Scope of filing Revised Returns under DVAT Act, 2004 (Delhi Act No. 3 of 2005) - Clarification regarding - VAT - Delhi - 04

GOVERNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI DEPARTMENT OF TRADE AND TAXES (POLICY-I BRANCH) BIKRIKAR BHAWAN, I.P. ESTATE, NEW DELHI-110 002 No. F.6(33)/P-I/VAT/2006-07/242 Dated : 31/05/06 CIRCULAR NO. 4 OF 2006-07 Sub. : Scope of filing Revised Returns under DVAT Act, 2004 ( Delhi Act No. 3 of 2005) - Clarification regarding Clarification are being sought from different quarters as to whether a revised return under Rule 29 of the Delhi Value Added Tax Act, 2004 (Delhi Act No. 3 of 2005) (hereinafter referred to as the said Act) is permitted to be filed to rectify any mistake, error or omission occurred in the original return due to clerical error or omission, which has no effect/ change in the tax already deposited by the dealer. Although provisions about filling of revised returns for correction of any type of error in original returns are quite clear yet doubt appears to have arisen in view of provisions as contained in section 28 of the said Act. It is observed in this connection that it is a well settled principal of law that error or omissions of whatsoever nature, it may be, should not be allowed to perpetuate for any reason on records and should be allowed to be rectified as and when noticed without any delay. Any sort of delay and latches in rectifying any such error would certainly lead to frustrate the purpose of filing returns and may lead to various complications in effective implementation of the enactment. For example if a dealer due to clerical error failed to indicate some figures in his return about its purchases against central statutory forms under the Central Act, which figures are required to be indicated in his local return or has inaccurately indicated purchases made on payment of full tax thereunder or otherwise against Branch transfer or inadvertently indicated some wrong figures due to totalling error or otherwise, the same would certainly lead to give inaccurate results while issuing forms against those purchases, although it has no effect on the tax paid by the dealer on its sale. In such situations, if dealer himself in the light of his own books of accounts and other records wants to rectify such error suo-motu, law should not be interpreted in such a manner that the same stands as hurdle in his way, if he himself by way of filing explanatory note, which he is supposed to file together with his return is ready to explain. No doubt section 28 of the said Act speaks about revised return, which is permissible to be filed within one month of discovery of mistake to be filed up to four years of making assessment, but title and contents thereof makes it clear that this provision only speaks about : "correction of deficiencies" in tax only, yet there may be certain other circumstances leading to errors and omissions or incorrectness, which requires rectification and filing of revised returns, where no tax effect is involved either excess or less. In this connection, it is hereby clarified that provisions as contained in sub-section (1) of section 26 of the said Act, if read with rule 29 framed thereunder, the same take care of such situations and dealers may file revised returns to rectify any type of error, omission or incorrectness in his original return since the words "such returns" and "as may be prescribed" in sub-section (1) of section 26 and words "correction of some error" in sub-rule (1) and "any mistake or error as detected by him" in sub-rule (2) of rule 29 covered the revised returns prescribed under the said Act Rules framed thereunder. In view of the above discussion dealers may be allowed to file revised returns under rule 29 of Delhi Value Added Tax Rules, 2005 to enable them to rectify any sort of mistake, errors or omissions occurred in original return. Such returns as and when filed by any dealer should always be in the prescribed period and duly supported by a detailed explanatory note enclosed therewith which shall be subjected to proper scrutiny by the concerned VATO / AVATO before relying thereupon. This issues with prior approval of the Commissioner, Trade and Taxes. (S.R. Maheshwari) Value Added Tax Officer (Policy-I) No.F.6(33)/P-I/VAT/2006-07/243-250 Dated : 31/05/06 1. All Addl. Commissioners. 2. All Joint / Deputy Commissioners. 3. Joint Commissioner (PR) for wide publicity. 4. P.S. to Commissioner (VAT). 5. All VATOs / AVATOs. 6. System Analyst, EDP for placing the circular on the department's website. 7. President, Sales Tax Bar Association (Regd.) 8. Guard File. (S.R. Maheshwari) Value Added Tax Officer (Policy-I)