Section 6, tnvat act

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Praveen Kumar K (Querist)
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14 August 2013 1. A TNVAT registered dealer executes Works Contract and Normal Sales also.
2. The dealer purchases certain goods from Outside State.
3. Can the dealer opt for Section 6 Valuation
If
(a) The dealer uses those goods purchased from outside State exclusively for Normal Sales.
(b) The dealer uses those goods commonly for both.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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15 August 2013 A dealer opting for valuation u/s 6 can do normal sales also. The sold goods can be local as well as interstate purchased.Here for the purpose of Sec 6 the receipts,purchases,expenses and other accounts,with respect to such works contract has to be kept seperate.But problem arises in filing returns. Composition(u/s 6)and other receipts have to to be reported seperately....mjk

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Praveen Kumar K

Praveen Kumar K (Querist)
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16 August 2013 Dear Sir,

I was given to understand that once a dealer opts for Section 6 valuation for a Financial Year, he can never opt for Section 5 valuation in the same Financial year, irrespective of the fact that he does trading also. Thus to summarise if a dealer is also doing trading he has to opt for Section 5 valuation, he cannot opt Section 5 & Section 6 partly.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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16 August 2013 Yes, it is better to be on Sec 5 valuation only in order to avoid any complications.....mjk

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