One of the taxpayer has provided their liability and itc competative figures for the f.y 2017-18(excluding VAT) & 2018-19. But not paid a single penny in cash, how could be possible without having any value addition and cash payment. clarify pls.
1). If his business is in net loss than in this situation it can be happen, not required to pay any tax in cash.
2). or otherwise business is in Profit, but intial investment in capital asset is high, for which he has taken ITC Credit on capital goods and using that ITC Including ITC on regular purchase to set of output liability, so in that case also it's possible.
1. It's cannot be possible in accounting system . check his purchase & sale . as in case of practice of under billing the ITC will always be the excessive.
2. Or he might be taking the bulk purchase in end of month.
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