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AJAY (Chartered Accountant) (70 Points)
Replied 30 October 2007

Hi Dear Ajay.., As per DVAT Scheme every dealer is liable to pay tax on all sales on and after his turnover exceeds the taxable quantum. whereas section18(3) of the DVATj act, whereby sale of capital assets will not be considered fo the purpose of arriving at the taxable quantum.Now as per this clause the activity carried on by a CA (You) , are specified under this section for the prupose of bussiness, then also sale of CAPITAL ASSETS, such as furniture, vehicles , would not be taxable due to two Obivous reasons, (i) He is liable to pay tax from the next sale, which will never take place since CA is not engaged in purchase or sale activity: and (ii) sale fo capital assets will not be considered for arriving at the taxable quantum. Therefore, a CA/Professional unless not engaged in purchases and sale of goods, will not be liable to pay tax on sale of merely capital assets. hope the above shalll resolve ur query i m too a delhi based CA.. with warm regards CA AJAY RAJPUT

Adv. S Sharma (Lawyer) (574 Points)
Replied 30 October 2007

Thx AJAY RAJPUT SIR
SIR CAN U REFER ANY JUDGEMENT IN RESPECT OF THIS KIND OF SALE, WHICH STATES THAT ITS NOT LIABLE FOR TAX.
LIKE JUDGEMENT IN BOTH LOCAL OR INTER STATE SALE

AJAY (Chartered Accountant) (70 Points)
Replied 30 October 2007

Dear Sir..,

right now i dont have any case law in support of my view , further i think that i may not be require to establish any thing as it is a part of law which does not require any interpretation itself as for determination of Taxable Quantum Capital Assets has been specifically exclueded hence it may be justifed by DVAT Act itself..

nageswararao (Mgr - Commercial) (142 Points)
Replied 01 November 2007

You are not satisfied the the definition of Dealer what it defined in VAT, so there is no quetion of liablity of VAT. So, you are not liable to pay any VAT. Ph 099891 57666, Email: nageswararao.bommakanti @ ril.com Land: 0884 2388343

(Guest)

we have purchased paints for our mahinery manufacturing unit @ 12.5% from both manufacturer and dealer. and we are charging output VAT as 4%. can we avail ITC 12.5% or 4%? please explain.

(Guest)

hi all well i post this topic last week, even after 7-8 days i didnt get any good reply from this CA Club. its so funnyyyyy. somebdy is talking about CAPITAL ASSEST/GOOD IS FURNITURE. i want to ask him , had he read the definition of capital assest in the CST AND DVAT ? No CAPITAL GOOD IN DVAT = means plant and machinery and equipment used in the process of trade or manufacturing : so is furniture fall in the scope of CAPITAL GOOD ? i think NO. suppose if u go in interview and if urs ans is this "one sales its proverty" can they peopl recruit u ? No Never. i asked about judgement but nobody gave any ans, whats this yar ? under VAT/SALES TAX any sale by dealer either regularly or otherwise is liable to sales tax. so if there is one sale , it will be liable to sales tax. otherwise means one sale and if u say seasonal then seasonal sale fall in the scope of regular sale. i m here talking about furnitur and furniture doen not fall in the scope of CAPITAL GOOD/ASSEST therfore it also does not fall in the scope of section 18 of DVAT. SECTION 18(3) excludes CAPITAL ASSEST , winding up the dealers activity and permanent diminution of dealers activity only Can Mr. Ajay tell me is furniture fall in the scope of Caital Assest. Kindly see the definition of caiptal assest and dealer in both CST and DVAT. no body given any judgement on this also uff, i hope some reply will come with perfaction or with conceptual clarity.

(Guest)

hi all well i post this topic last week, even after 7-8 days i didnt get any good reply from this CA Club. its so funnyyyyy. somebdy is talking about CAPITAL ASSEST/GOOD IS FURNITURE. i want to ask him , had he read the definition of capital assest in the CST AND DVAT ? No CAPITAL GOOD IN DVAT = means plant and machinery and equipment used in the process of trade or manufacturing : so is furniture fall in the scope of CAPITAL GOOD ? i think NO. suppose if u go in interview and if urs ans is this "one sales its proverty" can they peopl recruit u ? No Never. i asked about judgement but nobody gave any ans, whats this yar ? under VAT/SALES TAX any sale by dealer either regularly or otherwise is liable to sales tax. so if there is one sale , it will be liable to sales tax. otherwise means one sale and if u say seasonal then seasonal sale fall in the scope of regular sale. i m here talking about furnitur and furniture doen not fall in the scope of CAPITAL GOOD/ASSEST therfore it also does not fall in the scope of section 18 of DVAT. SECTION 18(3) excludes CAPITAL ASSEST , winding up the dealers activity and permanent diminution of dealers activity only Can Mr. Ajay tell me is furniture fall in the scope of Caital Assest. Kindly see the definition of caiptal assest and dealer in both CST and DVAT. no body given any judgement on this also uff, i hope some reply will come with perfaction or with conceptual clarity.

