Amendment status not verified — confirm the current text below against the official source.
(1) Subject to such conditions and restrictions as may be prescribed, every registered dealer other than a shipper of jute, shall be entitled to claim an input tax credit of his input tax against his output tax in such manner as may be prescribed. (2) The input tax credit as mentioned in sub-section (I), shall be the amount of tax paid or payable by the registered dealer at the time of purchasing the taxable goods (hereinafter referred to as the "purchasing dealer"), to the seller who is a registered dealer, on the turnover of purchases made by the purchasing dealer during the tax period subject to the provisions contained in sub-sections (3) to (9) and sub- section (15): Provided that subject to such conditions and restrictions and in the manner as may be prescribed, a registered dealer other than a shipper of jute, will get input tax credit for the goods other than capital goods, lying in stock with the dealer on the date of his incurring liability to pay tax under this Act when the dealer has proved to the satisfaction of Commissioner that such goods were purchased on or after a date specified for such purchase. (3) The purchasing dealer availing of the input tax credit shall maintain the registers and the books of accounts in the manner as may be prescribed. (4) The input tax credit shall be allowed to the extent of the amount of tax paid or payable by the purchasing dealer on his purchase of taxable goods made in the State from a registered dealer holding a certificate of registration and such goods are purchased for the purpose of— (a) sale or resale by him in West Bengal; or (b) sale in the course of inter-State trade and commerce; or (c) use as containers or material for packing of taxable goods intended for sale in the State or sale in the course of inter-State trade or commerce; or (d) use as raw materials, capital goods and consumable stores required for the purpose of manufacture of taxable goods intended for sale in the State or in the course of inter-State trade and commerce or in the packing of goods so manufactured; or (e) execution of works contract; or (f) use as raw materials, capital goods and consumable stores required for the purpose of manufacture of goods to be sold in the course of export under section 5 of the Central Sales Tax Act, 1956, and packing materials 74 of 1956. and containers used for packing such goods: Provided that if purchases are used partially for the purposes specified in this sub- section, the input tax credit shall be allowed proportionate to the extent they are used for the purposes specified in this sub-section. (5) The input tax credit shall not be claimed by the purchasing dealer until he receives from the registered dealer from whom he has purchased the goods, original tax invoice in the prescribed manner evidencing the amount of tax. (6) Notwithstanding anything contained in this Act, no input tax credit shall be allowed for purchases— (a) made from the registered dealer who has been allowed to pay tax at a rate under sub-section (3) or sub-section (4) of section 16; or (b) made in the course of inter-State trade and commerce; or (c) made in the course of importfrom outside the country; or SI PART III] THE KOLKATA GAZETTE, EXTRAORDINARY, DECEMBER 27, 2004 17 The West Bengal Value Added Tax Act, 2003. (Chapter III.—Incidence and levy of tax.—Section 22.) (d) of the taxable goods which are disposed of otherwise than by way of sale, or used as raw materials in manufacture of goods which are disposed of otherwise than by way of sale as mentioned in sub-section (8); or (e) of the taxable goods which are used in manufacture of goods specified in the Schedule A or in the packing of goods so manufactured and not sold in the course of export; or (f) of the taxable goods which remain unsold as stock of goods at the time of closure of business; or (g) of the taxable goods in respect of which the original tax invoice has been issued by a registered dealer from whom purchasing dealer has purchased such goods, without specifying the details of tax charged on such goods separately; or (h) of the taxable goods in respect of which the original tax invoice has not been issued by the registered dealer to the purchasing dealer or the same is not available to the purchasing dealer, subject to such conditions and restrictions as may be prescribed. (7) A registered dealer shall not be entitled to input tax credit in respect of the purchases of the following taxable goods:— (a) air-conditioning units, air coolers, fans and air circulators unless the registered dealer is in the business of dealing in such goods; (b) all automobiles including commercial vehicles, and two and three wheelers, and spare parts for repair and maintenance thereof, unless the registered dealer is in the business of dealing in such automobiles or spare parts; (c) crude oil unless the registered dealer is in the business of dealing in such products; (d) food, beverages and tobacco products, unless the registered dealer is in the business of providing such food, beverages and tobacco products; (e) goods purchased and accounted for in business but utilised for the purpose of providing facility to the employees including any residential accommodation; (f) goods used for personal consumption or gifts; (g) such goods or classes of goods as may be prescribed. (8) Where the turnover of purchases of taxable goods— (a) used or despatched for stock transfer outside the State otherwise than by way of sale; or (b) used as raw materials in manufacture, or in the packing of goods so manufactured, which are despatched outside the State otherwise than by way of sale, a registered dealer shall not be entitled to input tax credit unless the amount of tax on such turnover of purchases exceeds the amount calculated at the rate of four per centum or applicable rate of tax, whichever is lower, and the amount of input tax credit shall be calculated at such rate which exceeds four per centum or applicable rate of tax, as the case may be: Provided that where a registered dealer has already enjoyed input tax credit at the full rate, his input tax credit shall be reversed to the extent to which he is not eligible in such manner as may be prescribed. (9) The State Government may, by notification, specify any class of dealers that shall not be entitled to full or partial input tax credit. 