Mvat on exempted sales

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

25 October 2012 We are dealer of various brand cement like ambuja, JP, ultratech, Virat etc. in Maharashtra. We purchased cement with 12.50% vat and sale with same percentage. But our one supplier has having certificate of exempted sales. Their invoices stamped Exempted purchase & they didn’t collect vat on this purchase invoice. And When we going to sale this cement we do not collect vat separately on this cement sales. In our vat return we showed this amount Purchase Exempted and Sales exempted. We do not collect vat on this type sales. It is correct method of calculation Mvat liability? We have right to sales purchase exempted item without vat(Exempted sales). Please guide.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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26 October 2012 Mr Author,
There is no problem. When products of some industry are given exemption by the State Govt(just confirm) at all stages the goods will be exempted. You will have account it as such and declare in the returns.But,take a confirmation from the supplier/manufacturer.....MJK

Prakash Kochar

Prakash Kochar (Expert)
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27 October 2012 Dealer selling exempted goods purchased from a unit to whom exemption is granted under Vat Act of that particular State can sale the goods without charging tax separately or may charge tax on value addition in the tax invoice. In MVAT Act reseller is liable to pay tax on amount of value addition even if the goods mgf. by unit is exempted for tax.

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