Credit on white coal

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Manan Shah (Querist)
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17 December 2011 As per Section 11(5) of Gujarat Vat Act, provides that the purchases of certain goods are not eligible for Credit includes Goods are used as "fuel in generation of Electricity energy"

So my question is that one of my client is using White Coal for the purpose of boiler...can he take credit of the vat paid on White Coal??

CA CS PRASHANT

CA CS PRASHANT (Expert)
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17 December 2011 If direct nexus can be establised between the input(Coal) and the output(Final product) then certainly credit can be availed.

But if the generated power is sold outside then that portion cannot be eligible for VAT credit

Manan Shah

Manan Shah (Querist)
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18 December 2011 White Coal is used in the boiler for the purpose of production only...can we take credit of white coal ??

No direct nexus between input and output. Coal used in boiler for the purpose of pressing...

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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18 December 2011 Mr Manan shah,
As per sec11 of Gujarat VAT Act tax paid on purchses of fuel used for generation of electricity as captive power is not eligible for input credit.
MJK