Input credit for vat

Others 1135 views 8 replies

Aditya Kumar Narayan

CA Finalist

84 Points Joined July 2012

purchase of capital goods=Rs 100000,vat paid(not included in purchase price)=Rs 10000

1.sale price of said capital good=RS 150000

2.Sale price of the capital good=RS 70000

if the assessee uses the capital good merely for production,i.e he is not a dealer of the capital goods,will he be allowed input credit??

Replies (8)

Piyush Tanwar

Assistant Manager - Accounts

1432 Points Joined October 2009

No, only the registered dealer can avail benefit of claiming input tax credit.

ankur bansal (CA Final)

student

129 Points Joined January 2011

yes he will be allowed input credit

Allowing ITC on purchase of capital goods is restricted to some selected machinaries and plants in most of the states. This is given in in a notification. Find out what is the rule in your state.......mjk

Guest

Hi,

IF u have V.S.Datey sir's book refer page.no 21.

or for ur ref

Credit will be available of tax paid on CG purchased within the state.credit will be available only in respect of goods used in manufacturing and production.the credit will spread over 3 years and not in first year itself.there will be a negative list of CGs.

The credit of CG is available only for manufacturer or proceesor.

A trader can avail Input tax credit on CG only when he is trading of those CGs.

Rgds