Go Ad-Free on CAclubindia with Daily Mobile Updates. Subscribe Now!

Purchase from warehouse

12 June 2015

Suppose I'm purchasing entity and I am purchasing through a company which has a Warehouse in Surat and Head Office in Mumbai.Now if purchase bill is generated from Mumbai and Goods are sent from Surat then on those goods whether CST is applicable or VAT?

Reply
Follow
Share

5 Replies

Harshal (CA) (106 Points)
Replied 12 June 2015

Dear Friend,

TO decide whether a transaction is chargeable to VAT or CST, movement of goods is very Important. According to Section 3(a) of CST Act, CST is applicable when there is movement of goods from one state to another.

Its important to note that the Movement of Goods will decide the changeability & not location of the dealer. So as in your case, even if both dealers are situated in Maharashtra, the transaction is chargeable to CST as goods are moving from Surat (Gujrat) to Mumbai (Maharashtra)

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

Parth Prajapati (Student) (33 Points)
Replied 16 June 2015

Thank you for your reply Sir, but you haven't understood my question. I am sayiing that the goods that I am to receive are from Warehouse situated at Surat of the company situated at Maharashtra. So if I will receive goods from warehouse situated in Surat, whether VAT will be applicable or CST?

Harshal (CA) (106 Points)
Replied 16 June 2015

It will be chargeable to CST. As Goods are moving from one state (Gujarat) to Another (Maharashtra). Location of the dealer is not relevant. Even if both the buyer & seller are in Maharashtra, transaction involves interstate movement of goods. Hence it is chargeable to CST

1 Like