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Input Credit

This query is : Resolved 

04 July 2009 Sir/Mam,

The final product is exempted from VAT(ie zero rate of tax). However, the scrap generated during the manufacture of final products is chargeable to VAT.
Can VAT input credit be taken on purchase of raw materials etc. in proportion to the quantity scrapped or otherwise ?

04 July 2009 Input credit depend upon the taxability of the final product so taxablity of intermediate product will not make any change.

04 July 2009 Yes.
Under MVAT Act, it is permissible.


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