Prakash purchased yarn liable for VAT at 4% and manufactured cloth which was exempt from VAT in the State of Tamil Nadu. He wants to claim refund of VAT paid on input, i.e., yarn. For refund of VAT, he is— (A) Not eligib

CS Executive · Tax Laws and Practice · PYQS · June 2016
Prakash purchased yarn liable for VAT at 4% and manufactured cloth which was exempt from VAT in the State of Tamil Nadu. He wants to claim refund of VAT paid on input, i.e., yarn. For refund of VAT, he is— (A) Not eligible, since VAT chain is broken (B) Eligible for refund (C) Eligible for only 50% of VAT paid (D) Eligible for refund on producing Form-C.
(A) Not eligible, since VAT chain is broken
(B) Eligible for refund
(C) Eligible for only 50% of VAT paid
(D) Eligible for refund on producing Form-C.

Answer & Explanation:

Correct Answer: Option (A)

Official answer key: (A).

Topics: VAT

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