EXTRAORDINARY

PUBLISHED BY AUTHORITY

No. 1741, CUTTACK, TUESDAY, SEPTEMBER 18, 2018/ BHADRA 27, 1940

SECRETARIAT

THE ODISHA LEGISLATIVE ASSEMBLY

NOTIFICATION

The 18th September, 2018

No.8818/L.A.— The following Bill which has been introduced in the Odisha

Legislative Assembly on the 17th September, 2018 is herewith published under Rule-68 of

the Rules of Procedure and Conduct of Business in the Odisha Legislative Assembly for

general information.

THE ODISHA GOODS AND SERVICES TAX (AMENDMENT) BILL, 2018

BILL

TO AMEND THE ODISHA GOODS AND SERVICES TAX ACT, 2017.

BE it enacted by the Legislature of the State of Odisha in the Sixty-ninth Year

of the Republic of India as follows:—

1. (1) This Act may be called the Odisha Goods and Services Tax

(Amendment) Act, 2018.

(2) Save as otherwise provided, the provisions of this Act shall come into

force on such date as the State Government may, by notification, appoint:

Provided that different dates may be appointed for different

provisions of this Act and any reference in any such provision to the

commencement of this Act shall be construed as a reference to the

coming into force of that provision.

Short title and

commencement.

2. In section 2 of the Odisha Goods and Services Tax Act, 2017

(hereinafter referred to as the principal Act),––

(a) in clause (4),for the words “the Appellate Authority and the

Appellate Tribunal”, the words, brackets and figures “the Appellate

Authority, the Appellate Tribunal and the Authority referred to in sub-

section (2) of section 171” shall be substituted;

(b) in clause(16) for the words “Central Board of Excise and Customs”,

the words “Central Board of Indirect Taxes and Customs” shall be

substituted;

substituted, namely:—

“(h) activities of a race club including by way of totalisator or a license

to book maker or activities of a licensed book maker in such club; and”;

(d) clause (18) shall be omitted;

(e) in clause (35), for the word, brackets and letter “clause (c)”, the

word, brackets and letter “clause (b)” shall be substituted;

(f) in clause (69), in sub-clause (f), after the word and figures “article

371”, the words, figures and letter “and article 371J” shall be inserted;

(g) in clause (102), the following Explanation shall be inserted, namely:–

‘Explanation.––For the removal of doubts, it is hereby clarified that the

expression “services” includes facilitating or arranging transactions in

securities;’.

3. In section 7 of the principal Act, with effect from the 1st day of July, 2017,––

(a) in sub-section (1), ––

(i) in clause (b), after the words “or furtherance of business;”,

the word “and” shall be inserted and shall always be deemed to

have been inserted;

(ii) in clause (c), after the words “a consideration”, the word

“and” shall be omitted and shall always be deemed to have

been omitted;

(iii) clause (d) shall be omitted and shall always be deemed to

have been omitted;

Amendment

of section 2.

Odisha Act

7 of 2017

Amendment

of section 7.

(b) after sub-section (1), the following sub-section shall be inserted and

shall always be deemed to have been inserted, namely:––

“(1A) where certain activities or transactions constitute a supply

in accordance with the provisions of sub-section (1), they shall be

treated either as supply of goods or supply of services as

referred to in Schedule II.”;

sections (1) and(2)”, the words, brackets, figures and letter

“sub-sections (1), (1A) and (2)” shall be substituted.

4. In section 9 of the principal Act, for sub-section (4), the following sub-

section shall be substituted, namely:––

“(4) The Government may, on the recommendations of the Council,

by notification, specify a class of registered persons who shall, in respect

of supply of specified categories of goods or services or both received

from an unregistered supplier, pay the tax on reverse charge basis as the

recipient of such supply of goods or services or both, and all the provisions

of this Act shall apply to such recipient as if he is the person liable for

paying the tax in relation to such supply of goods or services or both.”.

5. In section 10 of the principal Act,—

(a) in sub-section (1), —

(i) for the words “in lieu of the tax payable by him, an amount

calculated at such rate”, the words, brackets and figures “in lieu of

the tax payable by him under sub-section (1) of section 9, an amount of

tax calculated at such rate” shall be substituted;

(ii) in the proviso, for the words “one crore rupees”, the words “one

crore and fifty lakh rupees” shall be substituted;

(iii) after the proviso, the following proviso shall be inserted,

namely:–

Amendment

of section 9 .

Amendment

of section 10.

