Gvat input tax credit

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 July 2013 Dear Sir,
My client is dealer and dealing in item which falls in Schedule I. He purchased the raw material and VAT is charged by the supplier. Now, my client is preparing the item which falls under GVAT Schedule I. So there is no VAT on sales. So, can we get credit on purchase...? If no, then tell me any other way to convince the supplier not to charge the VAT?

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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23 July 2013 if your purchased are taxable and your sales are exempted then you can claim refund as there is no tax liability on sales in your vat returns under gujarat commercial tax.

Querist : Anonymous

Querist : Anonymous (Querist)

23 July 2013 Thank you very much sir.
But my question is that the sales is exempted then even we can get the refund....?

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Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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24 July 2013 yes you can claim because your input vat/credit is not set of with output vat so the balance credit will have claim as refund.

for surety, in some reg. dealer, they have purchases of 12.5% and 15% vat and sales of finished good of 4% vat. so every time they are claiming refund in every return as no tax liability will happen.