56. Determination of disputed questions

This query is : Resolved

Rohan Kirtane (Querist)
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06 June 2010 One of our client is a Trust and registered under this act by mistake as it has no transaction or activity covered by MVAT. It buys Stationary , Printing Material, Books, Notebooks etc. and distributes it to various schools or even poor children.

My queries are
1) Can we cancel the registration ?
and
2) Take the exemption certificate regarding the vat charged to them by their dealers from whom the trust purchase2 such material.
or
3) Can we claim the VAT on purchases (if cancellation is not possible), as refund as there is no sale in this case.
we are planning to file an application U/s 56 to commissioner about these queries but surely would like to know whether any other alternative is there....

CA Kamal Gangaramani

CA Kamal Gangaramani (Expert)
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21 June 2010 Congratulation, you succeeded in getting MVAT Registration, we find it difficult get registration in geniune case also.

Anwer to Q1: u/s.3(3) if your liability is less then taxable in previous year you can apply for cancellation. I you case it will be as there is no sale .

Answer to Q2: There are no exemption certicates in VAT regime, please elobrate, what exemption certificate, and to take certificate form whom, the sales tax deparatment or the supplier.

Answer to Q3: Very intelligent question; Sell some books or say Rs.10,000/-, charge sales tax at applicable rate, claim credit of all purchase. As credit will be more then tax charged, you will not have to pay anything,

File perodical returns and at the end of the year, file application for refund in Form 501.