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-By Ch.Kapil,
Article Assistant at Gella & Co
Registration Process- IDT
Central Excise, Service Tax, K VAT
9/2/20141
Coverage
1. Major considerations under this Registration
are:
Type of Registration
When to take .?
How to Take ..?
2. Accounting for Expense and Auditor’s Role of
Registration?
9/2/20142
Few Terms defined in
law……….
9/2/20143
1. Business
2. Dealer
3. Goods
4. Input
5. Place of
Business
6. Works Contract
7. Taxable
Turnover
8. Excisable
Goods
9. Manufacture
10. Whole Sale
Dealer
11. Assessee
12. Service
9/2/20144
Business any trade, commerce, 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 in furtherance of gain or profit and whether or not any gain or profit accrues there from and transaction which is incidental to business activities mentioned above [ Sec – 2(06) of KVAT Act,2003]
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 [ Sec – 2(12) of KVAT Act,2003]
Goods means all kinds of movable property (other than newspaper, actionable claims, stocks and shares and securities) and includes livestock, all materials, commodities and articles (including goods, as goods or in some other form) involved in the execution of a works contract [ Sec – 2(15) of KVAT Act,2003]
9/2/20145
Input means any goods including capital goods
purchased by a dealer in the course of his business for
re-sale or for use in the manufacture or processing or
packing or storing of other goods or any other use in
business [ Sec – 2(19) of KVAT Act,2003]
Place of Business means any place where a dealer
purchases or sells goods and including any warehouse,
godown or other place where a dealer stores or
processes his goods, place of produce or manufactures
or processes goods and place where a dealer keeps his
accounts including documents and where a dealer carries
on business through an agent [ Sec – 2(23) of KVAT
Act,2003]
Works Contract includes any agreement for carrying out
for cash, deferred payment or other valuable
consideration, the building, construction, manufacture,
processing, fabrication, erection, installation, fitting out,
improvement, modification, repair or commissioning of
9/2/20146
Taxable Turnover means the turnover on which a dealer shall be liable to pay tax as determined after making such deductions from his total turnover and in such manner as may be prescribed, but shall not include the turnover of purchase or sale in the course of interstate trade or commerce or in the course of export of the goods out of the territory of India or in the course of import of the goods into the territory of India and the value of goods transferred or despatched outside the State otherwise than by way of sale [ Sec – 2(34) of KVAT Act,2003]
Excisable Goods means goods specified in the First Schedule and the Second Schedule] to the Central Excise Tariff Act, 1985 (5 of 1986)] as being subject to a duty of excise and includes salt [ Sec – 2(c) of Central Excise Act,1944]
9/2/20147
Manufacture includes any process - incidental or
ancillary to the completion of a manufactured product,
which is specified in relation to any goods in the
Section or Chapter notes of the First Schedule to the
Central Excise Tariff Act, 1985 (5 of 1986) as
amounting to manufacture or packing related activity [
Sec – 2(f) of Central Excise Act,1944]
Whole Sale Dealer means a person who buys or
sells excisable goods wholesale for the purpose of
trade or manufacture, and includes a broker or
commission agent who, in addition to making
contracts for the sale or purchase of excisable
goods for others, stocks such goods belonging to
others as an agent for the purpose of sale [ Sec – 2(f)
of Central Excise Act,1944]
Assessee means a person liable to pay the service
tax and includes his agent [ Sec – 65B(7) of Chapter
V, Finance act,1994]
Main Important for Service Tax
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Service means any activity carried out by a person for another for consideration, and includes a declared service, but shall not include—
(a) an activity which constitutes merely
(i) a transfer of title in goods or immovable property, by way of sale, gift or in any other manner; or (ii) a transaction in money or actionable claim
(b) a provision of service by an employee to the employer in the course of or in relation to his employment
(c) fees taken in any Court or tribunal established under any law for the time being in force. [ Sec –65B(7) of Chapter V, Finance act,1994]
Type of Registrations Under K VAT Under Central Excise Under Service Tax
Dealer Manufacturer Single
Hotelier /
Restaurateurs /
Caterers / Sweet Meat
Stall l/ Ice-cream
Parlours / Bakeries
Dealer Centralised
Mechanical Crushing
Unit
Non Assessee
Works Contractor Declarant
Based on the type of the business the
client deals with, the selection of type
of Registration applies 9/2/20149
Where do Law specify the
Registration as Mandatory..?
Chapter III of Karnataka VAT Act,2003 specify the
registration for VAT
Section 6 of Central Excise Act, 1944 for Excise
Section 69 of Chapter V of Finance Act,1994 for
Service Tax
9/2/201410
When do I need to Register? For VAT if the taxable turnover is more than Rs.
5,00,000 /-per annum or Rs.40,000/- in one month
For Central Excise if entity deals in manufacturing or
production and trading of goods specified in First
and Second schedule of Central Excise Tariff
Act,1985. Exemption Limit is available for SSI units
upto Rs. 150 Lakhs for First clearances in any
Financial Year starting from 1ST April (Notification
8/2003)
For Service Tax if taxable turnover exceeds Rs.9
lakhs in the Previous Year and exemption Limit of
Rs.10 lakhs in Current Year9/2/201411
In Detail of SSI- Small Scale
Industries
9/2/201412
When is an entity called as SSI…?
