The Kerala Finance Act, 2023 has introduced a crucial amendment that provides a one-time concession for filing appeals under the Kerala Value Added Tax Act (KVAT), 2003 allowing dealers to file appeals, even if the time limit had previously expired.
The crucial provision added to Section 55 of the KVAT Act, 2003, states, “Provided also that a dealer other than those whose cases involving disputed amounts have been settled, may, after the expiration of the said period, even if the appeal filed has not been admitted previously due to any reason, present a fresh appeal before the Appellate Authority on or before 30th September 2023”.
This amendment, brought by Section 8 Clause (19) Sub Clause (3) of the Kerala Finance Act, 2023 has added a proviso to Section 55 of the KVAT Act, 2003 offering a lifeline to the dealers and taxpayers who missed the deadline for filing VAT (Value Added Tax) appeals due to various reasons.
This one-time opportunity allows dealers to present a fresh appeal before the Appellate Authority, even if they had not filed any appeals or if their previous appeals were not admitted for any reason. The extension is valid until September 30, 2023, and is a clear testament to the legislature’s intention to ensure fairness and justice in the taxation system.
Taxation laws can be complex and disputes often arise between taxpayers and tax authorities. These disputes may lead to appeals being filed by the aggrieved taxpayers seeking redress. However, there are strict timelines within which these appeals must be filed and failure to do so can result in the appeal being rejected, leaving taxpayers with limited options for recourse.
The Kerala Value Added Tax Act, 2003, had provisions that set specific deadlines for filing appeals. Once these deadlines passed, taxpayers faced significant challenges in seeking justice, even if their appeals had merit. Recognising this issue and the genuine difficulties faced by taxpayers, the Kerala legislature took a commendable step by amending the law to provide relief.
Chapter VII of the KVAT Act, 2003 describes the provisions related to Appeals, Revisions and Settlement of cases. Section 55 under Chapter VII, as amended, deals with the provisions related to Appeals to the Appellate Authority which is as under: As per Sub Clause (1) of Section 55, any person aggrieved by any order issued or proceedings recorded “other than those under section 16, section 19, sub sections (8) and (9) of section 44, section 49, section 67, section 68, section 69 and section 70” passed by an authority empowered to do so under this Act not being an authority above the rank of Joint Commissioner of State Tax may, within a period of thirty days from the date on which the order was served on him, appeal against such order, (i) to the Joint Commissioner of State Tax (Appeals) where such decision or order is passed by any officer upto and including the rank of a Deputy Commissioner of State Tax; and (ii) to the Additional Commissioner of State Tax (Appeals) where such decision or order is passed by the Joint Commissioner of State Tax; (2) Provided further that the Appellate Authority may admit an appeal presented after the expiration of the said period if he is satisfied that the appellant had sufficient cause for not presenting the appeal within the said period: (3) Provided also that a dealer other than those whose cases involving disputed amounts have been settled, may, after the expiration of the said period, even if the appeal filed has not been admitted previously due to any reason, present a fresh appeal before the Appellate Authority on or before 30th September 2023.
The heart of this amendment lies in the addition of a proviso to Section 55 of the Kerala Value Added Tax Act, 2003. This proviso allows dealers, excluding those whose cases involving disputed amounts have been settled, to file a fresh appeal before the Appellate Authority on or before 30th September 2023 even if their previous appeals were not admitted for any reason.
The most notable aspect of this amendment is the extension of the deadline for filing these appeals. Taxpayers now have until September 30, 2023, to avail themselves of this one-time concession. This extension, although temporary, provides much-needed relief to taxpayers who may have missed their original appeal deadlines.
As per the amendments made to the KVAT Act, 2003, all dealers have the opportunity to file VAT appeals, even if they missed the previous deadlines or had their appeals rejected for any reason. This move is expected to bring much-needed relief to taxpayers who may have faced bureaucratic hurdles or administrative delays in the past.
