October 2018

Set Off vis-a-vis Gross Receipts for Rule 53(6)(B) of The MVAT Rules

G. G. Goyal
Chartered Accountant
C. B. Thakar
Advocate

Introduction

The grant of set off is prerogative of the legislature. In other words, set off is not right of the dealers. The set off is to be given as per Scheme, Rules and conditions attached therewith.

 

Under MVAT Act, there is broad scheme of granting set off including almost on all goods like Capital goods, trading goods and expenses are eligible for set off. However, there are certain conditions where set off can be reduced or it can be denied.

 

There is Rule 53(6)(b) which has attracted long litigation. The rule is reproduced below for ready reference.

 

53. Reduction in set-off

 

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