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TMI BlogVAT OR CSTX X X X Extracts X X X X X X X X Extracts X X X X ..... Dear Expert, We are the proprietor ship company in Kolkata , West Bengal generally engage in Trading Business in all over India. Recently we got an order from a reputed company in Kolkata. Right now they have a project in Andhra Pradesh.They asked us to deliver the material in Andhra Pradesh but the invoice should be in kolkata only. Now my question is what type of sales tax shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld we charged Vat/Cst? As per my best knowledge whether we raised the invoice in kolkata, the invoice will raise in VAT though we deliver the material at Andhra Pradesh. Please help me out with reference of cst act/rules. Asish Kumar Nath - Reply By Pradeep Khatri - The Reply = Buyer and seller can be in same State U/S 3 (a) under CST Act,1956 :- Sale can be inter state even if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both buyer and seller are in same State if goods are moving out of State on account of sale. You would have to charge CST as applicable. - Reply By Asish Kumar Nath - The Reply = Sir, Thank you for your reply. I want to vantilate a little on your openion: As CST Act : A sale or purchase of goods shall be deemed to take place in the course of inter-State trade or commerce if the sale or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchase- (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during theirmovement from one State to another. Explanation 1 - Where goods are delivered to a carrier or other bailee for transmission, the movement of the goods shall, for the purposes of clause (b) , be deemed to commence at the time of such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... delivery and terminate at the time when delivery is taken from such carrier or bailee. Explanation 2 - Where the movement of goods commences and terminates in the same State it shall not be deemed to be a movement of goods from one State to another by reason merely of the fact that in the course of such movement the goods pass through the territory of any other State. Please read the marke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and highlighted area where it is clearly written clause (a) can not fulfill without satiesfy clause (b) i.e transfer of document of tile from onestate to anotherstate. Now in my case transfer of document of title in same state but the material only deliver to another state on behalf of customer. Sir, I am really confused , please help me. If I am wrongly interpreted the matter please forgi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve me. - Reply By Pradeep Khatri - The Reply = The Section 3(a) and Section 3(b) is separated by ; or . Section 3(a) describes the Bill to Ship to aspect of sale under CST Act whereas Section 3b describes the concept of Transit sale. For the purpose of completion of transit sales under Section 3(b) , fulfilment of condition 3a is must. - Reply By Usha Mani - The Reply = ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dear Sri Asish Kumar Nath The transaction referred by you, falls under Sec 6(2) which deals E - 1 form transaction. A seller can raise the invoice on buyer (your kolkata buyer) within the same State, but move the goods to another buyer(Andhra Pradesh buyer) in another State. The fist buyer endorses the LR in favour of the second buyer who will clear the goods. The first buyer will rais ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e a bill on the second buyer (Consignee) but, need not collect any tax on the bill. But they have to mention that it is a sale under Sec 6(2) b) of the CST Act . You have to raise invoice on the kolkata dealer with CST 2% against C Form only and not VAT. Sec 3 of CST Act, 1956 , defines interstate movement of goods as A sale or purchase of goods shall be deemed to take place in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he course of inter-State trade or commerce if the sale or purchase- (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. Thanks and Regards, USHA - Reply By Asish Kumar Nath - The Reply = Dear Usha Ji, Thanks for your reply. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w please inform me that is it necessary to go through E1 sale? Regards, Asish Kumar Nath - Reply By Usha Mani - The Reply = Dear Sri Asish Kumar Nath For the nature of transaction referred by you, the sale will be only a E-1 sale as you have said that the invoice has to be in the name of the local buyer and the consignment will be despatched to Andhra Pradesh. Thanks and Regards, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... USHA - Reply By r.rajkumar kumar - The Reply = sales tax is only on the sale of goods and movement of goods. and the contract entered. since the contract is entred between Kolcota and A.P. and goods instated of comming to kokota it delivered to AP as per sthe contact terms. hence only CST applicable. and not local tax . - Reply By Rangarajan D V - The Reply = Dear Mr Asish When the mov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement of goods is from one State to another State, and if the buying dealer is a registered dealer, CST @ 2% against Form C shall be charged. Otherwise it CST will be the local VAT rate, without C form. In the instant case, since the material commence from West Bengal to Andhra Pradesh, the ultimate delivery and sales concludes only in AP and hence please charge CST as applicable. Hope you are c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lear. BEst Regards - Reply By Sanjib Kothari - The Reply = Prima Facie, the sale must be under CST Sale as the movement of goods are from one state to another. But, you must seek confirmation from your buyer based in Kolkata about issuance of C Form to you for this transaction from West Bengal - VAT OR CST - Query Started By: - Asish Kumar Nath Dated:- 27-4-2012 Value Added Tax - VAT-CST - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Got 9 Replies - VAT and Sales Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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