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Shivani (Learner)     21 April 2013

Form c not received

On 1-3-2012, Venus Ltd., Chennai sold goods worth 10000 to Mars Ltd., Bengaluru.

 

 

Questions.

 

1. Does Venus (seller) ask Mars (buyer) for form C at the time of sale?

Does Venus goes by the mere word of Mars that Mars will give Form C to Venus?

 

2. What is the time limit within which Mars has to give Form C to Venus?

 

3. Assuming Mars promised form c, then venus passed following entry in its books on 1-3-2012

Mars Ltd. debit 10200

To interstate sales 2% 10000

To CST Payable 2% 2000

 

Now what if Mars does not give Form C to Venus !

 

(a) What entry will Venus pass in its books assuming the Vat rate for goods sold to Mars in State of Tamilnadu is 5%.

Also on what date Venus will pass this entry? is it on the last date of the quarter i.e. on 31-3-12 in this example.

 

(b) Are there any consequences for Mars to bear for not having issued Form C to Venus?

 

(c) Any entry to be passed in books of Mars for failure to give Form C or penalty etc.?

 

Please advise.

 

Shivani

shivaniadream @ gmail.com

 

 



 3 Replies

Lakshy

Lakshy (Semi-Qualified C.A. PGDFM BCom.)     22 April 2013

1. Issue of C form is duty of purchaser.  To avail tax (concessional) benefit i.e.2% instead of 5% seller must have to collect C-Form and submitted to the department. If seller fail to do so, he may liable to pay balance tax 3% (5%-2%) at the time of assessment. Generally, issue of C-Form takes One month to Three months period. It is an online procedure. It is not important to received c-from within the financial year in which concern sales transaction took place, but prior to assesment you have C-Form in your hand. Keep follow up periodically. Suppose to suffer liability of 3% in case Mars fail to issue C-Form within stipulated time (before assessment) accounting entry would be.  Sales Tax Paid (Expenses) Dr to Cash/Bank. You can Dr to party if it is to be paid to you subject to mutual understandings.  Instead of this Mars liability is nothing.  Despite accounting entries apart from above mentioned will be base of nature of transaction.

 

 

asim jana

asim jana (accounts head)     26 April 2013

I agree with Sandeep. But tax liability becomes balance 3% CST and Interest 1% monthly (check the rate of Interest in your state) till the date of payment.

Jigar Patel

Jigar Patel (Owner)     26 March 2021

Hello sir, we are C-Form collection agency from Gujarat, if you have any problem regarding C-Form, feel free to contacts us 
Jigar - 940.  94.  90. . 19.  4


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