vat credit issue

[pardeep bisht]

please clear, vat credit is available on the raw material partially used byself for manufacturing the product on job work for export oriented unit

[NANDKUMAR SAGWEKAR]

Dear Sir, When you use the Raw Material for Job Work , I think it become works contract and you have to pay the VAT . If you pay the vat as 12.5% on value of Materials used in works contract , you can take the VAT set off. If you charge 8% Vat under composition scheme on total value then you are eligible to claim vat set off 64% of eligible set off. Export oriented unit has to claim the refund from dept. Thanks ANAND SHEMBEKAR CELL 9209904370

AI Summary

VAT credit availability: paying VAT on materials in job work permits set off; composition scheme limits set off and exports seek refund.
VAT credit depends on treating raw material used in job work as part of a works contract and on how VAT is paid; if VAT is paid on materials used in the works contract the taxpayer may claim VAT set off, while composition scheme payers have a reduced set off entitlement and export oriented units must claim any recovery by departmental refund.