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section 4

Amendment of Act 15 of 1963

The Kerala Finance Act, 2025
Tax202533 sections
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Statutory text

-1 4. Amendment of Act 15 of 1963.―In the Kerala General Sales Tax Act, 1963 (15 of 1963),―

  1. (1) in section 2,—
    • (a) for clause (xii), the following clause shall be deemed to be substituted, with effect from 1st July, 2017, namely:― “(xii) “goods” means i. petroleum crude; ii. high-speed diesel; iii. motor spirit (commonly known as petrol); iv. Aviation turbine fuel; and v. alcoholic liquor for human consumption;”;
    • (b) clause
    • (xvB) and clause (xxiib) shall be omitted;
  2. (2) in section 14, sub-section
  3. (5) shall be omitted;
  4. (3) in section 17D, in sub-section (2), in clause (e), in sub-clause (i), the words, figure and letter “or section 29A” shall be omitted;
  5. (4) for section 23B, the following section shall be substituted, namely:― “23B. Reduction of arrears in certain cases.—(1) Notwithstanding anything contained in this Act or rules made thereunder or in any judgment, decree or order of any court, tribunal or appellate authority, any assessee, who is in arrears of tax, interest or penalty payable under the provisions of clause
    • (b) of sub-section
  6. (1) and sub-section
  7. (2) of section 5 or section 7 of the Act may opt to settle the arrears in any of the assesment orders pertaining to the period from 1st April, 2005 to 31st March, 2021 on payment of principal amount of the tax and cess along with fifty percentage of interest in arrears as on the date of application and on such payment, penalty and the balance fifty percentage of the interest shall stand waived off: Provided that in case where the evidence, details and records pertaining to the penalty levied is not utilized or not liable to be utilized for any best judgment assessment under this Act, the demand relating to such penalty shall be settled under this section on payment of applicable tax relating to such penalty along with fifty percentage of the interest applicable on such tax as on the date of application: Provided further that on settlement of arrears pertaining to any of the financial year belonging to the aforementioned period, if no other sales tax or turnover tax remains to be settled in that particular year, then all the penalties pertaining to that year other than the penalty mentioned in the first proviso shall be deemed to be settled under sub-section (1).
  8. (2) Any assessee who intends to opt for settlement of arrears under sub-section
  9. (1) shall, on or before 30th June, 2025 submit an application before the assessing authority, in such form and in such manner as may be prescribed, accompanied with proof of payment of the amount made as per sub-section
  10. (1) through e-treasury portal.
  11. (3) Separate application shall be filed for settling the arrears pertaining to each assessment order.
  12. (4) The assessee shall withdraw all the cases pending before any appellate, revisional authority or tribunal under the Act or courts for opting to settle the arrears as per sub-section
  13. (1) and shall file the application accompanied by a copy of leave to withdraw granted by the authority or tribunal or court, as the case may be: Provided that the cases wherein the appeal filed by the Government is pending before any authority or tribunal under the Act or any courts may also be settled under this sub-section by making payment of the tax as per the demand in the original assessment order along with fifty percentage of the applicable interest as on the date of application. The assessing authority shall, on receipt of such application, seek for an adjournment of the cases to the appellate, revisional authority or tribunal under the Act or court until intimation regarding disposal of such cases and on settlement of such cases as per the demand in the original order, Government shall withdraw such appeals forthwith.
  14. (5) The assessing authority on receipt of the application with proof of payment shall verify the correctness of the application and the payment made and discrepancies, if any, shall be intimated to the assessee within one month, in such form and in such manner as may be prescribed.
  15. (6) The discrepancies under sub-section
  16. (5) shall be rectified by the assessee within a period of one month of receipt of the intimation in such manner as may be prescribed: Provided that no opportunity for rectification shall be granted more than once.
  17. (7) On settlement of the arrears pending as on the date of making payment of the amount specified under sub-section (1), the assessing authority shall issue an order of settlement within a period of one month in such manner as may be prescribed.