“Provided further that a person who opts to pay tax under clause (a)

or clause (b) or clause (c) may supply services (other than those referred

to in clause (b) of paragraph 6 of Schedule II), of value not exceeding ten

per cent. of turnover in the State in the preceding financial year or five

lakh rupees, whichever is higher.”;

(b) in sub-section (2), for clause (a), the following clause shall be

substituted, namely:––

“(a) save as provided in sub-section (1), he is not engaged in

the supply of services;”.

6. In section 12 of the principal Act, in sub-section (2), in clause (a), the words,

brackets and figure “sub-section (1) of” shall be omitted.

7. In section 13 of the principal Act, in sub-section (2), the words, brackets and

figure “sub-section (2) of” occurring at both the places, shall be omitted.

8. In section 16 of the principal Act, in sub-section (2),––

(a) in clause (b), for the Explanation, the following Explanation shall be

substituted, namely:—

“Explanation.—For the purposes of this clause, it shall be deemed

that

the registered person has received the goods or, as the

case may be,

services––

(i) where the goods are delivered by the supplier to a recipient or any other

person on the direction of such registered person, whether acting as an

agent or otherwise, before or during movement of goods, either by way of

transfer of documents of title to goods or otherwise;

(ii) where the services are provided by the supplier to any person on the

direction of and on account of such registered person.”;

(b) in clause (c), for the word and figures “section 41”, the words, figures and

letter “section 41 or section 43A” shall be substituted.

Amendment

of section 12.

Amendment

of section 13.

Amendment

of section 16.

9. In section 17 of the principal Act,––

(a) in sub-section (3), the following Explanation shall be inserted, namely:––

‘Explanation.—For the purposes of this sub-section, the expression ‘‘value of

exempt supply’’ shall not include the value of activities or transactions

specified in Schedule III, except those specified in paragraph 5 of the said

Schedule.’;

(b) in sub-section (5), for clauses (a) and (b), the following clauses shall be

substituted, namely:—

“(a) motor vehicles for transportation of persons having approved

seating capacity of not more than thirteen persons (including the driver),

except when they are used for making the following taxable supplies,

namely:—

(A) further supply of such motor vehicles; or

(B) transportation of passengers; or

(aa) vessels and aircraft except when they are used––

(i) for making the following taxable supplies,

namely:—

(A) further supply of such vessels or aircraft; or

(B) transportation of passengers; or

vessels; or

(D) imparting training on flying such aircraft;

(ii) for transportation of goods;

(ab) services of general insurance, servicing, repair and

maintenance in so far as they relate to motor vehicles, vessels or aircraft

referred to in clause (a) or clause (aa):

Provided that the input tax credit in respect of such services

shall be available—

Amendment

of section 17.

(i) where the motor vehicles, vessels or aircraft referred to in

clause (a) or clause (aa) are used for the purposes specified therein;

(ii) where received by a taxable person engaged—

(I) in the manufacture of such motor vehicles,

vessels or aircraft; or

(II) in the supply of general insurance services in

respect of such motor vehicles, vessels or aircraft

insured by him;

(b) the following supply of goods or services or both—

(i) food and beverages, outdoor catering, beauty treatment,

health services, cosmetic and plastic surgery, leasing, renting

or hiring of motor vehicles, vessels or aircraft referred to in clause (a)

or clause (aa) except when used for the purposes specified therein,

life insurance and health insurance:

Provided that the input tax credit in respect of such goods or

services or both shall be available where an inward supply of such

goods or services or both is used by a registered person for making

an outward taxable supply of the same category of goods or services

or both or as an element of a taxable composite or mixed supply;

(ii) membership of a club, health and fitness centre; and

(iii) travel benefits extended to employees on vacation such as

leave or home travel concession:

Provided that the input tax credit in respect of such goods or

services or both shall be available, where it is obligatory for an

employer to provide the same to its employees under any law for the

time being in force.”.

10. In section 20 of the principal Act, in the Explanation, in clause (c), for the

words and figures “under entry 84,”, the words, figures and letter “under

entries 84 and 92A” shall be substituted.

11. In section 22 of the principal Act,––

(a) in sub-section (1), after the proviso, the following proviso shall be

inserted, namely:—

“Provided further that the Government may, at the request of a special

category State and on the recommendations of the Council, enhance the

aggregate turnover referred to in the first proviso from ten lakh rupees to

such amount, not exceeding twenty lakh rupees and subject to such

conditions and limitations, as may be so notified.";

(b) in the Explanation, in clause (iii), after the word “Constitution” the

words “except the State of Jammu and Kashmir and States of Arunachal

Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand”

shall be inserted.

