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tax on capital goods

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Querist : Anonymous

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Querist : Anonymous (Querist)
14 December 2010 some one please tell me that if i purchase some fixed asset like furniture in cash and on that the vat is to be paid then wt is the accounting treat ment for that and can i take input creadit on such of these purchase plz tell me..........
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AMAN Gupta

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AMAN Gupta (Expert)
14 December 2010 no input of VAT is available if thr goods are not being used for trading or manufacturing purposes
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CS ,CMA Shambhu Kr. jha

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CS ,CMA Shambhu Kr. jha (Expert)
14 December 2010
you can pass the following journal entries in the book of account that is as follow Furniture a/c ---Dr
To cash A/C
you need not to debit the vat account separately coz , VAT and what ever other taxes paid on purchase of capital asset will be added to that particular asset and need not to treat separatly .
As far as credit are concerns you can 't take the credit for that ,coz it is consumable goods not directly related to the production or trading of the goods .
Thanks
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