  18. (8) Subject to the provisions of section 55C, if an assessee who opts to settle his arrears under sub-section
  19. (1) has remitted or deposited any amount towards the arrears under this Act after the service of demand notice, such amounts shall be given credit as tax and interest, and the assessee shall furnish the proof of payments made in this regard.
  20. (9) Notwithstanding anything contained in the Kerala Revenue Recovery Act, 1968 (15 of 1968) reduction of arrears under sub-section
  21. (1) shall be applicable to those cases in which revenue recovery proceedings have been initiated and the assessing authorities shall have the power to collect such amounts on settlement under sub-section
  22. (1) and where the amount is settled under sub-section
  23. (1) the revenue recovery proceedings against such assessees shall be deemed to have withdrawn on the 1st day of April, 2025 which shall then be binding on the revenue authorities, and such assessees shall not be liable for payment of any collection charge leviable by such revenue authorities.
  24. (10) Assessees who opted to settle their arrears under this section during previous years, but had failed to make payments may also opt to settle their cases under this section, and the amounts, if any, paid earlier, after the service of the demand notice, shall be given credit as tax and interest subject to the provisions of section 55C and the assessee shall furnish the proof of payments made in this regard.
  25. (11) Notwithstanding anything contained in this Act, or in any judgment, decree or order of any court, tribunal or appellate authority, there shall not be any refund or any adjustment subsequently for the amount settled under this section, under any circumstances.
  26. (5) after section 23BA, the following sections shall be inserted, namely:— “23BB. Distillery Arrear Settlement Scheme, 2025.—(1) Notwithstanding anything contained in this Act, or in any judgment, decree or order of any court, tribunal or appellate authority, an assessee who is in arrears of turnover tax payable under sub-clause
    • (b) of clause
      • (i) of sub-section
  27. (2) of section 5 of the Act pertaining to the tax period from 1st June, 2022 to 30th November, 2022 may opt to settle the arrears pending as on 1st day of April, 2025 on payment of the turnover tax payable and on such payment, the interest and penalty shall stand waived off: Provided that in case where the evidence, details and records pertaining to the penalty levied for the said period is not utilized or not liable to be utilized for any best judgment assessment under this Act, the demand relating to such penalty shall be settled under this scheme on payment of applicable turnover tax relating to the penalty as determined by the assessing authority: Provided further that on settlement of arrears pertaining to the aforementioned period, if no other turnover tax or sales tax remains to be settled, then all the penalties pertaining to the period other than the penalty mentioned in the first proviso shall be deemed to be settled under the scheme.
  28. (2) Any assessee who intends to opt for settlement of arrears under the scheme shall make payment of the amount due as on the 1st day of April, 2025 electronically through e-treasury portal and proof of such payment shall be produced before the assessing authority on or before 30th June, 2025.
  29. (3) The assessing authority on receipt of the proof of payment shall verify the correctness of the payment and short-payment, if any, shall be intimated to the assessee within one month of receipt of the proof of payment.
  30. (4) The short-payment, if any, intimated as per sub-section
  31. (3) shall be remitted by the assessee within 15 days of receipt of the intimation: Provided that no opportunity for payment of the short paid amount shall be granted more than once.
  32. (5) The assessing authority on receipt of the proof of payment as per sub-sections
  33. (3) and
  34. (4) shall verify the correctness of the payment and if the payment is complete as per the provisions of this scheme, an order of settlement in writing shall be issued within one month of receipt of such payment.
  35. (6) The assessee who opts to settle his arrears under the scheme shall withdraw all the cases pending before any appellate or revisional authority, tribunal under the Act or courts and a copy of leave to withdraw granted by the appellate, revisional authorities or courts, as the case may be, shall also be, produced along with the proof of payment before the assessing authority: Provided that the cases wherein the appeal filed by the Government is pending before any appellate or revisional authority, tribunal under the Act or any courts may also be settled under the scheme by making payment of the demand in the original assessment order. The assessing authority shall, on receipt of such payment as per sub-section (2), seek for an adjournment of the cases to the appellate or revisional authority, tribunal under the Act or any courts, as the case may be, until intimation regarding disposal of such cases and on settlement of such cases, as per the demand in the original order, Government shall withdraw such appeals forthwith.