12. In section 24 of the principal Act, in clause (x), after the words “commerce

operator”, the words and figures “who is required to collect tax at source under

section 52” shall be inserted.

13. In section 25 of the principal Act,––

(a) in sub-section (1), after the proviso and before the Explanation, the

following proviso shall be inserted, namely:––

“Provided further that a person having a unit, as defined in the

Special Economic Zones Act, 2005, in a Special Economic Zone or being

a Special Economic Zone developer shall have to apply for a separate

registration, as distinct from his place of business located outside the

Special Economic Zone in the same State.";

(b) in sub-section (2), for the proviso, the following proviso shall be

substituted, namely:––

Amendment

of section 20.

Amendment

of section 22.

Amendment

of section 24.

Amendment

of section 25.

28 of 2005.

"Provided that a person having multiple places of business in the State

may be granted a separate registration for each such place of business,

subject to such conditions as may be prescribed.".

14. In section 29 of the principal Act,––

(a) in the marginal heading after the word “Cancellation”, the words “or

suspension” shall be inserted;

(b) in sub-section (1), after clause (c), the following proviso shall be

inserted, namely:—

“Provided that during pendency of the proceedings relating to

cancellation of registration filed by the registered person, the

registration may be suspended for such period and in such

manner as may be prescribed.”;

be inserted, namely:—

“Provided further that during pendency of the proceedings

relating to cancellation of registration, the proper officer may

suspend the registration for such period and in such manner as

may be prescribed.”.

15. In section 34 of the principal Act,––

(a) in sub-section (1),––

(i) for the words “Where a tax invoice has”, the words “Where one or

more tax invoices have” shall be substituted;

(ii) for the words “a credit note”, the words “one or more credit notes

for supplies made in a financial year” shall be substituted;

(b) in sub-section (3),––

(i) for the words “Where a tax invoice has”, the words “Where one or

more tax invoices have” shall be substituted;

(ii) for the words “a debit note”, the words “one or more debit notes for

supplies made in a financial year” shall be substituted.

Amendment

of section 29.

Amendment

of section 34.

16. In section 35 of the principal Act, in sub-section (5), the following proviso

shall be inserted, namely:—

“Provided that nothing contained in this sub-section shall apply

any

department of the Central Government or a State Government or a local

authority, whose books of account are subject to audit by the

Comptroller and Auditor-General of India or an auditor appointed for auditing

the accounts of local authorities under any law for the time being in force.”.

17. In section 39 of the principal Act,––

(a) in sub-section (1),––

(i) for the words “in such form and manner as may be prescribed”, the words

“in such form, manner and within such time as may be prescribed” shall be

substituted;

(ii) the words “on or before the twentieth day of the month succeeding such

calendar month or part thereof ” shall be omitted;

(iii) the following proviso shall be inserted, namely:—

“Provided that the Government may, on the recommendations

of the Council, notify certain classes of registered persons who shall

furnish return for every quarter or part thereof, subject to such

conditions and safeguards as may be specified therein.”;

(b) in sub-section (7), the following proviso shall be inserted, namely:–

“Provided that the Government may, on the recommendations of the Council,

notify certain classes of registered persons who shall pay to the Government

the tax due or part thereof as per the return on or before the last date on

which he is required to furnish such return, subject to such conditions and

safeguards as may be specified therein.”;

(i) for the words "in the return to be furnished for the month or quarter during

which such omission or incorrect particulars are noticed", the words "in such

form and manner as may be prescribed" shall be substituted;

Amendment

of section 35.

Amendment

of section 39.

(ii) in the proviso, for the words “the end of the financial year”, the words “the

end of the financial year to which such details pertain” shall be substituted.

18. After section 43 of the principal Act, the following section shall be inserted,

namely:—

43A. (1) Notwithstanding anything contained in sub-section (2) of section

16,section 37 or section 38, every registered person shall in the returns

furnished under sub-section (1) of section 39 verify, validate, modify or

delete the details of supplies furnished by the suppliers.

(2) Notwithstanding anything contained in section 41, section 42 or

section 43,the procedure for availing of input tax credit by the recipient and

verification thereof shall be such as may be prescribed.

(3) The procedure for furnishing the details of outward supplies by the

supplier on the common portal, for the purposes of availing input tax credit

by the recipient shall be such as may be prescribed.

(4) The procedure for availing input tax credit in respect of outward

supplies not furnished under sub-section (3) shall be such as may be

prescribed and such procedure may include the maximum amount of the

input tax credit which can be so availed, not exceeding twenty per cent. of

the input tax credit available, on the basis of details furnished by the

suppliers under the said sub-section.

