f. 1-5-2006,
G.O.Ms.No.656, Revenue (CT-II), Dept. dt.2.06.2006 G.O.Ms.No.795, Revenue
(CT-II), Dept. dt.29.06.2006 and the G.O.s issued till date and ruling is given as
under:
M/s. Jubilant Organosys Ltd., Basheerbagh, Hyderabad is a registered dealer

under the AP VAT Act 2005 bearing a TIN 28860159472 on the rolls of the
Commercial Tax Officer Hyderguda Circle.
Sri. D. Harikishan, Advocate, duly authorized, appeared before the Authority

and represented the case.
The applicant’s head office is at Noida, Uttar Pradesh, while manufacturing Unit
is at Gujraula, Utter Pradesh. The applicant exports bulk drugs, fine chemicals,
intermediaries for pharmaceuticals etc, which are either wholly manufactured in their
manufacturing unit or outsourced from other manufacturers or get the goods
manufactured on contract basis (job work) on their behalf after supplying inputs/raw
materials to job workers/contract manufacturers.
In the present case, the applicant’s head office got export order for supply of
Niacin and Niacinamide. The applicant, in his manufactur ing unit at Gajraula, U.P.,
has processed a semifinished product called 3- cyanopyridine, which is a precursor for
the final products i.e. Niacin and Niacinamide. The semifinished product, “3-
cyanopyridine”, is sent to a dealer in A.P. for processing it into the finished products
i.e. Niacine & Niacinamide . The dealer in A.P., a registered TIN dealer , is one by
name & style Veerchemie and Auromatics (P) Ltd., Hyderabad, who sends back the
finished products after getting them packed as per the specifications of the exporter
or the applicant. The dealer in A.P., in the process of converting the semi-finished
into finished product, purchases certain consumables such as – sodium hydroxide,
sulphuric acid, methanol, etc, and also the specified packing material at his cost and
on his own account. All these consumables and packing materials are purchased from
the registered VAT & CST dealers after due payment of VAT or CST as the case may
be. The final product, manufactured by the dealer in A.P., is exported to foreign
countries. The dealer in A.P is paid the charges by the Head office of the applicant at
Noida for (1) Technical services & labour charges (2) Handling charges for
transpor tation of goods to the container depot. 3) Charges for consumables and (4)
Charges for packing material. In such a situation and circumstances of the case, the
applicant sought for clarification on the issues raised supra.
In view of the facts of the case explained and documents furnished, it is

clarified as under :
a) Where any material/ inputs are supplied by a dealer (hereafter called as

contractee) to another dealer (hereafter called as contractor) and a particular
type of processing is executed by the contractor on the behalf of the
contractee , then the nature of transaction would be either a job work or works
contract, based on the fact whether the execution of work is incidental or
ancillary to the supply of goods and whether the predominant components/
materials, used in such work, are supplied by the contractee or purchased and
used by the contractor and whether the work is done by the contractor on
behalf of the contractee or not. In the instant case entire semifinished product
i.e. 3-cyanopyridine, has been supplied by the contractee (the applicant)
wherein the contractor , converted semi-finished product into finished product.
In the process of conversion the contractor used certain consumables. There is
no transfer of goods in the process of conversion / execution of work. In such
a situation, the applicability of VAT does not arise, as there is no element of
sale or deemed sale. However, all the consumables purchased or used by the
contractor are not eligible for the claim of input tax credit, as provided under
sub-rule (2) (o) of rule 20 of the AP VAT Rules. Therefore, the charges
towards technical and skilled service & labour charges do not attract levy of
VAT.
b) Handling charges for transport of the goods to the point of Export Depot are
borne by the applicant and such charges form part of the consideration for
export sale . Even though the expenditure towards transport of the goods to the
Export Depot was paid by the contractor, it is reimbursed by the applicant
together with the charges for handling the goods. Hence, levy of VAT is not
attracted on such consideration a t the hands of the contractor, because the
contract is for service but not for supply of goods.
c) The turnover of consumables, used by the contractor in the process of
conversion of semi-finished goods into finished goods, are not liable to VAT
but, at the same time, such goods are not eligible for claim of Input tax credit
at the hands of the contractor under sub-rule (2) (o) of the rule 20 of the VAT
Rules..
d) In respect of the packing materials, supplied by the contractor in the process of
packing the goods in accordance with the specifications of the contractee, the
transaction is a contract for works within the State of A.P. and the
consideration, received towards goods involved in the work of packing the
contents are liable to VAT @ 4% subject to eligibility of 90% of the Input tax
credit against such goods, which are purchased within the State.
e) If the contractor supplies the packing materials in pursuance of prior contract
for export of specified goods to be packed with specified kind and quality of
the packing materials , the packing material, supplied by the contractor, is
liable to VAT, since the goods, supplied by the exporter to the foreign buyer
and the goods, supplied by the contractor to the exporter (contractor in this
case) are not one and the same. Just because the incorporation of goods /
packing material, supplied in the State of A.P. by the contractor to the
contractee / exporter by way of execution of works contract are in conformity
with the specifications of the foreign buyer, such goods are not zero-rated in
terms of Sec. 5 (3) of the CST Act, according to which the last sale or
purchase of any goods, preceding the sale or purchase in the course of export
of those goods alone shall be deemed be sold in the course of export and not
other goods, whether they form part the ultimate goods or not. Therefore the
transaction in question is a sale within the State. Hence in the above
circumstances, the packing materials, supplied, are liable to tax under the
provisions of the APVAT Act.
f) If the contractor purchases packing material from a VAT dealer and obtains
tax invoice for any packing material to be supplied in the circumstances,
discussed in the foregoing paragraphs, such sales are liable for VAT, as
discussed above and such goods are eligible for 90% of the Input tax credit
under Sec. 13 (7) of the AP VAT Act.
Sd/- Sd/- Sd/-

Addl/ Jt.Commissioner
To
M/s.Jubilant Organosys Ltd,
304 & 305, Doshi Chambers,
Basheerbagh,
Hyderabad.

Copy to the Deputy Commissioner (CT) Abdis Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 84 /2007. Dated 26 - 03- 2008.
O R D E R:
I. M/s Philips Electronics India Ltd, Hyderabad (TIN 28510197734) have filed an

Applicability of VAT on “Bio-Mass Stove”

Write up on Biomass stoves, and Brouchers
IV. Sri S. Vanuvamalai, Manager Corporate Fiscal, appeared for hearing and
explained the case.
(CT.II) Departme nt Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II) Department
VI. The applicants have developed a new energy saving, fuel efficient and
environment friendly device, mainly for the purpose of cooking, for the rural and semi
urban areas, which is known as “ Bio-Mass Stove”. The stove can be ignited by lighting
the fuel & Fuel can be any solid bio mass such as Wood sticks, cowdung, coconut shell
etc. The optimum air flow is created by specially positioning the holes in the burning
chamber. This enhances the efficiency of the burning of the fuel and also reduces smoke
and harmful emission of gasses.
Sub-entry 13 of Entry 53 of IV Schedule under Renewable energy devices and

spare parts enumerates” Biogas, Plants, Stoves, appliances and Engines”. Thus the Bio-
mass Stove dealt by the applicant do fall under the sub-entry 13 of Entry 53 of the IV
Schedule, of the AP VAT Act, 2005.
Therefore, the ruling is that BIO-MASS STOVES fall under the sub-entry 13
of entry 53 of Schedule of the APVAT Act, 2005 and liable to @ 4%.
Sd/- Sd/-
Addl.Commissioner Jt.Commissione r Jt. Commissioner.
To
M/s. Philips Electronics India Ltd,
3 A, I D A, Uppal,
Hyderabad.

Copy to the Assist. Commissioner (CT) (LTU) Begumpet Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 10 /2007. Dated 26 - 03- 2008.
O R D E R:
I. M/s V.N.D. Cell Plast, Hyderabad,(TIN 28110261832.) have filed an application


Whether Floral Bricks ( Thermo Plastics ( or)Cellular Plastics) liable to tax @ 4%
or not.

