Sir,
we are engaged in the business of stone crushing i.e we make big size of boulders or rocks blasted from hills or mountains into small size so as to be useful for construction activities. In this connection we have to pay royalty on crushed stone sold (our finished product ) @ 50/- per tonne. This royalty is paid to the government directly.
Doubt: now my doubt is whether we have to pay VAT on royalty or not. For ex: if the sale price (excl royalty) of crushed material is Rs 500/- per tonne and royalty is 50/- per tonne. Then on which amount i.e on 500 or 550/- i have to pay VAT. Please provide me, if any, section reference or any tribunal, high court or supreme court in support of you answer.
CAclubindia
