Section 10 of the Tripura Value Added Tax Act provides inputs tax credit. Taxes paid on inputs used for producing taxable goods or purchases are deductible from the tax payable on the taxable sales whether the inputs or purchases are used only partly for production or sale of taxable goods, credit would be given for a fraction of input tax equal to the proportion of the taxable sales to total sales.Provided credit for input tax may be enjoyed under the following circumstances:-(1)Purchasers and sellers shall be registered under the Tripura Value Added Tax Act, 2004;(2 Tax credit should be provided for production input and goods for sale;(3)In case of production, tax credit may be allowed for not only raw materials and components, but also for plant, machinery and equipments, provided purchases of such plant, machinery and equipment could be made eligible for input tax credit if these are acquired for use exclusively for taxable production, manufacturing or processing activities. Provided further that no input tax credit will be allowed for office equipment and building materials for use in residential or commercial construction. Though materials for factory construction may be eligible for tax credit. Tax credit will be denied for transportation of equipments and supplies (as transportation services are exempt from the tax).(4)Manufacturers and producers (including mining companies) are eligible to claim tax credit for the tax paid on virtually all of the materials used in their production or manufacturing processes. This would include raw materials, component, parts, packaging materials, consumables, chemicals, additives, lubricants and explosives but would not include motor fuels (petroleum and diesels but not furnace fuel) and coal and coke.(5)Goods brought from outside the State shall not be entitled to get input tax credit in respect of tax paid in the other State.(6)Subject to sub-section (4) of Section 10 an input tax credit allowed under this section can not be claimed by a dealer in a tax period unless the dealer has an original tax invoice for the taxable supply.[Provided that the dealers dealing in items as mentioned in Schedule - VIII shall be eligible for Input Tax Credit subject to the condition that the dealer shall produce original purchase voucher in form - XLI.] [Inserted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).](7)Where a dealer does not have an original [tax invoice / purchase voucher] [Substituted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).] evidencing the input tax paid, the Commissioner may allow an input tax credit in the tax period in which the credit arises, where the Commissioner is satisfied:-(a)that the dealer took all reasonable steps to obtain a [tax invoice/ purchase voucher] [Substituted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).]: and(b)that the failure to obtain a [tax invoice purchase voucher] [Substituted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).] was not due to any fault of the dealer, and(c)that the amount of input tax claimed by the taxable person is correct.Provided that the dealer shall give affidavit showing the reason of failure to obtain the [tax invoice or purchase voucher] [Substituted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).] disclose the details particulars of seller. If the Commissioner is satisfied that non-issuance of [tax invoice/ purchase voucher] [Substituted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).] is intentional and deliberate, the Commissioner may take penal action against the [selling or purchasing dealer] [Substituted vide the TVAT (First Amendment) Rules, 2011 (w.e.f. 17-08-2011).] as per provision.(8)No person shall be entitled for input tax credit on capital goods if such person is the second or subsequent purchaser of capital goods.(9)No person shall be entitled to input tax credit on the stock of goods remaining unsold at the time of discontinuance or closure of his business.
