Following information relates to purchases and sales of Kapil Ltd. for the month of September, 2014: Purchases for resale within the State ₹8,00,000 Purchases from registered dealers who opted for composition scheme ₹4,0

Calculation of VAT liability of Kapil Ltd. for the month of September, 2014 Particulars Amount (₹) A. Purchases eligible for Input tax credit 1. Purchases for resale within state taxable 8,00,000 2. Purchases from registered dealer opted for composition scheme Nil 3. Purchases to be used as consumable stores for manufacture of taxable goods 6,00,000 4. Purchases of goods where invoices do not show the amount of taxes separately Nil 5. Purchase of goods for personal consumption Nil 6. Purchase of capital goods (not eligible for input credit) Nil 7. Purchase of capital goods (eligible for input credit) 5,76,000 B. Input Tax credit available for the month of September 1. On goods other than Capital goods (₹8,00,000 + ₹6,00,000) × 12.5% 1,75,000 2. On Capital Goods (₹5,76,000 × 12.5%) / 24 installments 3,000 Total Input Tax Credit available 1,78,000 C. Net VAT Payable/Input Tax credit Carried forward Output VAT payable during September, 2014 (₹50,00,000 × 4%) 2,00,000 Less: Input tax credit available for September, 2014 (1,78,000) Net VAT Payable 22,000 D. Tax Credit to be carried forward For Capital goods (Balance 23 installments of ₹3,000 each) 69,000 For other than capital goods Nil Total ITC Carried Forward 69,000 Notes: Input tax credit is not available in the following cases: Purchases from registered dealer who opted for composition scheme. Purchases of goods where invoices do not show the amount of taxes separately. Purchase of goods for personal consumption. Purchase of capital goods is eligible for input tax credit, however as given in the question, the same is deferred to 24 equal installments.