Pre-Xmas Offer: 20% OFF on CAclubindia Pro Subscription! Code: XMAS20

Vat query on local purchase vs cst sale

Others 1053 views 1 replies

Sachin sharma

nil

76 Points Joined September 2010

Dear All

I have a question for which i need your help

My company which is registered in Noida,UP is purchasing goods locally and taking vat credit on the same and then selling the same goods in delhi which i a interstate sell.So do my company has to reverse the vat credit in this case.

also what if in the above case my company which also has another registered office at delhi first transfers the goods as stock transfer to delhi and then sale from here.

Replies (1)

Harshal Fifadra

Chartered Accountant

1489 Points Joined August 2011

The general case is output tax (-) input tax (-) CST payable (if any) . In your case it is inter state sale so VAT can be set off against the CST payable . There is no need of reversing the VAT credit . In case of Branch transfer it is not a sale provided FORM F is provided by the transferring branch to the receiving branch .