Write up
IV. Sri N. Sukhajeevan Reddy Partner, appeared for hearing and explained the case.
VI. The applicants have researched and developed a new product called “ Floral Bricks”
which are used in Floriculture, Hoticulture and as well as in Agriculture sectors as water
retention substance. The product is developed obsolutely by indegineous technology as
an import substitute. They contend that this product comes under Thermoset Plastics (
Cellular Plastics) category and taxable @ 4%.
The goods ‘Floral Bricks”as stated by the applicant which comes under
“Thermost Plastic ( Cellular Plastic)” is not notified in any Schedule of the AP VAT Act,
2005, hence fall under residuary entry of V Schedule and liable to tax @ 12.5%.
Therefore, it is clarified that, the goods dealt by the applicant fall under
residuary entry of V Schedule of AP VAT Act, 2005 and liable to tax @ 12.5%.
Sd/- Sd/- Sd/-

NOTE:- An appeal against this proceedings can be filed before the Sales Ta x Appellate
To
M/s.V.N.D. Cell Plast,
Plot No. 31, Shed No. 8, Phase-1,
I D.A. Cherlapally,
Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 14 /2007. Dated 26- 03- 2008.
O R D E R:
I. M/s Sri Balaji Agri Products, Gagan Pahad, Hyderabad (TIN 28465816105.) have

Rate of tax on the “ Agriculture/Horticulture trays/Block Types root trainers,
Conteneurs, godets, Pots, Tontines, used to keep the seeds to germinate and the day old
seedlings to grow for a shorter period”.

Nil
IV. Sri Nagesh Rangi, Advocate & Tax Consultant, appeared for hearing and
explained the case.
VI. The applicants are dealing in “ Agriculture/Horticulture trays/Block Type root

trainers, Conteneurs, Godets, .Pots, Tontine,” which are used to keep the seeds to
germinate and the day old seedlings to grow for a shorter period.
The goods dealt by the applicant are not notified in any Schedule of the AP VAT
Act, 2005, hence fall under residuary entry of V Schedule.
Therefore, it is clarified that, the goods, Agriculture/Horticulture trays/Block
Type root trainers, Conteneurs, Godets, Pots, Tontines fall under residuary entry
of V Schedule of AP VAT Act, 2005, and liable to tax @ 12.5%.
Sd/- Sd/- Sd/-

To
M/s. Sri Balaji Agri Products,
Survey No. 656, Sathamrai Post,
Gagan Pahad,
Hyderabad.

Copy to the Deputy Commissioner (CT) Saroornaga r Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 120 /2007. Dated 26 - 03- 2008.
O R D E R:
I. M/s V.Laxman Rao, Contractor, Secunderabad, have filed an application and


1) Where the contract purely labour oriented and there is no involvement of
material is liable to deduct the tax by the contree?
2) Is VAT Registration required for such Contracts?
3) Will there be liability under VAT for such Purely Labour Contracts?.
------
IV. Sri Murali Krishna STP authorized representative, appeared for hearing and
explained the case.
VI. The authorized representative explained that the contractor, V. Laxman Rao,
undertaken works with M/s. Nuclear Fuel Complex, Mallapur, Hyderabad for
cutting and removal of wild and rank vegetative growth at inside the N F C
Premises and for which the Contractee is insisting VAT Registration and VAT
deductions @ 4%. Hence sought clarification.
The contention of the applicant is verified, and it is clarified that, if the contract is
purely labour oriented and there is no involvement of material, the contractor doing
such contract is not liable to get himself registered and not liable to pay tax under
the provisions of AP VAT Act, 2005, and there is no need to deduct tax from the
amounts of the contractor doing such contract.
Sd/- Sd/- Sd/-
To
M/s. V.Laxman Rao, Contractor,
H.No.12.14.336, Vinoba Nagar, Lalapet,
SECUNDERABAD.

Copy to the Deputy Commissioner (CT) ______________ Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 166 /2006. Dated 26 - 03- 2008.
O R D E R:
I. M/s Andhra Pradesh State Road Transport Corporation Hyderabad , have filed an

Rate of tax on the following items:
1) Black Vulcanising Cement
2) Wedge Stock
3) Full Skirt Envelope with Valve bent.
4) High Bonding Cum 125 C.

Nil
IV. P.N. Ashok Kumar, Assistant Manager, appeared for hearing and explained the
case.
VI. The applicants are purchasing the goods for re-trading activity being carried on at
their re-trading shops.
The Government vide G.O.Ms.No 173 Revenue (CT-II) Department Dated
18.02.2008 added at entry 120 of IV Schedule to the APVAT ACT, 2005 as “ Tread
Rubber and other materials used for re-trading of tyres.” Hence liable to tax @ 4%.
Therefore it is clarified that the “materials used for re -trading of tyres” are
liable to tax @ 4%, as per the G.O. cited supra, with effect from 18.02.2008, earlier
to which it was taxable @ 12.5%.
Sd/- Sd/-
To
M/s. A.P.S.R.T.C
Musheerabad, Hyderabad.

Copy to the Deputy Commissioner (CT) ______________ Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 79 /2007. Dated 26 - 03- 2008.
O R D E R:
I. M/s Veeramani Biscuits Industries Ltd, Hyderabad, (TIN 28820135288 ) have


1) Branded Bread is taxable @4%, where as Bread Rusk is charged @
12.5%., pl.Clarify.
2) Cocoa Pods are taxable @ 4%, where as Cocoa Powder is charged @
12.5%. Pl. clarify.

Copies of invoices.
IV. Sri Sadasivudu Admn. officer, appeared for hearing and explained the case.
VI. The applicant sought clarification on the products Branded Rusk and Cocoa
Powder are the bye products of Branded Bread and Cocoa Pods respectively.
The main products Branded Bread and Cocoa Pods are liable to tax @ 4%
under Schedule IV of the AP VAT Act, where as its bye products of Branded
Bread Rusk and Cocoa Powder are not notified, hence sought clarification.
The Branded Bread and Cocoa Pods are notified at entry 15, and 18 respectively
of the IV Schedule to the AP VAT Act, 2005 and liable to tax @ 4%. But by Act
No.5 of 2007 dt. 22.1.2007, w.e.f. 1.9.2006, entry 18 has been substituted wherein
Cocoa Powder has been notified w.e.f.1.9.2006. However, Rusk of bread is not
notified in any of the entries of the IVth Schedule.
Therefore, it is clarified that, the goods , namely, Branded Bread and, Cocoa
Powder are taxable @ 4% under entry 15 and 18 respectively of the IV
Schedule, and Bread Rusk is taxable @ 12.5%, under residuary entry of V
Schedule of the AP VAT Act, 2005.
Sd/- Sd/- Sd/-
To
M/s.Veeramani Biscuit Industries Ltd,
Saidabad,
Hyderabad.

Copy to the Assit. Commissioner (CT) (LTU)Charminar Division Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 69 /2007. Dated 26 - 03- 2008.
O R D E R:
I. M/s Sri Vari Industries, Renigunta Tirupati, (TIN 28943768225.) have filed an
Rate of tax on the following goods:
1) Poly propylene spun bond non-woven fabrics of different thickness sold in
meters and also by weight.
2) Shopping bags
3) Packing bags
4) Medical disposables like Doctor’s gown, cap, face mask
5) Any other goods made from the fabrics
1) Write up on the commodity.
2) Certificate issued by Director & Secretary, The Synthetic & Rayon Textiles
Export Promotion Council.
IV. Sri K. Rajendra Chetty, partner, appeared for hearing and explained the case.
VI. The applicant is a manufacturer of PP Spun Bonded Non Woven Fabric, and the non
Woven Fabric is used for multifarious products such as Bed Sheets, Aprons, Curtains,
Face Masks etc. and treated it as similar to that of textile and may be exempted from tax.
The applicant has produced the copy of invoice at time of personal hearing where
in PP Fabric was quoted with HSN Code 5603 which is not notified in any Schedule of
the AP VAT Act, 2005, hence it is liable to tax @ 12.5% under residuary entry of V
Schedule of AP VAT Act, 2005.
Shopping Bags and Packing Bags fall under entry 90 of IV Schedule of the AP
VAT Act, 2005. Medical Disposables for one time use are also fall under IV Schedule
and Liable to tax @ 4%.
Therefore, it is clarified that, PP Spun Bonded Non Woven Fabric fall under
residuary entry of V Schedule, and liable to tax @ 12.5%. However, Shopping &
Packing Bags and Medical Disposables will fall under IV Schedule to the AP VAT
Act, 2005, and liable to tax @ 4%.
Sd/- Sd/- Sd/-
To
M/s. Sri Vari Industries, 81.2, Guravarajupalli, Genigunta,

Copy to the Commercial Tax Officer, II Tirupati Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 119 /2007. Dated 18 - 03- 2008.
O R D E R:
I. M/s ABVC Sri Manasa associates, Red Hills, Hyderabad (TIN 28352613880.)

