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Query...Urgent

CA. D.DHANANJAYA (CHARTERED ACCOUNTANT) (90 Points)

21 December 2009

Can any one tell me the chargeability of VAT and CST for the following:

Value of goods = Rs.10000

Freight = Rs.1000

Total purchase cost =Rs.11000

Now the question is to take the credit of vat or cst on 10000 or 11000 (Incl freight)..

If possible specify act for the above chargeability..

Pls do the needful.. Thank you

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10 Replies

Prabeer (B. COM (H) CA & CS Final) (5484 Points)
Replied 21 December 2009

The value of goods of Rs. 10,000.00 will attract VAT or CST.

The value of Freight charges of Rs. 1,000.00 will attract Service Tax.

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Bharat Khurana (Student) (153 Points)
Replied 21 December 2009

vat or cst is chargeable on amount of sales so it would be levied on rs. 10000

Jitesh Kumar (CA- FINAL) (68 Points)
Replied 21 December 2009

bharat khurana is right, amount of freight is relevent for accounting purpose, not for taxation

Venkateswarlu (CA Final) (51 Points)
Replied 21 December 2009

VAT or CST chargeable on Cost of the goods only. Not any other things. But, some of the department officials are asking to pay the vat or cst on Freight also. Input tax credit amount is what amount is mentioned in TAX Invoice is the eligible to take INPUT TAX CREDIT.

gadhamsetty manikanta (ca cwa isa) (66 Points)
Replied 21 December 2009

Originally posted by : D. DHANANJAYA
	Can any one tell me the chargeability of VAT and CST for the following: Value of goods = Rs.10000 Freight = Rs.1000 Total purchase cost =Rs.11000 Now the question is to take the credit of vat or cst on 10000 or 11000 (Incl freight).. If possible specify act for the above chargeability.. Pls do the needful.. Thank you

where to include freight or not depends on the terms of agreement.if it is free on board(FOB) sales,then u need not include freight but where as incase of delivery at the place of buyer u have to include freight

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CA PRAVEEN KESHAV (CHARTERED ACCOUNTANT) (331 Points)
Replied 21 December 2009

vat will be levied on rs 10000

cst will be levied on rs 1000

SUNIL (PCC ) (282 Points)
Replied 21 December 2009

Sir Ji,

Vat charged on actual purchase or sales amount not any other included direct exp. So vat charged on 10000.00 rs not 1000.00. Same as its ITC (if purchase proceeds) claimed for the period. If this purchase from unregistered then purchaser deposited its VAT amount (as the case may be) then he claimed OR adjust ITC against sales proceed.