How To Rectify DVAT 2A-2B Mismatch

Ankit Gupta

What is form 2A & 2B

Form 2A contain the details of all local purchases made by a registered dealer during the period (quarter) & Form 2B contain the details of local Sales made by a registered dealer during the period (quarter).

Who is required to fill Form 2A & 2B

Every dealer who is registered under DVAT Act ’2004 except Banquet halls & person carrying on E commerce business (say.Flipkart,Snapdeal)

What is the content of Form 2A & Form 2B

Following details are required to be given in Form2A

1. TIN of Seller/Purchaser
2. Name of Seller/Purchaser(Autofilled)
3. Classification of goods (VAT Rate)
4. Invoice Amount

What is 2A & 2B mismatch.

• It can better be understand with the help of an illustration

Suppose Mr.A purchase goods from Mr.B

INVOICE

Value =Rs.1000

+VAT =Rs.50

Invoice Value =Rs.1,050

Now,

Mr.A in his form 2A wrongly shows

Purchase value = Rs.1100

   +VAT = Rs.55

   Invoice Value = Rs1155

&

Mr.B in his form 2B correctly shown the sales at

Value =Rs.1000

+VAT =Rs.50

Invoice Value =Rs.1,050

The difference in Vat value (Rs.55-Rs.50) Rs.5 is called as VAT Mismatch

What are the reasons of Mismatch

Following can be the reasons of mismatch

1. Entered incorrect TIN Number
2. Entered incorrect amount
3. Issuance of Retail invoice in place of Tax Invoice

Who receive notice of Mismatch

• Only Purchaser of Vatable goods receive notice from Department of Trade & Taxes
• Since ,It is the responsibility of the purchaser to provide correct information to the department as he is willing to claim Input Tax Credit against output VAT liability.
• If purchaser provide incorrect information at higher value then it will create additional VAT Liability to him only which is beneficial to Department.
• Practically , No notice is received nowadays , directly demand order received in Form 24 Specifying the amount of VAT & Interest and Form 24A specifying the amount of penalty

At what rate Interest would become payable by the dealer

• If the dealer fails to pay VAT demand within the time as may be specified in the demand order, then he shall be liable to pay Interest in addition to VAT payable at the rate of 1.25%per month of part of month.

Is it possible to waive off Interest in an appeal or otherwise

• No , Not at all

What is the amount of penalty that can be levied by VAT officer in respect of mismatch report

• Amount of penalty that can be levied on Dealer: Rs.10,000 or VAT demand whichever is higher.(Without Limit)

Is it possible to waive of Penalty

• Yes, It is possible to waive off penalty through an appeal made to Appellate Authority with 30 days from the date of order.

• If the dealer is aggrieved with the order passed by Appellate Authority then he can file second appeal to Sales Tax Appellate Tribunal

How to remove 2A-2B Demand & Penalty

• If the mismatch arise due to mistake in DVAT return then it can easily be rectified by revising the return either by Seller or by Purchaser, if the revise period is still available

• Payment of VAT as demanded in Form 24 (Demand order)

• Filing an appeal to Appellate Authority

(Author Can Be Reached At 9811985576 or [email protected] for For DVAT Registration – Consultancy – Filings)

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