Input Tax Credit

Input Tax Credit.-

1. (1) Input tax credit shall be allowed, to registered dealers, other than the dealers covered by sub-section
2. (2) of section 6, in respect of purchase of any taxable goods made within the State from a registered dealer to the extent and in such manner as may be prescribed, for the purpose of-
   • (a) sale within the State of Rajasthan; or
   • (b) sale in the course of export outside the territory of India; or
   • (c) being used as raw material, except those as may be notified by the State Government, in the manufacture of goods other than exempted goods, for sale within the State; or
   • (d) being used as raw material in manufacture of goods for sale in the course of export outside the territory of India, however, if the goods purchased are used partly for the purposes specified in this sub-section and partly as otherwise, input tax credit shall be allowed proportionate to the extent they are used for the purposes specified in this sub-section.
3. (2) Notwithstanding anything contained in this section, no dealer shall be entitled to the credit of any input tax in respect of any sale of goods to him unless,-
   • (i) he is in possession of a tax invoice or debit note issued by a registered selling dealer under this Act, or such other tax paying documents as may be prescribed;
   • (ii) he has received the goods; Explanation.- For the purpose of this clause, it shall be deemed that the dealer has received the goods, where the goods are delivered by the seller to a purchaser or any other person on the direction of such registered dealer, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise;
   • (iii) subject to the provisions regarding matching of claim of input tax, the tax charged in respect of such sale has been actually paid to the Government, either in cash or through utilization of input tax credit admissible in respect of the said sale; and
   • (iv) he has furnished the return under section 17;
   • (v) the details of the invoice or debit note referred to in clause
   • (i) has been furnished by the registered selling dealer in the statement of sales and such details have been communicated to the recipient of such invoice or debit note in the manner as may be prescribed: Provided that where the goods against a VAT invoice are received in lots or instalments, the registered dealer shall be entitled to take credit upon receipt of the last lot or instalment: Provided further that the purchaser shall be entitled to avail the credit of input tax on payment made by him of the amount towards the value of sale of goods along with tax payable thereon;
   • (vi) a registered dealer shall not be entitled to take input tax credit in respect of any invoice or debit note for sale of goods, after the due date as may be prescribed, of furnishing of the return under section 17 for the month of November following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.
4. (3) Notwithstanding anything contained in this Act, no input tax credit shall be allowed on the purchases-
   • (i) from a registered dealer who is liable to pay tax under sub-section
5. (2) of section 6; or
   • (ii) of goods made in the course of import from outside the State; or
   • (iii) of goods taxable at first point in the series of sales, from a registered dealer who pays tax at the first point; Explanation.- For the purpose of this clause, “first point in the series of sales” means the first sale made by a registered dealer in the State; or
   • (iv) where the original VAT invoice or duplicate copy thereof is not available with the claimant, or there is evidence that the same has not been issued by the selling registered dealer from whom the goods are purported to have been purchased; or
   • (v) of goods where VAT invoice does not show the amount of tax separately; or
   • (vi) where the purchasing dealer fails to prove the genuineness of the purchase transaction, on being asked to do so by an officer not below the rank of Assistant Commissioner authorized by the Commissioner.
6. (4) The State Government may notify cases in which partial input tax credit may be allowed subject to such conditions, as may be notified by it.
7. (5) Notwithstanding anything contained in this Act, where any goods purchased in the State are subsequently sold at subsidized price, the input tax allowable under this section in respect of such goods shall not exceed the output tax payable on such goods.
8. (6) The burden to prove entitlement of input tax credit on any purchase shall be on such person who has filed a claim for Input Tax Credit.