Issue of I form by SEZ unit under EI transaction senario

[vishnumurthi holla]

Dear Sir,

We are a SEZ unit has given contract to 'A'-a Private limited company to construct a PEB for our SEZ Plant. Both SEZ Unit and The Contractors are in Karnataka.

Now The Contractor - A - Purchased some steel from the Manufacturer in Hyderabad and effected direct delivery to SEZ site ( Billed to A and Shipped to SEZ Unit). He has followed Rule 30 of SEZ Rules. Since this Transaction is Interstate Movement , the supplier is asking I form from SEZ Unit, which we are unable to issue as the re is no Buyer and seller relation lies between seller and SEZ Unit.

The contractor Bills it to SEZ unit on Running bill basis.

I need to Know, whether SEZ has to Issue I form to the Supplier or Contractor? What is the way out?

[YAGAY andSUN]

Dear Vishu,

This transaction come under the purview of Section 3 (a) of the CST Act, 1956 and on the basis of invoice submitted by Supplier ( under Bill to Ship to) you may issue Form I to the supplier. Please also cross check with your counsel and with the KVAT Authorities in this regard.

Regards

Team YAGAY and SUN

(Management and Indirect Tax Consultants)

[MUKUND THAKKAR]

Dear Vishumurthi,

if supplier bills generate like buyer and consignee, material supply not effected the excise duty, but so far is tax, same will be effected. and your contractor will pay the applicalbe taxes. if payment is released by you than are u able to provide I form, because purchase is not appear in books of account of raw material.

Mukund Thakkar

AI Summary

Form I issuance: SEZ unit may issue Form I to supplier in bill-to/ship-to interstate supplies under Section 3(a). Where a supplier uses a bill-to/ship-to invoice showing goods billed to the contractor but shipped to the SEZ unit, the SEZ unit may issue Form I to the supplier under Section 3(a) of the Central Sales statute, subject to confirmation with counsel and local tax authorities; allocation of tax liability depends on invoicing, payment, and accounting treatment, with the contractor bearing tax if treated as purchaser in records.