Purchase & sale within a outside state

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CA Atul Singhal (Querist)

05 June 2013 dealer is registered in Delhi under Delhi VAT Act. He purchases goods from a dealer in Haryana and sells to a costumer in Haryana. Sale or purchase does not occasions the movement of goods from one state to another.

pls advice whether CST is applicable or not.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

05 June 2013 Yes. your transaction is interstate sale only and attract CST. as per sec.3 of the CST act the following is the interstate sale

1.If the sale occasions the movement of goods from one State to another (Sec.3(a))

2.If the sale is effected by a transfer of documents of title to the goods during their movement from one State to another. (Sec.3 (b)

so your sale is treated as transfer effected by the transfer of documents

CA Atul Singhal

CA Atul Singhal (Querist)

07 June 2013 dear CMA Ramesh Ji
There is no movement of goods from one state to another.

sec.3(b) is applicable only when there is movement of goods from one state to another.

please read section 3(b) again.

Vasanth Kumar J K

Vasanth Kumar J K (Expert)

10 June 2013 when there is not movement of goods from one state to another the qeustion of interstate trade does not arise, in order to fall under section 3(b) first there should be movement of goods from one state to another during that movement transfer of document should happen, in your case it should be local sale unless there is exemption available for these kind of transactions liable for tax as per the rates applicable under the respective state law

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