Issue of Form C

What would be the value of 'C' forms and how the purchasing dealer will issue the 'C' forms under the following circumstances :

1. 'A' makes an inter state sales to 'B' for say Rs. 10000 in the month of January 2010 and B makes sales return of the same invoice in the month of say February 2010. While issuing the 'C' Form whether B would mention both the invoice no. against the purchases as well as the credit note no. against the return or he would simply not mention the invoice at all.

When any sales/ purchase return takes place, it has a reason behind it, and most of cases the purchasing dealer avoid to make entries in his purchase book, 

so if A sold goods to B and whole the consignment returned in same return period then the selling dealer will adjust the same in that quarter only, and file net only.

No C form will be issued by B in this case.

2. In the above case, if the sales return takes place in another quarter say in the month of April 2010, then whether B would mention the invoice no. in the 'C' Form pertaining to the quarter January-March 2010 and show the credit note against sales return in the 'C' Form for the quarter April - June 2010. In case there is no inter state purchases from A in the quarter April - June 2010 and no 'C' form is required to be issue what would B do. Also the fact is to be taken into account that the transactions have taken place in two separate financial years.

A sold goods in jan and received back in April , so he will show the details in april-june quarter return, as sales return, or revise the march quarter return, still no C form will take effect. 

3. In certain states, there are provisions under the local Vat act for an audit of accounts for which the last date is 31st October. Suppose, in the above case, the seller A has sold the materials in March 2010 and the accounts have been audited and returns submitted by October 2010. Later on say in November, B effects the return. Obviously B would not get a return of the CST element paid, but certainly he would not issue a 'C' form against this particular invoice. A has no scope to revise his return. Under the circumstances, how would B issue 'C' forms and that too taking into consideration the legal provision that 'C' forms are to be issued on a quarterly basis within the next quarter.

its not the deadline of 1st april to submit the audit report, but 31st oct , so the goods in transit will be accounted in the books of buyer, or the provisions are made, enough time is given of 7 months to account for these transactions. 

I would request experts to kindly go thorugh the same and enlighten me.