## Illustration regarding payment of surcharge in challan form VAT-2B.

In view of calculation of amount for Challan-2, 2A and 2B is as follows :-

Suppose sale is Rs. 1 lakh

Tax @ 5% = 5000

additional tax @ 10% of tax = Rs. 500

Total Tax is Rs. 5500

Suppose a client comes to you and tell you that his total Tax + Surcharge is = Rs. 5500, then you can calculate VAT and Surcharge as follows :-

5500 x 10/11 = 5000 – VAT

5500/11 = 500 – Surcharge

Now you have to pay Rs. 5500 in which is 5000 is VAT and 500 is Surcharge. This can be paid as follows :-
On Challan-2 = Rs. 4900 (you can deposit in cash or through cheque/draft in favour of Assistant Excise and Taxation Commissioner)

On Challan 2A = Rs. 500 (you can deposit in cash or through cheque/draft in favour of Punjab Municipal Fund)

On Challan 2B = Rs. 100 (you can deposit in cash or through cheque/draft in favour of Punjab Municipal Infrastructure Development Fund)

These figures represent percentage wise as follows :-

On Challan 2 = 98% of VAT (excluding surcharge) (i.e. Rs. 4900)
On Challan 2A = 10% of VAT (excluding surcharge) (i.e. Rs. 500)
On Challan 2B = 2% of VAT (excluding surcharge) (i.e. Rs. 100)

[Note : Practically the above solution is the only solution. Although if we go by the exact wording of the law, - tax, Municipal Fund and Municipal Infrastructure Development Fund cannot be calculated properly.]

See here relevant notification on form VAT 2B