Purchase & sale

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 September 2013 I HAVE PURCHASED GOODS FROM A PARTY OF RS10000000/ AND PAID VAT @5%.AFTER SOME DAYS I SOLD GOODS TO SAME PARTY OF RS 15000000/ & Charged vat@5%.Shall I HAVE TO MAKE PAYMENT BY BANK TO AVAIL INPUT TAX CREDIT.OR CAN I MAKE ADJUSTMENT ENTRY AND SET OFF MUTUAL AMOUNT BY ADJUSTMENT ENTRY. WILL THERE BE ANY PROBLEM FROM SALES TAX AUTHORITIES.WHAT WII BE BOOK ADJUSTMENT ENTRY & HOW SET OFF WILL BE MADE. WHAT WILL BE ENTRY & NARRATION

harish

harish (Expert)
Follow

29 September 2013 Presuming both are registered dealer, purchase of good will attract VAT & sale of same will again attract VAT. If purchase made for resale then set off will be allowed otherwise not available. Book adjustment only allowed in case of set off.