Interpretation of Circular No. 20/08 - Kerala VAT Act

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Sanjay Ashtaputre (Querist)

12 June 2008 The reference to the circular with respect to issue of "C" forms for purchases of materials which are directly used for processing and the purchases which are not directly connected with the processing of the goods in question involved in execution of works contract shall not be entitled for issue of "C" forms.

Are consumable such as bearing, spares, accessories, hardware, paints, chemicals, diesel considered as directly used for processing?

In case of purchase of capital goods such as plant and machinery can "C" form be issued?

CA. O.P. Agarwalla

CA. O.P. Agarwalla (Expert)

22 September 2008 No circular, notification of any state Govt can make narrower the scope of Section 8(3)(b)of CST Act 1956.

"For use by him in the manufacturing or processing of goods for sale" is to be understood properly.

What is being sold in WC, answer is goods (in the condition in which the goods are incorporated in Work Contract), accordingly, in my view goods used in manufacturing or processing of such goods (which are directly used in WC) are eligible for C forms.

Sanjay Ashtaputre

Sanjay Ashtaputre (Querist)

22 September 2008 Thanks for the guidance.

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