Mr. A has a TIN in Kerala. He got an order to supply some goods from another dealer Mr.B who is also a Registered dealer in Kerala. Then Mr. A gave a purchase order to Mr. C who is from another state and Mr.A directed Mr.C to supply the ordered goods to Mr.B. Is it a sale in transit as mentioned under 6(2) of the CST Act or a sale that should be taxable under VAT in Kerala after allowing CST purchase to Mr.A.
If the CST purchase took place first and subsequently there is a local sale in kerala then it is not a sales-in-transit.
Sale-in-transit is a sale which is not taxable under CST Act,1956. It is a sale in which the goods are sold by one party to another party while the goods are still in transit.
In the current case, it would be a 6(2) sale when:
1.A orders C to deliver the goods directly to B
2.A endorses the transportation details in name of B while the goods are still in transit.
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