Office of the Commissioner of Sales Tax

8th floor, Vikrikar Bhavan,

Mazgaon, Mumbai-10.

TRADE CIRCULAR

To,

------

No. :- ACST VAT-1/Refund/B- 422 Mumbai - Dt : 10th October, 2008.

Trade Circular No. 35 T of 2008.

Sub: Voluntary Refund scheme.

Ref: Trade Circular 56 T of 2007, dated 23/08/2007.

The procedure for grant of refund in the cases, wherein the net worth of business is substantial, the applicants have continuous and large claims of refund or the dealers are major exporters and those dealers who have extensive distribution network all over India, has been prescribed in Trade Circular 19 T of 2008, dated 23/05/2008.

In order to make available the benefit of fast refund scheme to additional dealers, a new refund scheme called the Voluntary Refund Scheme is now devised. The dealer may voluntarily avail the benefits of this scheme, and if he is eligible in terms of this circular and if he complies with the conditions laid down in this circular, then the refunds in his case will be granted as provided herein. This Trade Circular applies to any refund claims in respect of periods starting on or after 1st April, 2005.

B) APPLICABILITY OF THIS CIRCULAR:

The guidelines issued under this Trade Circular are applicable to all cases wherein the applications for refund in form 501 have been filed and no audit proceedings has been initiated and the cases where in applications will be received after the date of this circular till further instructions. The cases covered in Para “D” of this Trade Circular are however not eligible for the grant of refund under this circular.

C) CONDIITIONS FOR GRANT OF REFUND UNDER VOLUNTARY REFUND SCHEME:

The cases in which refund is due as per provisions of the Maharashtra Value Added Tax Act (MVAT Act) are only eligible for grant of refund under this circular.
All applications in Form-501 should be accompanied with purchase annexure in proper format.
The claimant dealer should submit the annexure of purchases in prescribed electronic format either on CD or pen drive along with application. (Annexure-A)
In cases wherein the applications in form 501 has been already filed, but purchase annexure in e- format was not submitted, the same should be submitted by the claimant dealer to the refund processing authority. (Annexure-A)
The claimant dealer should submit the list of CST declarations received and not received along with the form 501 in the enclosed proforma. (Annexure – C and D)
If so required by the refund processing authority, the certified copy of the return in which net refund has been claimed and the copies of returns from which refund has been carried forward should be submitted by the claimant dealer. This is subject to the instructions issued in Trade Circular 5T of 2008 dated 28/02/2008.
The dealer should certify that no sales tax dues are outstanding against him & also that he has not carried forward the said refund in any other subsequent return/s or has not adjusted it against any of his liability or against previous returns. (Annexure-B)
The dealer should give an undertaking for taking part in this voluntary refund scheme. (Annexure-B)
All the above mentioned certifications should be done by duly authorized person of the firm and should carry the stamp of the firm & name of the authorized person.

D) CASES NOT ELIGIABLE FOR VOLUNTARY REFUND SCHEME:

The cases wherein the returns are not correct, complete and self consistent.
The cases wherein abrupt rise in refund claim is noticed as compared to the immediately preceding year. ( e. i. rise in refund claim more than 25% of the previous year)
The PSI dealer holding the entitlement certificate for part of an industrial undertaking through investment in an expansion unit.
The cases wherein substantial reduction in refund claim after comprehensive audit has been noticed for the immediate preceding financial year. ( 5% of the refund claim or Rs. 25000/- which ever is higher)
The cases which are selected for the post-audit refund by the processing officer with prior permission of the Joint Commissioner.
The first refund claim of the newly registered dealers and the last refund claim in case of the dealers wherein the registration certificate has been cancelled.
The dealers trading in the commodities namely iron and steel, dyes and chemicals and edible oils.