nageswararao (Mgr - Commercial) (142 Points)
Replied 05 November 2007

Why should you feel like that, you are also an Auditor, you are unable to justify your self, how to you feel all the members are not perfect. Even you are not satisfying the definition of Dealer, how to you are liable?

CA Gnanika (CA ) (485 Points)
Replied 05 November 2007

i m really confused, can Ajay sir tell y r we supposed to pay tax on sale of furniture when we r not engaged in trading or manufacturing activity, i will be greatful to u if u can justify u'r question to pay tax on sale of furniture. pls help me ,u can mail me at gnanika_nagesh @ yahoo.com

(Guest)

hello Mr Nageswararao here i m talking about furniture and furniture is not capital assest. now are talking about the definition of dealer, then kindly see the definition of BUSINESS & DEALER. BUSINESS includes any trade, any adventure, any transaction or any occasitional transaction whether or not there is volume, frequency, CONTINUITY OR REGULARITY OF SUCH TRANSACTION. DEALER means any person who carries on BUSINESS [business already defined] in Delhi and includes (ix) any person who, for the purpose of or in connection with or incidental to or in the course of business dispose of any goods as unclaimed or confiscated with or incidental to or in the course of his business dispose of any goods as unclaimed or confiscated or scrap, SURPLUS, OLD, obsolete or as discarded material or waste product by way of sale dealer includes any (viii)casual dealer clause (i) to (ii to vii) sorry if u feel bad but see more then 150 members check the querry but not perfact ans. thats why. for the purpose to understand applicability of VAT on OLD OFFICE FURNITURE SALE i posted it. well i hope some perfact ans will come I THINK SOMEBODY IS UNABLE TO JUSTIFY SOMETHING THATS WHY THEY USE TO COME IN THIS SITE

(Guest)

Hi Gnanika well definitions of dealer in CST says dealer means any person who carries on (whether regularly or OTHERWISE) ?????????? POINT :- WHAT OTHERWISE MEANS, ITS NOT SEASONAL { SEASONAL FALL IN THE SCOPE OF RETGULAR } then what i sold my old furniture ,,,,, ya i know m not liable to VAT but why? what are the provisions behind this? u are saying :- we r not engaged in trading or manufacturing activity BUT POINT IS ONE ACTIVITY IS ALSO CONSIDERED TRADING ACTIVITY WHERE WE SALE OR PURCHASE THE GOOD. THERE SHOULD BE SOME CONCEPT OR LOGICAL REASONING. kindly read definition of dealer, business & capital assest in the act. furniture does not fall in the scope of capital assest. what are the provision which are saying i am not lible to VAT. I READ ALL THE ACT IN BRIEF BUT NOTHING WRITTEN ANYWHERE THAT:- IF AM DOING ONE ACTIVITY OR SALE ITS NOT LIABLE TO VAT. PLEASE DONT BELEIVE IN THUMB RULES. INTERPRETATION & FACT MATTERS

girish (article) (567 Points)
Replied 05 November 2007

Sales Tax- BUSINESS---any trade or commerce or manufacture in the nature of trade commerce or manufacture will be treated as business irrespective of making profit or not and any gain or profit accrued or not. DEALER--any person who carries on (whether regularly or otherwise)the business of buying selling supplying or distributing of goods directly or indirectly... SALE--any transfer of property in goods by one person to another..... THUS AJAYJI, IN YOUR CASE THERE IS NO BUSINESS AND YOU ARE NOT A DEALER AS SUCH WHY SALES TAX ? EVERYTHING IS PERFECT !!!!

(Guest)

hi girish what otherwise means in definition of dealer ? it means ONE TIME TRADE so what u say about that WORD ----- OTHERWISE

(Guest)

hi all The word trade means buying and selling and in our case I am not buying anything but only selling the old furniture therefore we are not liable to VAT/Sales Tax but the only question arise the word OTHERWISE in the definition of dealer and clause (v) of the definition of BUSINESS .