Karnataka Value Added Tax Act, 2003

Applicability:

The Karnataka Value Added Tax Act comes into from 1^st day of April, 2005. The Act is applicable to the whole state of Karnataka.

Registration:

Every dealer liable to register under section 22 shall submit application for registration in Form VAT -1 to the Local VAT office along with following documents:

·            Registration Fee of Rs.500/-

·            Certificate of Incorporation & Memorandum and Articles of Association/ Partnership Deed etc.

·            List of Directors

·            2 color photographs of Proprietor/Partners/Directors

·            Proof of Address

·            Details of Additional place of business in Form VAT – 3.

·            Details of all Partners in Form VAT – 4.

·            Security Deposit as demanded by the Local VAT Office.

On receipt of application for registration, the concerned VAT Officer will scrutinize the documents and on verification of place of business, if satisfied, will grant the certificate of Registration.  For Amendment/modification in the Registration Certificate, application shall be made in Form VAT -2 to the Local VAT Office. After scrutiny of the documents, Local VAT Officer will modify the Certificate.

Payment of Tax:

VAT for the particular month has to paid on or before 20^th day of subsequent month.

Returns:

The registered dealer has to file monthly as well as Annual Return to the Local VAT Office. Monthly Return has to be filed in Form VAT -100 on or before 20^th day of the subsequent month.

Annual Audited statement of Accounts has to be filed in Form VAT-240 on or before 31^st day of December.

Basics of Service Tax

Applicability:

Chapter V of the Finance Act, 1994 deals with the with provisions of Service Tax.  Provisions of this chapter extend to the whole of India except the state of Jammu and Kashmir. All Service providers shall apply and get themselves registered under the Act if the aggregate value of taxable services provided during the year exceeds Rupees Ten Lakhs.

Registration:

Application for registration has to be made in Form ST -1  to the superintendent of Central Excise of the concerned area along with necessary documents such as PAN copy, Memorandum and Articles of Association/Partnership Deed, List of Directors, List of Branch etc. On verification of application and accompanied documents, the Commissioner of Central Excise having jurisdiction over the area will grant the registration. On registration the Commissioner allot a Service Tax Registration number based on the PAN number of the applicant.

Payment of Service Tax:

All assessees shall pay the Service Tax to the credit of Central Government on or before 5^th day of the subsequent month.

Records:

Every assessee should maintain all records for a period of at least five years which are relating to transactions relating to –

a.       Services provided irrespective of whether taxable or exempted;

b.      Receipt/procurement of input services and payment for input services

c.       All the documents relating to input and capital goods

d.      All other financial records to be maintained in the normal course of business.

Returns:

Every assessee should file half yearly return in From ST-3 along with Form TR-6 on or before 25 days after the expiry of the half year i.e. 25^th October and 25^th April of the concerned financial year.

Basic of the Factories Act, 1948

Applicability:

The Factories Act, 1948 is applicable where-

i.                     10 or more workers employed in establishments which uses power

ii.                   20 or more workers employed in establishments which does not use the power

iii.                  Establishments engaged in the activity which is notified by the Government.

Approval of Plans / Drawings:

Prior approval of the Inspector of the Dept. of Factories of the concerned area have to be obtained for the construction of the new building or expansion/modification of the existing building. Applicant has to submit the application along with Fees, Stability Certificate, Land possession certificate, Clearance certificate from Pollution Control Board, 3 sets of Flow chart of manufacting process and any other documents as may be required by the Inspector without fail. On receipt of application, Department will scrutinize all the documents and grant the approval within 30 days from the date of submission, if the same is order.

Granting of Factory License:

Application for registration and granting of Factory license has to be made within 15 days from the date of commencement of the manufacturing activity in the factory. Application has to be accompanied by Fees, Memorandum and Articles of Association/ Partnership Deed, List of Directors, Health and safety policy etc. On receipt of application, Inspector of Factories will scrutinize the documents and visit the factory and on verification issue the license within 30 days.

Renewal of Factory License:

Application for renewal of the Factory License has to be made at least two month before the expiry of the License along with the original license, List of Directors and Fees. Renewals may be given to period of three years.

Welfare Measures:

Factories are under an obligation to provide certain amenities such as Drinking Water, Washing facilities, Latrine, Urinal accommodation, First aid appliances, Rest room, Creche, Canteen, Ambulance rooms, Health centers etc.

Statutory Registers:

Every factory establishments are required to maintain certain statutory registers such as Muster Roll, Register of Leaves with Wage, Overtime Register, Health Register etc.

Annual Return:

Every establishments should file combined annual return in Form No. 20 on or before 31^st January of every year without fail.

Statutory Compliance - November, 2010 - Due dates for Karnataka, India

Act	Particulars	Due date
EPF Act	Pay P.F.Deductions for the month of October, 2010	Before 15th November
EPF Act	Submit monthly return for the month of October, 2010 in Form 5 (along with Form 2, 10, 12 & 12A)	Before 25th November
EPF Act (in respect of international workers)	Submit monthly statement (for the month of October, 2010) IW-1 relating to details of Employyes qualifying for membership as International workers along with Form 5 (for unexempted) /Form 4 PS (for exempted)*	Before 15th November, 2010
ESI Act	Make ESI payments for the month of October, 2010	Before 21st November, 2010
Professional Tax	Submit Form 5  and pay Tax deducted from employees' salary/wages	Before 20th November, 2010
Water Cess Act & Rules	Pay Water Cess and submit return for the month of October, 2010	Before 5th November, 2010
Service Tax	Pay Service Tax for the month of October, 2010	Before 5th November, 2010
Sales Tax	Pay VAT and CST for the month of October, 2010	Before 20th November, 2010

The Industrial Disputes (Amendment) Act, 2010

Parliament of India has passed the Industrial Disputes (Amendment) Act, 2010 on 18.08.2010. The same has come to into force w.e.f. 15.09.2010.

The amended Act increased the wage limit for covering under the definition of workmen from Rs. 1600/- per month to Rs. 10,000/- per month. It also put responsibility on the establishments having 20 or more workmen to provide grievance redressal machinery with one stage appeal to the employer.

Renewal of Factory Licence in Karnataka, India

If the Factory License is expiring on 31^st December, 2010, then application for renewal of the license shall be made in Form No.2 (in triplicate) on or before 31^st October, 2010 with the Registering Authority.