Whether Survey & Leveling operations for preparation of model designs and data
estimates for existing DC in major, minor, sub- minors of Nagarjunasagar canals etc, and
providing and fixing benchmark stones, come under the purview of paying VAT

1) Copy of “ INVITATION FOR CONSULTANCY”, issued by Executive
engineer, Narasaraopet. ( Tender Notice No. 2/2007-08, dt. 23.6.2007)
2) Certificates from the Executive Engineers Narasarao pet and Vinukonda stated to
be the applicants work is “only execut ion of Survey Work & Designs and fixing
of bench marks and stones.”.
IV.Sri Y.P.Girdhar, Managing Partner, appeared for hearing and explained the case.
(CT.II) Departme nt Dated 31-03-2005 and G.O.Ms.No:490, Revenue (CT.II) Department
VI. The applicant stated that they would be providing service to the contractors who
are executing earth work in major, minor, sub- minor of Nagarjunasagar canals, while
doing only execution of Survey work & Designs and fixing of bench marks and stones,
and there is no involvement of material except consultancy work. The stone s required for
laying bench marks are supplied by the Executive Engineers.
When there is no transfer of material and if their activity is confined only to
consultancy services, the provisions of AP VAT Act does not attract.
Therefore, the ruling is that, if the transfer of material is not involved and
they provide only consultancy services, the provisions of AP VAT Act, 2005 does
not attract, and they are not liable to pay tax on such consultancy services.
Sd/- Sd/- Sd/-
To
M/s ABVC Sri Manasa Associates,
11-5-411, Red Hills,.
Hyderabad

Copy to the Commercial Tax Officer, Aghapura Circle.
NO ADVANCE RULINGS
PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner(Audit - II )
Sri K. Chengalraya Chetty, Jt.Commissioner (DMU)
*****
A.R.Com/ 42 /2007. Dated 28 - 05- 2008.
O R D E R:
I. M/s Suri Engineers Pvt. Ltd.,Nacharam, Hyderabad, (TIN 28940178643.) have


Rate of tax on “Rice Mill Machinery”

FORM-I i,e, Classification list of Excisable Goods Manufactured.
IV. Mr. Suresh Manager, appeared for hearing and explained the case.
VI. The applicants are manufacturers of Rice Mill Machinery and they sought for
rate of tax on their product under AP VAT Act, 2005. They have filed a
copy of Form - I i.e. Classification list of Excisable Goods Manufactured
issued by the Superintendent of Central Excise , Nacharam Range, where
the HSN Code for “Rice Mill Machinery is mentioned as 8437”.
Sub-entry 11 of entry 102 of IV Schedule to AP VAT Act, 2005, with HSN Code
8437 enumerates “ Machinery for cleaning, sorting or grading seed, grain or dried
leguminous vegetables; machinery used in the milling industries or for the
working of cereals or dried leguminous vegetables, other than farm type
machinery.” This entry is Added by Act, No. 34 of 2006, dt. 19-09-2006, w.e.f.
1-7-2006.
As per Central Excise tariff codes, “Rice Mill Machinery” is categorized at the
HSN No. 8437.80.20 . Since the entire Chapter heading 8437 is notified at sub-
entry 11 of entry 102,of IV Schedule, the goods Rice Mill Machinery do fall
under sub-entry 11 of entry 102 of the IVth Schedule.
Therefore, it is clarified that the Goods “Rice Mill Machinery” is
liable to tax @ 4% under sub-entry 11 of entry 102 of IV Schedule to AP
VAT Act, 2005, w.e.f.1-7-2006.
Sd/- Sd/- Sd/-
To
M/s.Suri Engineers Pvt. Ltd,Plot No. 4/4 IDA, Nacharam, Hyderabad.

Copy to the Deputy Commissioner (CT) Hyd.Rural Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 6 /2007. Dated 27 - 5- 2008.
O R D E R:
I. M/s Ashomech Visakhapatnam, (TIN 28160147338.) have filed an application

II. They sought clarification of rate of tax on the following goods:

1) Regulators for use in Gas Welding & Gas Cutting with HSN Code 8481.10.00
( Pressure reducing Valves)
2) Grinding Wheels with HSN Code 6804.22.10

Nil
IV. Sri A.Sarveswara Row, Advocate, authorized representative, appeared for

VI. The goods “ Regulators for use in Gas welding & Gas cutting” and “Grinding
wheels” dealt by the applicant are not notified in any Schedule to the AP VAT Act, 2005,
hence fall under residuary entry of the Vth Schedule, liable to tax @ 12.5%.
Therefore, it is clarified that the Goods “ Regulators for use in Gas Welding
& Gas Cutting” and “ Grinding Wheels” will fall under residuary entry of the Vth
Sd/- Sd/- Sd/-

Addl. /Jt. Commissioner

To
M/s. Ashomech,
27-32-88, Feet Road,
Visakhapanam.

Copy to the Deputy Commissioner (CT) Visakhapatnam Division.
Copy to the Commercial Tax Officer, Dabagarden Circle.
PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner(Audit II )
Sri K. Chengalraya Chetty, Jt.Commissioner ( DMU)
*****
A.R.Com/ 49 /2007. Dated 27 - 05- 2008.
Ref:- CCT’s.Ref.No: PM T/P&L/A.R.Com/2005, Dated 13-04-2005.
O R D E R:
I. M/s Gajra Gears Pvt. Ltd. Vijayawada, (TIN 28660145349.) have filed an

Rate of tax on “ Axle Shafts for Heavy/Light Commercial Vehicles & Tractor
Spares with HSN Code 8708.99.00.
III. The applicant sub mitted the following documents:

Copies of invoices.
IV. Sri B. Satyanarayana Branch Manager, appeared for hearing and explained the
case.
VI. The applicant stated that they are charging tax @ 12.5% on Axle Shafts used for
Heavy/Light Commercial Vehicles. But their competitors are charging tax @ 4% Hence
they sought clarification on rate of tax.
Having examining the issue and the nature of the goods, it is found that the
applicant stated that Axle Shafts is covered in Central Excise tariff under the entry 8708
.The said tariff code referes to parts and accessories of the motor vehicles with headings
8701 to 8705. Under these headings all LCV, Cars & Jeeps and Tractors are enumerated.
Tractors are enumerated under entry 63 of the IV Schedule Therefore, the Axle Shafts
exclusively used in tractors alone are liable to tax @ 4%. All other Axle Shafts that are
meant for LCV, Cars, Jeeps and non-driving axles and parts thereof are grouped under
HSN Code 8708. The HSN Code 8708 is not notified in any Schedule to the AP VAT
Act, 2005.
Therefore, we hold that Axles Shaft meant for motor Vehicles other than tractor
fall under residuary entry of Vth Schedule liable to tax @ 12.5%.
Sd/- Sd/- Sd/-
To
M/s Gajra Gears Pvt. Ltd,
Plot No. 34, 5th Floor, 2nd Cross Road, Autonagar, Vijayawada.

Copy to the Deputy Commissioner (CT) Vijayawada Division.
Copy to the Commercial Tax Officer, Autonagar Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 156 /2007. Dated 27 - 05- 2008.
O R D E R:
I. M/s Navayuga Engineering Company Ltd,.Visakhapatnam,(TIN 28970168166.)

II. They sought for clarification on the following:

1) Whether the applicant is liable to pay tax on the value of the goods purchased
/procured from non VAT dealer including from the out side the state dealer? If
so
2) Whether the applicant is liable to pay tax at the rate applicable to such goods
under the Act or after deducting 4% from the applicable rate?

