Input credit on purchase of diesel

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This query is : Resolved

Vaibhav Rathi (Querist)

13 June 2013 Hi..

Can any one please tell me is Input Credit available on Purchase of Diesel by a contractor for the purpose of operation of machines? but as we all know that purchase invoices received from diesel provider, do not show the amount of VAT separately.

Rupesh Jain

Rupesh Jain (Expert)

13 June 2013 NO CREDIT AVILABLE ON FUELS

Vaibhav Rathi

Vaibhav Rathi (Querist)

13 June 2013 Thank you for your reply sir.

but as per rule 53 "Reduction in set-off" of MVAT Act, 2002,

(1) If the claimant dealer has used any taxable goods as fuel, then an amount equal to 1[three per cent] of the corresponding purchase price shall be reduced from the amount of set-off otherwise available in respect of the said purchase.

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CA Pooja Agarwal

CA Pooja Agarwal (Expert)

13 June 2013 Answer is “No” you can not avail the Input credit on diesel (HSD) or petrol . As per input definition of central excise given below.

input" means all goods, except high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not, and includes lubricating oils, greases, cutting oils, coolants, accessories of the final products cleared along with the final product, goods used as paint, or as packing material, or as fuel, or for generation of electricity or steam used for manufacture of final products or for any other purpose, within the factory of production.

Explanation 1.- The high speed diesel oil or motor spirit, commonly known as petrol, shall not be treated as an input for any purpose whatsoever.

Explanation 2.- Inputs include goods used in the manufacture of capital goods which are further used in the factory of the manufacturer;

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Vaibhav Rathi

Vaibhav Rathi (Querist)

13 June 2013 Thank you for your reply m'am.

But i am concerned with Maharashtra Value Added Tax. And, i was guided by the department of "Acts & Rules" of the mumbai Sales Tax office that we can take the input credit on purchase of diesel used for the purpose of operation.

Rupesh Jain

Rupesh Jain (Expert)

15 June 2013 it is not possible

fuel are not calimable

can you take calim on Petrol?

Vaibhav Rathi

Vaibhav Rathi (Querist)

17 June 2013 why it is not possible? where it is written in the MVAT Act?
and logically thinking why it is not possible as this comprises one of the significant amount of Purchase for contractors. so after retention of 3% it is allowed. The law says.
Kindly go through Rule 53 of MVAT Act.

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