Disallow of Input vat

[MANOJ KUMAR]

Dear Sir,

Good afternoon.

My query is that is input disallow if by product is exempt. such as if when we process the wheat in mill we got Atta, Suji, Maida, Rawa and Choker but in case Atta, Suji, Maida and Rawa is Taxable in verious states but Choker is exempt.in this case input vat disallow in ratio of choker?

Pls answer me as soon as possible urgent basis

AI Summary

No Need to Reverse Input Tax Credit for Exempt By-Products like Choker under HVAT Act, 2003 A query was raised regarding the disallowance of input VAT when a by-product is exempt from tax. Specifically, the question involved the milling of wheat into products like Atta, Suji, Maida, and Rawa, which are taxable, while Choker is exempt. The response clarified that since Choker is a by-product, there is no requirement to reverse the proportionate input tax credit under the HVAT Act, 2003.