Sales Tax - AP Impact on all state businessman

SPLITING OF ANDHRA PRADESH & ITS IMPACT ON BUSINESS WORKING

As you all are aware that Andhra Pradesh is going to split into two new states on 02.06.2014 i.e. Telangana and New Andhra pardesh. Accordingly, in system there will be two two new business places. It impact on businesses in many ways.

Sales tax is implied on mostly all of the businesses. If we talk about the Forms used in Sales tax than we should be aware that now we have to issue separate forms from the purchases done from Telangana state and New Andhra Pardesh.

F Form: This form is issued when one unit of a company transfer goods to other  unit of the same company but in different state. The goods receiving state has to issue F Form to goods dispatching state declaring that the transfer of goods merely a stock transfer within company and not sale therefore tax should not be imposed. But the goods which will be dispatched on 01.06.2014 by old AP, for this goods receiving location has to issue a separate form mentioning old tin of AP. So, it is recommended to take a proactive action in advance and don’t do any stock transfer on 01.06.2014 to avoid unnecessary issues.

In India, Delhi is the state where F Form is issued on the basis of goods receipt date in remaining states F Form can be issued on the basis of dispatch date. So confusion arises,  if the goods which are dispatched in May 14 for Delhi and received in June 14 (e.g. on 04.06.2014) than this receipt has to be included in form issued for June 14 which is issue with New TIN of new AP/Telangana. To resolve this confusion, there is already a provision exist in Delhi that it allowed to businesses to issue a separate form for the goods which is received in current month but related to goods dispatched in previous month.

Please note that the tax period in AP for First Quarter is 01.04.2014 to 01.06.2014 and for Second Quarter is 02.06.2014 to 30.09.2014.

AP States issued a communication in advance that States from where one consolidated F- Form is issued for a month, the period for the month of May to be considered as 01.05.2014 to 01.06.2014. Similarly for C Form period of Q1 (2013-14) is to be considered as 01.04.2014 to 01.06.2014.

Similarly, many Departments’ portal validates the TIN of the new States. The validation programme requires change to consider the new TINs of Telangana and AP.

If we talk about way bill than existing physical waybills for consolidated State of AP may be used for dispatches to New AP even on or after 02.06.2014 but the TIN of the consignee has to be manually changed. However, the same cannot be used for dispatches to units situated in Telangana on or after 02.06.2014. Any dispatch on or after 02.06.2014, has to be accompanied by waybill (physical or online) carrying new TIN of either Telangana or RSAP depending on the consignee location. It has to be ensured all the transport documents generated on 02.06.2014 onwards are carrying new TIN of the consignee based on the State in which it is located.

Amit Jolly

Contact at ami.jolly@yahoo.co.in