Purchase tax in himachal pradesh

Others 1366 views 3 replies

sidharth

coo

30 Points Joined August 2011

hi all

i have a small query regarding purchase tax paid for the purchase of resin in himachal pradesh declared in the schedule "c" of hp vat bill 2005 .the resin is purchased from unregistered dealers by the firm and purchase tax @ 12.5%(on the payble amount) is deposited by the firm on its own tin number .can this purchase tax be treated as input tax credit by the firm?please clarify the same.

thanks

hp vat bill2005

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Replies (3)

MJ Krishnamurthy

ACCT(Retd)

7197 Points Joined July 2010

Mr. Siddharth,

As per Sec11 ,sub sec 7(c) of HP VAT Act when purchases are made from anunregistered dealer within the state,the tax paid on such purchases can not be claimed as input tax credit......MJK..

Ashish Vishnoi

Tax Consultant

58 Points Joined May 2008

Mr. MJK,

Reference to your comment I would like to bring in your kind attention the third proviso of Section 21 of the H.P. VAT Rule, 2005, which says ……… “ Provided further that the purchase tax paid under section 6 of the Act shall be considered as input tax credit for the purpose of subsequent sale in the hands of same person.”

Purchase tax is charged at first stage & the sellers are always the unregistered grower. Section 11 refered for second stage VAT Input Tax and not for first stage Purchased Input Tax.

Please Clarify the same.

Thanks.