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IS VAT NUMBER NECESSARY ON TAX FREE SALES ABOVE RS.10 LACS

veer singh (director) (28 Points)

30 April 2011

I HAVE A GARMENTS COMPANY IN PUNJAB. IN THIS COMPANY I AM DOING TWO TYPE OF SALES. ONE IS OF READYMADE GARMENTS WHICH IS TAXABLE 5.5%. OTHER IS TAX FREE LOOSE CLOTHES SALE.

I WANT TO KNOW IF I DO ONLY TAX FREE SALES WHOLE YEAR AND MY TAX FREE SALES WILL BE ABOVE RS.10 LACS, VAT NUMBER IS NECESSARY FOR ME ????????

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2 Replies

Aparna Raja K.C (Student) (520 Points)
Replied 30 April 2011

VAT Act says that any dealer, who intends to carry on the business of purchase and sale of goods in the State and is Liable to Pay Tax, cannot carry on the business unless he is registered and holds a valid registration certificate under the Act.

further

Taxable turnover is the aggregate total of sale prices of all taxable goods including goods taxable at zero rate. Sale price of goods and transactions exempted and VAT charged on taxable sales do not form part of Taxable Turnover.