Nil
IV. Sri A. Sarveswara Row, Advocate authorized representative, appeared for hearing
VI. After examining the questions with reference to the provisions of AP VAT Act
and Rules, the ruling is given as under:
VI Where ever any contractor purchases goods from non VAT dealers or from
outside the State for the purpose of use in execution of works contract, such
contractor is liable to pay tax on the value of such goods at the time of incorporation
which may include certain expenditure over and above the purchased price, at the
tax rates applicable to such goods. The value of such goods shall be excluded for the
purpose of computation of turnover on which tax by way of composition at the rate
of 4% is payable.
Sd/- Sd/- Sd/-


To
M/s. Navayuga Engineering Company Limited,
Dwarakanagar,
Visakhapatnam
submitted to the Commissioner of Commercial Taxes, A.P. Hyderabad

Copy to the Asst.Commissioner (CT) LTU, Visakhapatnam
PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner(Audit-II)
Sri K. Chengalraya Chetty, Jt.Commissioner (DMUl)
*****
A.R.Com/ 33 /2007. Dated 24 - 05- 2008.
O R D E R:
I. M/s D.S.F. Aquatech Private Limited, Visakhapatnam (TIN 28300259523) have


Rate of tax on Prawn Seed.

Nil
VI. The applicant’s nature of business is producing prawn seed and to sell the same to
the prawns growers. Initially the prawn seed was brought under entry 24 of the I
Schedule to the AP VAT Act, 2005, and subsequently, prawn seed is deleted from the
entry 24 of the I Schedule, vide Act. No. 5 of 2007 w.e.f. 1-4-2005. Hence the applicant
sought clarification of rate of tax on PRAWN SEED.
Prawn Seed is included again to the entry 24 of the I Schedule to the AP VAT
Act, 2005 by Act No,. 40 of 2007, dt. 18.12.2007 w.e.f. 1-4-2005.
The present entry No.24 of the I Schedule enumerates “ Meat, flesh of poultry,
fish including dry fish, prawns, prawn seed, lobsters, crabs, shrimps and other sea food
except when they are sold in frozen state or in a sealed container; eggs, livestock and
animal hair”
Therefore , it is clarified that the Prawn seed is exempted from tax w.e.f. 1-4-
2005, vide entry 24 of the I Schedule to the AP VAT Act, 2005.
Sd/- Sd/- Sd/-
Addl. /Jt.Commissioner
To
M/s.D.S.F. Aquatech Pvt. Ltd.,
D.No. 7-8-20/1, Kastur iba Marg,
Visakhapatnam

Copy to the Commercial Tax Officer, Chinawaltair Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 32 /2007. Dated 24 - 05- 2008.
Ref:- CCT’s.Ref.No: PM T/P&L/A.R.Com/2005, Dated 13-04-2005.
O R D E R:
I. M/s The Andhra Pradesh Shrimp Seed Production Supply and Research Centre,
Visakhapatnam (TIN 28430177690) have filed an application and sought clarification
and advance ruling on the following items under Section 67 of APVAT Act, 2005 read
with Rule 66(2)(i) of APVAT Rules, 2005 along with the application fee of Rs.1,000/-

Rate of tax on Prawn Seed.

Nil
VI. The applicant’s nature of business is producing prawn seed and to sell the same to
the prawns growers. Initially the prawn seed was brought under entry 24 of the I
Schedule to the AP VAT Act, 2005, and subsequently, prawn seed is deleted from the
entry 24 of the I Schedule, vide Act. No. 5 of 2007 w.e.f. 1-4-2005. Hence the applicant
sought clarification of rate of tax on PRAWN SEED.
Prawn Seed is included again to the entry 24 of the I Schedule to the AP VAT
Act, 2005 by Act No,. 40 of 2007, dt. 18.12.2007 w.e.f. 1-4-2005.
The present entry No.24 of the I Schedule enumerates “ Meat, flesh of poultry,
fish including dry fish, prawns, prawn seed, lobsters, crabs, shrimps and other sea food
except when they are sold in frozen state or in a sealed container; eggs, livestock and
animal hair”
Therefore , it is clarified that the Prawn seed is exempted from tax w.e.f. 1-4-
2005, vide entry 24 of the I Schedule to the AP VAT Act, 2005.
Sd/- Sd/- Sd/-
To
M/s.The Andhra Pradesh Shrimp Seed Production Supply and Research Centre,
Mangamaripeta,
Visakhapatnam

Copy to the Commercial Tax Officer, Chinawaltair Circle.
PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner( Audit-II )
Sri K Chengalraya Chetty, Jt.Commissioner ( DMU)
*****
A.R.Com/ 122 /2007. Dated 13 - 05- 2008.
O R D E R:
I. M/s Multi Speed Gears Pvt. Ltd., (TIN 28124132455.) have filed an application
Rate of tax for “ Electronic Speed Limiter” HSN.Code. 9032.
1) Write up on electronic speed limiter, (2) Broucher, (3) Automotive Vehicles Speed
Limitation Devices Specifications- issued by the Automotive Research Association of
India.
IV. Sri M.V.L. Narasimha Rao, Advocate, appeared for hearing and explained the
case.
VI. The applicant is a manufacturer of Electronic Speed Governor commonly known as
Road Speed Limiter which constantly monitors the speed of a vehicle and governs the
speed within the set limit. The applicant’s manufacture Unit is at Himachal Pradesh. Now
newly registered for a branch at Hyderabad and sought rate of tax on “ ELECTRONIC
SPEED LIMITER”. The applicant contended that their product will fall under sub item
25 of entry 103 of IV Schedule to the AP VAT Act under Description “ Automatic
Regulation or Controlling Instruments and apparatus, with HSN Tariff Code No. 9032.
and liable to tax @ 4%.
The applicant could not produce the copies of tax invoices, on the plea that
branch office at Hyderabad is yet to start the business.
Sub-entry 25 of entry 103 of IV Schedule to the AP VAT Act, 2005
enumerates “ Automatic Regulation or Controlling Instruments and apparatus,
with HSN Tariff Code No. 9032”.
Therefore it is clarified that, if the Electronic Speed Limiter falls under the
description of “Automatic Regulation or Controlling Instruments and apparatus” it
is liable to tax @ 4% under sub-entry 25 of entry 103 of IV Schedule to the AP VAT
Act, 2005.
Sd/- Sd/- Sd/-
To
M/s. Multi Speed Gears Private Limited,
1-7-138 Flat No. 13 , Sai Kiran Apartment Kamalanagar, Hyderabad.

PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner(Audit - II)
*****
A.R.Com/ 89 /2007. Dated 09 - 05- 2008.
O R D E R:
I. M/s Deccan Enterprises Private Limited, Balanagar, Hyderabad (TIN

28560120100.) have filed an application and sought clarification and advance ruling on
II. They sought clarification of Rate of tax on the following goods:

PRODUCT HSN TARIFF NO.
1) Grooved Rubber sole Plates/ Rail pads 40082190
2) Rubber ‘ O ‘ Rings 40169350
3) Rubber Washers 40169350

Nil
IV. Sri S.Anjaneyulu, Accounts Manager , appeared for hearing and explained the
case.
VI. The applicants are manufacturers of Rubber Products and sought clarification
of rate of tax on the products.
The products manufactured by the applicant are not notified in any Schedule
to the AP VAT Act, 2005: Hence they fall under residuary entry of Vth
Therefore it is clarified that the goods (1) Grooved Rubber Sole Plates/
Rail Pads, (2) Rubber ‘ O ‘ Rings , and (3) Rubber Washers ,
manufactured and sold by the applicant fall under residuary entry of
Vth Schedule to the AP VAT Act, and liable to tax @ 12.5%.
Sd/- Sd/- Sd/-

To
M/s.Deccan Enterprises Private Limited,
B/58, 59 & 60, Asstd. Private Industrial Estate,
Balanagar, Hyderabad-500 037

Copy to the Commercial Tax Offic er, R.P.Road Circle.
PROCEEDINGS OF THE

Sri K.Chengalraya Chetty, Jt.Commissioner (DMU)
*****
A.R.Com/ 95 /2007. Dated 3 - 05- 2008.
O R D E R:
I. M/s Versha Traders Tenali Taluk(TIN 28908206720.) have filed an application


1) CALCITE POWDER, ( 2) LIME STONE POWDER, (3) CHINA CLAY
POWDER (4) STEATITE POWDER, (5) DOLOMITE POWDER, ( 6 ) COMMON
SALT, (7) FLDSFER POWDER;

