Statutory forms importance

[Ganeshan Kalyani]

Dear Sir,

We deal in goods exempted from VAT. We do stock transfer. Whether statutory form F is necessary to be issued or received. What is implication if not complied.

Regards,

ganeshan

[YAGAY andSUN]

Dear Ganeshan,

Form F is mandatory in case of transfer of stock from one place to other of the dealer's. If not issued or received within prescribed time limit or not submitted at the time of assessment, then, such transfer of stock would be deemed as Sale under CST Act, 1956. Hence, Tax, interest and penalty would be levied/imposed, accordingly.

Regards,

NeelamTaneja- Executive Consultant

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

[Ganeshan Kalyani]

Dear Expert,

As per my understanding, in absence of statutory forms rate of tax as per schedule rate will be applicable. Here in case of exempt goods in absence of statutory forms what tax will the government apply. Kindly clarify.

[Ganeshan Kalyani]

Dear Expert,

I hope issuing /receiving of Form F is essential to prove that the transaction is Inter State stock transfer and not sale. In absence of form F the transaction is termed as sale and tax @ rate prevailing in receiving state for that product as per schedule entry is levied. However if the product is exempt that the question arises as what will be the tax rate at which authority will tax the transaction. I seek expert comment in this regard.

regards,

ganeshan

AI Summary

Form F requirement: absence can convert inter state stock transfers into taxable sales leading to tax, interest and penalty. Form F is mandatory for inter state stock transfers to establish non sale status; failure to issue, receive or produce Form F within prescribed time may result in the transfer being treated as a sale under the Central Sales Tax regime, attracting tax, interest and penalty. The respondent notes that absent statutory forms the scheduled tax rate of the receiving State will be applied. The text records uncertainty about the effect where the goods are VAT exempt and whether authorities will still assess tax in that circumstance.