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Vat applicable or Not

vijaya kumar n (JOB) (488 Points)

30 June 2010

Good Evening to All,

is it Vat applicable for hiring the equipments and Machinery??????????

Suggest me

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6 Replies

SUDHIR & PRADEEP JI (CA FINAL+LLB + DISA) (2299 Points)
Replied 01 July 2010

Dear Vijay

Plz tell for which state are you talking about

bcoz the vat applicability is differennt in differennt state

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TRILOCHAN (SENIOR ACCOUNTANT) (698 Points)
Replied 01 July 2010

in Delhi VAT is applicable on hiring of Machinery

vijaya kumar n (JOB) (488 Points)
Replied 01 July 2010

Karnataka State

RAJU (LEARNER) (1089 Points)
Replied 02 July 2010

Dear Vijaya

VAT is applicable on hiring of all goods (which includes machinery & equipments). Though VAT is a State subject, the concept of `Sale` and `Transfer of Right to Use` for all the States are the same as the States are bound to levy tax only based on the powers conferred by Constitution of India. So, I believe it is applicable for all the States.

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vijaya kumar n (JOB) (488 Points)
Replied 02 July 2010

Mr.Dharmaraju,

If possible can u send the Govt Circular ................

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RAJU (LEARNER) (1089 Points)
Replied 03 July 2010

Please go through the definition of Sale in KVAT Act. The definition of sale includes `Transfer of Right to Use` which is nothing but hiring. Since VAT is payable on sale of all goods, the tax needs to be paid even on hiring ....