Is vat/cst is levied on sale of second hand machinery.

This query is : Resolved

CA/CS sarban kumar jha (Querist)
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28 July 2015 RESPECTED ALL,
IS VAT/CST IS LEVIED ON SALE OF SECOND HAND MACHINERY WITHOUT ANY VALUE ADDITION. FOR EX. A FIRM PURCHASES A MACHINE ON 01.04.2010 AND SALES IT AFTER USING IT FOR 5 YEARS ON 01.04.2015 AT A VALUE WHICH IS APPROX OF WDV LEFT AS PER INCOME TAX ACT. MY Q. IS SHOULD I CHARGE VAT/CST ON SUCH SALE IN BILL? PLEASE ADVICE,IF YES THEN THERE IS NO VALUE ADDITION TO MACHINE,WE ARE JUST SELLING IT AFTER USING FOR 5 YEARS,KINDLY ADVICE.

CA John Abraham Austin ACA

CA John Abraham Austin ACA (Expert)
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28 July 2015 It depends on the state VAT Act.
Here in Kerala, if a Machinery or Motor Vehicle is used for less that 18 months, he VAT rate on sale would be the original rate of that Machinery/ Vehicle (I.e, 14.5% presently). If used more than that period, it would be 0.50%.

Please refer your State VAT Act.