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How and to whom the Rs. 50 Crores LBT Amendment is Applicable?




Maharashtra Provincial Municipal Corporations Act, 1949, is the Act under which levy of LBT (Local Bodt Tax) is being made in certain municipal corporations w.e.f. 1st April 2013, replacing Octroi in certain cities in Maharashtra. This Act is now known as The Maharashtra Municipal Corporations Act (Act No. LIX of 1949).

In exercise of the powers conferred by the above Act, the Government of Maharashtra, made rules vide Notification No. LBT-0209/CR-65/09/UD-34, dated 25th March 2010 namely “Bombay Provincial Municipal Corporations (local body tax) Rules, 2010”. These rules are now known as The Maharashtra Municipal Corporation (Local body Tax) Rules, 2010. The Government of Maharashtra has now come with a Notification No. LBT- 2015/CR-47/UD-32 dated 23rd July 2015, which amendments the LBT Rules, 2010. This amendment can bring some cheer to the trading community which was protesting and fighting for the abolition of the LBT in Maharashtra.

According to these amendments the dealer is liable for LBT registration only when his turnover of sales or turnover of purchases, for any period and during any year on or after 1st April, 2015 is not less than Rs. 50 Crores. This is as per the amendment to Rule 3. And according the amendment to Rule 17 the dealer may apply for the cancellation of his registration if neither the turnover of sales nor the turnover of purchases, during year prior to year starting on 1st April 2015 has exceeded Rs. 50 Crores, and the Commissioner shall, after holding such inquiry as he deem fit cancel the Certificate of Registration with effect from 1st August 2015 or any other date he may think fit.

These are the two amendments as per the new Notification. The dealers having turnover of sale or purchase less than Rs. 50 Crores annually account for 99.85 per cent of all traders in the State. This amendment therefore brings all small traders in the state out of the purview of LBT and hence must bring cheers to the trading community.

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