vat on sale of second hand car in assam

This query is : Resolved

R.K.SHARMA

R.K.SHARMA (Querist)
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06 October 2007 please let me know whether vat is applicable on sale of second hand car in assam.
if seller has not cahrged vat, whether it is to be deposited by purchaser later on.

S.RAVICHANDRAN

S.RAVICHANDRAN (Expert)
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12 October 2007 As of VAT Act is concerned, whether the goods in question come iny of the Schecules of the VAT Act has to be seen. Please refer Assam VAT Act for the applicability.

Second thing, the VAT is payable only by the seller and not the purchaser. It is the obligation of the seller to charge and pay VAT on the sale and not the buyer.

CA. O.P. Agarwalla

CA. O.P. Agarwalla (Expert)
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19 November 2007 This is a very disputed question and I could not get bthe answer of this question.
HOWEVER- I WILL LIKE TO DRAW THY ATTENTION ON THE ITEM SL. NO. 23 OF FOURT SCHEDULE OF ASSAM VAT ACT, 2003, WHICJH IS AS UNDER:-

23. (a) Pre-owned cars having engine capacity upto 1000cc
Rs. 3000/- per Car
(b) Pre-owned cars having engine capacity above 1000cc
Rs. 5000/- per Car

Explanation 1. -Pre-owned cars under this entry means an used car registered under the provisions of the Motor Vehicles Act, 1988 (Central Act 59 of 1988) and purchased by a dealer for re-sale.
Explanation 2. – For the purpose of this entry, the amount of tax as specified in column (3) is payable on per car basis in lieu of the paise in the rupee.
Explanation 3. – Where the liability to pay tax in respect of the sale of a pre-owned Car arises under this Act and the transfer of ownership is required to be caused in the certificate of registration of such Car or a new registration mark is required to be assigned to such car in the State under the Motor Vehicles Act, 1988 (Act No 59 of 1988), no Registering Authority shall cause the transfer of ownership in the certificate of registration or assign a new registration mark to such pre-owned car unless the copy of the sale bill/ invoice of the dealer registered under this Act showing charging of the amount of tax on the sale of such pre-owned car is produced before such Registering Authority or the proof of full payment of tax is produced in accordance with the fourth schedule appended to the Act in respect of the sale transaction of such vehicle”
(inserted vide Notification No.: FTX.55/2005/Pt/43 dated 08/08/2005 w.e.f. 09/08/2005)

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CA. O.P. Agarwalla

CA. O.P. Agarwalla (Expert)
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11 December 2007 I think you shuld also peruse the section 12 of the AVAT Act, 2003, which is as under:-
12) Levy of tax on purchases.- Every dealer who in the course of his business purchases any taxable goods from any person, in the circumstances in which no tax under section 10 is leviable on the sale price of such goods, shall be liable to pay tax on the gross turnover of purchase of such goods, if after such purchase, the goods are,—
(i) used or disposed of in any manner other than by way of sale in the State; or
(ii) consumed or used in the manufacture of tax free goods specified in the First Schedule; or
(iii) consumed or used in the manufacture of taxable goods, and such manufactured goods are disposed of otherwise than by way of sale in the State or in the course of interstate trade and commerce or export out of the territory of India; or
(iv) despatched to a place outside the State other than as a result of sale in the course of inter-state trade or commerce or export out of the territory of India,

and such tax shall be levied at the same rate at which tax under section 10 would have been levied on the sale of such goods within the state on the date of such purchase.