A. According to Ministry of Micro, small and medium enterprises SSI IS “ Small scale and ancillary units i.e. undertaking with investment in plant and machinery of less than Rs. 10 million. [Micro, Small and Medium Enterprises Development Act,2006 – MSMED Act]
What do Notification 8/2003 (Tariff) say?
A. Clearances need to be the excisable goods specifed in First and Second schedule with few exceptions like undergarments, blankets of wool, sandal wood oil and many other goods.
Registration Required on Service
Recipient Basis
9/2/201413
1. Insurance
2. Goods Transport Agency
3. Sponsorship
4. Arbitral Tribunal
5. Advocate Services
6. Support Service
7. Rent or Cab Service
8. Supply of Manpower
9. Works Contract Services
10. Import of Service [Section 66A- Chapter V of FA,1994]
- [Notification No 15/2012]
How to register under VAT?
Apply online by visiting the www.ctax.kar.nic.in
and fill in the details in Form 1
Select the LVO code and fill in the details with
soft copy of the documents
After application is submitted, the VAT
commissioner will inform the VAT Inspector for
physical verification of business and documents
explained further
Vat Tax Identification Number(TIN) will be allotted
on Receipt of nominal fee Rs. 3,500/-
9/2/201414
Documents required for Registration
Common for VAT, Service Tax and Central Excise
1. Incorporation Certificate of Company (in case of Companies)
2. Memorandum of Association & Article of Association (in case of Companies)
3. Partnership Deed in case of Partnership Firm
4. True copy of Board resolution empowering company representatives as Authorized signatories.
5. Rental Agreement/ Lease Agreement
6. PAN Card of Corresponding Business Entity
7. Address Proof of Director – Lease / Rental Agreement, Electricity Bill
8. ID Proof of Director – Pan Card / Election Card/ Passport/ Driving License
9. Passport size Photograph of Management
10. Registration copies with other Departments like PT, Labour dept. 9/2/201415
For Central Excise Logon or Login in www.aces.gov.in under Central
Excise
Select the Form applicable i.e. Form A1 or A2 or A3
or Non Assessee and Declarant available under
registration column
Registration Certificate is proof for our registration
Major Requirements under this form are:
1. List of Major goods that are traded, manufactured
2. List of Major goods that are Inputs for Business
Tariff Heading for List of Major Goods are
required for filling of the Application Form9/2/201416
For Service Tax
Logon or Login in www.aces.gov.in under Service
Tax Column
Select the Form ST 1 available under registration
column and fill the details as required
Certificate of ST-2 is obtained as proof of
Registration
Major Requirements under this form are:
1. List of Major services that provided
9/2/201417
Few Examples for Type of
Registration
[ Limits has been exceeded ]
Type of Registration
Required
Service Tax
Service Tax and VAT
Service Tax and VAT
Service Tax
Service Tax and VAT
Service Tax
Excise and VAT
Name of the Entity
Bank
:
Job Worker
:
BBMP and BMTC
:
Redbus
:
MC Donalds , KFC
:
BCCI
9/2/201418
Type of Registration in case of
Branches
What should an entity do if has Branches..????
As VAT is state government tax, registration of
branches to be taken in respective states only
In case of Multi points of business or branches,
the client can apply for registration as “Input
Service Distributor” useful for passing on the
cenvat credit of Service Tax
And entity can also avail the Centralised
Registration for the branches of business for
Service Tax
9/2/201419
Accounting For Registration
Expenses
Accounting for Expenses met for establishing an
entity like company is accounted as Revenue
Expenditure
In the same way Statutory Registration under
IDT also.
Fees met for this registration to be expensed
under “ Rates and Taxes”
9/2/201420
Few Questions……????
9/2/201421
A from Delhi reached Bangalore for giving gold ornaments designing. For that he purchased raw material and stationery in Bangalore itself. He is not registered under any IDT. He wants our help to take registration. Under where he is liable to Register..?
Raja has a business of buying goods locally and exporting them. Now which IDT registration applies to him?
Ms. Radha is a beautician, exceeding taxable turnover limit of 9 Lakhs in Previous Year.Curent Year limit is also exceeded. But she has became Mrs.Radha by the end of the Year. Now who is responsible for un registering under Service Tax
………..Continued
9/2/201422
Mr. Sharath Chandra is dealer in trading of
excisable goods from Rajasthan to Hyderabad.
Occasionally he comes to Bangalore to do the
same business. Now where all the places he has
to register?
Shree Manjunath Traders is into the business of
trading the plywood. Sale of goods are made as it
is but description of goods is different from
purchase bill to Sale Invoice.?
Srimadth & Co provide advocate services to the
clients in addition to tax consultants. In this
criteria who has to register and under what?
Auditor’s Role
He has to check the registration certificate for clear and correct understanding of the client’s Business
He has to verify the input credit of the goods which are stated in Form A1 under Excise
He has to verify the accounting of Registration, Renewal and amendment of registration expenses with proper supporting
New Feature CFC – Certified Facilitation Centres made by ICAI, ICWI
9/2/201423