Hence, as per this Amendment, the dealers can file a VAT appeal on or before 30-09-2023 before the Appellate Authority, the Joint Commissioner (Appeals) along with the required documents. The grounds of appeal shall be accompanied by documents like:
The grounds of appeal shall be accompanied by the following documents:
The Appellate Authority, considering the intention of the legislature, shall condone the delay in filing the appeal and consider the appeal in merits.
The extension of the appeal deadline until September 30, 2023, offers a second chance for those who believe they were unjustly denied an opportunity to present their cases. This one-time concession recognises that genuine cases should not be penalised due to technicalities or procedural issues. Recognising that some appeals may have been delayed due to circumstances beyond the control of the taxpayer, the legislature has wisely included provisions to address these situations.
This second chance is available for filing appeals against any assessment or penalty orders passed under the KVAT Act, 2003.
If no records with respect to the matters are found with the dealer, then he can file an application before the proper officer to issue a certified copy of the Order and the Demand Notice specifying the assessment year and other relevant details such as Order Number, etc. Once the same is received, he can file an appeal before the appellate authority before 30-09-2023 by making use of this opportunity.
Once the dealer files an appeal before the appellate authority by paying 10% of the tax demand, then Revenue recovery (RR) proceedings if any shall be deemed to be stayed. The dealer does not need to worry about any arrear recovery proceedings against him until the disposal of the appeal.
In future, on bringing any Amnesty Schemes by the Government, the dealers who had filed appeals under the above context can also avail the benefits of such amnesty schemes.
At the outset, it is highlighted that the Kerala Value Added Tax, 2003, like any other beneficial legislation, aims to ensure and promote justice, welfare, benefit, remedy and a liberal approach towards the citizens of the country leading to a fair tax regime.
The legislative intent behind this amendment is clear – to promote fairness and equity in the tax system and to ensure quick adjudication and disposal of all VAT-related litigations. It acknowledges that there can be legitimate reasons why appeals were not admitted or why taxpayers missed their original deadlines. These reasons could range from genuine misunderstandings of complex tax laws to unforeseen circumstances that hindered the appeal process.
By offering this one-time concession, the Kerala legislature is not only acknowledging the difficulties faced by taxpayers but also demonstrating its commitment to a just and equitable tax system. It recognises that taxpayers should not be denied their right to appeal simply due to procedural technicalities or missed deadlines.
TheDepartment intends to reduce red-tapism, allowing the dealers to file VAT appeals pertaining to all the previous years by condoning the delay so that the department can dispose of all the issues and matters related to VAT, giving an end to the stagnant situation in the VAT scenario.
In this streamlined Goods and Services Tax (GST) Regime, it is very essential for all the stakeholders of the Act to dispose of and conclude all the VAT-related issues and matters at the earliest in the interest of justice.
The scope of this amendment is broad, as it applies to all dealers under the Kerala Value Added Tax Act, 2003, with the exception of those whose cases involving disputed amounts have been already settled. This inclusivity ensures that a wide range of taxpayers can benefit from the one-time concession.
Dealers across Kerala now have until September 30, 2023, to file VAT appeals, regardless of whether they missed previous deadlines or had their appeals rejected in the past. This amendment represents a unique opportunity for taxpayers to have their cases heard and potentially resolved in a fair and timely manner.
The Kerala Finance Act 2023, through its amendment to the Kerala Value Added Tax Act, 2003, has made a commendable effort to address the concerns of taxpayers and promote fairness in the taxation system. The one-time concession for filing appeals, along with the provision for condoning delays, demonstrates the legislature’s commitment to ensuring that genuine grievances are heard and justice is served. It offers a much-needed lifeline to dealers who may have faced bureaucratic roadblocks in the past.
As the September 30, 2023 deadline approaches, dealers are encouraged to take advantage of this one-time concession and present their VAT appeals to the Appellate Authority, ensuring that their voices are heard in the pursuit of tax justice.
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