Question regarding mvat and section 3(7)

First of all, I'm a seller from maharashtra. 90% of my sales are outside maharashtra(ie, interstate)

 

I wanted to apply for both VAT and CST.

 

I have this two questions:

 

1) What is the requirement(turnover or anything else) to be liable to apply for CST

 

2) For Maharashtra VAT, there used to be section 3(7) which got deleted by  a 2006 circular. This sections said the following:

 

"(7)   Any person who at any time after the appointed day becomes liable to pay tax under the Central Sales Tax Act, 1956 (74 of 1956), but who is not liable to pay tax under the other provisions of’ this section shall be liable to pay tax on the sales and purchases effected by him on and from the day on which he becomes so liable to pay tax under the Central Sales Tax Act, 1956 (74 of 1956) and accordingly nothing contained in the proviso to sub-section (2) shall apply to him in any year"

 

Basically, it is saying that if X is liable for CST then he automatically becomes liable(mandatory registration) for MVAT.

 

Sadly, this section was removed by a 2006 circular.

 

I want to know that if I get CST registration, do I automatically become liable for MVAT registration?

 

Basically I'm trying to register for MVAT under the "compulsory category" so that I don't have to pay 25000 security deposit.

 

Thank you
Anil

Replies (1)

Dear Anil Nair,

In Maharshtra VAT Registration is mandatory if your total turnover of sales exceeds 10 lakh & taxable turnover exceeds 10,000/-. Taxable turnover includes Turnover liable for CST.

In you case if your turnover exceeds 10 lakh even for Out of Maharashtra Sales you have to take mandatory registration & no need to pay deposite of 25,000/-

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