Tally

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Mukeshh Agarwal (E-solutions)     20 June 2011

Adjustment of CST against VAT

Hi !

I have a trading firm in Orissa related to garments. I purchase it from other states against CST 2% and I sell the same agaisnt 4 % VAT.

My query is : Is there a way I could adjust this 2% CST against 4% Output VAT (or) Is there any alternate method ?

Thanks in advance..

 

rgds,



 22 Replies

ashish gupta

ashish gupta ( student)     20 June 2011

you cannot adjust CST paid against ur Vat liability. But CST paid is added to the cost. however both CST and VAT paid is allowable under Income Tax

CA Nitu Agarwal

CA Nitu Agarwal (CA, M.Com)     20 June 2011

CST paid on purchase can't be adjusted against output Vat. However input VAT can be adjusted against CST collected on Sales.

surender

surender (Manager Accounts)     20 June 2011

Im agree with  Ashish and Neetu.CST Paid on purchase can not be  adjusted with Output VAT.

Maneet Puri

Maneet Puri (student)     20 June 2011

CSt paid on interstate purchases cannot be adjusted for the payment of vat. but however if you are also purchasing within the state then excess vat input remaining unutilised can be adjusted for the payment of CST . But Credit of cst cannot be taken for the payment of vat , there is no other alernative available , you cannot take input credit on cst .

CA ADITYA SHARMA

CA ADITYA SHARMA (CA IN PRACTICE )     20 June 2011

no it could not be adjusted       

@*CS Siddharth Bumb. *

@*CS Siddharth Bumb. * (B.Com, CA Final, CS )     20 June 2011

Originally posted by : ashish gupta

you cannot adjust CST paid against ur Vat liability. But CST paid is added to the cost. however both CST and VAT paid is allowable under Income Tax
alekhya

alekhya (Article Trainee)     20 June 2011

hi frndz.......... ive a small doubt..

Can input taxcredit (VAT) be used for payment of CST....?

Santhosh Poojary

Santhosh Poojary (SIEMPRE AHÍ PARA TI)     20 June 2011

 

Originally posted by : Nitu Agarwal

CST paid on purchase can't be adjusted against output Vat. However input VAT can be adjusted against CST collected on Sales.

Agree.

Rajnikant Vadigoppula

Rajnikant Vadigoppula (CA, CS And CMA Final)     20 June 2011

i agree with above views, the logic behind this is,

CST is collected by the centre and remitted to the state.

if u pay cst to other state (say maharashtra) and claim vat against cst of your state ( say orissa).

in this case it is a loss of revenue to the orissa state.

so it cannot adjusted the revenue of one state to revenue of other state. 

2 Like
prakash

prakash (article)     20 June 2011

Yes I agree with above views cst paid on purchase cant be adjusted against Vat


(Guest)

cst and input tax credit can only be adjusted if both are paid/payable to treasury of same government.

Examples-

(1) if purchased from other state and sold to same state- Cant be adjusted as because CSt is paid to that otehr state and vat is payable to domestic state

(2) Purchase made from own state and sold outside-  since input vat and cst is paid to same govt. ie. own government. CST can be adjusted with input VAT paid.

 (3) If purchased and sold in own state-  VAt payable can be adjusted withh input vat

(4) if purchased from other state and sold to oter state (whether sold to purchasing state or not)- CSt payable cant be adjusted with CSt paid to own government.

 

Since cst and vat paid are deductable expense under income tax act, one may get releif of income tax on these expense

1 Like
Srinivas Reddy

Srinivas Reddy (CA , MBA)     21 June 2011

Ya i agree with Mr.Rajnikant, what he said the reason is absolutely right.

 

Ms.Alekhya,

for u r query also same answer, but reverse can b possible

C.A Tarun Shah

C.A Tarun Shah (practice)     21 June 2011

C..S.T can't be adjusted against VAT Out put as per Sales Tax Act .But you can avoid VAT pymt.by doing 6(2) -Sales in Transit transaction wherin you have to give 'C"form to supplier & obtain E1 form from the suppliers

if you would like to know more abount the 6(2) pl.send query in CA CLUB INDIA

 

Tarun

BHAGYESH RAVANGE

BHAGYESH RAVANGE (C.A Job)     21 June 2011

No C.S.T CAN'T be adjusted against Vat.


Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register  


Start a New Discussion

Popular Discussion


view more »







Subscribe to the latest topics :
Search Forum:

Trending Tags