From unbranded sellers - Tamilnadu

[Guest]

Hi

We purchase old furnitures from Unbranded sellers and also from houses and then refurbish it and sell it . We are registered dealer with showroom with VAT and CST. How to treat this unbranded purchase of wooden furnitures in to account and any extra tax to be paid for this unbranded purchase.

Thanks in advance.

Regards

Ponnukumar

[YAGAY andSUN]

Dear Ponnu,

If your are paying tax on sales then there is no requirement to pay tax on purchase from unregistered dealers.

Regards

YAGAY and SUN

[Guest]

Hi

Thanks for the answer , but we cannot show this in to purchase as there is no bill for it and because of this we may not be able to show this in stock list if iam right.

My auditor is saying we should not purchase from unregistered dealer and ieven if we purchase it cannot be accountable in purchase , stock and selling.

Any circular / note published from government supporting it.

Regards

Ponnu

[SURENDRA BABU MUTHYALA]

No.1 is You have to pay purchase tax on the old and unbranded furniturenas per the provision read below:

Section 12. Levy of purchase tax .-- (1) Subject to the provisions of sub-section (1) of section 3, every dealer, who in the course of his business purchases from a registered dealer or from any other person, any goods (the sale or purchase of which is liable to tax under this Act), in circumstances inwhich no tax is payable by that registered dealer on the sale price of such goods under this Act, andeither -

(a) consumes or uses such goods in or for the manufacture of other goods for sale or otherwise;

or

(b) disposes of such goods in any manner other than by way of sale in the State;

You can also claim the same under ITC the next month in the monthly return.

No need to break heads.

[Guest]

Thanks Mr.Suresh. So if the items purchased from URD for making outer good for sale and for consumption attracts no tax and all other than that have to be paid Purchase tax of 14.5% and treated as input tax and same can be adjusted in every month tax filing . Hope iam right.

BTW for purchasing from URD do i need to get sign in voucher kind from them and have to be referred in the Input tax ?

Thanks

Ponnu

AI Summary

Purchase tax on unbranded purchases may apply; purchase tax can be claimed as input tax credit in returns. Purchases of used, unbranded furniture from unregistered sellers may attract purchase tax when the goods are taxable and the seller does not charge tax; this levy applies where the purchaser consumes or uses the goods in manufacture or disposes of them other than by sale in the State. A registered dealer can treat purchase tax paid as input tax credit and adjust it in the next monthly return. Practical recordkeeping-such as obtaining a signed voucher from the seller-is necessary for accounting and claiming input credit, though no specific voucher format is prescribed in the text.