13 October 2010
sir we are establishing power plant in maharashtra state & it will take 2 year to generate power. We will capitalised all pre operating expenses after completion of project. My question is how we trate VAT on expenses? Can we take set off or not? if yes then any retention is require? Please guide.
We are incurring admistartive expenses e.g.purchse of safety shoes,printing & stationery wtc. On this purchases we have paying MVAT. Till there is no sale, therefore there is no liability. We have to take refund from Govt. after completion of year. Sir, my question is currently we are paying VAT on purchases. As per Accounting we are debiting these expenses on AUC. After completion of project all expenses will allocate on asset. Currently there is no criterion decided of allocation. My question is that I have to file MVAT & CST return, how should I treat the VAT in this return i.e. should i take full credit on expenses and apply for refund or should not take credit on expenses?
CAclubindia
