Vat on hire purchase transaction

Hi Darshan,

I am unware of particularities of Gujrat state, however, since the basic premise of VAT is same for all the state, I can enumerate a point or two on VAT for Hire purchase:

1) Physical delivery is of prime importance in hire purchase transaction which means VAT is applicable at the point of physical transfer. please note that in Hire purchase sale take place at the time of final payment, that too if buyer/Hire purchaser agrees to buy.

2) ITC becomes automatically available.

3) Tax is calculated on on sale price excluding of interest factor.

Please revert back in case you need any clarifications.

Regards

Thanx Yuvraj....But how the Vat wil be charge ?Is whole of the vat to be charged at first instance or partially at the time of down payment and partially as and when the installments due...???