Vat liabilities

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2012 Please advice below Case
There are one propitiatory firm M/s A register for VAT in Mumbai and sale to another firm M/s B that in also register in Mumbai
But material purchase from M/s C Banglore, Karnatka and delivery also in Banglore behalf of second firm M/s B those of register in Mumbai
Please advice below.
Vat Paid in Karnatka can we take credit benefit in Maharashra or any other benefit can get for vat paid paid in karnatka.

Anil Verma

Anil Verma (Expert)
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16 June 2012 To my knowledge, VAT paid to a dealer outside the state where purchaser is registered will not be allowed as credit against VAT received from within state of registered dealer.
But if there is a case when registered dealer paid VAT within state of registered dealer and sales to outside state than this VAT paid within state can be set off against collection from outside state.
In your case my first answer is applicable as you are purchasing from Karnataka and selling within the state of Maharashtra where dealer is registered in Maharashtra. VAT credit is not allowed.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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16 June 2012 Mr Author,
There was another solution for this problem i.e. E1 sale.You could have thought of it earlier and reduced the tax burden to just 2% only.In future think of this idea....MJK

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