we are manufacturing Detergents and selling the same for both intra andninter-state. The basic input of detergents are procured from outside the state except very few in which we avail Input Tax Credit. We would like to have clarification on the following.
“Whether the said input tax credit can be availed for both intra and inter-State sale” Sub.Rule-3 of Rule-11 and foot note in Annexure-II of VAT 201 say like this:-
Sub. Rule-3 of Rule-11 : c) In case, the sale of goods in the manner referred to clause (a) above, results in CST payable less than the corresponding input tax on the corresponding purchase of goods, the input tax creditable for the tax period shall be reversed by the amount calculated in the box provided in serial No.5 of Annexure-II in the Return.
d) In case the CST payable is equal to or more than the corresponding input tax as calculated as per provisions of clause (c), there shall be no reversal of Input Tax Credit.
Foot Note of Annexure-II: Manufacturer will calculate the proportionate inputs (goods) used in the manufacturing of goods sold in inter-State trade and calculate the purchase value of those inputs (goods) as well as the input tax.
It may be noted that our CST payable is much more than the input tax credit we avail.
We may be clarified the correct statutory provision.