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NEED HELP

SANTOSH TRIPATHI (SENIOR MANAGER COMMERCIAL) (89 Points)

19 October 2010

PLEASE ADVICE IF WE CAN TAKE CREDIT OF EXCISE DUTY BUY FROM A TRADER WHO IS REGISTERED IN EXCISE AS A TRADER. LATER WE HAVE TO SOLD THIS TO EXCISE REGISTERED UNIT

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6 Replies

Anand (ACCOUNTS EXECUTIVE) (68 Points)
Replied 19 October 2010

Sir,

If u r registered in excise you avail the credit of excise.

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Prabhat Kumar (Advocate & Consultant) (1912 Points)
Replied 19 October 2010

Rule 9 subclause (iv) of the cenvat credit rule 2004 says that an invoice issued by first stage or second stage dealer can be used for availing cenvat credit, so if the trader is a first stage or second stage dealer you can avail the cenvat credit.

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R P Ananthakumar (Sr. Officer - Central Excise/Cash) (514 Points)
Replied 20 October 2010

As per rule you are eligible to take credit based on that dealer invoice and also you have to debited, when you have raised the invoice to your customer.

you treated as traded goods.

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 06 November 2010

condition 1) you must be registered to excise department as a Dealer

condition 2) the dealer supplying you goods is 1st stage dealer

here you have to act as 2nd stage dealer, to get the transaction valid in rules of excise department.

AVIJIT MONDAL (Student CMA) (24 Points)
Replied 23 September 2012

SIR,

WHAT IS THE ACCOUNTING TREATMENT WITH EFFECT IN SALES TAX RETURN FOR FOLLOWING CASE:

MY COMPANY IS EXCISE REG. COMPANY . WHEN GOODS PURCHASE FORM A TRADER WHO IS NOT EXCISE REGISTER DEALER BUT AT THE TIME OF MATERIAL PURCHASE FROM THAT DEALER HE PROVIED HIS OWN BILLS WITH 1ST OR 2ND STAGE DEALER TRANSPOTER COPY FOR CENVAT CREDIT. PLS TELL ME THE ACCOUNTING TREATMENT WITH EFFECT IN SALES TAX.

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U S Sharma (glidor@gmail.com) (21063 Points)
Replied 23 September 2012

Originally posted by : AVIJIT MONDAL
	SIR, WHAT IS THE ACCOUNTING TREATMENT WITH EFFECT IN SALES TAX RETURN FOR FOLLOWING CASE: MY COMPANY IS EXCISE REG. COMPANY . WHEN GOODS PURCHASE FORM A TRADER WHO IS NOT EXCISE REGISTER DEALER BUT AT THE TIME OF MATERIAL PURCHASE FROM THAT DEALER HE PROVIED HIS OWN BILLS WITH 1ST OR 2ND STAGE DEALER TRANSPOTER COPY FOR CENVAT CREDIT. PLS TELL ME THE ACCOUNTING TREATMENT WITH EFFECT IN SALES TAX.

if the trader is not registered under excise, then input credit is not admissible,

every good has some manufacturer and some dealer in between the way of transaction, so its not doubted that the dealer is actual dealer of the goods, direct from the manufacturer or on the way as 2nd stage,

but this does not qualify that the invoice issued by the said dealer qualify for input credit. to get qualified for input credit, department needs the transporter copy of dealer's invoice only, of registered dealer.

as your dealer is not regd with excise , hence the input credit lapse at the point when the goods are sold to 1st unregistered dealer, and it can not be passed on in the chain.

reg sales tax, if the goods are procured within the state, then you are eligible for vat credit, however the same is not available if not procured within the state,