Section 13(4) in Kerala Value Added Tax Rules, 2005
(4)Deduction of input tax under sub-section (2) of section 11 or refund of input tax under section 13 shall be subject to the following conditions: -(a)The deduction or as the case may be, refund, shall be allowed in thirty-six equal monthly installments over a period of three years from the date specified in sub-section (2) of section 11;(aa)in the case of industrial units including those which have undertaken expansion, diversification or modernization the deduction or refund, as the case may be, shall be allowed in twelve monthly instalments from the date specified in the proviso to sub section (2) of section 11.(b)No deduction of input tax shall be allowed where the use of capital goods relates wholly to the manufacture of exempted goods and/or goods falling under the fourth Schedule:Provided that where the capital goods are used in relation to any goods, other than those included in the fourth schedule, sold in the course of export, refund of input tax shall be allowed, subject to the provisions of rule 47, irrespective of whether the goods so exported is exempted from tax or not;(c)Where the capital goods are used from the commencement of commercial production in relation to taxable and exempted or non taxable goods simultaneously, the monthly installments fixed under clause (a) shall be apportioned between the taxable and exempted or non taxable goods on the basis of the ratio of taxable and exempted turnover during the period in which the input tax credit is claimed. The portion of the input tax allocable to taxable goods shall be allowed and that allocable to exempted goods disallowed and deducted from the input tax credit eligibility of the dealer;(d)where the capital goods used in relation to exempted or non-taxable goods, is subsequently used in relation to taxable goods wholly or partly, the input tax credit allowable for the capital goods shall be calculated as follows;-(i)where the capital goods are used subsequently in relation to taxable goods only, the input tax credit for the months in which the capital goods are used in relation to exempted goods shall be disallowed and the input tax credit for the months during which the capital goods are used in relation to taxable goods shall be allowed;(ii)where the capital goods are used subsequently for manufacturing exempted or non taxable goods and taxable goods simultaneously, the input tax credit for the period during which such capital goods are used for the manufacture of exempted or non taxable goods shall be disallowed and the input tax credit for the months during which the capital goods are used for the manufacture of taxable goods and exempted or non taxable goods shall be determined in the manner prescribed under clause (c);(e)Where the capital goods are used partly in relation to goods falling under the first Schedule and/or the fourth Schedule and partly in relation to taxable goods, the input tax credit calculated under clause (a) above shall be apportioned among the goods falling under the first Schedule, fourth Schedule and other goods on the basis of the ratio of the turnover of goods coming under the first schedule and fourth Schedule and that of other goods, and the input tax credit allowed or as the case may be, disallowed in the manner specified in clause (c) above;(f)The dealer shall claim the deduction in the monthly return.(g)where refund of input tax is available in respect of capital goods under rule 46 or rule 47 in respect of which input tax credit is also available under section 11, the amount for which refund or input tax credit, as, the case may be is to be allowed, shall be arrived at in the manner specified in clause (c) with suitable modification.
