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VAT on capital asset

Gautam Patel (CA and CWA) (146 Points)

09 December 2009

An assessee is governed under the MVAT Act and is filing his monthly return under form 233. He is dealer and repairer in watches.He has purchased office equipments on which VAT is separately charged. Whether he can take VAT setoff on the above assets purchased?

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3 Replies

Shambuling (Assurance executive) (58 Points)
Replied 10 December 2009

As per my knowledge of reading mvat an assessee is using the capital goods for shope where he is trading taxable goods so he can clame in put tax credit but condition is 2% less from at what tax percentage charged by the vendor to him.

ARVIND LAMBA (IPCC) (68 Points)
Replied 13 December 2009

do not apply vat on capital assets

apply vat any fixed assets = 12.5%

electronic items= 4%

CA Sunil Anwani (CA) (117 Points)
Replied 17 December 2009

He can Take set-off on Office Equipment after 3% reduction as per Rule 53(7A), However if the said goods are Capital assets then he can claim Full Set-off.