Dear Friends
There are 3 parties A, B and C.
C is exporter in Maharashtra,
A is supplier from Gujrat and
B is trader in Maharashtra.
B has purchased goods from A and sold to C.
The goods are exported to foreign country.
C will issue Local Form H to B.
The question is whether B can issue Form H to A as the sale is the last sale in course of export?
Section 5 of CST Act
(3) Notwithstanding anything contained in sub-section (1), the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods out of the territory of India shall also be deemed to be in the course of such export, if such last sale or purchase took place after, and was for the purpose of complying with, the agreement or order for or in relation to such export."
Form H can not be issued for purchase prior to penultimate sale. It can be issued only for sale immediately prior to the export. So B can not issue form H to A.
Thankyou for the answer sir.
So B has to pay sales tax of 2% against C form.
Is there any procedure where we can save this 2% sales tax?
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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