Input rate of Cement for a cement product(RCC Spun Pipe) manufacturer under West Bengal Vat rule
SD
(Querist) 27 November 2010
This query is : Resolved
Hi,
I am running a manufacturing unit of RCC Spun Pipe where cement is the one of major raw material.At time of purchase this cement I used to pay VAT @ 12.5% to the dealer.Now please let me know if I'd get the input tax rebate of this cement purchase under the current VAT rule of West Bengal.If yes please let me know the rate of which I would get input tax rebate.I'd appreciate your help if you mention the exact section/sub section of the rule that described the same.
Khaleel Ahmed Mohammed
(Expert) 27 November 2010
You are advised to consult with your local tax practitioner, This will be very help ful for you.
R.Ramachandran
(Expert) 29 November 2010
Dear Mr. SD,
In terms of Section 22(4) of the W.B. VAT Act, 2003, input tax credit of VAT paid will be allowed except in respect of those goods specicied in the Negative List appended to the Section.
According to Serial No. of the Negative Schedule, cement is one of the items on which input tax credit will not be allowed. Only exception is when the cement is used by a registered dealer in execution of works contract, or when being resold as such by a Dealer.
The above position is despite the provision contained in Section 22(4)(d) which says input tax credit shall be allowed when such goods are purchased for "use as raw materials and consumable stores required for the purpose of manufacture of taxable goods itended for sale in the State or in the course of inter-State trade and commerce."
soumitra basu
(Expert) 02 December 2010
I think Mr. Ramachandran is correct. Though it is morally not correct but legally correct.
