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Double tax of cst

A. mehta (Gen mgr) (35 Points)

01 August 2013  

We are a just new ly formed Pvt comp with no turnover as yet. In a first once-of transaction some equipment has to be purchased by us interstate and then sold to another registered dealer party who also is inter state. Since we are not registered we have to pay 15% CST. We wish to keep our source of material confidential if we can,to the Buying party. Can someone please advise us on the following-

1) Do we have to compulsory register with VAT and CST, although we do not have any turnover yet.

2) If not , then by paying 15% CST, we will be increasing the price to the new buyer by that amount- can he claim it as a input credit- if so how ? and what will be our declaration?

3) Can we ship directly to the new buyer from our purchaser and thus take his C form at 2%? We would not be able to keep our source confidential then.

4) please suggest the best option to us in the above scenario. 
 

Grateful for help and advice.

 

Mehta


 2 Replies

RAJ KUMAR BHANDARI (FINANCE) (165 Points)
Replied 01 August 2013

FIRST OF ALL YOU CAN NOT TAKE INPUT CREDIT OF CST.

AND IF YOU ARE NOT REGD. DEALER, THEN WHY YOU PURCAHSE GOODS FOR RE-SALE.

AND IF YOU ARE DOING BUSINESS, SO MUST BE REGD. DEALER WITH VAT FOR CONCESIONAL RATE (CST @ 2% AGAINST FORM C)

THANKS

RAJ KUMAR BHANDARI

CA Dhiraj Ramchandani (CA, M. com) (10818 Points)
Replied 02 August 2013

You are suppose to get register with that state, as goods are moving on your name..

 

Moreover., what is the problem if your customer comes to know about your vendor?? It is a good option, if your vendor directly delivers good at your customer's place, that would help you maintaining not even your warehouse or any facility for protecting goods..

 

But if you  buy the goods after registering your company., you can buy goods at 2% and sell the same at 2% and can earn a higher profit, in such transaction...


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