Nil
IV. Sri U. Surendra Babu STP , appeared for hearing and explained the case.
V. The issue has been examined with refe rence to the provisions of the APVAT Act
VI. According to the applicant , all the items are natural minerals converted in to
powder by pulverizing them which they procure from outside the State. The applicant
further explained that these items are covered under Ores and Minerals specified in entry
No.43 of Schedule IV to the Act and taxable at 4%. It is found that the identity or
character of the Minerals in not lost just because it is converted from rock to powder
form, which is a phys ical process without addition of any external substance.
We have examined the plea of the applicant. It is clarified that the goods, (1)
CALCITE POWDER, ( 2) LIME STONE POWDER, (3) CHINA CLAY
POWDER (4) STEATITE POWDER, (5) DOLOMITE POWDER, (6) FLDSFER
POWDER , dealt by the applicant do fall under “Ores and Mineral” , U/ entry 43 of
the IV Schedule to AP VAT Act, and liable to tax @4%. With regard to item
COMMON SALT , it is hereby clarified that ” Salt “including processed and
branded salt is exempted from tax, vide entry 35 of the I Schedule of the AP VAT
Act, 2005.
Sd/- Sd/- Sd/-
To
M/s.Versha Traders,
8-91, Brahmamgari Temple Bazar,
Angalakudur, Tenali Taluk,
Guntur District.

Copy to the Commercial Tax Officer, Morrispet Circle.
PROCEEDINGS OF THE

Sri K . Chengalraya Chetty Jt.Commissioner (DMU)
*****
A.R.Com/ 38 /2007. Dated 03- 05- 2008.
O R D E R:
I. M/s S.M.Traders, Secunderabad (TIN 28500141151) have filed an application


Rate of tax on the following Goods.
1) Gunny Bags (2) Poly Bag
3) Paper Core old (4) PVC Core Olastic
5) Plastic liner (6) Paper Sack
7) Waste DFC Cartons (8) Metal Scrap
9) Paper Scrap (10) Alluminium Scrap
11) Plastic Scrap (12) Plastic Drum
13) Waste Steel Jar (14) Laminate Scrap
15) Laminate jute Bag (16) Laminate plastic Pouch
17) Laminate Jute Torn Bag. (18) Poly Linear

Copies of invoices
IV. Mr. T.Venkateswara Rao, Advocate, authorized representative, appeared for
G.O.s issued so far and the ruling is given as under:
VI. The applicant is a Trader in Empty Gunny Bags, waste paper and scrap of iron,
plastic and H D P. He purchased Gunny Bags and other scrap items from M/s. Tata Tea
Ltd, . He contended that all the above items fall under category of packing material, but
M/s. Tata Tea Ltd are charging @12.5% Hence sought clarification of rate of tax on the
above goods.
The contention of the applicant is examined with reference to the copies of

invoices , which reveals that the goods dealt by the applicant i.e. Gunny bags, scrap
items, do fall under category of packing materials and scrap items taxable @ 4% under
Schedule IV of the AP VAT Act, 2005. However, the goods such as Poly bag, PVC Core
Plastic, Plastic Liner, Plastic Drum, Waste Steel Jar, Laminate Plastic Pouch, Laminate
Scrap, Poly Liner are also contended to be eligible for tax @ 4%. But fall under residuary
entry under Schedule V of the AP VAT Act, 2005 and liable to tax @ 12.5%..
Therefore the ruling is that the scrap item of goods namely Gunny Bags,
Paper core old, Paper Sack, Waste DFC Cartons, Metal Scrap, Paper Scrap,
Alluminium Scrap, Plastic Scrap, Laminate Jute Bag, Laminate Jute Torn bag, are
taxable @ 4%. But other goods namely Poly Bag, PVC Core Plastic, Plastic liner,
Plastic Drum, Waste Steel Jar, Laminate plastic pouch, Laminate Scrap, Poly Liner
are taxable @ 12.5% under residuary entry of V Schedule of the AP VAT Act, 2005.
Sd/- Sd/- Sd/-

To
M/s. S.M.Traders,
6-7-537/1, New Bhoiguda,
Secunderabad. 3

Copy to the Commercial Tax Officer, _____________ Circle.
PROCEEDINGS OF THE

*****
A.R.Com/ 2 /2008. Dated 3-5- 2008.
O R D E R:
I. M/s Sabbella China Veer Reddy & Others (TIN 28580214254.) have filed an
1) Please clarify that way bill are to be obtained and carried along with to
vehicle transporting mangoes, raw fruits.
2) Also to clarify whether the packing material containing the mangoes
is not liable to VAT with reference to entry 18 of the I Schedule and
relevant rule thereon.
NIL
IV. S.Satyanarayana Managing Partner , appeared for hearing and explained the case.
VI. The applicant states that he is engaged in the business of Fruits and while
dispatching Mangoes the applicant is not enclosing way bill form prescribed under the
A.P.VAT Act, 2005 as fruits are exempted from tax under the Act. While this being so,
the applicant has stated that check post authorities are stopping the consignment and
insisting for waybill. In the circumstances, the applicant seeks ruling whether waybill is
required for transporting fruits.
We have considered the plea of the applicant. Rule 55 of A.P.VAT Rules
refers to movement of goods in goods vehicle. Proviso under sub-rule (1) of the said
rule exempts use of waybill in respect of transport of the goods specified in
Schedule I of the Act. Entry 18 of the I Schedule enumerates” Vegetables & fruits
other than those cured, frozen, preserved, processed, dried, dehydrated or canned.”
Thus the mangoes, raw fruits dealt by the applicant fall under entry 18 of the I
Schedule of the A.P.VAT Act, 2005, hence exempt from tax. Therefore, the ruling is
that When the exempt goods listed in Schedule I of the Act are transported, there is
no necessity of issue of waybill. Thus the need for way bill to accompany the vehicle
transporting raw fruits does not arise.
Regarding the other clarification sought by the applicant, the packing
material containing the mangoes is not liable to VAT as the contents for which the
packing material is used i.e. mangoes are exempt from tax.
Sd/- Sd/- Sd/-
To
M/s. Sabbella China Veer Reddy & Others
Fruits Exporters, Canal Road, Anaparthi, E.G.Dist.

Copy to the Commercial Tax Officer, Ramachandrapuram Circle.
PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner( )
*****
A.R.Com/ 92 /2007. Dated 3-05- 2008.
O R D E R:
I. M/s Bhagyanagar Laboratories Balanagar, Hyderabad (TIN 28030247414.) have

Rate of tax on the goods Viz. Radio Rod Thermistors with HSN Code No. 8533.

1) Copy of Form RT-12 Return
2) Copy of Order of the Commissioner of Customs and Central Excise Hyd. I dt.
23.9.1997..
IV. Sri T.Ramesh Babu Advocate , appeared for hearing and explained the case.
VI. The applicants are dealing in thermistors and contended that they are
suitable for Radiosonde applications to measure the atmospheric temperatures by ballon-
borne Radiosonde upto a height of 37km or above depending upon the capability of the
carrier ballon. These thermistors are proven temperature sensors and are in use in
meteorological applications for the last three decades. which are falling under Excise
Tarrif Heading 8533 and liable to tax @ 4%. The applicant stated that at present they are
not under the limits of Central Excise , but earlier they were. Hence they have submitted
Show Cause Notice issued by the Commissioner of Customs and Central Excise during
the year 1997.
The plea of the applicant is examined and found as per the Form R.T.12 Return
and order of the Commissioner of Customs and Central Excise Hyd- I vide Proc.O R.No:
78/93 Adjn. Dt. 23.9.97 shows that HSN Tariff Code 8533 is attributed to “Rod
Thermistors for radiosonda..”
Sub entry 19 of entry 39 of the IV Schedule, enumerates “ Electrical resistors

( including rheostats & petentiometers), other than heating resistors .” Vide
G.O.MsNo.1615 Revenue (CT-II) Dt. 31.5.2005 HSN Code 8533 is notified against
sub-entry 19 of entry 39 of IV Schedule.” As per Chapter 85 of the Central Excise
Tariff Code Act, eight digit code 8533.40.30 is attributed to Thermistors .
Therefore it is clarified that “Thermistors ” do fall under sub-entry 19 of
entry 39 of IV Schedule to the AP VAT Act, 2005 and liable to tax @ 4%.
Sd/- Sd/- Sd/-

To
M/s. Bhagyanagar Laboratories,
Balanagar, Hyderabad.

