Inter state sale

This query is : Resolved

MUKESH JAIN (Querist)
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02 August 2016

Gentleman

I have a query , suppose A of Assam purchase from B of Assam and sale to C of Bihar in transit sale , in this case what tax will charge by B to A and further A to C and why . If any kind of form issue , then who will issue form to whom ? Pl explain .

Another case is if A of Delhi purchase from B of Assam and sale to C of Assam in transit sale , then also please guide us what tax charge and form liability to whom ?

Please mail me your explaination and guide me . Please also provide your contact details

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MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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02 August 2016 Mr Mukesh Jain The first case A of Assam purchasing from B of Assam is a local transaction. These goods can not be sold on-line to C of Bihar.The first sale between B and A is within Assam. This cannot be extended to a transit sale. Here a normal VAT invoice is to be raised and Assam VAT is to be paid. Later for selling by A to C an interatate invoice to be raised. If both are registered dealers CST@ 2% can be charged against 'C'form issued by C to A.These two sales are independent.
In the second case A purchasing from B of Assam is interstate sale and this can be forwarded to C of Assam,during transit by endorsing the documents in favour of C. Now B will issue an interstate invoice to A charging CST @2% and A will issue an interstate invoice without any CST to C.. C will give a 'C' form to A and A will give a 'C' form to B.B will also issue an E1 form to A. ........mjk

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MUKESH JAIN

MUKESH JAIN (Querist)
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03 August 2016 Thank you very much Mr Krishnamurthy Ji for your response .Sir , in my case 1 , there should be some law to avoid multiple taxes burden .

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MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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03 August 2016 Mr Mukesh Jain. : Although it amounts to multiple tax in the first case it can not be avoided. First and second transit sales are provided in the Central Sales Tax Act only.If the first sale is an interstate sale,i.e. across two state borders,it can be continued to another person during transit. On the contrary,if the first sale is an intra-state sale it can not be extended during transit into one more transaction.......mjk

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