(5) The amount of tax specified in the outward supplies for which the

details have been furnished by the supplier under sub-section (3) shall be

deemed to be the tax payable by him under the provisions of the Act.

(6) The supplier and the recipient of a supply shall be jointly and

severally liable to pay tax or to pay the input tax credit availed, as the case

may be, in relation to outward supplies for which the details have been

furnished under sub-section (3) or sub-section (4) but return thereof has not

been furnished.

(7) For the purposes of sub-section (6), the recovery shall be made in

such manner as may be prescribed and such procedure may provide for

Insertion of new

section 43A.

“Procedure for

furnishing

return and

availing input

tax credit.

non-recovery of an amount of tax or input tax credit wrongly availed not

exceeding one thousand rupees.

(8) The procedure, safeguards and threshold of the tax amount in

relation to outward supplies, the details of which can be furnished under

sub-section (3) by a registered person,—

(i) within six months of taking registration;

(ii) who has defaulted in payment of tax and where such default has

continued for more than two months from the due date of payment of

such defaulted amount, shall be such as may be prescribed.”.

19. In section 48 of the principal Act, in sub-section (2), after the word and

figures “section 45”, the words “and to perform such other functions” shall be

inserted.

20. In section 49 of the principal Act,––

(a) in sub-section (2), for the word and figures “section 41”, the words,

figures and letter “section 41 or section 43A” shall be substituted;

(b) in sub-section (5),––

(i) in clause (c), the following proviso shall be inserted, namely:––

“Provided that the input tax credit on account of State tax shall be

utilised towards payment of integrated tax only where the balance of the

input tax credit on account of central tax is not available for payment of

integrated tax;”;

(ii) in clause (d), the following proviso shall be inserted, namely:––

“Provided that the input tax credit on account of Union territory

tax shall be utilised towards payment of integrated tax only where the

balance of the input tax credit on account of central tax is not available

for payment of integrated tax;”.

Amendment

of section 48.

Amendment

of section 49.

21. After section 49 of the principal Act, the following sections shall be

inserted, namely:––

49A. Notwithstanding anything contained in section 49, the input tax credit on

account of State tax shall be utilised towards payment of integrated tax or

State tax, as the case may be, only after the input tax credit available on

account of integrated tax has first been utilised fully towards such payment.

49B. Notwithstanding anything contained in this Chapter and subject to the

provisions of clause (e) and clause (f) of sub-section (5) of section 49, the

Government may, on the recommendations of the Council, prescribe the order

and manner of utilisation of the input tax credit on account of integrated tax,

central tax, State tax or Union territory tax, as the case may be, towards

payment of any such tax.”.

22. In section 52 of the principal Act, in sub-section (9), for the word and

figures “section 37”, the words and figures “section 37 or section 39” shall be

substituted.

23. In section 54 of the principal Act,—

(a) in sub-section (8), in clause (a), for the words “zero-rated supplies”, the

words "export" and "exports" shall respectively be substituted;

(b) in the Explanation, in clause (2) ,––

(i) in sub-clause (c), in item (i), after the words “foreign

exchange”, the words “or in Indian rupees wherever permitted by the

Reserve Bank of India” shall be inserted;

(ii) for sub-clause (e), the following sub-clause shall be

substituted, namely:––

“(e) in the case of refund of unutilised input tax credit

under clause (ii) of the first proviso to sub-section (3), the due date

for furnishing of return under section 39 for the period in which such

claim for refund arises;”.

Insertion of

new sections

49A and 49B.

“Utilisation of

input tax credit

subject to certain

conditions.

Order of

utilisation of

input tax

credit.

Amendment

of section 52.

Amendment

of section 54.

24. In section 79 of the principal Act, after sub-section (4), the following

Explanation shall be inserted, namely:—

‘Explanation.––For the purposes of this section, the word person shall

include “distinct persons” as referred to in sub-section (4) or, as the case

may be, sub-section (5) of section 25.’.

25. In section 107 of the principal Act, in sub-section (6), in clause (b), after

the words “arising from the said order,”, the words “subject to a maximum of

twenty-five crore rupees,” shall be inserted.

26. In section 112 of the principal Act, in sub-section (8), in clause (b), after

the words “arising from the said order,” the words “subject to a maximum of

fifty crore rupees,” shall be inserted.

27. In section 129 of the principal Act, in sub-section (6), for the words “seven

days”, the words “fourteen days” shall be substituted.

