Section 9(9) in The Delhi Value Added Tax Act, 2004
(9)[(a) Notwithstanding anything contained to the contrary in sub-sections (1) and (3) and subject to sub-section (2), tax credit in respect of capital goods shall be allowed as follows:-(i)⅓rd of the input tax on such capital goods arising in the tax period, in the same tax period;(ii)[ Balance ⅔rd of such input tax in, equal proportions, in corresponding tax periods, in two immediately successive financial years:]Provided that, where the dealer sells such capital goods, the dealer shall be allowed as tax credit, the balance amount of the input tax, if any, in respect of such capital goods as has not been earlier availed as tax credit, such tax credit shall be allowed in the tax period in which such capital goods are sold and only after adjusting the output tax payable by him:[Provided Further that where the dealer transfers such capital goods from Delhi otherwise than by way of sale before the expiry of three years from the date of purchase, he shall, after claiming the balance amount or input tax, if any, not availed earlier in respect of such capital goods, reduce the input tax credit by the prescribed percentage of the purchase price of such capital goods and make adjustments in the input tax credit in the tax period in which these capital goods are so transferred:Provided Also that where a dealer has purchased capital goods and the capital goods are to be used partly for the purpose of making sales referred to in sub-section (1) of this section and partly for other purposes, the amount of tax credit shall be reduced proportionately:] [Existing second proviso substituted by DVAT (Second Amendment) Act, 2005 (10 of 2005), dated, 16-11-2005.]Provided Also that no tax credit in respect of capital goods shall be allowed if such capital goods are used exclusively for the purpose of making sale of exempted goods specified in the first schedule:Provided Also that no tax credit in respect of capital goods shall be allowed on that part of the value of such capital goods which represents the amount of input tax on such capital goods, which the dealer claims as depreciation under section 32 of the Income Tax Act, 1961 (43 of 1961).(b)If any capital goods in respect of which tax credit is allowed under clause(a)of this sub-section is transferred to any other person otherwise than by way of sale at the fair market value before the expiry of a period of 5 years from the date of purchase, the tax credit claimed in respect of such purchase shall be [reversed] [Substituted for 'reduced' by DVAT (Second Amendment) Act, 2005 (10 of 2005), dated, 16-11-2005.] in the tax period during which such transfer takes place.]
