ITC reversal-TNVAT

[yash arya]

Under Sec.19(4)  0f  TNVAT Act, it requires reversal of ITC  upto 5 percent in respect of transfer of goods interstate for resale or manufacturing.  Kindly clarify if this provision is applicable for the  goods listed in Part A of First Schedule where vat rate applicable is 1 percent , say, semi-finished diamond jewellary items sent to Branch in other state for finishing process. 

- shekar r

[DR.MARIAPPAN GOVINDARAJAN]

Whether you have got clarified in the above issue? If not please inform.

AI Summary

Input tax credit reversal questioned for interstate transfers of low rated goods sent to a branch for finishing work. Whether input tax credit reversal applies to inter state transfers of goods sent to another state for resale or manufacture is queried, specifically asking if the reversal requirement extends to goods listed in the First Schedule (Part A), exemplified by semi finished diamond jewellery sent to a branch in another state for finishing.