Puma
Overcharging vat

I purchased a cap from PUMA retail store on the Mall, Shimla with M R P Rs 1099/- inclusive of all taxes on 5.1.2013. There was an offer of 20 to 50% discount on certain items, duly displayed and advertised in the show room, The amount charged from me should have been Rs 879.20p after allowing me discount of 20% but I was charged Rs 923. 16 p

Working the price of the cap WITHOUT VAT @ 5% i.e. basic price works out to Rs.1046.67p without vat. Even if the discount of 20% admissible is calculated at this basic price, the discounted basic price works out to Rs 837.33p and 5% vat on this price works out to Rs 41.86p thus total price should be charged as 879. 20P.(Rs 833.33 Rs 41.P).. Whatever way, the chargeable price is to be calculated, it works out to Rs 879.20p WHEREAS I HAVE BEEN CHARGED RS. 923. 16P by again charging Rs 43. 96p vat @5 % on Rs. 879.20p. It is a clear cut case of cheating people by charging VAT twice on one sale of product. FIRSTLY, the price i.e. MRP is inclusive of VAT and after allowing the advertised discount of 20%, VAT is again charged on the reduced price.

I pointed out this wrong charging when I noticed it the same day but the sales man who had attended me was highly arrogant and rude to me. Another gentleman gave a number of some Chandigarh office where an officer by the name of Mr Manu Sharma was more rude than the local man and said that I could do whatever I liked and that the procedure is being adopted throughout their sales stores in the country.

This purchase was made by me through my credit card and the cash memo given to me is a computer generated document.

I feel that this is not proper and every purchaser is being robbed by charging vat twice on each purchase. One can imagine the unauthorized collection of this amount by PUMA .

I understand that under the VAT rules / act any amount excessively collected by a seller attracts penalty.

In any case, I wish to bring this matter to the notice of local VAT collection Authority i.e. HP Excxise & Taxation Department and seek a clarification.