OFFICE OF THE COMMISSIONER COMMERCIAL TAXES,

JAMMU AND KASHMIR GOVERNMENT, SRINAGAR

CLARIFICATION NO. 21 OF 2010 Dated 11th June, 2010

M/s Volva Cables, Industrial Estate, Rangreth have sought clarification under section 87 of the J&K VAT Act, 2005 read with rule 93 of J&K VAT Rules, 2005 along with the application fee of Rs. 100/-.

The application is examined and found in order. Hence admitted.

The applicant has sought clarification as to whether as per SRO 91/176, the industrial units claiming tax remission on the sale of finished goods while making price adjustment has to depict gross value or net value in the returns.

The matter has been examined. It is hereby clarified that price adjustment mechanism under SRO-91 of 2006 dated: 16.03.2006 and SRO-176 of 2006 dated: 31-03-2006 calls for inclusion of tax element notionally in the sale invoice. Columns 1 to 3 in the return form i.e. VAT- 11 (Quarterly Return) and VAT-11-A (Annual Return) pertain to the sales within the State and the term "Taxable turnover" has been used in these columns. Taxable turnover is defined under J&K VAT Act, 2005 as "the turnover on which a dealer shall be liable to pay tax as determined after making such deduction from his total turnover in such manner as may be prescribed."

It, therefore, follows that the net sale value and not the gross sale value is to be depicted in the return.

Sd/-

(Bashir Ahmed), IAS

Commissioner Commercial Taxes