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C Forms

Rashu (:)) (37 Points)

30 March 2011

Hi,

I have a doubt with regard to C Forms.

If a normal man (not a dealer) wants to purchase some goods which is taxed at the rate of 12.5% in his state and in the neighbouring state the same good can be purchased by issuing C Forms i.e. at 2% whats the use of he buying the goods in the same state? He can buy it from different state also by paying less tax?

Just heard this form my boss and i need to answer him soon.. could you please help me.

Thank you:)

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9 Replies

Ramandeep singh (CA-final,M.com (Final)) (59 Points)
Replied 30 March 2011

Rashu, from the purchasing of goods from inter state the purchaser wil not able to take credit of vat paid by him on purchase if he purchase in the own state then he can take credit of amount paid by him Ex. if a purchaser purchase good of 1000 from the own state then he have to paid of vat assume 12.5% approx Rs. 125 and purchaser sold this good in 1100 then he will collect 137.5 rs. ultimately he have to paid 12.5rs. of vat after taking the vat credit. if he purchase from inter state with c form the he have to paid 20 Rs. as a vat. so purchase from intra state will also good in fluctuations in prices

1 Like

CMA Sameer Epari (CA Final Student) (409 Points)
Replied 30 March 2011

Dear Rashu, I agree with Mr.ramandeep, moreover only a registered dealer can get C form from the department,if that person unable to issue form C. he will be charged tax at local rate and he can not take the input tax credit, and if that person is an end user of the goods the efffect of both Intra state and Inter state are same....

1 Like

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 30 March 2011

Originally posted by : Rashu
	Hi, I have a doubt with regard to C Forms. If a normal man (not a dealer) wants to purchase some goods which is taxed at the rate of 12.5% in his state and in the neighbouring state the same good can be purchased by issuing C Forms i.e. at 2% whats the use of he buying the goods in the same state? He can buy it from different state also by paying less tax? Just heard this form my boss and i need to answer him soon.. could you please help me. Thank you:)

yes he can buy goods from other state by paying 2% CST and submitting C forms, but he can not take any input credit benefit for this, at the time of sale he has to pay the entire 12.5% or applicable tax on such goods.

whereas if he buys goods within state and pays 12.5% vat than he can use the whole vat paid set off against the vat liability arised on sale of such goods in state.

1 Like

Madhusudan Kabra (knowledge seeker) (1779 Points)
Replied 30 March 2011

In both the cases where he is not a deler can not avail the credit of tax paid on purchase.

In case of CST paid .... no credit of tax paid even if he is registered deler.

In case he is not registered delear and not availing Vat input credit , its better to buy from other state.

Regards

Madhusudan

Ram Avtar Singh (Nagari Sultanpur U.P.Delhi) (14477 Points)
Replied 30 March 2011

Originally posted by : Madhusudan Kabra
	In both the cases where he is not a deler can not avail the credit of tax paid on purchase. In case of CST paid .... no credit of tax paid even if he is registered deler. In case he is not registered delear and not availing Vat input credit , its better to buy from other state. Regards Madhusudan

Un registered Dealer/ person can not purchase against form "C"

Madhusudan Kabra (knowledge seeker) (1779 Points)
Replied 31 March 2011

Agreed with you Ramavtar sir ... & that why its better to purchase from outside state naaa beacause he can not avail Vat credit also .......then why to go for pay higher tax better to buy from outside..

Comments invited on this view from all ...

Regards

Madhusudan

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 31 March 2011

a person who is not registered with department and does not obtain CST number, how he can purchase goods under concessional rate ( against C form) and how he can be able to issue C forms for such purchases?

2 Like

pranjal agarwal (kotputli) (22 Points)
Replied 11 January 2014

The department issues C Forms to the registered sales dealers only (earlier yearly but now quarterly). It is done to promote the inter-state purchases because earlier no credit was given to the sellers for CST paid, hence nobody was willing to puchase goods from another state. Now, by the issuance of C Forms, the registered sellers can make the inter-state purchases by paying 2% CST and getting the whole credit of 2% CST paid.

Ravindra Singh (Article Assistant) (88 Points)
Replied 14 January 2014

Hlw sir,

I want to ask a query related to C form invoice, If we make a sale against C form in cash then can we issue an invoice on the name of "CASH" as party name instead of Party's name???

Thanks in Advance.....plese reply