Adjustment of vat and cst

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This query is : Resolved

Deepak Kumar Gupta (Querist)

06 April 2013 A registered (both under VAT and CST) dealer purchased goods from Bengal by paying VAT @14.5% i.e. Rs. 14500/- and all the goods are sold outside the state by charging CST @2%i.e. Rs. 2400/-. What will be the tax treatment under VAT & CST?

CA RICHA BADALIA

CA RICHA BADALIA (Expert)

06 April 2013 You can set off your CST liability with the VAT input.

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CHIDHAMBARA BALAJI

CHIDHAMBARA BALAJI (Expert)

06 April 2013 The treatement of VAT Input return and CST outflow return has to be treated separately
First he has to claim as Input tax credit for VAT and if any VAT Sales he can adjusted subj to conditions if any
Secondly the CST he has to create liability and shown as payable
Then he has to select the option has adjust against vat in his return ans correspondingly passing JV by debiting CST and crediting VAT Adjustment account

MJ Krishnamurthy

MJ Krishnamurthy (Expert)

06 April 2013 Mr Gupta DK, You are situated in which state?......mjk

Deepak Kumar Gupta

Deepak Kumar Gupta (Querist)

07 April 2013 Thanks for your support....

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)

27 May 2013 None of replies are in order. VAT is matter of State Govt. and CST is the matter of Central Govt. Both cannot be adjusted. If you have paid VAT in Bengal the show the goods as goods returned to the dealer and ask him to raise CST bill. In this case no VAT will be charged but VAT will be charged in the state in which you are selling the goods. I think Mr. MJK expert on indirect tax can throw more light on this subject.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)

27 May 2013 Thanks Mr Agarwal. Here the matter is to be taken in the practical way. No doubt,CST is levied by a Central govt enactment,but its administration is entrusted to the respective state govts. In the vat returns interstate purchases and sales are also to be declared along with local purchases and sales. While doing so,total input(from local RD and URD purchases) is to be deducted from total output(from local and interstate sales) to arrive at net tax payable. If the input tax is more than output tax then the excess can be c/f to next month or refundable.This is the common rule in all states.So,please note: input tax of local purchases is adjastable against CST also......mjk

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