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No.VAT-1006/Resale Tax(Medicine)/71/Adm/3
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Trade Cir. No.21 T of
2007 |
Mumbai, Dt.27.02.2007 |
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Applicability of Resale Tax on Drugs and
Medicine under
Bombay Sales Tax Act, 1959.
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Gentlemen/Sir/Madam,
Queries have been received by this office regarding the applicability of
resale tax on medicines under the Bombay Sales Tax Act, 1959. The position is clarified as under:
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The provision for Resale Tax (R.S.T.) was
inserted w.e.f. 1st
April 2001
on goods specified in Schedule ‘C’ by section 10 of the B.S.T. Act, 1959. The section was again amended w.e.f.
1st May
2002. As per provisions of clause (iv) of section
10, resale of goods covered by entry 37
in Part-II of Schedule ‘C’ is required to be deducted from turnover of sales
while determining turnover of sales for levy of Resale Tax.
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At the same time, entry 146, in Group ‘A’
of Notification under section 41 was added w.e.f.
1st May
2002,
for exemption of R.S.T. on retailers w.e.f.
1st April
2001
subject to some conditions and restrictions.
The said notification entry was deleted retrospectively w.e.f. 1st
May 2002 vide Notification
No.STA-2004/CR-24/Taxation-2 dated 22nd
July 2004.
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It is clarified that the entry 146, in
Group ‘A’ of Notification under section 41 had become redundant as exemption of
R.S.T. on drugs and medicine covered under Schedule Entry C-II-37 was provided
by the section
itself. R.S.T. is not leviable on drugs and medicine w.e.f.
1st May 2002 although the
notification entry 146 has been deleted with effect from
1st
May 2002.
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This
circular cannot be made use of for legal interpretation of provisions of law as
it is clarificatory in nature. If any member of the trade has any doubt, he may
refer the matter to this office for further clarification.
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You are requested to bring the contents
of this circular to the notice of the members of your association.
Yours faithfully,
(B.C.KHATUA.)
Commissioner of Sales Tax
Maharashtra State, Mumbai. |
