Commercial Tax Department of Karnataka Government has introduced an all new System of VAT filing wherein a dealer is required to file the detailed list of Purchases, Sales, Interstate Purchases, Stock Transfer and Imported Purchases in the specified format. These statements are required to be uploaded before filing monthly Return. The statements are required to be filed by dealers with a total turnover exceeding Rs 50 Lakhs in the previous year or cumulatively at any point in time during the current year.
Our Comments
- The VAT Departmental authorities are trying to create a robust system wherein they would be able to verify the procurements made by and sales executed by a dealer;
- The authorities would be able to verify if the input tax credit availed by purchasing dealers have been declared by the selling dealer in his VAT returns;
- While the system will help the departmental authorities in minimizing tax evasions by cross verifying the returns of the selling dealer with the returns filed by the purchasing dealer, the system could also create many issues;
- Currently, the departmental authorities are not allowing input tax credit on tax invoices issued in a particular month on which credit has been claimed in the subsequent months. Refunds to SEZ units and SEZ developers is also being denied in such scenario;
- The delay in accounting the invoices in the same month of issue could be on account of various reasons like transactions executed in the last week of the month, works contract - were purchase is recorded based on approval from project managers;
- The new system would only help the officers determine the cases where the purchase invoices are not booked in the month in which invoices were raised and thereby deny the input tax credit;
- There does not seem to be any provision for revision of these uploaded statements;
- What would be the consequences of non filing of these statements
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