input tax credit

This query is : Resolved

ankita (Querist)
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03 January 2010 had a query relating to input tax credit - Suppose the seller has collected excess VAT from the dealer due to some calculation mistake , then can the dealer get credit for the entire amount of VAT paid or will he get credit on VAT amount excluding the excess?

If my query is not clear enough then here's an illustration:
Purchase Amt : :Rs.100
Vat @ 4% :Rs. 4
Vat actually collected by :Rs 4.3 supplier
Billtotal :Rs. 104.3

So in this case, can we claim Rs. 4.3 as input credit or can we claim just Rs.4????

Your reply is eagerly awaited. Please do reply.

Ankita Mundhada

CA Deepak P. Agrawal

CA Deepak P. Agrawal (Expert)
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04 January 2010 In your case you can take credit of Rs.4 only because as per Section 60(2) of MVAT Act no RD can collect tax in excess of amount of tax payable and hence the supplier will have to forfeit that amount.
Regards