Form I to be issued by the sez buyer

[Ravikumar muthusamy]

Dear Experts

Our company In Tamilnad supplied goods to buyer in SEZ within the state and also other states against their SEZ notification. But the sales tax officer demands Form I from the sez buyer within TN and CST 2 percent for SEZ sales to other state SEZ buyers,

 

pls clarify on this validiity

regards

ravikumar

[Viswanathan Nemmara]

For sales to SEZ buyer within the State, form ARE-1 is to be issued by the seller to the SEZ buyer which should be duly certified by the Custom Officer in charge of the SEZ and returned to the jurisdictional officer of the seller within the State within 45 days of clearance.

Form I is to be issued by the SEZ buyer to a supplier from outside the State.  It is the equivalent of Form C.  However, in case of Form I no CST is to be levied.

Viswanathan Nemmara

[Ravikumar muthusamy]

Thanks for double clarifiying my query like CST not to be levied. Kindly clarify if FORM I is not obtained from the buyer what is our liability

[Viswanathan Nemmara]

If Form-I is not obtained, it will be treated as sale for home consumption and full rate of tax applicable within the State of the Seller will be payable, which can be recovered from the buyer.

[Ravikumar muthusamy]

Very kind of you for giving us clear cut reply, Pls confirm if we hv to reverse Input credit availed on local vat purchased goods which we supplied to SEZ and now paying CST 5 percent in absense of Form I from the buyer, as we do in casese of CST sales without c form

[Ravikumar muthusamy]

Ok thanks a lot for clarfications in dtls

rgds

Ravikumar / 9094043313

[Ramanujam Varadarajan]

In case of local sale to SEZ unit located within TN, there would be no VAT levy as sale to SEZ unit is considered as Zero rated sale and no form I is require to be obtained.  Further, the sale would not be affect the VAT input tax credit for the product availed by the seller.

If the sale is madeto SEZ unit located outside TN is exempt from CST if  sale is made against Form I.  However, if Form I is not produced, it would be treated as normal CST sale subject to CST at the VAT rate applicable for the product.  Further this would also affect  VAT input tax credit availed by the seller on the product. 

 

[Ravikumar muthusamy]

Dear Experts

Would humbly request What is the time limit to produce FOrm I for sez sales

[Ramanujam Varadarajan]

There is no specific timelimit for submission of Form I under CST Rules as against quarterly time limit for Form C or Form F.  Thus, in all practical perspective, Form I should be submitted at the time of completion of assessment / audit.

 

[Ravikumar muthusamy]

Ok sir thanks,

 

Really so proud of our Experts for giving us 100 percent accurate info.

Once again thanks a lot to one and all

AI Summary

Form I for SEZ sales ensures exemption from CST; absence treats sale as domestic, triggering state tax and credit consequences. For SEZ supplies, sellers issue ARE-1 for intra-State deliveries, certified by SEZ Customs and returned within 45 days; for inter-State supplies the SEZ buyer issues Form I, which, when produced, exempts the transaction from CST. Absence of Form I results in treatment as a sale for home consumption, full State tax/CST becoming payable (recoverable from buyer) and potential disallowance or impact on VAT input tax credit. No specific CST-rule time limit exists for Form I; it should be produced by assessment or audit completion.