Issue of "c" form

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Vijay Modi (Querist)
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29 July 2011 Dear Sir,

We are the Manufacturer and also the job worker (Get the material from a manufacturer and we are doing some process and returned). In Invoice, we charged only our JW charges. During JW, we used to procured tools and other consumables from outside and within the state. Want to know:
1. For Inter state purchase whether we can apply for "C" Form.
2. For Local purchase (WB) whether we can avail the Input VAT Credit on Inter state sales of our manufactured parts.
3. Can u adjust the Input VAT Credit on Out put VAT on Sale of Scrap generated during JW.

Please help.
Regards,

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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30 July 2011 Mr. Vijay Modi,
You can not buy tools and consumables from ouside state by using 'C' forms.You can issue 'C' forms for purchases of raw materials required for manufacturing work only. if you procure raw materials locally for manufacturing process the input vat credit can be adjusted aginst output tax of interstate sales also. Input tax of local purchases can not be taken credit out of the output tax of JW scrap sale,because you are not using any raw material in a jobwork.This is the general procedure in most of the vat laws.MJK

Vijay Modi

Vijay Modi (Querist)
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20 August 2011 Thanks for the reply.

As v are using the tools and consumables for manufacturing the final products: 1. Manufactured goods and 2. JW goods.

Can we issue "C" forms for tools and consumables purchased for both the products or not.

Thanks & Regards,

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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20 August 2011 Mr. Vijay Modi,
In your case the law says,you can issue 'C' forms for purchase of 1) machinery for processing and manufacture,2)raw materials,3)paking materials,only. The interstate purchases you make should be declared in advance before the tax authorities and get it entered in your CST registration certificate. Otherwise you can be penalised for wrong issue of 'C' form.Tools and consumables are not covered under these rules.
MJK

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