  36. (7) Notwithstanding anything contained in section 55C, if an assessee who opts to settle his arrears under sub-section
  37. (1) has remitted or deposited any amount towards the arrears under this Act after the service of demand notice, such amounts shall be given credit as tax and the assessee shall furnish the proof of payments made in this regard.
  38. (8) Notwithstanding anything contained in the Kerala Revenue Recovery Act, 1968 (15 of 1968), reduction of arrears under sub-section
  39. (1) shall be applicable to those case in which revenue recovery proceedings have been initiated and the assessing authorities shall have the power to collect such amounts on settlement under sub-section
  40. (1) and where the amount is settled under sub-section
  41. (1) the revenue recovery proceedings against such assessees shall be deemed to have withdrawn on the 1st day of April, 2025 which shall then be binding on the revenue authorities, and such assessees shall not be liable for payment of any collection charge leviable by such revenue authorities.
  42. (9) Notwithstanding anything contained in this Act, or in any judgment, decree or order of any court, tribunal or appellate authority, there shall not be any refund or any adjustment subsequently for the amount settled under this scheme, under any circumstances. 23BC. Power to remove difficulties.―(1) If any difficulty arises in giving effect to any of the provisions of sections 23B and 23BB, the Commissioner of State Tax may, by order, not inconsistent with the provisions of the aforementioned section or sections, remove such difficulty: Provided that no such order shall be made after the expiry of a period of one year from the date of commencement of the said sections.
  43. (2) Every order issued under sub-section
  44. (1) shall be laid before the Legislative Assembly by the Government.”;
  45. (6) in section 29,—
    • (a) in the marginal heading, the words “and inspection of goods in transit” shall be omitted;
    • (b) sub-sections (2), (2A), (3), (4),
  46. (5) and
  47. (6) shall be omitted;
  48. (7) for section 29A, the following section shall be substituted, namely:― “29A. Inspection of goods in transit or storage.―(1) Any person in charge of a conveyance carrying any consignment of goods or in charge of goods stored as part of transit or otherwise shall be accompanied by such documents as may be prescribed.
  49. (2) The Commissioner of State Tax shall be empowered to specify by notification the additional conditions for carrying goods in transit or for storage of goods while in transit or otherwise, and the documents to accompany such goods.
  50. (3) Where any person transports consignment of goods or stores goods as part of transit or otherwise, an officer not below the rank of Assistant State Tax Officer may intercept or inspect such goods and require the person in charge to produce the document prescribed under sub-section
  51. (1) or
  52. (2) or both, as the case may be. The person in charge shall be liable to produce the document and allow inspection of the goods.”;
  53. (8) for section 30E, the following section shall be substituted, namely:― “30E. Confiscation of goods, conveyance or both.―(1) Notwithstanding anything contained in this Act, any person who is found to be in charge of any goods in contravention of the provisions of sub-section
  54. (1) or
  55. (2) of section 29A, then all such goods and the conveyance, if any, used as a means of transport for carrying the said goods and related documents shall be liable to detention or seizure by an officer not below the rank of Assistant State Tax Officer, for verification.
  56. (2) The officer on detaining or seizing the goods referred above for verification suspects that the owner or person in charge of the goods has violated the provisions of sub-section
  57. (1) or
  58. (2) of section 29A, a notice shall be issued to the person in charge of the goods or conveyance or both, as the case may be, within two days of the detention or seizure, in such manner as may be prescribed, informing him of the reason for the seizure and detention and shall provide an opportunity of being heard.
  59. (3) If the owner or person in charge of the goods referred above proves the bonafide of the transport or storage of goods within three days of the seizure and detention, the authorized officer shall release the goods and the conveyance, if any.
  60. (4) If the owner or person in charge of the goods fails to prove the bonafide of the transport or storage as per sub-section (3), all such goods or conveyance or both, as the case may be, shall be liable to confiscation by the officer referred to above and the owner or person in charge of the goods or conveyance or both, as the case may be, shall be liable to pay a penalty equal to double the amount of applicable tax and cess.
