vinay gangadhar hegde (Tax Consultatnt) 10 July 2011

Defective Purchase Bill Under Karnataka VAT Act.2003

One particular dealer purchases goods from supplier who in turn issues tax invoice charging tax ( both are registerd dealers under Karnataka Value Added Tax Act.2003). The purchasing dealer based on the said invoice claimed input tax credit. Later VAt authorities cross verified the purchase with the books of accout of supplier and found that the bill no. mentioned in bill issued to buyer differs with duplicate copy of bill lies with seller however amounts and qty supplied tallies. Can the VAT authorities disallow the inputax credit for buyer? pl calrify with any case law

With regards

VINAY G.H.

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2 Replies

M.V.GIRI (ADVOCATE & TAX CONSULTANT) 11 July 2011

The burdon of proof is lies on the purchaser who is claiming input tax credit on that purchases. The reason should be find out by the purchaser. is there any technical error or malfide mistake? If such is the mistake the authorities can disallow the input tax credit as the purchase bill is not authenticated one.

Sajeev Menon (Legal Consultant Dubai 00971 508836442) 13 July 2011

Hi, if the quanity, quality ,date and the other details are the same, you can make an application for the input credit, if the the tax authority ask the clarification you can produce the letter from the seller as the seller has to remit the tax for the same deal or they have to remit the tax twice for the mistake.