Copy to the Commercial Tax Officer Balanagar Circle.
PROCEEDINGS OF THE

Sri K.Chengal raya Chetty, Jt.Commissioner (DMU)
*****
A.R.Com/ 113 /2007. Dated 3 - 05- 2008.
O R D E R:
I. M/s Sai Priya Darsini Enterprises (TIN 28590249691.) have filed an application

1) CALCITE POWDER, ( 2) LIME STONE POWDER, (3) CHINA CLAY
POWDER (4) STEATITE POWDER, (5) DOLOMITE POWDER, ( 6 ) COMMON
SALT, (7) FLDSFER POWDER;

Nil
IV. Sri U. Surendra Babu STP , appeared for hearing and explained the case.
Dated 15-04-2005 as superceded in G.O.Ms.No.1596, Re venue(CT-II) Dept.
VI. According to the applicant , all the items are natural minerals converted in to
powder by pulverizing them which they procure from outside the State. The applicant
further explained that these items are covered under Ores and Minerals specified in entry
No.43 of Schedule IV to the Act and taxable at 4%. It is found that the identity or
character of the Minerals in not lost just because it is converted from rock to powder
form, which is a physical process without addition of any external substance.
We have examined plea of the applicant. It is clarified that the goods, (1)
CALCITE POWDER, ( 2) LIME STONE POWDER, (3) CHINA CLAY
POWDER (4) STEATITE POWDER, (5) DOLOMITE POWDER, (6) FLDSFER
POWDER , dealt by the applicant do fall under “Ores and Mineral” , U/ entry 43 of
the IV Schedule to AP VAT Act, and liable to tax @4%. With regard to item
COMMON SALT , it is hereby clarified that ” Salt “ including processed and
branded salt is exempted from tax, vide entry 35 of the I Schedule of the AP VAT
Act, 2005.
Sd/- Sd/- Sd/-
Addl.Commissioner Jt.Commissio ner Jt. Commissioner.
To
M/s.Sai Priya Darsini Enterprises,
31-7-6A, Saralanagar,
Sultanabad, Tenali Taluk,
Guntur District.

Copy to the Commercial Tax Officer, Morrispet Circle.
C--OMMERCIAL TAXES DEPARTMENT
PROCEEDINGS OF THE

*****
A.R.Com/ 214 /2006. Dated 30 - 06 -2008.
O R D E R:
I. M/s Sri Maruthi Printers, Vijayawada, (TIN 28700120451.) have filed an


1) Whether the Printing press is liable to be registered as dealer under AP VAT
Act 2005 or not.
2) The turnover relating to collection of labour charge for printing of books
meant for reading comes under works contract or not.

Application in VAT Form 570
IV.Sri S.Rajeswar Rao, Proprietor, appeared for hearing and explained the case.
VI. (a) Sub-section (3) of Section 17 of the AP VAT Act, 2005 stipulates that
every dealer whose taxable turnover in the preceding three months exceeds Rupees
ten lakhs or in the twelve preceding months exceeds Rupees forty lakhs shall be
liable to be registered as a VAT dealer.
Therefore, if the applicant, scores taxable turnover of ten lakhs in the
preceding three months or forty lakhs in the preceding twelve months, is liable to be
registered as a VAT dealer.
(b) With regard to the second point it is clarified that if the entire
material is supplied by the customers for the printing of books, it will be treated as a
job work and hence is exempted from tax. But at the same time no input tax credit
will be allowed in respect of any material used.
Sd/- Sd/- Sd/-

To
M/s Sri Maruthi Printers,
5-6-59/41, Tammina Krishnamurthy St.
Vijayawada;

Copy to the Deputy Commissioner (CT) Vijayawada Division.
Copy to the Commercial Tax Officer,Kothapet Circle.
PROCEEDI NGS OF THE

Present: Sri Sri G.Lakshmi Prasad, Addl.Commissioner( Policy) ( FAC)

Sri K.Chengalraya Chetty, Jt.Commissioner ( DMU)
Dr. K. Raghavaiah, Jt. Commissioner( Audit -I I )
*****
A.R.Com/ 12/ 2008. Dated 30 -06 -2008.
Ref:- CCT’s.Ref.No: PMT/ P&L/ A.R.Com/ 2005, Dated 13-04 -2005.
O R D E R:
I. M/s Heritage Foods (I) Ltd., Punjagutta, Hyderabad, (TIN 28310167509)

the following items under Section 67 of AP VA Act, 2005 read with Rule
66(2)(i) of AP VAT Rules, 2005 along with the application fee of
Rs.1,000/-
II. Facts of the case as explained by the applicant are that ;
The applicant maintains its accounts division-wise as under:-
1) Dairy Division:- Under this division the procurement of milk as well as
sale of milk and milk products are accounted for.
2) Retail Division:- The purchase and sale of consumer products
including food grains is accounted for under this unit. In respect of
milk products purchased by the applicant branch transfers are
effected and the same is accounted for in this unit.
3) Agri Division:- In this division procurement of fruits, vegetables and
other agricultural and horticultural products are accounted for. Any
other division transfers are recorded in respect of goods transferred to
retail division.
III. They sought clarification on the following:

1) Whether the applicant can claim input tax credit on purchase of
consumer goods in the retail division on the tax paid in effecting the
purchase of goods in retail division and set-off for the same against
the output tax payable on the corresponding sales.
2) If so, in respect of common inputs used for the taxable goods, the
exempt goods and exempt transactions while applying the formula A
X B/C whether the applicant can take into consideration in computing
the taxable turnover only the turnovers relating to the goods involved
in the said purchases. Similarly, in computing the total turnover
whether the applicant can adopt the total turnover in respect of that
particular division.
3) In respect of Dairy division whether the excess input tax credit
available to it in the retail division could be set-off against the output
tax payable in that division?
I V. The applicant submitted the following documents:

- NIL -
V. Sri S.Krishna Murthy, Advocate and authorized representative,
VI . The issue has been examined with reference to the provisions
of the APVAT Act and Rules and HSN Codes notified by
Government vide G.O.Ms.No.398, Revenue (CT-II) Department
dated 31-03-2005 and G.O.Ms.No.490, Revenue (CT-II) Dept.,
dated 15-4-2005 as superceded in G.O.Ms.No.1596,
Revenue(CT-II) Dept., dated 27-8-2005, in G.O.Ms.No.1615,
Revenue (CT-II), Dept., dt.31-8-2005, G.O.Ms.No.502, Rev.
(CT-II) Dept., dt.1 -5-2006 w.e.f.1-5-2006, G.O.Ms.No.656,
Revenue (CT-II) Dept., dt.2 -6-2006, G.O.Ms.No.795 (CT-II)
Dept., dt.29 -6-2006 and the G.O.s issued till date and the
ruling is given issue-wise as under:
VI I . I SSUE :1) The calculation of input tax credit is governed
by Rule 20 of AP VAT Rules. The said Rule clearly states that
w hen any VAT dealer is able to establish that the specific
inputs are meant for specific outputs, the I TC can be claimed
separately for taxable goods. I f such a VAT dealer mak es sale
of exempt goods and exempt transactions along with taxable
goods, the I TC shall be restrict ed proportionate to the
turnover of taxable goods by applying the formula A X B/ C as
prescribed under sub-rule (6 ) of Rule 20 of AP VAT Rules. I f
the applicant can establish that the inputs are exclusively
used only in one division and are not shared with other
divisions, the computation under the Rule can be made
division wise and the component of ‘C’ in the Formula is the
total turnover of the Division.
I SSUE : 2 ) For common inputs a VAT dealer can claim I TC by
applying the Formula A X B/ C subject to the conditions
prescribed under sub-rule (6 ) of Rule 20 of AP VAT Rules. I n
computing the “total turnover” for the purpose of component
‘C’ in the Formula the applicant will have to adopt total
turnover of all the division s which share the common inputs.
I SSUE : 3) As the applicant shall file single consolidated
returns for all the divisions put together for each tax period in
Form VAT -200, this question does not arise.
Sd/- Sd/- Sd/-

Addl./Joint Commissioner (CT)
To
M/s Heritage Foods (I) Ltd.,
6-3-541/C, Punjagutta,
HYDERABAD.

