Vat & service tax

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Ramaswamy (Querist)
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28 July 2013 A person collects VAT on sale of SIM CArds till 2006 March, based on Kerala High Court Judgement. Later Supreme Court in BSNL remands the issue to the assessing authority. Later Supreme Court in Idea cellular Ltd confirms that SIM CARD is only liable for service tax and not liable for VAT. Accordingly the person remits service tax for the period till 2006.
In this circumstance should the VAT collected be forfeited?

RENGARAJ R.K

RENGARAJ R.K (Expert)
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29 July 2013 IF YOU HAVE COLLECTED VAT IN YOUR BILLS, YOU CANNOT CLAIM NOW AND IT WILL BE FORFEITED. OR YOU HAVE TO RETURN THE VAT AMOUNT TO ALL YOUR DEALERS AND CLAIM THE SAME FROM THE GOVT.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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09 August 2013 Mr Rengaraj RK, I think claim of refund of wrongly paid VAT is allowed to tax payers only and not to tax collecters.This point may please be noted.....mjk

Ramaswamy

Ramaswamy (Querist)
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09 August 2013 Sir,
My point is Sales tax was collected and remitted. Now by virtue of Supreme Court judgment service tax is paid. If the amount is forfeited will it not amount to the dealer being put to a jeopardy? Especialy since the service tax is paid, there is no enrichment for the dealer. In that situation is the dealer not entitled for refund of sales tax paid?

RENGARAJ R.K

RENGARAJ R.K (Expert)
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09 August 2013 Agreed, with most respect to you MJK sir. What i have stated applies to the person who collected the tax. That is, having collected but not remitted either to the department or to the customer, such wrong/excess collection will be forfeited. Many decided cases are there.

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