my client is paying tax under compositon and he , after purchasing capital goods , enter into partnership . The firm wants to take credit of said input tax credit by endorsing the purchase bills. can firm eligible take credit of input tax paid by the composition dealer ?
4 Replies
Hari Wadhwa
(CA in Practice)
(485 Points)
Replied 12 November 2011
Mr Ramakrishna
Under composition scheme, the registered dealer is NOT allowed to issue Tax Invoice. Further, No tax credit is permitted to be claimed on purchases.
AUDITOR VINOTHKUMAR
(a)
(870 Points)
Replied 12 November 2011
DEAR HARI,
WHAT IS UNDER COMPOSITION?
ADVANCE THANKS
Hari Wadhwa
(CA in Practice)
(485 Points)
Replied 13 November 2011
Dear Mr Vinoth
The term "Under Composition" means a dealer who has opted to register himself under the composition scheme with the VAT deptt.
Ramakrishna Bhat
(OWNER)
(57 Points)
Replied 15 November 2011
One of the conditions of compositon tax is that the dealer cannot take input tax credit , and he shall not purchase goods form interstate
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