Liability if the Word 'TAX' is not printed on the 'TAX Invoice'

[Sukesh Gupta]

'A' a manufacturer in Delhi issues an Excisable Invoice ( for claiming MODVAT Benefit) to another Manufacturer 'B' in Delhi who is also Registered With EXcise .The Format of the Invoice is as prescribed by Excise Department ie Invoice bears Tin No,ECC Code,PAN etc But the word 'TAX' is not put before 'INVOICE'

How serious is this Omission? Can 'B' not claim VAT Credit for VAT amount Charged by 'A'

[YAGAY andSUN]

Dear Sukesh,

The law is very clear on this aspect that Input Tax Credit can be claimed only on the strength 'Tax Invoice'. Department may levy penalty for non-compliance in this regard to the extent of ₹ 500/- per Invoice.

Regards,

Team YAGAY and SUN

(Management and Indirect Tax Consultants)

[Mahir S]

"A" should be advised to issue new invoices accordingly..

As for the invoices already issued, the word TAX should be affixed by a rubber stamp and same should be signed/initialed by "A". Thereafter VAT Credit may be taken by 'B' AFTER written intimation to the department about the changes made in the invoices.

Thereafter, it is upto the department to decide on the said issue.

[Sukesh Gupta]

Are the Rules and Regulations so vague and arbitrary and one is solely at the mercy of the authorities when there is no evasion of Tax ?

AI Summary

Manufacturer's Invoice Lacks 'TAX' Label, Risking VAT Credit and Penalty; Suggestions Made for Compliance Adjustment. A manufacturer in Delhi, 'A,' issued an invoice without the word 'TAX' before 'INVOICE' to another manufacturer, 'B,' raising concerns about claiming VAT credit. Pradeep Khatri noted that input tax credit requires a 'Tax Invoice,' and non-compliance may incur a penalty of 500 per invoice. Naveed S suggested 'A' issue new invoices or stamp the word 'TAX' on existing ones, notifying the department of changes. Sukesh Gupta questioned the clarity and fairness of the regulations, implying reliance on authorities despite no tax evasion.