We purchased machines and since it was rejected by quality dept, we did not raise GRN and also did not account the bill & hence VAT input credit was not claimed
Subsequently the machine was returned back to the supplier for repair & replacement by raising Debit Memo without charging VAT.
But the supplier is insisting that we should have charged VAT on the Debit Memo so that they can claim back VAT Credit as they have charged VAT when they initially sold the machine
Our argument since the machine was sent back for repairs & replacement we did not charge VAT on the Debit Memo
Pl. clarify the treatment of VAT for Repairs & Replacement of Capital Good under Karnataka Value Added
CAclubindia
