Admissibility of input tax credit or input tax rebate and manner of claim of input tax credit or input tax rebate by a registered dealer.

19. (1) Subject to the conditions and restrictions laid down in section 22 of the Act and elsewhere in this Chapter, a registered dealer, who is entitled to enjoy input tax credit or input tax rebate, shall get such input tax credit or input tax rebate of the input tax, paid or payable by him in respect of his purchase in West Bengal of taxable goods, for re-sale or for use directly in the manufacture of taxable goods and containers or materials required for packing of goods so resold or manufactured for sale in West Bengal, or for use in the execution of works contract in West Bengal, or disposal of goods otherwise than by way of sale referred to in sub-section (7) of section 22 of the Act.

(2) Where capital goods, as referred to in clause (6) of section 2 of the record, are purchased by a registered dealer for manufacture of taxable goods for sale or, for execution of works contract or, to keep the goods in saleable condition or, to effect the sale properly, the input tax credit or input tax rebate on such capital goods shall be staggered over a period, as specified in the Table below, starting from the month in which such capital goods were capitalised in the books of account of the dealer:-

Table

Purchase price of capital goods

Number of instalments

 

Not exceeding one crore rupees

 

One monthly

 

Above one crore rupees

 

Four half yearly

Provided that the Additional Commissioner or the Deputy Commissioner, if satisfied that purchase has been split up into multiple bills, may, by passing a reasoned order upon giving the dealer an opportunity of being heard, direct to consider all such purchases to be treated as a single one and determine the input tax credit or input tax rebate payable thereon accordingly:

Provided further that input tax credit or input tax rebate in respect of capital goods acquired by a registered dealer on hire purchase, shall be allowed, from the date when the first hire charges become payable on the amount of hire charges of the period.

(3) Where a non-taxable goods becomes taxable from a particular date after the appointed day and input tax credit or input tax rebate has not been availed on capital goods used in manufacturing such goods, then the amount of input tax credit or input tax rebate that will be available on such capital goods shall be calculated on the basis of the following

formula:-

Y=     A x B

         C 

 

Where `Y' = Input tax credit or input tax rebate available;

`A' = Input tax paid at the time of purchase of the capitalgoods;

`B' = Written down value of the capital goods on the datefrom which the manufactured goods become taxable; and

`C' = Actual cost, as capitalised, of the capital goods:

Explanation.- The expression "Written down value" used in the formula means the actual cost less the depreciation till the date prior to the date from which the goods became taxable.

Provided that the input tax credit or the input tax rebate shall be available on such capital goods which have been purchased within a period of three years preceding the date on which such non-taxable goods became taxable.

(4) Where a manufacturer of taxable goods manufactures the capital goods required by him for the purpose of such manufacture, he shall be entitled to avail of the input tax credit or input tax rebate in respect of purchase of such goods, required directly for the purpose of manufacture of such capital goods.

(5) Input tax credit or input tax rebate shall be allowed if any taxable goods, as such or after being partially processed are sent by a manufacturer registered under the Act to a job worker for further processing, testing, repair, reconditioning or any other purpose, and it is established from the challans, documents or records produced by the registered dealer concerned that the goods in question have eventually been received by him within ninety days from the date of despatch to the job-worker and eventually sold: Provided that the input tax credit or input tax rebate, if already enjoyed, will be reversed in the manner specified in the rule when the goods have not been received back within the ninety days.

(6) Where a registered dealer starts making payment of tax on sales of goods under sub-section (2) of section 16 upon being ineligible to pay tax under the provision of the third proviso to sub-section (3) of that section, then, notwithstanding anything contained in clause (g) of sub-rule (1) of rule (20), such dealer shall be able to enjoy the input tax credit or input tax rebate in the manner prescribed in rule 22 on such goods, other than capital goods, held in stock, from the date on which he became so ineligible to pay tax under sub-section (3) of section 16 and when such goods were purchased within the period during which tax was paid under sub-section (3) of section 16.

(7) Subject to the provisions of clause (a) of section 61, where the input tax credit or input tax rebate of a registered dealer determined for a period exceeds output tax for that period then the excess amount of input tax credit or input tax rebate may be carried forward to the next period.

(8) A registered dealer who intends to claim input tax credit or input tax rebate, shall make payment by account payee cheque or account payee draft only to the seller, where such payment exceeds rupees twenty thousand in a day:

Provided that this provision shall not apply to such purchasing registered dealer who proves that banking facility is not available at his place.

(9) A registered dealer who intends to claim input tax credit or input tax rebate shall, for the purpose of determining the input tax credit or input tax rebate, maintain accounts, documents and all other relevant records in respect of purchases and sales made by him in West Bengal and in the course of inter-state trade and commerce and shall also maintain the registers prescribed elsewhere in the rules for such purpose.

(10) A registered dealer shall while determining the net tax payable by him in respect of a tax period, first deduct the net tax credit as referred to in sub-section (17) of section 22 from the output tax for such period under the Act, and if there is still any balance of input tax credit or input tax rebate available thereafter, he shall deduct such input tax credit or input tax rebate from the tax payable under the provisions of the Central Sales Tax Act, 1956 for that tax period.