The Hindu : New Delhi News : Call to amend Delhi VAT Act

Online edition of India's National Newspaper
Thursday, May 18, 2006

New Delhi

New Delhi

Call to amend Delhi VAT Act

Staff Reporter

`For better revenue collections and enlisting support of all abiding traders'

NEW DELHI: The All-India Tax Advocates Forum has suggested several amendments to the Delhi VAT Act so that anomalies in the existing law are corrected for better revenue collections and enlisting the support of all the abiding traders.

The Forum has demanded that the Delhi Government amend five main components of the existing VAT law. These include discretionary powers of the VAT Tribunal to grant stay on disputed taxes, VAT Commissioner's unbridled powers to pass any order prejudicial to the revenue collection, absence of show-cause notice in case the returns are perceived to be faulty even due to a clerical mistake, ex-parte decisions of VAT officers against minor delays leading to huge bogus demands and finally lack of information to traders who have filed their annual returns for the 2004-05 fiscal by March 31 this year.

Forum president M.K. Gandhi said the anomalies in the existing law that even the local government has recognised should be amended. "After all, the trading community in the city has contributed over Rs 7,000 crores in an year to Delhi Government's revenues," he noted.

It has been suggested that for streamlining the VAT Act, the automatic stay route -- both at the levels of first Appellate Authority and the Tribunal in case of disputed taxes -- should be included, aggrieved parties should be given the right to seek revision before the VAT Commissioner and major changes be brought in Sections 32, 33 and 86 of the VAT Act to bring about accountability and fair play in the VAT collection system.

Stating that in case of 2004-05 assessments there is a total absence of feedback and this has created fear in the trading community of arbitrary demands being made on them, Mr Gandhi said: "Even the daily collection register (DCR) for the last fiscal has not yet been closed."

Averring that existing anomalies in the law had led to considerable corruption in the VAT Department, he demanded that the contemplated changes must be in tune with practices and procedures prevalent in several other States.

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