Copy to the Deputy Commissioner (CT), Punjagutta Division.
PROCEEDINGS OF THE

*****
A.R.Com/ 116 /2007. Dated 28 - 06- 2008.
O R D E R:
I. M/s Rashtriya Ispat Nigam Ltd, Visakhapatnam, (TIN 28470121364.) have filed
an application and sought clarification and advance ruling on the following items under

Whether the inputs i.e. Cement and Steel used in construction of fly over bridge
between two plants, plant boundary wall and laying of road inside the plant will be
attracted under the provisions of AP VAT Rule 20 (2)(i) i.e. “ any input used in
construction or maintenance of any buildings including factory or office building shall
not be eligible for input tax credit, unless the dealer is in the business of executing works
contract and has not opted composition”.

An application in form 570 along with a brief note.
IV. Sri A.arveswara Row, Advocate, authorized representative, appeared for hearing
VI. As the applicant is a dealer in the business of manufacture and sale of iron
and steel, but not a dealer in execution of works contracts, the Rule 20 (2) (i) is
squarely applicable. Therefore, the applicant is not eligible for input tax credit on
the purchase of all inputs that are used in the execution of civil works of building or
road construction works being under taken by them.
Sd/- Sd/- Sd/-

To
M/s. Rashtriya Ispat Nigam Ltd,
Visakhap-atnam

Copy to the Asst.Commissioner (CT) LTU Visakhapatnam.
PROCEEDINGS OF THE

Dr. K. Raghavaiah, Jt. Commissioner(Audit -II )
*****
A.R.Com/ 118 / 2007. Dated 25 - 07- 2008.
O R D E R:
I. M/s Vishwanath Transformers Ltd. Hyderguda, Hyderabad (TIN 28136851785.)


“ Rate of tax on the goods sold under deemed sale in execution of works
contract as sub-contractor, whose main contractor was awarded with electrical sub-
station by the Government Department/Agencies as mentioned under Entry 116 in
the IV Schedule to the AP VAT Act, 2005. Tax payable by the sub-contractor both
under Composition Scheme and non-Composition Schemes may be clarified. If
under non-Composition Scheme, Whether the sub-contractor has to pay tax only at
the rate of 4% under Entry 116 in the IV Schedule to the Act with reference to
Section 4 (7)(a) and Rule 17(d)(e)”.
III. The facts of the case as explained by the applicant are that the applicant interalia
is engaged in the execution of works contract. The applicant is executing works on
behalf of the main contractors also. The main contractor got the works of electric sub-
station construction from the APSPDCL. Main contractor entrusted part/ whole of the
contract to the applicant on sub-contract basis.
IV The applicant submitted the following documents:
1) Copy of work order, (2) Copy of BID Document; (3) Written Submissions.
IV. Sri T.Ramesh Babu Advocate , appeared for hearing and explained the case.
V. It is argued by the authorized representative that as per the definition of the sale
under Section 2 of the APVAT Act, it includes deemed sale in the course of execution of
works contract. As per the theory of accretion in the works contract applicant is the
person who employed the goods in the works contract effecting the deemed sale to the
contractee. It is further stated that as per Section 4 (7) (h) of the Act, the legislature fixed
the taxable event on the sub-contractor only by exempting the main contractor. It is
therefore, argued that the applicant has to pay tax only @ 4% as per entry 116 of the IV
Schedule to the Act.
VI. The issue has been examined with reference to the provisions of the APVAT Act
VII (i) When APSPDCL awards contract to the main contractor and when the main
contractor, in turn, passes on the same contract to a sub-contractor, who, in fact,
incorporates the goods in the course of execution of the work for the APSPDCL. The
relationship between the main contractor and the sub-contractor is one of Principal and
Agent, because there is no scope for two incorporations in the process of execution of the
contract. Agent is an extended hand of the principal and is eligible for all the benefits to
which the main contractor is eligible. Further the entry 116 envisages reduced rate of
tax on the basis of the end user. In the case of works contracts,. It is fact that the sub-
contractor directly supplied the goods by way incorporation, though the billing process is
done technically in a different way. If it is established that the goods are supplied or sold
to the end users, specified under entry116, such goods will fall under the said entry and
shall be liable to be taxed @ 4%. In the circumstances, explained above, the supply of
goods to APSPDCL by the sub-contractor will fall under entry 116 of the IV Schedule to
the Act.
(ii) As to taxability of the applicant as a sub-contractor under non-composition
scheme it shall be as per Section 4 (7)(a) and under composition scheme it shall be under
Section 4 (7)(c) Section 4 (7) (e) of the Act.
Sd/- Sd/- Sd/-

To
M/s. Vishwanath Transformers Limited,
R.K.Vipanchi Estate, 5th Floor, Hyderguda, Hyderabad.

Copy to the Commercial Tax Officer Narayanguda Circle.
NO ADVANCE RULINGS
PROCEEDINGS OF THE

Sri K. Chengalraya Chetty, Addl.Commissioner (Audit)
*****
A.R.Com/ 90 /2007. 27 - 09- 2008.
O R D E R:
I. M/s Savant Instruments Private Limited, Hyderabad, (TIN 28210119853.) have

1) Rate of tax on Analytical/Process Instruments.
2) Rate of tax on Pressure Guages
3) Rate of tax on Reagents.
Copies of Bill Entry for Home Consumption. .
IV. Sri A.V.S. Rao, Managing Director, appeared for hearing and explained the case.
VI. The applicants are traders in Analytical, Laboratory, Electronic Process
instruments for Water & Waste Water Testing Instruments with Reagents, Pressure
Guages. They sought for clarification on rate of tax on such products. The applicants
have submitted the copies of Bill of Entry for Home Consumption with HSN Codes
9025,9026,& 9027 which are notified in IV Schedule , at sub-entries 19, 20, & 21
respectively of Entry 103, vide G.O.Ms.No. 795 Dt. 29.6-2006, w.e.f.1-7-2006.
Therefore, the ruling is that the Goods, viz., Pocket Thermometer, Digital
Thermo Anemdmeter and Mini IR Thermometer with HSN Code 9025 fall under
sub-entry 19 of Entry 103 of IV Schedule to the APVAT Act, 2005 and the goods
Pressure Measuring Divices such as, Flow Meter, Magnetic Guage and Mithelic
Guage with HSN Code 9026 fall under the sub-entry 20 of Entry 103, and
Analytical/ Process Instruments, such as, Chlorine Analyzer, Conductivity Analyzer
and Portable Low level Dissolved Oxyzen Analyzers with HSN Code 9027 fall
under the sub-entry 21 of Entry 103 of the IV Schedule to the AP VAT Act, 2005
and liable to tax @ 4% w.e.f.1-7-2006.
The goods, i.e. “Reagents” dealt by the applicant are not notified in any
Schedule to the AP VAT Act, 2005, hence they fall under residuary entry of the Vth
Schedule, and liable to tax @ 12.5%.
Sd/- Sd/- Sd/-
Addl/Jt.Commissioner.
To
M/s. Sava nt Instruments Pvt. Ltd,
418, 4th Floor Kubera Towers, Narayanguda, Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 104 /2007. Dated: 02-09-2008
O R D E R:
I. M/s. Soundarya Decorators Private Limited, Hyd. TIN 28910140911 have


1. Are SEZ units liable to deduct TDS from the contractors?
2. If yes, are not contractors eligible to get the credit for such TDS amounts?

Write up
IV. Mr. J.K Rao, Chartered Accountant and authorized representative

VI. Sub-section (3) of Section 22 of the AP VAT Act, 2005 prescribes that any
Central Government or State Government or an Industrial, Commercial, Trading
undertaking of the Central or State Governments or a statutory body or a Company
registered under the Companies Act, 1956 or any other person shall deduct TDS from the
amounts payable by them to a contractor dealer who executes work for them at the rates
prescribed from time to time, under Rule 18(1) of the AP VAT Rules, 2005.
Therefore, all contractees to whom wo rk is being executed by the contractor

irrespective of whe ther the contractee is located in SEZ area or not, shall deduct
TDS at the rate mentioned in Rule 18(1) of the AP VAT Rules, and shall pay such
tax so deducted to the State Government as per the procedure thereof.
The contractee shall furnish Form VAT 501A supplied by the contractor
indicating the TIN, amount of tax deducted etc. The contractor VAT dealer shall
submit the VAT 501A to the assessing authority prescribed along with the return in
Form VAT 200. The assessing authority shall give credit to the TDS received by
him to the account of the dealer contractor.
To
M/s. Soundarya Decorators Private Limited,
Road No.3, Banjara Hills, Hyderabad.

