It equipments on rentals

This query is : Open

Gurmeet Singh (Querist)
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01 December 2012 Dear Sir / Madam,

Our Company has given below said IT Equipments on Rentals whereas the Ownership and Possession is with the company only right to use the equipment is transfered (without operator) to the Customer:

1.Computer (servers) with Operating system and softwares
2.Printer
3.Powersupply ( UPS)
4.Display device, keyboard, mouse
5.Client Machines with operating system and proprietary software

Can you please help me with the below queries:

1.MVAT Rate on such rental incomes.
2.Why MVAT Rate should not be 12.50%
3.Schedule under which the above will be covered.

Please help.

Regards,
Gurmeet Rohra

CA. C V SURYAM

CA. C V SURYAM (Expert)
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02 December 2012 As constructive possession has been established in this case, the liability under VAT arises at taxable at the rate specified under residuary schedule i.e., 12.5%

Gurmeet Singh

Gurmeet Singh (Querist)
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03 December 2012 Dear Sir,

Thanks a lot for your valuable but after referring to the Schedule C of MVAT, I guess above said will be covered under VAT@5% category. Also refered to the Notification No. 1505/CR-116/Taxation 1 & under that all above equipments are covered under CENTRAL EXCISE TARIFF HEADING 84.71.

Please correct me if I am wrong.

Regards,
Gurmeet Rohra

Gurmeet Singh

Gurmeet Singh (Querist)
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