Originally posted by : Sanjay |
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Is it possible to avoid payment of VAT on Sales, Which are turned into bad debts?
Seller is not going to received any amount for whatever sale he has made. But on that sale he is liable to pay VAT.
Can anybody please share there views with corresponding Case Law or Extract from Act?
Thanks in Advance |
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Under MVAT Act, dealer is liable to pay tax on the basis of turnover of sales and purchases. Section 3 of the MVAT Act specifies the incidence of tax.
A dealer who is an importer is liable to pay tax if the turnover of sales or purchases exceed Rs. 100,000/- in a year.
Dealers other than importer shall be liable to pay tax if the turnover of sales or purchases exceed Rs. 500,000/- in a year.
Therefore, even if there is bad debts on account of sales, dealer will still be liable to pay tax.