PROCEEDINGS OF THE

*****
A.R.Com/ 4 /2008. Dated 02- 09 - 2008
O R D E R:
I. M/s Jai Hind Cycle Agency, Gowliguda, Hyderabad,(TIN 28760228798 ) have


Rate of tax on Rubber Solution:

Broucher.
IV. Mr. R.D. & N.K.Rathi, Advocates, appeared for hearing and explained the case.
The applicant has sought clarification , rate of tax on Rubber Solution. The commodity
Rubber solution is not notified in any Schedules of the AP VAT Act, 2005, hence it
squarely fall under residuary entry in the fifth Schedule to the AP VAT Act 2005 and
Therefore it is clarified that “Rubber Solution” falls under residuary entry of

Vth Schedule to the AP VAT Act, 2005 and is liable to tax @ 12.5%
To
M/s. Jai Hind Cycle Agency,
15-3-33, Gowliguda,
Hyderabad..

Copy to the Commercial Tax Officer, Gowliguda Circle.
PROCEEDINGS OF THE
Present: Sri G. Lakshmi Prasad, Addl.Commissioner (Policy)

Sri K. Chengalraya Chetty, Addl. Commissioner (Audit)
Dr. K. Raghavaiah, Jt. Commissioner (Audit - II)
*****
A.R.Com/112/2006. Dated:20-10-2008
O R D E R:
I. M/s. M.R.F. Limited, Sadasivapet, Medak (TIN 28620142408) have filed an
1) Is input tax credit eligible in full on dispatch of ma nufactured goods to
their export godown in Tamilnadu for export out of India?
2) Will the movement of goods be treated as stock transfer eligible for input
tax credit only if VAT paid in excess of 4%?
1) Copies of invoices (2) Copies of various judgments of Hon’ble Supreme
Court of India and Hon’ble High Court.

IV. Mr. S. Sridharan, Chartered Accountant and authorized representative,
VI. The clarification sought by the applicant is carefully examined with
reference to the Act and Rules and settled law on the issue. Primarily the issue involves
dispatch of manufactured goods to their godown in Tamilnadu from where such goods
are exported outside India directly by them under section 5(1) of the CST Act, 1956, for
the purpose of export pre- identified goods (tyres) are stock transferred to their branch at
Chennai from where the goods are exported, in pursuance of a contract, to other
countries. Since, the issue is the point of question of fact, the dealer should claim as
exports, if the movement occasions in pursuance of pre-existing export contract or
otherwise as stock transfers. Further, goods occasions movement of the stock transfers
resulting direct exports of the same goods without any further manufacture modification
or process, such transactions shall be treated as exports only subject to conditions for
which ITC as eligible under Section 13 of the AP VAT ACT, 2005.

However, this authority is not inclined to give a clarification on the issue for
the reason that the dealers are expected to prove and to discharge the burden of
proof to the assessing authority that the goods are for export but not stock transfers
to their branch office. Thus, the claim of acceptance or otherwise depends upon the
prior orders, details of goods dispatched in pursuance to such contract,
reconciliation of export documents vis-à-vis stock transfer details etc. Therefore,
this authority would not be in a position to give any clarifications on the question of
facts and on the issues requiring the burden of proof to be discharged by the dealer.
Accordingly, the application is disposed off.
Sd/- Sd/- Sd/-

Addl.Commissioner Addl.Commissioner Jt. Commissioner.
Addl. / Joint Commissioner.
To
M/s. M.R.F. Limited, Sadasivapet.
Post Box No.2, Sadasivapet,
Medak District.

Copy to the Asst. Commissioner (CT), L.T.U., Nizamabad .
PROCEEDINGS OF THE
Present: Sri G. Lakshmi Prasad, Addl.Commissioner(Policy)

Sri K. Chengalraya Che tty, Addl.Commissioner (Audit)
*****
A.R.Com/ 86 /2007. Dated 11 -11- 2008.
O R D E R:
I. M/s Sri Vijaya Visakha Milk Products Co. Ltd.,Visakhapatnam, (TIN

28132885261) have filed an application and sought clarification and advance ruling on

Whether the ‘Sweet flavoured Milk’ fall under Sl.No. 16 of I Schedule to the AP
VAT Act or not?

Write up.
IV. Sri A.Sarveswara Row, Advocate, appeared for hearing and explained the case.
Revenue (CT-II), Dept. dt.2.06.2006

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COMMENTARY ON

A.P. VALUE ADDED TAX

Critical Summary of VAT Act, 2005

It is in this context, the maintenance of accounts correctly by the assessees

Further, the assessing authority is always competent to make a re-

since nothing is lost and everything is gained by the dealers in cooperating

Value Added Tax and Entry Tax

Value Added Tax and Service Tax

Works Contract in which the transfer of goods predominates is taxable

VAT and Central Sales Tax

VAT vs. Printers & Publishers

Printers are those who carry on printing alone. If it is a job work,

While concluding this introduction I would like to thank Miss M.L.

Statement Of Objects And Reasons (Act No. 23 of 2005)1

According to the sub-section (3) of Section 22 of the Andhra Pradesh

In Writ Petitions bearing number 1278 & 7998 of 2006 filed by M/

It is proposed to levy tax on the sales of packed items of food across

It is also proposed to amend the Schedules to be in conformity with

It is observed that the composition of tax provided to builders and

(i) Entry 24 of Schedule-I: "Meat, Flesh of Poultry, Fish including dry

provisions in the Act. The definition of Special Economic Zone is newly

An amendment was also proposed to Section 29 of the Act, to authorize

(iii) Under entry 102- amendment is proposed to include pharmaceutical

Sub-section (2) of Section 79 of the Andhra Pradesh Value Added Tax

5. To enact a new composition scheme for works contract involving

Therefore, an amendment is proposed to sub-section (7) of Section 21

relevant provision is being amended suitably. However, a discretion to the

VALUE ADDED TAX (AMENDMENT) ACT, 2012

1. Short title, extent and commencement:– (1) This Act may be

(4) ‘Assessing authority’ means any officer of the Commercial Taxes

executes any works contract involving supply or use of material directly

after subjecting it to any physical, chemical or any process other than

(12) ‘Deputy Commissioner’ means any person appointed to be

(23) ‘Place of business’ means any place where a dealer purchases

or in any manner whatsoever, of goods, being food or other article for

(a) to have been used or supplied by the dealer in the course of

(34) ‘Tax’ means a tax on the sale or purchase of goods payable

enumerated in item 1 of the Schedule-VI, on which tax at special rates

Definitions form an important part in any legislation. Every Act before

For the purposes of administering the Act, the Government appoints in

Where a three member bench finds that there is a conflict in the

as agents. An agent who brings parties together who collects commission

Financial institutions selling the machinery for purposes of recovering

Revision of broad band connectivity involves transfer of property in

The Second Schedule is titled as 'Transactions Zero Rated' and eligible

What happens after

1. The whole of A.P. General Sales Tax Act of 1957 ceases to be in

Transfer of right to use goods

transfer of right to use goods. The amount so realised is chargeable to

Documents to be presented at the

(5) The Trip Sheet shall be provided by the driver. It is a document

1. Added by Act No. 34 of 2006, w.r.e.f. 1-4-2005.

Appellate Tribunal. It is defined to be a high powered tribunal to meet the

3A. Appointment of Officers:– The State Government, may, appoint1

shall pay tax at the rate 1[specified in Schedule-V] on the total

food or any other article for human consumption or drink, served

Incidence of tax means, the transactions which attract the charge of

1. Added by Act No. 21 of 2011, w.r.e.f. 1-4-2009.

If the goods used in the Works Contract are involved in inter-State