28. In section 143 of the principal Act, in sub-section (1), in clause (b), after

the proviso, the following proviso shall be inserted, namely:—

“Provided further that the period of one year and three years

may, on sufficient cause being shown, be extended by the Commissioner

for a further period not exceeding one year and two years respectively.”.

29. In section 166 of the principal Act, for the words “thirty days”, the words

“fourteen days” shall be substituted.

30. In Schedule I of the principal Act, in paragraph 4, for the words “taxable

person”, the word “person” shall be substituted.

31. In Schedule II of the principal Act, in the heading, after the word

“ACTIVITIES”, the words “OR TRANSACTIONS” shall be inserted and shall

always be deemed to have been inserted with effect from the 1st day of July,

2017.

Amendment

of section 79.

Amendment

of section 107.

Amendment

of section 112.

Amendment

of section 129.

Amendment

of section 143.

Amendment

of Schedule II.

Amendment

of Schedule I.

Amendment of

section 166.

32. In Schedule III of the principal Act, —

(i) after paragraph 6, the following paragraphs shall be inserted, namely:––

“7. Supply of goods from a place outside India to another place outside India

without such goods entering into India.

8. (a) Supply of warehoused goods to any person before clearance for home

consumption;

(b) Supply of goods by the consignee to any other person, by

endorsement of documents of title to the goods, after the goods have been

dispatched from the port of origin located outside India but before clearance

for home consumption.”;

(ii) the Explanation shall be numbered as Explanation 1 and after

Explanation 1 as so numbered, the following Explanation shall be

inserted, namely:—

‘Explanation2.––For the purposes of paragraph 8,

the expression“warehoused goods” shall have the same meaning as

assigned to it in the Customs Act, 1962.’.

52 of 1962.

Amendment of

Schedule III.

STATEMENT OF OBJECTS AND REASONS

The Odisha Goods and Services Tax Act, 2017 ( Act 7 of 2017) has come into

force w.e.f. 1^st July, 2017 to levy and collect tax on intra-State supply of goods or

services or both by the State Government.

2. The Act provides for certain provisions for smooth transition of existing

taxpayers to new goods and services tax regime. However, the new tax regime had

faced certain difficulties. One of the major inconveniences caused to the taxpayers,

especially small and medium enterprises, was the process of filing return and payment

of tax under the Goods and Services Tax laws. In this regard, the proposed new return

filing system envisages quarterly filing of return and tax payment for small taxpayers

along with minimum paperwork. In order to implement the new return filing system, and

also to overcome the above difficulties, it is proposed to amend the Odisha Goods and

Services Tax Act, 2017.

3. The proposed Odisha Goods and Services Tax (Amendment) Bill, 2018, inter

alia, provides for the following, namely:—

(i) to amend section 7 of the Act to clarify the scope of supply;

(ii) to amend section 9 of the Act empowering the State Government to notify

classes of registered persons to pay the tax on reverse charge basis in

respect of receipt of supplies of certain specified categories of goods or

services or both from unregistered suppliers;

(iii) to amend section 10 of the Act so as to enhance the limit of composition levy

from one crore rupees to one crore and fifty lakh rupees;

(iv) to amend section 17 of the Act to specify the scope of input tax credit;

(v) to amend section 22 of the Act to enhance the exemption limit for registration

in the special category States from ten lakh rupees to twenty lakh rupees;

(vi) to amend section 25 of the Act so as to facilitate tax payer to have the option

to obtain multiple registrations for multiple places of business located within the

same State and to provide for separate registration for Special Economic Zone

unit or developer;

(vii) to amend section 29 of the Act so as to insert a provision for temporary

suspension of registration while cancellation of registration is under process;

(viii) to insert a new section 43A so as to provide for the new system of filing

return and availing input tax credit;

(ix) to amend sub-section (6) of section 107 of the Act relating to Appeals so as

to provide that the amount of pre-deposit payable for filing of appeal shall be

capped at twenty five crore rupees;

(x) to amend section 129 of the Act so as to increase the period relating to

detention or seizure of goods and conveyance in transit from seven days to

fourteen days.

(xi) to amend section 166 of the Act for laying of notification under this Act

before the State Legislature for a total period of fourteen days.

The Bill seeks to achieve the above objectives.

SHASHI BHUSAN BEHERA

Member- in-Charge

A. K. SARANGI

SECRETARY

ODISHA LEGISLATIVE ASSEMBLY

Printed and published by the Director, Printing, Stationery and Publication,Odisha,Cuttack-10

Ex. Gaz. 1218-173+12