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Input VAT Set Off against CST Liability

Ashish (Student) (53 Points)

30 July 2010

Dear All!

Can anybody pls explain me with documentary proof that whether excess input vat can be utilised while paying the cst liability for the states of Himachal Pradesh, Karnataka and Rajasthan.

Thanks

Ashish Agarwal

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5 Replies

Harpreet (* * * * * *) (1670 Points)
Replied 30 July 2010

I think you do not need documentary proof bcoz when you file your sales tax return you will find two form i.e. one for local sales and another for central sales so you will definitely find that there is option to adjust your excess payment towards local vat (input vat credit available). I think the same will be available in all the forms of all the states.

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Ram Avtar Singh (Nagari Sultanpur U.P.Delhi) (14497 Points)
Replied 30 July 2010

Agree with expert

ravichandra (Jr.Accountant) (26 Points)
Replied 28 August 2010

I have a business Iam Purchasing Goods From Other States CST 2% Monthly. How to Caluculate Vat and CST Purchase at The time of Monthly Retuns. Please Help me. My Business In Andra and Purchase From Karnataka and Tamilanadu and Kolkata.

Atul (a) (25 Points)
Replied 11 November 2010

But Mr. Harpreet, I can't find any place where we can adjust the Excess Input VAT in the Form I for CST calculations. Please guide.

Regards,

Atul Goel

Ravi Prasad (Self employed) (148 Points)
Replied 16 November 2010

The two taxes are independent of each other. The CST is liable to be paid on all the interstate transactions and it is a liability. The VAT is independent and there is set off mechanism for the tax to be admitted on all the sales and claim the rebate of the input tax on all the purchases, only VAT.

The laibilities are calculated separately under each Act. If there is excess VAT paid i.e. Input tax is more than the Output tax, then the excess amount gets adjusted to the tax payable under the CST Act.

By virtue of section under VAT Act, the VAT paid on the inputs which are sold interstate is eligible for rebating. This has nothing to do with the CST Act.