  61. (5) Whenever confiscation of any goods or conveyance or both, as the case may be, is authorised by this Act, the officer shall give to the owner of the goods an option to pay in lieu of confiscation, such fine as the said officer thinks fit: Provided that such fine leviable shall not exceed the market value of the goods confiscated: Provided further that the aggregate of such fine and penalty leviable shall not be less than one third of the market value of the goods confiscated. Explanation.―For the purpose of this section, the term “market value” shall be the full amount which any person is required to pay in order to purchase such goods from the retail outlet of such goods within the State.
  62. (6) Whereas the conveyance detained, if any, is a carriage hired for transporting goods, the owner or the person in charge of the conveyance shall have the option to pay in lieu of confiscation of the conveyance, a fine equal to double the amount of tax and cess applicable on the goods being carried with or fifty thousand rupees, whichever is higher: Provided that the conveyance shall be released on payment of such fine subject to the condition that the owner or person in charge of the conveyance shall make arrangements for safe storage of the goods carried with and also shall bear the cost for such storage.
  63. (7) Wherein the owner or person in charge of the goods or conveyance or both, as the case may be, fails to prove the bonafide of the transport, the officer shall serve a notice to the owner or person in charge of the goods or conveyance or both intimating the reason for the confiscation of the goods or conveyance or both, in such form and in such manner as may be prescribed, within five days of detention or seizure as per sub-section (2).
  64. (8) The owner or the person in charge of the goods or conveyance in lieu of confiscation may make payment of such fine mentioned in sub-section
  65. (5) within fifteen days of receipt of the notice referred to in sub-section (7).
  66. (9) Wherein the owner or person in charge of the goods or conveyance seeks further time for payment of the fine as per sub-section (5), the officer in charge may grant a further time period not exceeding seven days.
  67. (10) If the owner or person in charge of the goods or conveyance makes payment of the penalty referred to in sub-section
  68. (4) and the fine referred to in sub-section
  69. (5) within the period mentioned under sub-section
  70. (8) or (9), as the case may be, all the proceedings in respect of the notice specified in sub-section
  71. (7) shall be deemed to be concluded.
  72. (11) If the owner or person in charge of the goods or conveyance fails to remit the penalty referred to in sub-section
  73. (4) and the fine referred to in sub-section (5), within the period mentioned under sub-section
  74. (8) or (9), as the case may be, the officer shall issue an order, in such form and manner, finalising the confiscation of the goods or conveyance or both, as the case may be, within forty five days of issuance of the notice referred to in sub-section (7).
  75. (12) The officer adjudging the confiscation shall take and hold possession of the goods or conveyance or both and every officer of Police, on the requisition of such proper officer, shall assist him in taking and holding such possession.
  76. (13) Where an order of confiscation under this section has become final in respect of any goods and/or conveyance or both, as the case may be, the goods or conveyance or both so confiscated shall be liable to be sold or disposed off otherwise to recover the penalty payable under sub-section
  77. (4) in such manner as may be prescribed.
  78. (14) Notwithstanding anything contained in the Act or rules made thereunder, where the confiscated goods are perishable, hazardous, or explosive in nature, the officer shall reduce the period of finalisation of confiscation and dispose off the said goods within such reduced time period. Explanation.―For the purpose of this section, “conveyance” includes a vessel or a vehicle.”;
  79. (9) section 30F shall be omitted;
  80. (10) section 31 shall be omitted;
  81. (11) in section 34, in sub-section (1),―
    • (i) the word and symbol “,section 29” shall be omitted;
    • (ii) after the words, figure and letter “or section 30A”, the symbol, words, figure and letter, “, or section 30E” shall be inserted;
  82. (12) section 45B shall be omitted;
  83. (13) after section 57, the following section shall be inserted, namely:― “57A. Power of Commissioner of State Tax to issue instruction.―Subject to the provisions of the Act, the Commissioner of State Tax may, from time to time, issue instructions and directions as he may deem fit for the implementation of this Act in a unified manner.”.

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