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Sales tax issue

Yash (AAA) (24 Points)

22 November 2012

I have my firm based in Mumbai, if Iam selling my product to a consumer outside Maharashtra, which tax do I have to pay VAT(12.5%) or CST(4%) ?

Please note that the customer is a single individual and not a company so it doesnt have any registered VAT or CST Tin number.

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8 Replies

CA Ruben Balooni (Professionalism ™) (1324 Points)
Replied 22 November 2012

VAT is for intra-state sale and CST if for inter-state sales.Hence in your case you are liable to pay CST.

Yogita (Partner) (434 Points)
Replied 22 November 2012

First I correct you that CST is 2% & not 4% & that to against Declaration in form C if the Purchasing party gives you C form.

Now you said your Purchasing party is an Individual & not registered under any Sales tax Act. So you will have to Charge VAT @ full arte as Applicable to that product in Maharashtra Since you are in Maharashtra. I hope your query is answered

1 Like

Poonam (Student CA Final ) (90 Points)
Replied 23 November 2012

Yes agree with Mr Yogesh , just want to clarify , if your product which will u going to sell to other party outside Maharashtra , coming under 12.5% vat tax then you have to charge 12.5% tax & if comming under 5% vat tax rate then charge 5%.

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CA Suryakant Dubey (CA ) (931 Points)
Replied 23 November 2012

Vat & cst rates are decided as per the schedules of Mvat act.....rate of vat & cst will depends upon in which schedule your goods fall...n if you sale those goods interstate, Cst will attract....rate will lower down if the party to whom ur selling Issues you a C form...

Ramanuj (Accountant.) (834 Points)
Replied 23 November 2012

Dear Yash

If you are selling to unregistrated party , you have to full charges of state cst rate as per schedule 12.5 % & 5 %. if have selling to registrated party , party issued to "C" form then you have to imposed cst 2 %.

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Saurabh garg (article) (78 Points)
Replied 24 November 2012

I f there is interstate state sale then CST payable is Local Vat Rate or CST rate (2%) whichever is higher. In your case CST Rate is 12.5%. You are eligible for ITC for payment of CST.

SANTOSH BALTE (ARTICLE ASSI.) (37 Points)
Replied 29 November 2012

If sale ------Within the state then-------- VAT (INTRA-STATE SALE)

if sale ------- out of state then ------------CST (INTER-STATE SALE)

Vat rate will be applied as per Schedule (Statewise rate may be different )

Unregistered Dealer:

If Purchasing party 'out of state ' and unregistered dealer then CST will be charged as per Vat rate applicability to particular goods(Cst Sale)

Registered Dealer

A ) If Purchasing party 'out of state ' and registered dealer but C Form is not issuing then CST will be charged as per Vat rate applicability to particular goods that is called as CST sale.

B) If Purchasing party 'out of state ' and registered dealer and C Form is issuing then CST will be charged @ 2%.

AS PER CASE:as per ur

Your party is in out of state so cst will be charged as per vat rate 12.5%.Means CST SALE @ 12.5%