Allowability of CST along with quanrity

[ranjit ronald]

Dt.14.08.09 Sir, We are a chemical manufacturing company, and allowing quantity discount in subsequent month by way of credit notes. While crediting the quantity discount, CST is not allowing to the customers. Some of our customers are requesting us to allow proportionate CST towards quantity discount. Please advise us whether CST is allowable along with quantity discount as per CST rules. RANJIT RONALD C.R. ASST. ACCOUNTS OFFICER THE KERALA MINERALS AND METALS LTD., KOLLAM, KERALA STATE

AI Summary

Chemical company seeks advice on allowing CST on quantity discounts via credit notes; considers revised return for tax adjustment. A chemical manufacturing company is seeking advice on whether Central Sales Tax (CST) can be allowed on quantity discounts provided via credit notes. The company faces customer requests to allow proportionate CST on these discounts. A respondent suggests that CST is payable on the sale value after deducting the quantity discount, provided the discount is a pre-condition of the sale. If tax has already been paid, the company can file a revised return to claim the benefit and adjust future tax liabilities accordingly.