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E1 purchase/sale

Believe in Yourself (article) (139 Points)

17 January 2012

Can anyone plz explain me what are E1 purchase & sale??

And can we take the credit of duties paid on E1 purchases.???

Plz do the needful & rep asap..

Thanks in advance...

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2 Replies

RAJU (LEARNER) (1089 Points)
Replied 17 January 2012

In brief, E-1 sale can be done by transfer of documents of title to the goods during their movement from one state to another.

In such transaction, a buyer (Party 1) purchases goods from an Interstate seller (Party2) against Form-C. While the goods are in transit, the buyer (Party 1) will endorse the document of title (LR) in favour of his customer (party 3) without taking delivery of the goods.

In this case, Party 2 will charge CST and collect Form-C from Party 1. Party 1 will sell the goods (E-1 sale) to Party 3 without any tax. In support of the exemption, Party 1 will have to collect E-1 form from Party 2 and Form-C from Party 3.

Trust the above clarifies you..