Doubt in VAT - TNVAT - Second Sale

CHENNAI/ TN.::: I have purchased some furniture (wooden furniture) and a mattress but the retail trader didnt charge me anything as VAT. Instead at the bottom of the bill it was wriiten that "SECOND SALE" and in highlighted words "VAT ALREADY PAID. COMPOSSION TAX @ 0.5%". I am so confused as to why he didnt charge VAT. I am also not sure to which schedule it belongs to.

Does this "SECOND SALE" mean that it is a sale of second hand goods? Or it simply means that it is the second sale in the distribution channel ? Can anybody give me a reply ?

Replies (6)

its registered VAT sale under composition scheme, but you can not avail input credit on this purchase. 

Dear U. S. Sharma Sir please clarify the composition scheme

/forum/files_download.asp?msg_id=533973

 

/forum/composition-scheme-79750.asp

Dear Rajeesh

This Janarthanan Tax Consultant from Coimbatore, Tamilnadu replying to u r qeury.First second sales means it is not second hand goods.As u have mentioned it is the second sale in the distrubution channel.Regarding composition scheme any dealer purchasing goods locally and selling the same locally can avail this option.The following conditions need to be satisfied .

1. he should register his organization with Sales tax dept and obtain TIN number.

2.He should purchase the goods locally and sell the same locally.

3. he should give option letter to the Sales tax dept every year.

4. The tax to be paid @ 0.50%

5.The dealer cannot collect the 0.50% tax from customers.

6.He cannot do interstate purchases.

7.The tutnover limit under composition scheme is only 50 lakhs.

8.The relevant section under TNVAT Act is Sec 3(4).

Hope this will clarify u r requirements.

Thanks

Dear Mr.Janarthanan

I want to known that a person whose is proprietor of a wooden blocks seller , Hope where in Vat was involved.

That person didnt file VAT return for abt 2 yrs 

he is now also into trading

what is remedy????????

I buy a commodity from a local trader and resell it.

I buy it by paying 14.5% , so does this mean that I can sell this to local customers by just paying 0.5% by availing the composition scgheme.

 

Also please clarify in this case, if I should bear this 0.5% or collect it from the customer. 

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