E1 purchase/sale

In brief, E-1 sale can be done by transfer of documents of title to the goods during their movement from one state to another.

In such transaction, a buyer (Party 1) purchases goods from an Interstate seller (Party2) against Form-C. While the goods are in transit, the buyer (Party 1) will endorse the document of title (LR) in favour of his customer (party 3) without taking delivery of the goods.

In this case, Party 2 will charge CST and collect Form-C from Party 1. Party 1 will sell the goods (E-1 sale) to Party 3 without any tax. In support of the exemption, Party 1 will have to collect E-1 form from Party 2 and Form-C from Party 3.

Trust the above clarifies you.. 

E 1 Purchases under which category will applied in annexure 1A