Interstate Sale of Cars

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This query is : Resolved

Prasanna B.V.S (Querist)

04 July 2009 Dear Sirs,

Can a registered car dealer in Tamil Nadu buying a car from the manufacturer under VAT, sell the car to a end user in another state or union territory (read as to Pondy from Tamil Nadu)? If yes, will this sale invoice be VAT or CST? Can input VAT credit be taken in this and how should the sales tax (VAT or CST) be remitted?

Regards

Prasanna

Amit Sheode

Amit Sheode (Expert)

05 July 2009 There is no legal bar to the sale of MV interstate. In all cases where the sale results in interstate moment of goods then it is a sale covered u/s 3 of CST i.e. CST is applicable.
Input tax credit can be taken if not specifically disallowed under TNVAT Act. The difficulty in almost certainly the buyer cannot give you C form because firstly the MV must not be covered under his registration under the CST Act & secondly unless he is a reseller in MV he cannot declare that he is using the car for reselling of use in manufacturing.

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