E) GRANT OF REFUND:

The refund by the procedure given in this circular will be granted only to those dealers, who agree to take part in the voluntary refund scheme as per annexure-B.
The input tax credit for the purpose of this circular will be allowed to the extent of suppliers whose return filling is confirmed.
The claimant dealer, may if he so desires, voluntarily submit the proof of return filing of the suppliers, if the same is not available with the department. The refund granting officer may accept the copies of the chalans and upon verification may allow the input tax credit in respect to chalans produced.
The differential tax liability under the Central Sales Tax Act in respect of missing declarations will be adjusted against the refund claim.
The refund will be issued after reducing the refund claim to the extent of non confirmation of the filing of returns of the supplier and differential liability due to missing declarations under CST Act.
The details of reduction of the refund will be supplied to the dealer along with R. S. O., so that the dealer can apply for refund after correction of the defects. (Annexure -E)
Once the refund is granted either after reduction or in full, the refund application will be treated as finalized and closed.
If confirmation of return filing in respect of any of the supplier and or any of the declarations under CST Act is subsequently received, in respect of which the refund was reduced, the dealer can again apply in form 501 for pending refund of that period along with the proof of return filed by supplier and / or the declaration under CST Act. However, this claim of refund shall be made only after six months from the date of making earlier application and only one application shall be made in respect of the balance claim.
Needless to state that the alternative of the optional bank guarantee is also available as per procedure laid down in the Trade Circular 56 T of 2007.

F) COMPREHENSIVE BUSINESS AUDIT:

Comprehensive business audit will be undertaken in selective cases in which refund under this circular has already been granted.
Comprehensive business audit will also be undertaken in all the cases mentioned in Para “D” and in those cases where the dealer does not opt for Voluntary refund scheme. The refund in these cases will be granted only after Business Audit.

This circular cannot be made use of for legal interpretation of provisions of law, as it is clarificatory in nature. If any member of the trade has any doubt he may refer the matter to this office for further clarification.

You are requested to bring the contents of this circular to the notice of all the members of your association.

Sd/-

(SANJAY BHATIA)

Commissioner of Sales Tax,

MaharashtraState, Mumbai.

Copy forwarded to :-

1.a)All the Addl. Commissioners of Sales Tax in the State.

b)All the Joint Commissioners of Sales Tax in the State.

c)All the Sr. Dy. Commissioners of Sales Tax in the State.

d)All the Dy. Commissioners of Sales Tax in the State.

e)All the Asstt. Commissioners of Sales Tax in the State.

f)All the Sales Tax Officers in the State.

Copy forwarded with compliments to :-

1)Officer on Special Duty, Finance Department, Mantralaya, Mumbai, for information.

2) Accounts Officer, Sales Tax Revenue Audit, Mumbai and Nagpur for information.

Copy to all Desks and Desk Officersin the office of the Commissioner of Sales Tax, M.S. for information.

(P. N. Patil)

Addl. Commissioner of Sales Tax,

VAT – I, MaharashtraState, Mumbai.

“ANNEXURE – A”

(To be submitted by the dealer along with form 501)

Officer Desk ID / Name of Claimant dealer / Sr. No. / Tax Invoice No. / Date of Invoice yyyy-mm-dd / Name of the supplier / Tin No. / Net Amount / Tax / Total Invoice Amount.
1 / 2 / 3 / 4 / 5 / 6 / 7 / 8 / 9 / 10

''ANNEXURE – B”

( To be submitted by the dealer along with form 501)

M/s......

......

…...... Date......

To,

The Joint Commissioner of Sales Tax,

Refund & Refund Audit, Mazgaon,

Mumbai-10.

Sub: Request for early grant of refund amount under Voluntary Refund Scheme.

Ref: Our Refund Application in F-501,dated------, for M/s ------, for return period from ------to ------

for Rs...... /-

Sir,

In respect to above referred refund application, I / we wish to apply for the early refund under Voluntary Refund Scheme. I / we understood the terms and conditions of the above scheme. I / we undertake to adhere to the terms and conditions if there are any.

I am / we are aware that, any refund as per the above scheme, if wrongly claimed / granted can be recovered from me / us along with the interest.

Thank You.

Yours Faithfully,

(Authorized Signatory)

DECLARATION (Part of annexure – B)

I / we hereby voluntarily agree and declare that, I / we:

Will submit, if required, the complete “Purchase Annexure” in proper electronic format. (Either on CD or on Pen drive).
Will, if needed, provide certified copies of all the returns pertaining to the period covered by the refund application (refund claiming return as well as the returns in which the refund amount has been carried forward to the next period).
Agree on the amount of refund that is found to be grant-able under this Voluntary Refund Scheme.
Will not file more than one additional application to claim the remaining part of the refund (if any) after the receipt of part refund under VRS.
Will not file an additional refund application for the same period of return within six months of the date of receipt of refund under Voluntary Refund Scheme.
Undertake that we will repay (with interest) any amount that is later on found to be not due to us but was granted to us anyway.
Hereby, agree that the Department reserves the right of refusal of eligibility under VRS.

