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NOTIFICATION

No. FD 05 CET 2009(I), Bangalore, dated 03.06.2009

In exercise of the powers conferred by Section 11-A of the Karnataka Tax on Entry of Goods Act, 1979 (Karnataka Act 27 of 1979), the Government of Karnataka, being of the opinion that it is necessary in the public interest so to do, with effect from the First day of April, 2009 hereby exempts the tax payable under the said Act.

  • on the entry of plant and machinery and capital goods for use including those brought for the purpose of establishing captive power generation plant, into a local area caused by a dealer who is a new industrial unit located in Zone-1 or Zone-2 or Zone-3 area as specified in the Government Order No. CI 233 SPI 2008, dated 28th February, 2009 for a period of three years from the date of commencement of its project implementation, and
  • on the entry of any goods for use as raw materials inputs, component parts and consumables (excluding petroleum products) into a local area caused by a dealer who is a new industrial unit located in Zone –1 or Zone-2 or Zone-3 area as specified in the Government Order No. CI 233 SPI 2008, dated 28th February, 2009, for a period of five years from the date of commencement of commercial production of such unit.

Explanations - For the purpose of this Notification.

  • “Capital Goods”, means plant including cold storage and similar plant, machinery, equipments, moulds, tools and jigs;
  • A “New Industrial Unit” means a unit which has made new investments on fixed assets and includes an existing unit investing at least 50% of its original investment for undertaking expansion/ diversification/ modernization, in creation of new assets under the expansion / diversification/ modernization programme.

Note

  • This Notification is applicable to all new and additional investments in expansion / diversification / modernization, made on or after 1st April, 2009 and on or before 31st March, 2014.
  • This Notification is applicable only to –
    • manufacturing enterprises, and
    • service enterprises listed in Annexure-3 to the Government Order No. CI 233 SPI 2008, dated 28th February, 2009.
  • This Notification shall not apply to.-
    • such of those industrial units which have already been granted a package of Incentive and Concessions as per the previous policies;
    • a micro or small or medium or large scale or mega industrial unit from the date on which its registration with the Director of Industries and Commerce, Government of Karnataka is cancelled;
    • the ineligible industries listed in Annexure – 4 to the Government Order No. CI 233 SPI 2008, dated 28th February, 2009, irrespective of their location.

Procedure - An industrial unit claiming tax exemption under this Notification shall produce the following documents at the time of filing first monthly or quarterly statements under the Karnataka Tax on Entry of Goods Rules, 1979.

  • In the case of a new micro / small / medium / large scale / mega project unit, a certificate in original issued by the Director of Industries and Commerce, Government of Karnataka or his authorized nominee, certifying.-
    • that it is a unit registered as such;
    • the value of fixed assets in terms of land, building and plant and machinery and such other productive assets like tools, jigs and fixtures, dyes, utilities like boilers, compressors, diesel generating sets, cranes, material handling equipments and such other equipments which are directly related to production purpose on the date of commencement of commercial production;
    • that no part of its fixed assets other than land and building is old / used / second-hand, with the exception of those imported from outside the country;
    • the date on which investment and fixed assets has taken place;
    • the date of commencement and completion of project implementation of the unit;
    • the date of commencement of its commercial production;
    • that it is eligible for exemption from payment of entry tax as per the Government Order No. CI 233 SPI 2008, dated 28th February, 2009; and
    • the zone in which the unit is located and category under which the unit is eligible for tax exemption.
  • In case of an existing unit making additional investment in expansion/ diversification / modernization, a certificate, in original issued by the Director of Industries and Commerce, Government of Karnataka or his authorized nominee, at the time of filing of first monthly or quarterly statement under the Karnataka Tax on Entry of Goods Rules, 1979, after the commencement of expansion / diversification / modernization programme certifying the quantum of investment in fixed assets made for creating new assets under expansion / diversification / modernization programme and that the investment in expansion / diversification / modernization has been made on or after First April, 2009 and that it is eligible for entry tax exemption under the Government Order No. CI 233 SPI 2008, dated 28th February, 2009.
  • In each of the subsequent years for which tax exemption is claimed under this notification, the unit shall produce a certificate from the Director of Industries and Commerce, Government of Karnataka or his authorized nominee within sixty days of the commencement of the year certifying that the registration of the unit is valid for the year.
 
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