ZERO RATED SALE RESTRICTED TO
COMMERCIAL ACTIVITIES IN RESPECT OF
SPECIAL ECONOMIC ZONES
In Section 18 (1) (ii) of
the Tamil Nadu Value Added Tax Act, 2006, the expression for the purpose of use in manufacture, trading,
production, processing, assembling, packaging or for use as packing material or
packing accessories, has been inserted with effect from 29.1.2016
and the zero rated sale of goods to any registered dealer located in Special
Economic Zone in the State is restricted to commercial activities only.
The sales made to any
registered dealer located in Special Economic Zones for other purposes (other than for the purpose of use in manufacture, trading, production,
processing, assembling, packaging or for use as packing material or packing
accessories) were not Zero Rated
sale and hence liable for taxation.
Section 18. Zero-rating. -- (1) The following shall be zero rate sale for the
purpose of this Act, and shall be eligible for input tax credit or refund of the
amount of the tax paid on the purchase
of
goods specified in the First Schedule including capital goods, by a registered
dealer in the State, subject
to such restrictions and conditions as may be prescribed:-
(i) A sale
as specified under sub-section (1) or (3) of section 5
of the
Central Sales Tax Act, 1956; (Central Act 74 of 1956).
(ii) Sale of goods to any registered
dealer located in Special
Economic Zone in the State,
for
the purpose of use in manufacture, trading, production, processing, assembling,
packaging or for use as packing material or packing accessories, if such registered dealer has been
authorized to establish such units by the authority
specified by the Central Government in this behalf; and
(iii) Sale of goods to International Organizations listed out in
the
Fifth Schedule.
(2) The dealer, who makes
zero
rate sale, shall be entitled to refund of input tax paid by him on purchase of those goods,
which are exported as such or consumed or used in the manufacture of
other goods that are exported as specified in sub-section (1), subject to such
restrictions and conditions as may be prescribed.
(3) Where the dealer has not adjusted the input tax credit or has not
made
a claim for refund within a period of one hundred and eighty days
from
the date of making
zero
rated sale such credit shall lapse to
Government.
https://ctd.tn.gov.in/documents/10184/10943/217+%28Act+No.13%29/5c4ced0a-6170-4f1e-b1ba-741f5f596885?version=1.1
https://ctd.tn.gov.in/documents/10184/10943/217+%28Act+No.13%29/5c4ced0a-6170-4f1e-b1ba-741f5f596885?version=1.1