I / we hereby further certify that there are no sales tax dues pending from us and also that the amount of refund in question here has neither been carried forward to any of the subsequent periods nor been adjusted against any liability by us.

Date: Signature,

Place: (Authorized Signatory)

“Annexure-C”

(To be submitted by the dealer along with application in form 501)

Statement of available valid declarations for interstate sales/deemed exports for Period From……………………to…………………….

M/s………………………………………………………………………………………………

Address………………………………………………………………………………………………………………………………………………………………………………………………………

MVAT TIN

(a) Received Declarations in Form C for inter state sales

Sr No / Invoice No / Date / Name of inter state purchaser / CST No. of inter state purchaser / Net Amount / CST Amount / Invoice Total / Declaration Number
Total

(b) Received Declarations in Form D for interstate sale.

Sr No / Invoice No / Date / Name of inter state purchaser / CST No. of inter state purchaser / Net Amount / CST Amount / Invoice Total / Declaration Number
Total

Note: The information in respect of the received declarations in Form D needs to be provided only for the inter state sales up to 31/03/2007.

(c) Received Declarations in Form F for branch transfers

Sr No / Invoice No / Date / Name of the consignee / CST No. of the consignee / Invoice Amount / Declaration Number
Total

(d)Received Declarations in Certificate EI/E II

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Declaration Number
Total

(e) Received Declarations in Form H for deemed exports to inter state purchasers

Sr No / Invoice No / Date / Name of inter state purchaser / CST No. of inter state purchaser / Invoice Amount / Declaration Number
Total

(f) Received Declarations in Form H for deemed exports to local dealers

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Declaration Number
Total

(g) Received Declarations in Form I for inter state sales

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Declaration Number
Total

(h) Received Declarations in Form J for inter state sales

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Declaration Number
Total

Signature

Name…………………………………..

Status…………….……………………

Date:-……………………………

Place:-…………………………..

“Annexure -D”

(To be submitted by the dealer along with application in form 501)

Statement showing differential tax on account of non-availability of valid declarations for interstate sales/deemed exports for Period From………………….to………………(Position of missing declaration and certificates as on ______)

M/s………………………………………………………………………………………………

MVAT TIN

(a) Missing Declarations in Form C for inter state sales

Sr. No. / Invoice No / Date / Name of inter state purchaser / CST No. of inter state purchaser / Net Amount / CST Amount / Invoice Total / Differential CST amount payable
Total

(b) Missing Declarations in Form D for interstate sale.

Sr No / Invoice No / Date / Name of inter state purchaser / CST No. of inter state purchaser / Net Amount / CST Amount / Invoice Total / Differential CST amount payable
Total

Note: The information in respect of the missing declarations in Form D needs to be provided only for the inter state sales up to 31/03/2007.

Sr No / Invoice No / Date / Name of the consignee / CST No. of the consignee / Invoice Amount / Differential CST amount payable
Total

(d)Missing Declarations in Certificate EI/E II

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Differential CST amount payable
Total

(e) Missing Declarations in Form H for deemed exports to inter state purchasers

Sr No / Invoice No / Date / Name of inter state purchaser / CST No. of inter state purchaser / Invoice Amount / Differential CST amount payable
Total

(f) Missing Declarations in Form H for deemed exports to local dealers

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Differential VAT amount payable
Total

(g) Missing Declarations in Form I for inter state sales

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Differential CST amount payable
Total

(h) Missing Declarations in Form J for inter state sales

Sr No / Invoice No / Date / Name of purchaser / CST No. of purchaser / Invoice Amount / Differential CST amount payable
Total

Signature

Name…………………………………..

Status…………….……………………

Date:-……………………………

Place:-…………………………..

“ANNEXURE - E”

a. Reduction in refund due to missing declarations under CST Act

Type of Declaration / Net Taxable Amount / CST Paid or adjusted against refund / Differential CST Amount for missing declarations
Total

b.Reduction on account of input tax credit disallowed

Sr No / Name of supplier / Return period of the supplier / Input Tax Credit Disallowed
Total

c. Other reasons if any (Please specify)