1.Under HVAT, 2003 we can take the credit of VAT paid on inputs/capital goods purchased. Now, this available input credit can be utilised to pay our VAT liability on the sales made within the Haryana(i.e. Local Sales). If our VAT liability on the sales made in the haryan(Local Sale) is less then the Input Credit available, then the balance Input Credit (balance after utilising for payment of VAT liability on local sale) can be utilised to pay our CST Liability.
2. we can not take the credit of CST paid on purchase of Inputs/Capital Goods.
VAT paid on Purchases = Rs. 100
CST Paid on Purchases = 50
Therefore, total input credit available = Rs. 100 only
Now, suppose VAt liability on sales made in Haryana = Rs. 50
CST liability on interstate sale = 500
Now out of total credit of Rs. 100 we can use 50 Rs. for payment of our VAT liability. Balance Rs. 50 can be utilise for the payment of our CST liability. Thus Rs. 450(500-50) for CST liability we will have to pay in cash.
VAT paid on Purchases - We can take the credit and can utilise for payment of both VAT and CST
CST paid on Purchases - We can not take the credit.