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VAT INPUT ON MATERIAL RECEIVED

Krishnaraj (Asst.Manager - Finance & Accounts) (32 Points)

20 November 2009

Can any body explain me on what basis i can avail the VAT ITC benefit before submitting the monthly VAT Return ?

1.Can i avail the Input once the Material is received ? or

2. Can i avail once it is consumed for Production ? or

3. Can i avail the same only when i account it at in my books by creating the liability in the name of supplier ? or

4. Can i avail only after i receive the TAX Invoice ( in case where the material is received via Delivery challan and INVOICE will be received on a later stage and accounting is done basis of invoice not DC) ??

Kindly clarify ????

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CA Chandra Kishore Bajpai (Tax Consultant) (3088 Points)
Replied 20 November 2009

It is kindly suggested to everyone who is going to post query on VAT, please provide complete information and frame your query in a specific way not in general.

Foe example

1. State name :- Where dealer is registered so that query could be replied in the light of relevant provision of the state VAT law

2. Nature of Business

3. Descriptttion & Nature Goods:- to determine rate & taxability of goods etc etc.

Now i am making an effort for your query:-

Q-1.Can i avail the Input once the Material is received ?

Material must be received before claiming ITC

Q 2. Can i avail once it is consumed for Production ?

In some state ITC is available on consumption of goods but in general once material recived ITC can be claimed

Q-3. Can i avail the same only when i account it at in my books by creating the liability in the name of supplier ?

Purchase must be recognsed in books of aacount to claim ITC

Q-4. Can i avail only after i receive the TAX Invoice ( in case where the material is received via Delivery challan and INVOICE will be received on a later stage and accounting is done basis of invoice not DC)

Documents on the basis of which ITC can be claimed, should be in possesion of the dealer at the time of claiming ITC as invoice is the documents which make eligible the dealer to claim ITC ,thus ITC should be claimed when Invoice is in possesion