21 April 2016
we are register dealer under vat and purchase petrol and disel form outside state for our petrol pump (owned by propritor A). half of fuel is sold to outside coustomer and half fuel is self consumed ( means prop. A has another business of transport ). now how to account for trf of fuel to other prop. firm ? is it a sale to self or stock trf ? also how to show this in vat return ??
21 April 2016
In the above case , the 50% fuel which captively consumed ,it is not sale.and if the fuel is used in vehicles for transportation then the company cannot issue c form against this purchase. But in VAT return should shown in purchase as well good movement otherwise than by way of sales column.
21 April 2016
thanks of reply but here is a point ... we cannot calculate how exactly is going to be used for self consumtion and how much for sale.. currently we r issuing form c to party and treating self consumption as sale to self.. but i know its wrong. there should be a way
21 April 2016
You can get the total purchase , sale to outsiders , closing stock etc. then from these you can calculate how much of fuel is captively consumed . If you have issue the c form then you can cancell that and give only c form for the sales portion . Advise the supplier to raise the supplimentary sale invoice to you for balance cst amount , you should pay that . In this case you show party purchase as against c form and partly without c form.
22 April 2016
If possible they can file revise return otherwise they may deposit differential tax with interest along with a letter. In this case you need to pay interest amount also. But if you follow your existing practice , in case of assessment if it is noticed they they will impose penalty , which is twice of the tax amount.
22 April 2016
Since you have nentioned that the transportation business is with the another firname then it is a sale. Just pass the normal sale purchase entry.
22 April 2016
Same company having 2 different business , so I think it should be treated as captive consumption, as per VAT act and c form should not be issued against that . It is not a normal sale.
22 April 2016
Captive consumption is only when it is usedin the same business. In the given case transportation business is separate and petrol pump is seprate since both are having different current account separate registration under vat act and in transportation in service tax. Books of both the business will be kept seprate. Fist rule of the accouting is Business is separate from the owner. Also if you show captive consumtion in petrol pump business then in transportation business how will show the cost of fuel.
22 April 2016
mean i should buy fuel by paying 2 % cst and then my pump will show this as sale to transport firm on market price . and i will pay vat @ 16 on that sale.. ??
22 April 2016
Yes, this is the only option left with you. Moreover if go by your way, every person having transportation business will open a petrol pump and show the self consumption leading to loss to revenue. Even if you go by the terms of contract between Indian Oil and Petrol pump you are allowed only to sale to Public and not for self consumption, if you consume yourself it will amount breach of contract.
Further, your local state govt will also pinch out that they are having loss of revenue due to this structure.
22 April 2016
mr. sagar currently we have public licence for lump means we cannot used this as self consumtion that is why we are showing this as a sale.. but we are thinking of changing licence for self consmption bcoz we are paying vat on sale to our other firm. and also transportation business do have petrol pump for self consumption
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