Sale to government department - burden of additional sales tax

[Guest]

We are Govt Suppliers of electrical goods in NOIDA. As per Govt. Notification ,Sale to Government is equivalent to sale to unregistered dealer w.e.f. 1-4-2007. Is the concept of Form 'D' abolished? Whether Govt Departments will be given provision to get themselves regisered in Sales Tax dept. to issue Form 'C'? Suppliers who have received orders from Govt Dept along with Form 'D' surely can not use these form on their sale in financial year 2008-08. Is this right? In U.P, rate of local sales tax is 10 %. So who will bear the brunt of this additional 6 % sales tax??

[Guest]

If the government department fulfills the conditions of CST Act (like resale of goods), they can get themselves registered and avail the benefit of "C" form. Otherwise, local sales tax is to be paid. To solve the problem, that who will bear the differential tax, you have to take the issue with the concerned buyer only. There is no option.

AI Summary

Government Supplier Queries Sales Tax Changes: Form 'D' Abolished, Form 'C' Registration for Government Departments Under Section 8(4) A government supplier of electrical goods in NOIDA raised a query about the implications of a government notification effective April 1, 2007, which equates sales to government departments with sales to unregistered dealers. This change raises concerns about the abolition of Form 'D' and whether government departments can register for Form 'C' to avoid additional sales tax. The local sales tax rate in Uttar Pradesh is 10%, leading to a potential 6% increase in tax burden. The response suggests that if government departments meet certain conditions, they can register and use Form 'C'; otherwise, the additional tax must be discussed with the buyer.