Query related to interstate sale

[Guest]

I am a registered VAT dealer in the state of Andhra Pradesh. I have 2 scenarios on which i want some clarification. They are as follows:

Scenario 1:

I want to import goods in the state of TamilNadu (here by referred to as TN) and sell it in TN, but I don't have a local VAT registration in TN. How can I proceed further with the transaction? What kind of tax to be levied on the sales? How should be the invoice format?

Scenario 2:

I want to buy from TN manufacturers and sell it in TN, but I don't have a local VAT registration in TN. How can I proceed further with the transaction? What kind of tax to be levied on the sales? How should be the invoice format?

Awaiting a valuable solution.

Regards,

Mithilesh

[SURENDRA BABU MUTHYALA]

No.1 is that you intend to import goods in the State of Tamilnadu and sell the same in Tamilnadu.

No.2 is that you intend to buy goods from manufacturers n Tamilnadu and resell the same in Tamilnadu.

For both the scenarios you need to obtain VAT/CST registration in Tamilnadu. Its mandatory.You should have a business premises for this purpose. You can contact the Tamilnadu VAT officer of the jurisdiction where you wanna set up your business-base. Or else you may avail the services of any Consultant,and provide him all the relevant info/records for obtaining registration.

As regards the levy of tax it depends upon the commodity you would like to import/trade/sell.

For imports you will not get any input tax credit, and you have to bill it to the buyers after charging VAT as per the local rate of tax.

If you are buying from local manufacturers you can avail input tax credit (the tax charged to you at the time of purchase by the manufacturer) after selling the same to local buyers. The ITC can be claimed at the time of filing the returns.

Invoice formats are the same as in AP,except the registration numbers on the top and address etc., Absolutely there are no hazels.

[PARTHASARATHY V]

Hello Mithilesh Grandhi

As per the quarries raised by you, in both the scenario the activity will happen at Tamil Nadu, Hence you have to register with the Tamil Nadu Vat Authorities, then only you will be permitted to do the trading activity.

Or else your customers may not able to claim the VAT Credit since the purchase from the Un Registered Dealers, and movement of goods also in trouble.

It is better and advisable to go for registration first in TN.

AI Summary

State VAT registration required for sales conducted within that state; failure prevents buyers claiming input tax credit and obstructs movement. Registration with Tamil Nadu VAT authorities is mandatory for dealers selling within Tamil Nadu; a local business premise and Tamil Nadu registration number must appear on invoices. Imports sold in Tamil Nadu do not permit the importer to claim input tax credit and must be billed at local VAT rates. Purchases from local manufacturers by a registered dealer permit input tax credit to be claimed when filing returns. Failure to register prevents buyers from claiming VAT credit and may cause movement and compliance difficulties.