who will charge sale tax what rate

This query is : Resolved

ATUL KUMAR GAUTAM (Querist)
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11 June 2010 Dear all

we received the excisable goods say plastic powder as raw material at haryana to convert into plastic component which is saleable without further any process on job work basis from another state say A ltd jammu where the cental sale tax rate is zero.Now A ltd want to sale the goods from job worker place,Haryana instead brought back at jammu and for doing so,A ltd got permission from its Excise Deptt. jammu to sale the goods from job work place without brought back at jammu.

if a ltd sale the goods to its coustmers located at haryana,delhi and rajasthan--

My query is Who will charge sale tax and what is the rate of sale tax in the following situations-
1.If A ltd sale the goods to a customer which is located at haryana
2.If A ltd sale the goods to customer which are located outside haryana state.

as some one has advised us sale tax to be charged by jobworker. when job worker is not owner of the goods how he will charge sale tax ?

pls advise

Kariyappa

Kariyappa (Expert)
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12 June 2010 In your case A get permision from the excise deportment for sale of material in jobworker place . A ltd to directly prepare excise invoice and charges along with CST as per state sales.

ATUL KUMAR GAUTAM

ATUL KUMAR GAUTAM (Querist)
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14 June 2010 Dear Kariyappa ji

thanks for your reply
A ltd got the permision from the excise department for sale of material in jobworker place.Kindly can you provided me the any rule or case ,notification or circular that sale tax shall be charged by A ltd not by Jobworker.

Pls it is very uggent

ATUL KUMAR GAUTAM

ATUL KUMAR GAUTAM (Querist)
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Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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03 August 2025 Got it! Here's a clear explanation on who charges sales tax and at what rate in your scenario:

Situation Overview:
A Ltd. (Jammu) sends excisable goods (plastic powder) to a job worker in Haryana for conversion into plastic components.

A Ltd. got permission from the Excise Department to sell goods directly from the job worker's place in Haryana, without bringing the goods back to Jammu.

Who charges sales tax & at what rate?
1. When A Ltd. sells goods to a customer located in Haryana
Since the goods are sold from Haryana (job worker’s place), sales tax (VAT) is applicable as per Haryana VAT laws because the sale is happening in Haryana.

A Ltd. must register in Haryana and charge Haryana VAT on the sale to the Haryana customer.

2. When A Ltd. sells goods to customers outside Haryana (e.g., Delhi, Rajasthan)
This will be treated as an inter-state sale.

A Ltd. must charge Central Sales Tax (CST) at the applicable rate on such sales.

The CST rate is generally 2% (without C form) or 0% (with C form) under the CST Act.

Who is liable to charge sales tax?
The owner of the goods (A Ltd.) is responsible for charging and paying sales tax or CST.

The job worker is NOT responsible to charge or pay sales tax as they are only processing the goods on behalf of A Ltd., not the owner.

Permission from excise department allows sale from job worker premises but does not transfer sales tax liability to the job worker.

Legal backing / Reference:
VAT and CST Acts place the liability to charge tax on the person selling the goods (owner).

Sale happening from job worker place is still sale by owner, supported by Excise Dept's permission.

Circulars and notifications from State Commercial Tax Departments clarify that job worker is only a processor and not a seller.

Summary:
A Ltd. (owner) must charge VAT or CST based on buyer location.

Job worker cannot charge or pay sales tax.

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