Interstate Purchase of Capital Goods Macninery

[Vimal Goel]

Hi everyone ! I'm currently having a steel processing unit in Bangalore.

I'm purchasing a custom made machine for Slitting of Steel Coils form a manufacturer in Rajkot(Gujrat)

My auditor says that I cannot issue a 'C' form against the machinery purchase form Rajkot.

Now, I'm forced to pay 5% CST for the same.

Can anyone guide me on this rule with proper documentation proof.

Will be of great help.

Thanks,

Vimal Kumar Goel 

+9199005534321

[YAGAY andSUN]

Rule 13 of the Central Sales Tax (Registration and Turnover) Rules, 1957 enumerate that the goods referred to in clause (b) of subsection (3) of the Section 8 which a registered dealer may purchase, shall be goods intended for use by him as raw material, processing materials, machinery and plant, equipment, tools, stores, spare-parts, accessories, fuel or lubricants, in the manufacture or processing of goods for sale, or in mining, or in the generation or distribution of electricity or any other form of power.

Hence, you can provide the C form against the purchase of machinery provided it should be used in manufacture or processing of goods for sale.

[Mukesh Shah]

Hi Vimal, 

You can provide C form provided you are registered under CST and such registration certificate includes the plant and machinery you want to issue Form C towards.

AI Summary

Buyer of Custom Machinery Challenges 5% CST Requirement, Citing Rule 13 for 'C' Form Eligibility An individual with a steel processing unit in Bangalore is purchasing a custom-made machine from a manufacturer in Rajkot, Gujarat. Their auditor advised that a 'C' form cannot be issued for this machinery purchase, necessitating a 5% Central Sales Tax (CST) payment. Two responses were provided: one citing Rule 13 of the Central Sales Tax (Registration and Turnover) Rules, 1957, which allows issuing a 'C' form for machinery used in manufacturing or processing goods for sale; the other confirming the possibility if the buyer's CST registration includes such machinery.