In Bihar during 2005-2006, we were told by auditors and Telecom companies that VAT Rate on cell-phones is 4%, thus I was billed around Fifty Lakhs of cell-phones during 2005-2006 under 4% by a telecom company and I further sold it at 4%. Also, in Bihar State VAT Circular it was shon that ALL ELECTRONICS AND EQUIPMENT FOR COMMUNICATION SUCH AS WIRED TELEPHONE, WIRELESS TELEPHONE, EPABX AND ITS ACCESSORIES & COMPONENETS THEREOF.
But In revised circular of 2006-2007, MOBILE PHONE was also added to that line. Now state hasstarted pointing out that since it was added in 2006-2007, thus it can't be covered under 4% for 2005-2006 as if it had been same as others which has been indicated, they wouldn't have added MOBILE PHONE in 2006-2007.
Please, somebody help me out by finding some act or rule or anything which can be of help as they are going to fine rest 8.5% on total sales+ Penalty which is around ten lakhs.
Please somebody help me...
CAclubindia
