Branch Transfer against Form F

[Guest]

Sir,

We are supplied material on 31st of october from our branch to head office in other state they have recd material in the month of 5th of November. we are supplied some more materials also in the month of November the recd same month itself. In that case they have issued Form F totally in month of November Itself. But in AG Audit they are not accepting the Form F. They ask we to pay Full tax. Please give us suggestion for this matter. 

[Ganapathy Subrmaniyan]

1)      46 VST 275(Mad) Ashoka Sweets: CST – Dealer transferred the goods to Pollachi, from where goods moved to sister concern at Kerala.  AO verified all documents, Form F, Pattials etc., and granted exemption u/s 6A.  Later revised, because in Form XX, mentioned as “our branch”.  HC on the basis of Ashok Leyland case 134 STC 473 = 2004 (1) TMI 365 - SUPREME COURT OF INDIA allowed the petition.  Form F has NOT been proved as false

2.      25 VST 309 CSTAA: Sri Venkateswara Steel Industries,Salem: The AO made original asst accepting Branch transfer.  On the basis of Inspection revision made mechanically treating it as Interstate Sales with PENALTY.  Held, asst on all the sales as Interstate sales not permissible owing to paucity of evidence.  PENALTY not permissible when the dealer had disclosed all the evidences

 

[Mritunjay Kumar]

Please elaborate the reasons they are giving for non-acceptance of Form-F. Prima facie, it seems that demand made is illegal.

[YAGAY andSUN]

Dear Seeta Lakshmi,

The Central Sales Tax (Registration and Turnover) Rules, 1957, Rule 12 (1) Provided also that where, in the case of any transaction of sale, the delivery of goods is spread over to different financial years it shall be necessary to furnish a separate declaration or certificate in respect of goods so delivered in each financial year.

Regards,

Team YAGAY & SUN

(Indirect Tax Consultants)

AI Summary

Form F acceptance: branch transfer documentation must be proved; rejection and penalty unwarranted absent evidence, declarations required. Form F and accompanying delivery proof must be accepted as evidence of branch transfers to another state unless fraud or falsehood in the declarations is demonstrated; penalties and recharacterisation as interstate sales are not permissible when the dealer has produced supporting documents. Additionally, where delivery spans different financial years, a separate declaration is required for goods delivered in each year under Central Sales Tax rules.