capital goods

Hi All


Query:- My Company purchased capital goods in the year 2001, at that time Credit scheme was not avilable under Sales tax. Capital goods in the shape of equipment were not used for manufacturing any taxable goods/product. Actly they were used for cinemagrphy.


Now I want to sell those equipments,, so Should I charge VAT from the purchaser. Section 6(3) of DVAT saying NO only in that case where Company purchased the goods but didint took credit of the same. while at the time of purchase, credit scheme was not in existance. My company is not engaged in manufacturing or trading activity etc.


Thx nd Regards,


Sachin

Replies (5)

in the last line of your "company is not engaged in manufacturing or trading activity etc" it means the company is not registered under DVAT Act. if yes, than the co. is not liable for vat upto exemption limit provided under DVAT/CST Act.

Hi Sanjeev

thank you,, but My comapny is registered under DVAT,, actly as I said, equipments are cinema equip, they used for showing the movie in cinema. Company is register under DVAT because there is retaurant in Cinema and other stall type of things under which goods are owned and purhase - sale done by cinema/company itself.

case totally depend on facts?

 

Hi Sanjeev,


 


OK, simply, goods purchased when credit scheme was not in existance under DVAT now credit is available. but now question not for credit but for payment of tax. Because section 6 (3) of DVAT saying when goods purchased and credit was not taken then at the time of purchase of that good, thn at the time of sale of same good VAT will not be payable.


 


If purchase of goods were made after introduction of VAT thn SECTION 6(3) is applicable but in present scenario goods were purchased before introduction of VAT and same goods were not used in the manufacturing or any other type of selling of goods activity.


 


basically confusion is change of provision of VAT Act, 2004 AND sales tax act.

it seems the dealer would be liable to pay VAT

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