Input vat credit disallowed for purchase from cancelled deal

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

21 March 2013 I PURCHASED SOME MATERIALS FROM A DEALER WHOSE RC WAS CANCELLED. MY ITC HAVE BEEN CANCELLED BY SALES TAX DEPARTMENT.WHAT SHOULD I DO? SHALL I HAVE TO PAY TWICE TAX? SOMEBODY PLEASE HELP ME?

CA Priti Surana

CA Priti Surana (Expert)
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22 March 2013 You can take the stand that the dealer u purchased goods from , was a registered dealer at the time you purchased the goods, and one can take credit of input tax as soon as the tax invoice is received, and you must be having ax invoices if you purchased goods from registered dealer. You can fight on the basis of tax invoices you have.

Querist : Anonymous

Querist : Anonymous (Querist)

22 March 2013 Shanti Kiran India Pvt. Ltd. Vs. Commissioner of Trade & Taxes [2013-VIL- 04-DEL]

The High Court of Delhi held that in the absence of any mechanism enabling a purchasing dealer to verify if selling dealer deposited tax with the Government and in the absence of notification whereby purchasing dealer can ascertain that a selling dealer's registration is cancelled, benefit of input tax credit under Section 9(1) of the Delhi Value Added Tax Act, 2004 cannot be denied.THUS ITC CANNOT BE DISALLOWED EVEN IF PURCHASE IS MADE FROM A DEALER WHOSE RC HAVE BEEN CANCELLED.

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CA Priti Surana

CA Priti Surana (Expert)
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25 March 2013 Thank you for the specific information.