25. Assessments
1) Where a VAT dealer fails to file a VAT return as prescribed under Section 20, the authority prescribed shall assess unilaterally the tax payable. The authority prescribed shall serve upon the VAT dealer a notice of the tax assessed and the penalty due on form VAT 204. The VAT dealer shall pay the sum within the time and the manner specified on the form or shall file the return outstanding. If the return is filed the unilateral assessment shall be withdrawn, without prejudice to the penalty under sub-section (3) of Section 50 and interest due for late payment.
2) a) A VAT unilateral assessment shall be made by totaling the tax declared on the tax returns or paid by way of assessment during the previous twelve months and by dividing the amount by twelve to arrive at an average monthly liability for the previous twelve months. The average shall be compared with the tax due declared on the last return filed. The higher figure of the two shall be used for arriving the tax for the purpose of assessment. A penalty of fifty percent (50%) of that sum shall be levied.
b) In the case of a VAT dealer who has not been registered for a period of twelve months, the amount declared in box 16 (b) of Form VAT 100 shall be divided by twelve to provide the basis for the calculation of the average taxable turnover. The standard rate of tax shall be applied to this amount to calculate the tax liability. A penalty of fifty percent (50%) of that sum shall be levied. In the case of a deemed registration under sub-rule (4) of Rule 4, the total turnover declared on Form VAT 100 shall be divided by twelve to provide the basis for the calculation of the taxable turnover.
c) Where a credit return is filed in the previous twelve months with the claim of credit carried forward in any tax period, the credit carried forward shall be ignored for the calculation. Where a return is filed in the previous twelve months with the claim of refund in any tax period, the refund amount shall be deducted from the total tax declared on the returns for calculation of the taxable turnover under clause (a) or (b).
d) Where in the previous twelve months, credit or refund is claimed in all the returns or a credit balance is arrived at, no unilateral assessment shall be made.
3) Where a TOT dealer fails to file a return as prescribed under Section 20, the authority prescribed shall assess the tax payable unilaterally. The authority shall serve upon the TOT dealer a notice of the tax assessed and a notice of the penalty due on form TOT 010. The TOT dealer shall pay the sum within the time and manner specified on the form or file the return outstanding. If the return is filed the unilateral assessment shall be withdrawn without prejudice to the penalty under sub-section (3) of Section 50 and interest due for late payment.
4) a) A TOT unilateral assessment shall be calculated by totalling the tax declared on TOT returns or demanded and or paid by way of assessment for the previous twelve months. This sum shall be divided by four to provide an average quarterly TOT liability. A penalty of fifty percent (50%) of that sum shall be levied;
b) In the case of a TOT dealer who has not been registered for a period of twelve months the amount declared in box fourteen of Form TOT 001 shall be divided by four to arrive at the average taxable turnover. The turnover tax rate shall be applied to this amount to calculate the TOT liability. A penalty of fifty percent (50%) of that sum shall be levied;
c) In the case of a TOT dealer registered under the provisions of sub-section (8) of Section 17, the gross turnover declared for the year ending 31 of March 2005 under the Andhra Pradesh General Sales Tax, 1957 shall be divided by four to arrive at the average taxable turnover for the purposes of this rule.
5) Where any VAT return filed by the VAT dealer appears to the authority prescribed to be incorrect or incomplete that authority prescribed shall assess the tax payable to the best of his judgment on Form VAT 305 after affording a reasonable opportunity to the dealer in Form VAT 305 A. He shall serve upon the VAT dealer an order of the tax assessed, the penalty and interest due on form VAT 305. The VAT dealer shall pay the sum within the time and manner specified on the notice.
6) Where any TOT return filed by the TOT dealer appears to the authority prescribed to be incorrect or incomplete that authority shall assess the tax payable to the best of his judgment on From TOT 025 after affording a reasonable opportunity to the dealer on Form TOT 025A. He shall serve upon the TOT dealer an order of the tax assessed, the penalty levied and interest due on Form TOT 025. The TOT dealer shall pay the sum within the time and manner specified on the notice.
7) Where a dealer receives any amount due to price variations, which have not been included in the return filed for that tax period, he shall include the additional amount received and tax calculated at the rate applicable in the return to be filed in the period in which the additional amounts are received.
8) a) For the purpose of Section 53, the tax underdeclared in respect of input tax means the excess of input tax claimed over and above the input tax actually entitled to be claimed in the return for a particular tax period
b) The tax underdeclared in respect of output tax means the difference between output tax actually chargeable and the output tax declared in the return for a particular tax period
c) In respect of a TOT dealer the tax underdeclared means the difference between the tax declared on Form TOT 007 and the tax actually due by the dealer for the period.
9) Where any sales tax credit claimed under Rule 37 is found to be in excess of the amount actually entitled, such amount shall be recovered along with interest by assessing the VAT dealer.
Illustration:
a) VKM, a VAT dealer filed a return for tax period declaring input tax as Rs.10000/- and output tax as Rs.5000/- and the net excess tax of Rs.5000/- was carried over to the next tax period. On verification by the authority prescribed after 6 months, the eligible input tax credit is found to be Rs.8000/-. There was no variation in output tax. The tax under declared in respect of input tax is Rs.2000/- (Rs.10000 – Rs.8000)/-. The percentage of under declaration of tax is twenty five percent (25%) (2000X100/8000). Accordingly under declared tax of Rs.2000/- along with penalty of Rs.500/- i.e. twenty five percent (25%) and interest at the rate of 1% for the period i.e. six months of delay is payable.
b) NKC, a VAT dealer filing a return declared input tax as Rs.23000/- and out put tax as Rs.77000/- and net tax of Rs.54000/- was paid along with return. On verification by the authority prescribed after four months it was found that there is no variation in the eligible input tax declared in the return. However, the output tax chargeable for that tax period was found to be Rs.80,000/- as against the declared out put tax of Rs.77,000/-. The tax under declared in respect of out put tax is Rs.3000/- (i.e. Rs.80000-Rs.77000). The percentage of under declaration is 3.8% (3000X100/80000). Now the dealer is liable to pay the under declared tax of Rs.3000/- along with penalty of Rs.300/- i.e. 10% and interest at the rate of 1% for the delayed period of 4 months.
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