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Cst query

Sachin More (MBA-Finance Executive - accounts & Finance) (422 Points)

03 January 2014

Dear all,

we have purchase fabrics from M/S pratik enterprises. vendor has not charges cst on that as fabric is exempt. but than also vendor has ask for "c form" though material is exempt.

is this valid ? shall we issued " c form " or any other form is there.

Thanks in advance

sachin more

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4 Replies

MJ Krishnamurthy (ACCT(Retd)) (7197 Points)
Replied 03 January 2014

C form can not /need not be issued for non-taxable sale.Even in sales where tax liability is less than 2%(may be 1%,like gold,jewejjery etc) a C form should not be issued,because it amounts to misuse of C forms.......mjk

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B.N.Dharmendra (Senior Manager Indirect Taxation) (136 Points)
Replied 06 January 2014

Dear Sir,

If only the product is taxable but you sell to a registered buyer who's SEZ (Form-I) or for Export purpose(Form-H) then buyer can claim exemption from paying tax or If local Tax is 5% or 14.5% and sells to interstate registered buyer then it can be sale CST-2% against Form-C and but when the goods itself is exempted catergory no need to issue the Form-C just mention in the Sale Invoice the goods is exempted under sec? - Tax Nil.

MJ Krishnamurthy (ACCT(Retd)) (7197 Points)
Replied 06 January 2014

You are correct.In the invoice it may or may not be mentioned about exemption.Issue of an invoice is enough.On sale of non-taxable goods C form should not be insisted......mjk