Haryana State Government has recently clarified that additional surcharge i.e. at the rate of 5% shall be applicable to all the composition dealers registered under Haryana Sales tax except the retailer dealer under composition scheme pursuant to Rule 52.

Stay updated! Join our Email Newsletter for exclusive Articles, updates, and announcements.

Join our Email Newsletter

Section 7A was inserted in the Haryana Value Added Tax Act, 2003 (here-in-after referred to as the Act) effective from 2.4.2010 levying an additional tax in the nature of surcharge at 5% of the tax payable by a dealer registered under the Act. A retailer in lump sum composition scheme under Rule 52 of the Haryana Value Added Tax Rules, 2003 (here-in-after referred to as the Rules) has been specially excluded from the provision of this surcharge by section 7A of the Act.

It has now come to the notice of the department that there is some confusion among the lump sum composition dealers whether the surcharge is to be levied, collected and paid by them or not. The assessing authorities may also not be clear about this levy on lump sum composition dealers under the Act.

It is brought to your notice that there is no ambiguity in regard to the levy of surcharge on lump sum composition dealers. Also this issue has recently been decided by the Hon’ble Haryana Tax Tribunal in favour of the State in STA No.485 of 2012-13 in the case of M/s.Mahashiv Promoters (P) Limiited, Rohtak V/s State of Haryana (a copy is enclosed for ready reference).

Therefore, in the light of the above, it is quite clear that surcharge is to be levied and collected from the lump sum composition dealers availing lump sum schemes under different Rules except the lump sum paying retailers covered under the rule 52 of the Rules. All the assessing authorities working under your administrative control should be informed to implement the above provisions of law strictly.

Circular No. 41/St-1    Dated:-14.1.2014

(Refer the Complete Circular and Case Judgement Below)

About the Author:

CA Ankit Gulgulia

Author is Practicing Chartered Accountant in New Delhi/NCR and specialising in Indirect Taxes, Corporate Laws and Transfer Pricing. He can be reached at ankitgulgulia@gmail.com  +91-9811653975

DISCLAIMER: This article is provided purely for your information only and you should check other information sources before taking any action based on any of the content in this article. Neither the authors nor website hosting the article make any warranty as to the quality or currency of the information contained in any of the site’s articles.

Readers are advised to consult the professional for understanding applicability of this article as a matter of jurisprudence. While due care has been taken in preparing this document, the existence of mistakes and omissions herein is not ruled out. No part of this document should be distributed or copied (except for personal, non-commercial use) without our written permission.

Note : As a part of Our Quality Policy , We Don’t Publish any Restricted Material on our Website . If you have issues kindly let us know here

Related Tags CA Ankit Gulgulia, HVAT, updates 

Stay updated! Join our Email Newsletter for exclusive Articles, updates, and announcements.

Join our Email Newsletter
Notify of

Inline Feedbacks
View all comments