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MVAT Input credit on sale of asset

Mahavat 1079 views 1 replies

Dear All,

Please answer the following Query:

we are a service provider and so not registered under VAT. Now we affected a sale of Asset to group company and amount is above exemption limit for registration mentioned under Act. To explain better assume we are Company "ABC" and group company is "XYZ".

Both ABC and XYZ are not registered under the MVAT till date

ABC purchased Assets in 2008-09 and paid sales tax to vendors and capitalised the same. Now  the same are sold to XYZ.

Queries :

1. DO "ABC" and "XYZ" requires registration under MVAT ACT.

2. Can "ABC" claim credit for VAT purchased on purchase of asset

3. Can XYZ claim credit of VAT paid to ABC ( Assets consist of office equipment,furniture and computers)

Replies (1)
Originally posted by : saharsh

Dear All,

Please answer the following Query:

we are a service provider and so not registered under VAT. Now we affected a sale of Asset to group company and amount is above exemption limit for registration mentioned under Act. To explain better assume we are Company "ABC" and group company is "XYZ".

Both ABC and XYZ are not registered under the MVAT till date

ABC purchased Assets in 2008-09 and paid sales tax to vendors and capitalised the same. Now  the same are sold to XYZ.

Queries :

1. DO "ABC" and "XYZ" requires registration under MVAT ACT.

2. Can "ABC" claim credit for VAT purchased on purchase of asset

3. Can XYZ claim credit of VAT paid to ABC ( Assets consist of office equipment,furniture and computers)

1) purchase in 2008-09 as unregistered, can not take input credit now

2) you have to use alternate channel of sale, viz registration of title of goods at sub registrar office, this will byepass the vat procedure. 


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