TaxTMI 
TaxTMI 
We have received order from Chennai to deliver goods at Surat, whether we have to charge VAT or CST on said transaction. We are situated at Ahmedabad. We will insert on invoice copy, Conisgnee name with Surat location and buyer's name/billing address will be Chennai location. Pls. guide whether to charge VAT or CST on stated transaction??
Applicability of VAT or CST
28 May 2009 
8 Replies 
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Movement of goods determines tax classification; delivery within the seller's state indicates VAT rather than CST applicability.
Tax classification depends on whether the physical movement of goods is necessitated by and inextricably linked to the contract of sale. If goods remain physically within the seller's State despite the buyer's billing or payment address elsewhere, the transaction is treated as an intra state sale subject to VAT; only where goods physically move across State boundaries as part of the sale will CST apply. Contractual delivery terms and consignee instructions determine the operative destination for tax purposes. (AI Summary)
Tax classification depends on whether the physical movement of goods is necessitated by and inextricably linked to the contract of sale. If goods remain physically within the seller's State despite the buyer's billing or payment address elsewhere, the transaction is treated as an intra state sale subject to VAT; only where goods physically move across State boundaries as part of the sale will CST apply. Contractual delivery terms and consignee instructions determine the operative destination for tax purposes. (AI Summary)