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7. Reduction of tax credit |
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1.For the purposes of sub-section (6) of section 9 and sub-clause (ii) of clause (c) of sub-section 3 of section 10, the tax credit shall be reduced in the following manner:-
(a) in the case of goods specified in the Second Schedule, the tax credit shall be reduced by 100 percent; and
(b) in the case of goods other than those specified in the Second Schedule, the tax credit shall be reduced by [ 2/R X 100] percents where R is the rate of tax applicable as per section 4."'.
Provided that in case of following goods, the tax credit shall be reduced by 100 percents: .
(i) Un-manufactured tobacco, tobacco and tobacco products in all forms such as cigarettes (irrespective of form and length), chewing tobacco, gutkha, cigars, hooka tobacco, khaini, zarda, surti, bidis etc.;
(ii) All kinds of lubricants. "; and
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2.Where a dealer has transferred any goods in the circumstances specified under sub-section (6) of section 9 and has made a reduction of tax credit by the prescribed percentage, he shall be entitled to claim the tax credit so reduced when he brings such goods back into Delhi for sale on which tax is payable under section 3 or for sale in the course of inter-State trade or commerce or for sale outside Delhi or for sale in the course of exports out of the territory of India, subject to the condition that the goods brought back to Delhi are the same goods as originally transferred [6][or the goods processed or manufactured out of the goods as originally transferred.] |
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3.Where any goods or goods manufactured out of such goods are lost or destroyed, the dealer shall not be eligible to claim tax credit on such goods and the credit taken in any earlier tax period shall be reversed in the tax period in which goods are claimed to have been lost or destroyed. |
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4.For the purpose of sub-section (9) of section 9, the prescribed percentage of reduction of tax credit shall be 2 percent. |
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(5) For the purposes of sub-section (10) of section 9 and sub-section (3) of section 10, in case of following goods, the tax credit shall be reduced by {(R-2)100/R} percents, where R is the rate of tax applicable as per section 4:
(i) Un-manufactured tobacco, tobacco and tobacco products in all forms such as cigarettes (irrespective of form and length), chewing tobacco, gutkha, cigars, hooka tobacco, khaini, zarda, surti, bidis etc.;
(ii) All kinds of lubricants.
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7A. Adjustment to tax
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Where adjustment of tax arises under clause (e) of sub-section (1) of section 8 by reason of the whole or part of the price owed by the buyer for the purchase of goods having been written off by the dealer as bad debt, the dealer shall make such adjustment to the extent of the tax on the price written off as bad debt provided such price has been written off in his books of accounts and the price so written off has also been claimed by the dealer as deduction under section 36 of the Income Tax Act, 1961 (43 of 1961):
PROVIDED that where the price so written off relates to the sale of goods taxable at different rates of tax specified under section 4, the adjustment shall be made by allocating the price so written off to various amounts outstanding in the following order:-
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(i) any interest amount due and outstanding; |
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(ii) sale price of any exempt goods; |
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(iii) sale price of goods taxable at the rate of 1 percent; |
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(iv) sale price of goods taxable at the rate of 5 percent; and |
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(v) sale price of goods taxable at the rate of 12.5 percent or more, in order of increase in tax rate:". |
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PROVIDED FURTHER that where the price so written off is recovered subsequently either in whole or part, it shall be deemed to be the sale of goods by him in the tax period in which such price is recovered and the dealer shall make an adjustment in calculating the tax payable for the same tax period by allocating the recovered amount to the amounts stated above in the reverse order.
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7B. Adjustment of tax due to retrospective reduction of tax liability by virtue of the Delhi Value Added Tax (Second Amendment) Act, 2005
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a.A dealer, in consequence of the retrospective operation of
the reduced rates of tax on the turnover pertaining to declared goods involved in the execution of works contracts and the works contracts which are in the nature of printing works in accordance with the provisions of section 4; or
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b.the eligibility to claim input tax credit on purchase of second hand goods from the resident seller under sub-section (2) of section 15; or |
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c.the discharge of tax liability on works contracts in accordance with the provisions of sub-section (4) of section 105,
shall re-compute his tax liability and shall make adjustments on account of excess amount of tax deposited under the Act, if any, in the first return which is due to be filed after the date of notification of the Delhi Value Added Tax (Fifth Amendment) Rules, 2005:
PROVIDED that the dealer shall not make the adjustments of the excess amount of tax deposited unless such excess amount has been refunded to the purchaser:
PROVIDED FURTHER that the dealer shall submit the proof of the amount so refunded to the purchaser along with his return mentioned above.
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