Composition under m vat

VAT (Legacy) 400 views 1 replies

Dear Professional Colleague,

We want a clarification regarding composition scheme under M Vat act  for buying and selling of second hand motor vehicle.

As per the section 42(2) composition scheme and notification no. VAT-1505/CR-105/Taxation-1 serial no. 4 "Dealer in second hand Motor Vehicle" can avail the scheme of composition vat and pay tax @ 12.5% on 15% of selling price.

Does the said notification include the commercial vehicle like as truck or not  ?


Attached File : 1405979 1403692 m vat notification.pdf downloaded: 139 times
Replies (1)

Dear Surendar Sharma

For understanding the term motor vehicle, reference can be made to Section 2(28) of the Motor Vehicles Act, 1988 . The extract is reproduced as below :

"motor   vehicle"  or   "vehicle"  means  any  mechanically propelled vehicle adapted for use upon roads whether the power of 1    Subs. & ins. by Act. propulsion is  transmitted thereto from an external or internal source and includes  a chassis  to which  a body  has not been attached and a trailer; but  does not include a vehicle running upon fixed rails or a vehicle of  a special type adapted for use only in a factory or in any other enclosed  premises or  a vehicle  having less  than four  wheels fitted  with  engine  capacity  of  not  exceeding  thirty-five  cubic centimetres;

(emphasis supplied)

Referring to the above definition, it can be inferred that second hand motor vehicle includes "truck" within its meaning.

 


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