ADMISSIBILITY OF VAT INPUT CREDIT

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Gaurav Garg (Querist)
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16 July 2008 please answer the following query:

A COMPANY HAS HEAD OFFICE IN HARYANA AND ONE BRANCH AT DELHI. IT PURCHASES SOME CONSUMABLES FROM DELHI AND RECEIEVES IT AT ITS BRANCH OFFICE AT DELHI.BUT IT MAINTAINS ACCOUNTS ONLY AT HARYANA HEAD OFFICE IN RESPECT OF DELHI BRANCH ALSO.

NOW IF IT RECORDS THE DELHI PURCHASE IN ITS BOOKS WHETHER IT CAN CLAIM VAT INPUT ON DELHI PURCHASE TO SET OFF VAT OUTPUT IN RESPECT OF DELHI SALES.

I HAVE A DOUBT BECAUSE IF IT IS ENTERED AT HARYANA, IT WILL BE A INTER-STATE PURCHASE NEEDING "C" FORM IRRESPECTIVE OF DELIVERY OF GOODS AT DELHI BRANCH.

PLEASE ANSWER THE QUERY IN ELABORATE MANNER. I

CA. O.P. Agarwalla

CA. O.P. Agarwalla (Expert)
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17 September 2008 Though I have not gone thrugh the VAT Acts of these States, but still I would like to comment on the same on thes basis of settled principles.

01. Normally no ITC is available on consumables to dealers.

02. As per requirement of VAT Act, branches in all the State shpuld keep their accounts separately.

03. If the goods are purchased by you at Delhi and have taken the delivery at Delhi, it is a intra-state sale/purchase.
You can send the goods as stock transfer by obtaining F form from Hariyana. Or you can direct your seller to despatch the goods directly to Hariyana, in that case it will be a inter-state sale.

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