DVAT Act - Another Blow

Within days of amending the DVAT Act regarding non-eligibility of full Input Tax Credit on Central Sales (Concessional Rate of Tax), the DVAT department is out with another blow for dealer registered under Delhi VAT Act.

Vide Circular No. 05 dated 29-06-2012, it has become mandatory to fill online (www.dvat.gov.in) details of the C/ F Form received, missing forms and tax paid in lieu of missing C Forms for the period 2009-10 and 2010-11. What is most disheartening is that the above information is to be furnished on or before 20-07-12

Para 5 of the circular states that “default assessment will be framed only to the extent of missing and unverified central declaration forms in respect of which due tax and interest has not been deposited by the dealers”

It means if a dealer has not received forms for the year 2009-10 & 2010-11 from his customer yet, he will have to deposit the tax along with interest by 20^th July’2012.

Para 6 of the circular states that “in cases where no information is furnished online, it will be presumed, that no Central Declaration Forms have been submitted ………. and such cases will be assessed on priority basis”

For future, it may be treated as a positive step from the DVAT department, as it will be convenient to file DVAT-51 online. However, it has also created undue pressures who have not received the C/F form for the year 2009-10 and 2010-11 yet. Such persons have been left with no choice. Either they will have to arrange the forms from their buyer before the very near deadline or they would have to deposit the differential tax to avoid penalty etc.

Last 2 lines of Para 7 of the circular is worth noting to understand the upcoming impact of this circular: “kindly file the requisite information online, positively by 20^th July’ 2012, so as to avoid inconvenience, adverse assessment and Penalty at a later date”.

The department does not seems to provide any further extension to submit the C Forms and they have cleared themselves by closing the circular by the following line: “The Said link would be disabled after 20^th July’ 2012”