Transit sale/e1 sale

VAT (Legacy) 612 views 2 replies

SSNarayana

Partner

46 Points Posted on 04 February 2013

I need information regarding Transit Sale. I would appreciate a response from a reliable source.

We are based in AP(Let us assume we are "B") and we are registered for VAT&CST. We purchased electrical products from Gujarath (Let us assume we bought from "A" in Gujarath)and sold them to another company (They are also registered for VAT&CST) in AP(Let us assume the company from AP who bought from us is "C"). Our supplier from Gujarath raised in our name (in the name of B) and mentioned consignee as "C" and delivered the goods at C's place in A.P. C after receiving the goods , consumed them for their own purpose(they did not sell to anybody)

Now i would like to know what are the forms involved in the whole transaction and the sequence of Form issues. Who should issue which form to whom and when?

I would appreciate a detailed reply with proper sequence of Forms in step by step process.

Thanks and Regards

Replies (2)

Mr Subrata Dasgupta

Finance Professional

171 Points Posted on 04 February 2013

Dear SS Narayana

The correct sequence of events will be as follows

1. B receives invoice from A, and issues "C" Form to A

2. A issues E1 Form to B

4. B issues invoice to C mentioning the same LR/RR Number.

3. B receives "C" Form and payment from C

The correct documentation and procedure will be as follows

1. A hands over the goods to Transporter who issues LR in the name of B with destination as C (AP)

2. During the period of transit B endorses the LR in the name of C.

3. Based on the Endorsed Copy of the LR, C takes delivery of the material for his use.

Important :-

Please note that all invoices raised for the transaction by A and B should mention the same LR/RR Number and date. The material should not be sent on "Door Delivery" basis.
B should not show the value of CST separately in its invoice on C.
The quantity at the begining and end of the transaction should remain the same.