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State of Kerala - Section

Section 12 in Kerala Value Added Tax Rules, 2005

12. Determination of Input tax credit in respect of opening stock.

(1)Goods held as opening stock on the date of coming into force of the Act, in respect of which input tax credit is claimed by a dealer under sub-section (13) of section 11 shall be -
(a)those which were taxable under the Kerala General Sales Tax Act,1963 (15 of 1963);
(b)those purchased within one year preceding such date;
(c)in the case of goods, other than those taxable at the point of first or last purchase as applicable under section 5 and those taxable under section 5A of the Kerala General Sales Tax Act, 1963 and those in respect of which tax under the Kerala Tax on Entry of Goods into Local Areas Act, 1994 (15 of 1994) is paid supported by bills issued by dealers registered under the Kerala General Sales Tax Act,1963 (15 of 1963);
(d)in the case of goods taxable under the said Act either under section 5A or at the point of purchase, supported by sale bill issued by the seller or purchase bill or bought note, as the case may be, issued by the dealer claiming such input tax credit;
(dd)in the case of goods in respect of which tax under the Kerala Tax on Entry of Goods into Local Areas Act, 1994 (15 of 1994) has been paid, supported by receipt issued by the appropriate authority for the payment of tax;
(e)those which were taxable under the Kerala General Sales Tax Act, 1963 (15 of 1963) and are also taxable under the Act; and
(f)physically available with the dealer on such date.
Explanation. - For the purpose of sub-section (13) of section 11, -
(a)goods in respect of which bill/invoice was issued by the selling dealer prior to 01.04.2004 shall not be deemed to have been purchased within one year preceding the date of coming into force of the Act even if the goods actually reached the buyer on or after such date; and
(b)goods in respect of which bill/invoice was issued by the selling dealer prior to 01.04.2005 shall be deemed to have been physically available with the buyer on the day preceding the date of commencement of the Act, even though the goods actually reached the buyer on or after 01.04.2005.
(c)Where the goods are supported by bills issued by a dealer registered under the Kerala General Sales Tax Act, 1963 (15 of 1963), the amount of tax computed under sub-rule (3) shall be deemed to have been shown separately in such bills for the purposes of sub-section (13) of section 11
(2)Any dealer claiming input tax credit in respect of such goods shall submit to the Assessing Authority, an application in Form 25A on or before the 31st day of January 2006 along with the opening stock inventory as on the date of coming into force of the Act, separately for goods falling under different Schedules to the Kerala General Sales Tax Act, 1963 (15 of 1963) -
(i)purchased within the State from dealers registered under the said Act-(a) where tax collection is shown separately (b) where such tax collection is not shown separately;
(ii)purchased from outside the State and those in respect of which tax under the Kerala General Sales Tax Act, 1963 (15 of 1963) has not been suffered. Where a particular purchase bill is lost the dealer shall obtain from the seller a duplicate bill showing the particulars included in the original bill, with a certificate of the seller to the effect that the duplicate bill is issued in the context of the loss of the original bill and furnish details there of in the statement furnished in Form 25A;
(iii)in respect of which tax under section 5A of the said Act had been paid; and
(iv)in respect of which tax under the Kerala Tax on Entry of goods into Local Areas Act, 1994 (15 of 1994) had been paid.
Along with the application in form 25A the dealer shall also submit a statement showing separately the opening stock value of goods as on 01.04.2004 and 01.04.2003 in respect of goods taxable at the hands of the dealer and those exempted at his hands. The stock inventory and the statement of purchase bills referred to in this sub-rule shall be certified by a Chartered Accountant or a Cost Accountant, where the dealer submitting the statement was covered by the provisions of section 27A of the Kerala General Sales Tax Act 1963 (15 of 1963) during the year 2004-05. The time limit may be extended by the assessing authority by fifteen days in deserving cases.Provided that in the case of dealers who became eligible for input tax credit under sub-section (13) of section 11 in the light of the Kerala Value Added Tax (Amendment) Act, 2005 (39 of 2005) and submission of an application in Form No. 25A or revisions of the application in Form No. 25A already submitted under this rule has become necessary, such application in Form No. 25A or such revised application in Form No. 25A shall be filed within thirty days from the date of publication of the Kerala Value Added Tax (Amendment) Rules, 2005.
(3)Where in respect of goods taxable at the point of sale the selling dealer has not shown tax collection separately in the bills or, in respect of goods taxable at the point of first purchase in the state, where the dealer claiming input tax credit is not the first purchaser in the state, the amount of tax paid by the dealer to the sellers in respect of which input tax credit is allowable shall, subject to the provisions of sub-rule (6), be determined by applying the following formula:
a)9 PR10(100+R) In the case of goods to be of special importancein inter-state trade or commerce (Declared Goods) under section14 of the Central Sales Tax Act 1956.
b)85 PR100(100+R) In the case of other goods.
where P is the opening stock value of the goods and R is the rate of tax applicable to the goods, including additional sales tax, if any, under the Kerala General Sales Tax Act 1963, (15 of 1963 ) (in the case of goods falling under the Fifth Schedule to the Kerala General Sales Tax Act, 1963, (15 of 1963 ), shall be the rate of tax, including additional sales tax, if any, applicable on the first sale of the goods in the state)
(4)In In the case of goods which suffered tax at the point of first purchase or last purchase under the Kerala General Sales Tax Act, 1963 (15 of 1963) at the hands of the dealer claiming input tax credit, the tax so suffered on such goods held as opening stock on the date of coming into force of the Act, for the purpose of calculation of the input tax credit shall, subject to the provisions of sub-rule (5), be determined by applying the rate of tax, including Additional Sales Tax, if any, on the purchase value of the goods calculated at the average price of such goods in the month preceding the date of coming into force of the Act.
(4A)In the case of goods in respect of which tax under section 5A of the Kerala General Sales Tax Act, 1963 (15 of 1963) has been paid on its purchase and such goods had been used in the manufacture of other goods and are held as opening stock on the date of commencement of the Act, whether as finished goods or as work in process, the tax paid under section5A of the said Act in respect of such goods shall be calculated by applying the rate of tax on the purchase value of the goods calculated with reference to the purchase bill or bought note relating to the goods.
(4B)In the case of goods in respect of which tax under the Kerala Tax on Entry of Goods into Local Areas Act, 1994 (15 of 1994) had been paid, the amount of input tax credit shall be the actual tax paid on the goods as supported by the receipts issued by the appropriate authority.
(5)
(a)In the case of goods in respect of which tax had been paid by the dealer claiming input tax credit, at the point of first purchase or at the point of last purchase under the Kerala General Sales Tax Act, the input tax credit in respect of such goods under sub-section (13) of section11 be claimed by the dealer in the return for the month of April 2005.
(b)In the case of goods in respect of which tax was paid by him under section (5A) of the Kerala General Sales Tax Act, 1963, the input tax credit in relation to such tax shall be claimed in the return for the month subsequent to the month in which the application or as the case may be, the revised application is submitted under sub-rule (2).
(6)Where the dealer claiming input tax credit has submitted the statements as required by sub-rule (2), the dealer shall claim input tax credit in three equal monthly instalments commencing from the return for the month of May 2005 onwards or in the return for any subsequent three months. In the case of a dealer who had filed the application in Form No. 25A on any date subsequent to 31st day of May 2005, in accordance with the provisions of sub-rule (2), input tax credit under this sub-rule may be claimed in three equal monthly installments commencing from the month subsequent to the month in which the application in Form No. 25A is submitted or from the month subsequent to the month in which the assessing authority communicates his approval of the statements made in Form No.25AProvided that the prior approval of the assessing authority shall not be required in the case of the dealers who submit the application in Form No. 25A or revised application in Form No. 25A under the proviso to sub-rule (2)
(7)Where a dealer who had opted for payment of tax under sub-section (5) of section 6 or under section 8 changes over to the payment of tax under sub-section (1) of section 6, he shall submit an application in Form No.25A along with a stock inventory on the date of change over, duly certified by a Chartered Accountant or a Cost Accountant, where the dealer is covered by the provisions of section 42, and a statement of the purchase bills issued by registered dealers paying tax under sub-section (1) of section 6, within fifteen days from the date of change over.
(7A)Where a dealer becomes liable to tax during the course of an year by reason of his total turnover reaching the limit specified under sub-section (1) of section 6, he shall submit an application in Form No.25A along with a stock inventory as on the date on which his total turnover reaches such limit in the manner specified in sub-rule (7) above and a statement of purchase bills issued by registered dealers paying tax under sub-section (1) of section 6, within fifteen days from the date on which the total turnover reaches the said limit.
(8)Where the dealer referred to in sub-rule (7) or in sub-rule (7A) has submitted the statements as required by the said sub-rule, the assessing authority shall verify the claim and, where it is satisfied that the claim is in order, permit the dealer to claim input tax credit in respect of such goods held as opening stock in three equal monthly installments commencing from the return period subsequent to the date of order allowing such input tax credit.