Input tax credit is to be proportionately reduced on purchase of goods if such goods are used other than local sale.

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..... (TO BE PUBLISHED IN PART IV OF THE DELHI GAZETTE-EXTRAORDINARY) GOVERNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI (DEPARTMENT OF TRADE AND TAXES) BIKRI KAR BHAWAN, I.P. ESTATE, NEW DELHI - 110002 No. F. 1(1)/POLICY-III/VAT/2005/1203 Dated: 15/12/05 NOTIFICATION A question of general public interest has arisen with respect to the interpretation of Delhi .....

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..... les or exports. Sub section (4) should not be read in isolation. It is to be read with sub sections (1) and (3). Sub section (1) defines the purchases, which earn input tax credit. Sub section (3) lays down that the amount of tax credit to which a dealer is entitled in respect of the purchases of goods shall be the amount of input tax arising in the tax period reduced in the manner described in su .....

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..... also (II) sales which are exempt from tax, the item being specified in the First Schedule, in that event, the input tax credit on the turn over of purchases has to be reduced proportionately. Now, therefore, in exercise of the powers conferred under section 85 of the Delhi Value Added Tax Act, 2004 (Delhi Act 3 of 2005), I, R.K. Verma; Commissioner, Value Added Tax hereby rule that the inpu .....

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