What is meaning of Section 13(3) of UP VAT Act ?
Wheather a Dealer who re-sales the goods purchased with in the state should claim the ITC in the propportion of sale of goods.
Example: If a dealer purchases the goods from registered dealer against tax invoice of Rs. 10,000 and tax on which was charged @ 4% i.e Rs. 400/-. Lateron he selles the goods of Rs. 4000 and tax on which was charged @ 4% i.e Rs. 160/-. (Purchase value of Sale of Rs. 4000 is supposed to be 3500 and ITC on the same @ 4% is 140)
Please clariffy that he should calim the ITC on purchase value of sale. Wheather tax liabilty will be computed as follows:
Tax on Sale 160 - ITC claimed Rs. 140 Tax Payable Rs. 20 or
he should compute his tax liabilty as follows:
ITC Claimed (Full tax against purchase) 400
Tax on sale 160
Tax payable NIL
ITC c/f for next tax pd. 240
Please clarify the ahove issue. Thanks
Abhishek Srivastava, Adv.
