Input Tax Credit on Purchases

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 October 2010 Dear Sirs,

We have a Zonal office (Pestisides and Agro Chemicals)and we have two depots in Karnataka where the billing activities are happened while preparing the VAT return we are not taking any input tax credit.
At the time of audit the same point will asked by our internal auditor saying that we have to suppose to take a credit on purchases.

Please let me know at what type of purchases can we take a credit of VAT.

Please help me.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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19 October 2010 In your query not mentioned your products whether taxable under VAT?

Kishanlal Paliwal

Kishanlal Paliwal (Expert)
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20 October 2010 Pesticides and Agro Chemicals are generally taxable under VAT Act of various states.

You can take take benefit of input VAT credit if taxable under VAT in your state.

Please take care that since you are operating depots and getting the goods as stock transfer, than no question arises of "Input tax credit".

You are entitled to get Input VAT credit benefit only against the goods procured by paying VAT.

Please also ensure that VAT amount is separately mentioned in the invoice otherwise sales tax department may disqualify the input credits.

Regards
K.L.Paliwal

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