Set off eligibility
This query is : Resolved
04 February 2012
A search & seizure action was conducted on the dealer and lots of unrecorded
sales and purchase invoices were found. Naturally, he has to pay tax on
unrecorded sales. Whether set off is available on corresponding unrecorded
purchase?
under MVAT Act,2002
sales and purchase invoices were found. Naturally, he has to pay tax on
unrecorded sales. Whether set off is available on corresponding unrecorded
purchase?
under MVAT Act,2002
05 February 2012
Dear Siddharth,
As per the MVAT Act, 2002 Liability arises immediately after the Sales Turnover crossed the limit prescribed in Act. Moreover Credit of the purchase available in the Financial year in which the invoice recoreded in the books of Accounts. Further, you have to show such purchase turnover alongwith Input Vat details in your Return to obtain the set-off against the output vat liability. Hence question of credit of unrecoreded purchase is not arised if it is not recorded in books of accounts and shown in return.
As per the MVAT Act, 2002 Liability arises immediately after the Sales Turnover crossed the limit prescribed in Act. Moreover Credit of the purchase available in the Financial year in which the invoice recoreded in the books of Accounts. Further, you have to show such purchase turnover alongwith Input Vat details in your Return to obtain the set-off against the output vat liability. Hence question of credit of unrecoreded purchase is not arised if it is not recorded in books of accounts and shown in return.
06 February 2012
Thank you Nishad Patkar
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