Break up of an interstate purchase bill is like this;
Product value > 2,300.00
CST > 46.00
Freight > 200.00
Total >2,546.00
What is the value to be mentioned in Form C ? Is it the total amount of Rs.2,546.00 or Rs.2346.00 ie excl freight ???
Please advice me regarding this.
You need to mention only for RS:2346/-
Why is it Rs.2,346.00 ?? The bill value is Rs.2,546.00 right ?
we need to issue C forms only for the materials purchased not for freight. Normally u r entering in accounts for material value Rs:2346/- and frieght charges RS:200/-. We are not yet treating full amount as material purchased.
If tax collected is with frieght charge then U need to issue in the fulll value, in this case you material value is only 2346/- and the principal will account only the base value + tax in his books of account &frieght charges accounted seperately & will calim as exempted TO , you need to give only the value of RS 2300+ 46
selvan
please noe c form amount is 2,346 because According to the VAT rules C form is issue alway on basic + tax not any other charges.
so where we have to show the freight of 200/-
No need to show freight charges in C Form. Freight charges take it as expenses in your company accounts.
You can issue C form without Transport charges. If by mistake, issued the C form for total value including the transport charges, there is nothing wrong and seller will have to explain to his sales tax officer that the buyer has issued the c form including the transport amount. One thing is sure that the assessing officer cannot disallow or reject the C Form for this reason. There are decided cases in the state salestax act that to arrive the purchase cost and to levy purchase tax (product like sugarcane) the transport and handling is to be added.
Hope it is clear.
rengaraj r.k
CAclubindia
