Amendment in Registration certificate Registration certificate can be amended in the following situations: 1. If there is change in the name of business.

2. If there is change in the place of business. 3. If there is change in the nature of business i.e. Trading is converted into Manufacturing or Manufacturing is converted into Trading. 4. If one or more new goods have been included or one or more goods have been deleted 5. If there is change in the Constitution e.g. Partnership Firm is converted into Proprietary or Proprietary is converted into Partnership Firm. 6. If there is any other similar change. Amendment can be made at the request of the dealer or the department can make amendment on its own. Question 6: Write a note on cancellation of registration certificate. Answer: Cancellation of registration VAT registration can be cancelled on: (i) Discontinuance of business; or (ii) Disposal of business; or (iii) Death of the dealer (iv) Annual turnover falling below the specified limit e.g. In case of Delhi VAT if turnover becomes less than 10 lakhs (v) Violation of the provisions of State VAT Act leading to cancellation of certificate Illustration 1: Compute the invoice value to be charged and amount of tax payable under VAT by a Registered Dealer who had purchased goods for `1,50,000 (exclusive of VAT) from the same State and after adding for expenses of `12,000 and profit of `25,000 had sold in the same State. The rate of VAT on purchase and sales is 12.5%. Solution: ` Purchase price 1,50,000 Add: Expenses

12,000 Add: Profit 25,000 Amount to be billed 1,87,000 Add: VAT @ 12.5% - Output Tax 23,375 Total invoice value 2,10,375 VAT Payable VAT charged in the invoice - Output Tax 23,375 Less: VAT credit on input 12.5% of `1,50,000 - Input Tax (18,750) Net VAT Payable 4,625 (b) Presume the goods were sold in some other States to Unregistered Dealer. Solution: Purchase price 1,50,000 Add: Expenses 12,000 Add: Profit 25,000 Amount to be billed 1,87,000 Add: CST @ 12.5% - Output Tax 23,375 Total invoice value 2,10,375 CST Payable CST charged in the invoice - Output Tax 23,375 Less: VAT credit on input 12.5% of `1,50,000 - Input Tax (18,750) Net CST Payable 4,625 (c) Presume the goods were sold in some other States to Registered Dealer against Form C. Solution: Purchase price

1,50,000 Add: Expenses 12,000 Add: Profit 25,000 Amount to be billed 1,87,000 Add: CST @ 2% - Output Tax 3,740 Total invoice value 1,90,740 CST Payable CST charged in the invoice - Output Tax 3,740 Less: VAT credit on input 12.5% of `1,50,000 - Input Tax (18,750) CST Payable Nil Balance VAT Credit (to be carried forward or refund can be taken) 15,010 Illustration 2: Compute the VAT amount payable by Mr. A (Registered Dealer) who purchases goods from a manufacturer on payment of `4,50,000 (including VAT) and earns 15% profit on purchase. The goods have been sold to retailers and VAT rate on purchase and sale is 12.5%. Solution: ` Purchase price 4,50,000.00 Less: Input tax (4,50,000 x 12.5% / 112.5%) (50,000.00) 4,00,000.00 Add: Profit (4,00,000 x 15%) 60,000.00 Amount to be billed 4,60,000.00 Add: VAT @ 12.5% - Output Tax 57,500.00 Total invoice value 5,17,500.00 VAT Payable Output tax 57,500.00

Less: Tax credit (12.5% of `4,00,000) - Input Tax (50,000.00) Net VAT Payable 7,500.00 (b) Presume the goods were sold in some other States to Unregistered Dealer. Solution: ` Purchase price 4,50,000.00 Less: Input tax (4,50,000 x 12.5% / 112.5%) (50,000.00) 4,00,000.00 Add: Profit (4,00,000 x 15%) 60,000.00 Amount to be billed 4,60,000.00 Add: CST @ 12.5% - Output Tax 57,500.00 Total invoice value 5,17,500.00 CST Payable Output tax 57,500.00 Less: Tax credit (12.5% of `4,00,000) - Input Tax (50,000.00) Net CST Payable 7,500.00 (c) Presume the goods were sold in some other States to Registered Dealer against Form C. Solution: ` Purchase price 4,50,000.00 Less: Input tax (4,50,000 x 12.5% / 112.5%) (50,000.00) 4,00,000.00 Add: Profit (4,00,000 x 15%) 60,000.00 Amount to be billed 4,60,000.00

Add: CST @ 2% - Output Tax 9,200.00 Total invoice value 4,69,200.00 CST Payable CST-Output tax 9,200.00 Less: Tax credit (12.5% of `4,00,000) - Input Tax (50,000.00) CST Payable Nil Balance VAT Credit (to be carried forward or refund can be taken) 40,800.00