18 THE KOLKATA GAZETTE, EXTRAORDINARY, DECEMBER 27, 2004 [PART III The West Bengal Value Added Tax Act, 2003. (Chapter III.—Incidence and levy of tax.—Section 22.) (10) Where a registered dealer without entering into a transaction of sale, issues to another registered dealer tax invoice, retail invoice, bill or cash memorandum with the intention to defraud the Government revenue, the Commissioner may, after making such inquiry as he thinks fit and after giving the registered dealer a reasonable opportunity of being heard, deny the benefit of input tax credit to such registered dealer issuing or accepting such tax invoice, retail invoice, bill or cash memorandum, either prospectively or retrospectively, from such date as he may deem fit and proper. (11) If the taxable goods are purchased for the purposes specified in sub-section (4) and are used fully or partly for purposes other than those specified in that sub- section, or are used fully or partly in the circumstances described in sub-section (8), the input tax credit, if availed of, shall be reduced on account of such use from the net tax credit being claimed for the tax period during which such use has taken place and such reduction shall be done in the manner as may be prescribed. (12) The net tax credit shall be determined in the following manner, namely:— Net tax credit = A + B — C Where— "A" represents the amount of input tax credit which the dealer is entitled to under sub-section (1) subject to other provisions of this section; "B" represents outstanding input tax credit brought forward as determined from the previous tax period; "C" represents reverse tax credit as determined under the proviso to sub- section (8) or sub-section (11). (13) Where any purchaser, being. a registered dealer, has been issued with a credit note or debit note in terms of section 44 or if he returns or rejects goods purchased, as a consequence of which the input tax credit, availed by him in any period in respect of which the purchase of goods relates, becomes either short or excess, he shall compensate such short or excess by adjusting the amount of input tax credit allowed to him in respect of the tax period in which the credit note or debit note has been issued or goods are returned, subject to such conditions as may be prescribed. (14) The methods that are used by a registered dealer in a year to determine the extent to which the goods are sold, used, consumed or supplied, or intended to be sold, used, consumed or supplied in the manner specified in sub-section (1) shall be fair and reasonable: Provided that the Commissioner may, after giving the registered dealer an opportunity of being heard and for the reasons to be recorded in writing, reject the method adopted by the registered dealer and calculate the amount of input tax credit. (15) Notwithstanding anything contained elsewhere in the Act, when a dealer enjoying deferment of payment of tax under sub-section (1) of section 97 or under clause (a), or clause (b), or clause (c) of section 118, purchases taxable goods from within West Bengal, which are used as raw materials in manufacture of taxable goods or in the packing of goods so manufactured, or capital goods, he shall not be entitled to input tax credit during the period of such enjoyment which shall be accumulated and carried forward until the expiry of such period of deferment: Provided that such dealer shall be entitled to input tax credit in respect of such purchases of taxable goods within West Bengal, output tax on sale in West Bengal of which, cannot be deferred: Provided further that such dealer shall be entitled to refund of input tax credit in respect of such purchases of taxable goods within West Bengal, where the goods manufactured by using such goods have been exported out of the territory of India. 1 PART MI THE KOLKATA GAZETTE, EXTRAORDINARY, DECEMBER 27, 2004 19 The West Bengal Value Added Tax Act, 2003. (Chapter IV.—Registration of dealer, enrolment of transporter, carrier or transporting agent, issue of provisional certificate and demand of security, etc.—Section 23.) (16) In no circumstances, any registered dealer including the commission agent shall be permitted to transfer his input tax credit to any other registered dealer or, as the case may be, the principal officer. (17) (a) When a registered dealer who produces or manufactures tea in West Bengal makes a sale of such tea through an auctioneer in auction held in Kolkata, under the auspices of Calcutta Tea Traders' Association or in Siliguri under the auspices of Siliguri Tea Auction Committee, or through a broker-member of the Calcutta Tea Traders' Association or Siliguri Tea Auction Committee, being his agent under the private treaty sales, such registered dealer shall exclude his sales of such tea for determining his turnover of sales provided that the auctioneer or the broker- member, as the case may be, is a dealer registered under this Act and such registered dealer shall furnish a certificate, in the prescribed form, with a copy of relevant account of sales. (b) Such auctioneer or broker-member shall not be entitled to get any input tax credit. Bar to carry on business as a dealer without being registered. CHAPTER IV Registration of dealer, enrolment of transporter, carrier or transporting agent, issue of provisional certificate and demand of security, etc.