22 November 2014
Dear All, My Company makes cst sale invoice in below format to each party:-
Value of cost of product Excise 12% Edu Cess 3% SH Edu 1% Cst 2% Carriage outward xyz amount Service tax on carriage 3% Edu cess on Service tax 2% Senior & Higher Edu 1% = total value of Bill. I want to know on which value should I receive form C, because some parties issue form c on total bill some issue after excluding carriage+service tax+edu+she, when i ask resion, they reply it as according to rule of sales tax. kindly clarify it.
22 November 2014
Excluding carriage and service is better. (This is because VAT has nothing to do with that) Some people are approximate enough in asking for C form and hence they include TOTAL value. In either case, the puirpose of CST dept is well served. C form is for CST dept to know that the interstate transaction has occurred. The subsequent action is to check that in the DESTINY state, it is regarded as first sale or NOT.
22 November 2014
I am preparing sale tax cases for FY 11-12, A party has send first 2 quarters's forms C excluding carriage & service tax & last quarter's forms C with carriage & service tax. In this condition what should I do. Should I ask for extra value of form C for first 2 quarters or it is ok.
09 August 2024
For Central Sales Tax (CST) purposes, the Form C should be issued based on the value of the goods sold excluding certain items like carriage outward and service tax. Here’s how you should handle the situation and understand the correct value for which Form C should be issued:
### Understanding Form C Issuance:
1. **Value for Form C:** - **Form C** should cover only the value of goods sold and not include charges like carriage outward, service tax, or other taxes. - The amount for which Form C is issued should be the **invoice value of the goods** before adding the charges for carriage, service tax, or any other taxes.
2. **Breakdown of Invoice:** - **Cost of Product**: This is the value on which Form C should be issued. - **Excise Duty, Edu Cess, SH Edu, CST, Carriage Outward, Service Tax**: These should be excluded when issuing Form C. Form C is meant to cover the value of goods only.
3. **Handling Different Values on Form C:** - If you have received Form C excluding carriage and service tax for some quarters and with them for others, you should ideally reconcile the amount to ensure that Form C is issued correctly. - **Request for Adjustment:** For the first two quarters, you should request the parties to issue Form C for the correct value of goods sold, excluding carriage and service tax. You should seek additional Form C values to cover the discrepancies.
4. **Legal and Compliance Aspects:** - **Sales Tax Rules**: CST rules typically require that Form C be issued based on the value of goods sold, excluding any additional charges. Ensure that your understanding aligns with the legal provisions and consult relevant sales tax rules or a tax advisor if needed. - **Documentation**: Keep records of all communication and documents related to the issuance of Form C. This will help in case of any audits or compliance checks.
### Steps to Take:
1. **Verify the Amount**: Ensure that Form C is correctly issued based on the value of the goods sold, excluding carriage and service tax. 2. **Request Correct Forms**: Contact the parties who have issued Forms C incorrectly (with or without carriage/service tax) and request them to issue corrected Forms C if necessary. 3. **Document Corrections**: Keep track of the corrections and any additional Forms C issued to reconcile with your sales tax returns.
### Summary:
- **Form C** should cover the value of goods only. - **Exclude** carriage, service tax, and other charges. - **Request Corrections** from parties if Forms C were issued incorrectly. - **Consult Sales Tax Rules** or a tax professional for specific guidance and compliance.
By ensuring that Form C is issued accurately, you will be able to maintain compliance with sales tax regulations and avoid potential issues during audits or reviews.
CAclubindia
