Vat on readymade garments

This query is : Resolved

Mohan Verma (Querist)
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14 August 2011 One of my client is a Readymade Garments dealer

As per recent Delhi notifications, if the readymade garments are below 5000 will attract 5% vat and above 5000 will attract 12.5% vat.

Here the confussion is whether it is on Sale price or on MRP value ?

Please help

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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15 August 2011 Mr.Mohan Verma,
What amount you receive during the sales is important and not the price marked on the garments.In your invoices whenever you are charging less than Rs5000/-you can collect 5% DVAT and 12.5% for the garments above that price. Your invoice is the proof for the tax authorities.
MJK