Entry tax has been introduced on entry of goods into local areas for consumption, sale or use therein with effect from 1-10-2002. At present, entry tax is levied on 17 products only, in addition to the levy of entry tax on motor vehicles under the Maharashtra Motor Vehicles Entry Tax Act, 1987.

Levy of Entry Tax

  ♦  Entry tax is levied when goods are brought into the local areas from outside the State or from outside the country for consumption, use or sale.

  ♦  No entry tax will be levied if the goods are brought into the local area from another local area in Maharashtra.

The definition of 'local area' under Section 2(1)(h) is very wide term and covers all the areas in the State of Maharashtra.

Liability for Entry Tax

  ♦  The liability to pay entry tax is on the importer, who may be the owner of the goods or even the agent of the owner, such as C & F agent, Consignment agent, etc.

  ♦  Entry Tax is levied on the 'value of the goods' imported into the local area.

 —  Section 2(1)(n) defines 'value of the goods' which means the purchase cost including cost of transportation, packing, forwarding, handling charges, commission, insurance, taxes, duties, etc. However, octroi or entry tax paid under any other law will be excluded.

 —  If the goods are not purchased by the importer, the value of the goods will be the value recorded in the documents accompanying the goods.

 —  If the documents accompany the goods, the value will be the fair market value of the goods imported.

Reduction of Entry Tax Liability

  ♦  The entry tax payable in respect of the goods brought into the local area will be reduced by the tax paid relating to General Sales Tax in any other State or Union Territory in India.

  ♦  However, no reduction will be allowed of the Central Sales Tax paid on inter-State purchases.

Set-off of Entry Tax under BST Act and MVAT Act

  ♦  The Bombay High Court in the case of [Eurotex Industries and Exports Ltd. vs. State of Maharashtra (135 STC 25)] has held Entry Tax cannot be levied at a rate which is higher than the 'effective rate' under BST Act. The 'effective rate' would be the liability after grant of set-off under the BST Act. Accordingly entry 13 of the Schedule to the Entry Tax Act was held ultra vires. The said entry had been revived for the periods 1-10-2002 to 31-3-2005 vide Maharashtra Act No. XXV of 2007.

  ♦  After this judgment vide Mah. Act. No. 13 of 2004, Section 42 of the BST Act has been amended with retrospective effect from 1-10- 2002 to allow set-off of the Entry Tax paid under the BST Act. This set-off is available under Rules 41D, 41F, 42AB, 42AC, 42AD, 43D of the BST Rules with effect from 1st July, 2004. No set-off is available where the goods imported are tax free goods or are exempted under section 41 notifications under the BST Act, 1959.

  ♦  The MVAT Act also provides for grant of set-off of Entry Tax paid in accordance with provision of Section 48 and Rules 52 to 55.

Exemption from payment of Entry Tax

  ♦  No entry tax is payable if the goods are brought into the local area for processing as may be prescribed and the processed goods are sent outside the State. The processes will be prescribed by notification in the Official Gazette.

  ♦  No entry tax is payable if the goods are brought into the local area for resale within the State or sale in the course of inter-State trade or for export outside country.

  ♦  No entry tax is payable on the fuel or consumables contained in the fuel tank of a goods vehicle entering the local area for its own consumption.

  ♦  If the goods imported without payment of Entry Tax are not dealt with in the manner stated above, the importer will have to inform the assessing authority by the 25th of the succeeding month and deposit the entry tax which otherwise would have been payable.

Registration

  ♦  Every importer registered under the BST Act, 1959 or who is liable for registration under the BST Act, 1959 and who are liable to pay entry tax has to apply and obtain entry tax registration. Liability for registration and payment of Entry Tax will be from the first import irrespective of the turnover of the goods imported.

  ♦  However, importers who are registered under the BST Act, 1959 or who are liable to obtain registration, but who are not liable to pay entry tax are not required to obtain entry tax registration.

Payment of Entry Tax and Returns

  ♦  Any other importer, who is not registered or is not liable to obtain registration under the BST Act, 1959, will be liable to pay Entry Tax and will have to obtain registration if the value of the goods specified in the Schedule, imported in a financial year exceeds ₹ 10,000. An importer who does not import any of the specified goods is not liable to obtain registration.

  ♦  The application for registration is to be made in Form 1 within 30 days of the importer becoming liable to pay entry tax. A single application is required to be made for all places of business in Maharashtra.

Payment of Entry Tax and Returns

  ♦  The return is required to be filed in Quadruplicate, of which the 'Original' and the 'Duplicate' portion returned to the importer.

  ♦  The Bank will retain the 'Triplicate' and the 'Quadruplicate' portions, of which the 'Quadruplicate' will be sent by the Bank to the assessing authority.

  ♦  The 'Duplicate' portion will have to be submitted to the assessing authority. The time limit for submit 'Duplicate' portion will be the same as prescribed above for filing of payment of taxes.

  ♦  The return can be revised within 3 months from the due date of the original return.

  ♦  The provisions & procedures under MVAT Act & Rules relating to electronic filing of returns, electronic payment of tax etc. electronic application or appeal or any other electronic documents has been made applicable to this Act w.e.f. 1-4-2016.

  ♦  Rule 8 of Entry tax is amended retrospectively w.e.f. 01-04-2005 to provide that limitation period of the MVAT Act equally apply to assessments under the Entry Tax Act.

Schedule (with effect from 1-4-2005)

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