CA Devender Chauhan (Group Financial Accountant) (1526 Points)
16 November 2010One of our client puchase some component and packing material and pay vat in Haryana.
Then didn't sell these items directly but show them as consumption and pay vat on the consumption.
I want to ask that can they take vat credit of the vat they pay on purchases against the vat they pay on consumption.
Ravi Prasad
(Self employed)
(148 Points)
Replied 16 November 2010
Yes, you can take rebate of the input tax paid on the purchase of packing materials consumed for packing the goods as VAT Act treats packing materials as inputs. The condition for this is that the goods packed and sold must also be taxable under the VAT Act.
CAclubindia
