Notes 09 - Notes on clauses - Levy, collection and recovery of Commodities Transaction Tax. - Finance Bill, 2013

Levy, collection and recovery of Commodities Transaction Tax. Chapter VII of the Bill seeks to provide for levy, collection and recovery of Commodities Transaction Tax. Clause 106 of the Bill seeks to define certain terms and expressions used in this Chapter. Clause 107 of the Bill seeks to make a provision for the charging of a tax called commodities transaction tax at the rate of 0.01 per cent. in case of sale of commodity derivatives in respect of commodities other than agricultural commodities traded in recognised associations. Clause 108 of the Bill provides the manner of computing the value of a taxable commodities transaction. The value of a taxable commodities transaction, in the case of sale of commodity derivative, shall be the price at which the commodity derivative is traded. Clause 109 of the Bill provides for collection and recovery of commodities transaction tax by a recognised association from the seller. The amount of commodities transaction tax collected by the recognised associations has to be paid to the credit of the Government by 7th day of the month following the month in which the commodities transaction tax is collected. Sub-clause (1) of clause 110 of the Bill provides for furnishing, by recognised associations (assessee) responsible for collection of commodities transaction tax, of a return in the prescribed form and prescribed manner and setting-forth such particulars as may be prescribed in respect of all taxable commodities transactions entered into during a financial year in that association. Sub-clause (2) confers power on the Assessing Officer to issue notice requiring any assessee who has not furnished the return, to furnish such return within such time as may be specified in the notice. Sub-clause (3) provides for furnishing of revised return before the assessment is made, in case of discovery of any omission or wrong statement in the return earlier furnished. Clause 111 of the Bill contains provisions relating to assessment of the value of taxable commodities transactions and commodities transaction tax payable or refundable on the basis of such assessment. It also provides that no assessment shall be made after the expiry of two years from the end of the relevant financial year. Clause 112 of the Bill provides for rectification of mistakes apparent from the record of any order passed by the Assessing Officer within one year from the end of the financial year in which the order sought to be amended was passed. The Assessing Officer may rectify mistakes either suo motu or at the instance of the assessee. Further, any amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee shall be made only after giving the assessee a reasonable opportunity of being heard. Clause 113 of the Bill provides for payment of simple interest at the rate of one per cent. for every month or part of a month where the commodities transaction tax collected is not credited to the account of the Central Government within the period specified in the said clause. Clause 114 of the Bill provides for imposition of penalty on the assessee responsible to collect transaction tax. The penalty would be a sum equal to the amount of commodities transaction tax not collected in a case where the assessee fails to collect the whole or any part of commodities transaction tax. In other cases, such penalty imposed will be one thousand rupees for every such failure. However, the penalty imposable under this clause shall not exceed the amount of commodity transaction tax that was to be paid. Clause 115 of the Bill provides for penalty for failure to furnish return under clause 110. The penalty in such cases will be one hundred rupees for every day during which the failure continues. Clause 116 of the Bill provides that any person, who fails to comply with notice issued under sub-clause (1) of clause 111, shall be liable to pay, by way of penalty, in addition to any commodities transaction tax and interest, a sum equal to ten thousand rupees for each failure. Clause 117 of the Bill provides that no penalty will be imposable under clause 114, clause 115 or clause 116, if the assessee proves that there was reasonable cause for the failure to comply with the provisions of the said clause. It is further proposed that no order imposing a penalty under this Chapter shall be made unless the assessee has been given a reasonable opportunity of being heard. Clause 118 of the Bill provides that sections 120, 131, 133A, 156, 178, 220 to 227, 229, 232,260A, 261, 262, 265 to 269, 278B, 282 and 288 to 293 of the Income-tax Act, 1961 which, inter alia, relate to issue of notice of demand, recovery and collection of tax, appeals to High Courts and the Supreme Court, appearance of authorised representatives, etc., will so far as may be, apply in relation to commodities transaction tax. Clause 119 of the Bill provides for an appeal to the Commissioner of Income-tax (Appeals) when the assessee denies his liability to be assessed under this Chapter or against any order passed under clause 111 or clause 112 by an Assessing Officer. This clause also contains provisions relating to time for filing appeal, etc., and provides that provisions of section 249 to 251 of the Income-tax Act, 1961, shall as far as may be, apply in such cases. Clause 120 of the Bill provides for appeal to the Appellate Tribunal against order passed by Commissioner of Income-tax (Appeals) under clause 119. This clause contains provisions relating to time and procedure for filing appeal before the Appellate Tribunal. This clause also provides that where an appeal has been filed under this clause, the provisions of sections 252 to 255 of the Income-tax Act, 1961 shall, as far as may be, apply to such appeals. Clause 121 of the Bill provides for punishment, by way of imprisonment upto a period of three years and with fine, for making any statement in any verification, account or statement which is false. This clause also provides that an offence punishable under this clause shall be deemed to be non-cognisable within the meaning of the Code of Criminal Procedure, 1973. Clause 122 of the Bill provides that no prosecution shall be instituted for an offence under clause 121 except with the prior sanction of the Chief Commissioner of Income-tax. Clause 123 of the Bill confers power on the Central Government to make rules for the purposes of carrying out the provisions of this Chapter. This clause also provides that every rule made under this clause shall be laid before each House of Parliament. Clause 124 of the Bill confers power on the Central Government to issue orders for removal of any difficulty arising in giving effect to the provisions of this Chapter. This power is available to the Central Government for a period of two years from the date on which the provisions of this Chapter come into force. Every order made under this clause shall be laid before each House of Parliament. This amendment will take effect from the date appointed in the notification to be issued by the Central Government