Haryana Cabinet approves amendment in VAT rules

Chandigarh, Oct 21 (UNI) The Haryana Cabinet today approved the proposal of Excise and Taxation Department to amend Haryana VAT Rules, 2003 to expand the scope of scheme of interest free loan (IFL) under Industrial Policy, 2005.

''Now mega units coming up in backward areas shall be entitled to get benefit of conversion of 50 per cent of VAT paid on the sale of such goods into interest free loan for a period of seven years from the date of commercial production repayable after a period of five years from the date of grant of IFL,'' an official spokesman said.

Small scale industrial units coming up in backward areas would get similar benefit for a period of five years from the date of commercial production repayable after a period of five years from the date of grant of interest free loan, he said.

Food processing units coming up anywhere in the State would get similar benefit of conversion of 75 per cent of VAT paid into IFL for a period of five years from the date of commercial production repayable after a period of five years from the date of grant of interest free loan.

Downstream industries of Indian Oil Corporation Ltd (IOCL), to be set up in the industrial park to be established as part of Petro Chemical Hub, would be entitled to get benefit of conversion of 50 per cent of VAT paid on the sale of goods produced into interest free loan for a period of seven years from the date of commercial production repayable after a period of seven years from the date of grant of IFL.

The quantum of interest free loan would be determined on a basis of tax actually paid along with the returns filed in the Department of Excise and Taxation under the Haryana Value Added Tax Act, 2003 only in respect of intra-state sales of manufactured goods for consumption within the state, except plant and machinery.

The use of such goods as raw material in manufacturing of other goods within the state would not be considered as consumption within the state.

It may be recalled that a provision had been made in the Industrial Policy, 2005 since June 6, 2006 for grant of interest free loan to mega projects in backward areas, small scale industries in backward areas, food processing industries throughout the state and downstream industries of IOCL.

UNI MA SG SB1559