Sales within State but Buyer Outside State - Whether it would be Local Sale Or Central Sale ?

[PAWAN KUMAR SHARMA]

We have a supplier A inChennai and we have a manufacturing set up in Uttrakhand,

We have also a Job worker B in chennai and we want that our supplier A directly supplies material to Job Worker B.

In that case what would be the Sales Tax i.e. whether CST or VAT ?

Please advice.

[YAGAY andSUN]

It would amount to Interstate Sales as it ends up with Bill to Ship to transaction.  Contract of sale occassion the movement of goods, though within the state but it would be treated as interstate sales.

[Guest]

IT WOULD BE LOCAL SALES AND ATTRACT LOCAL TAX IF DELIVERY AFFECTED WITHIN THE STATE.

[BipadBhanjan dixit]

If the manufacturers' additional place of business is not declared at channai then it is a CST sale because the aultimate sale is effected on Uttrakhand.

[YAGAY andSUN]

In case of interstate sale u/s 3(a), sale is interstate if it occasions movement of goods from one State to other. There should be express or implied stipulation for movement of goods outside the State. Since the goods are being supplied to the jobwork for purpose of doing jobwork and inturn jobworked goods will be moved to Uttrakhand, hence, tentamount to interstatesale.

Dealer at Uttrakhand, would have to furnish Form C to the supplier of the goods at Chennai.

AI Summary

Debate on Tax Classification: Is a Supplier to Manufacturer Transaction in Chennai a Local or Interstate Sale? A discussion on a forum addresses whether a transaction involving a supplier in Chennai, a job worker also in Chennai, and a manufacturing setup in Uttarakhand constitutes a local or central sale for tax purposes. One participant argues it is an interstate sale due to the 'Bill to Ship to' nature of the transaction, requiring Form C. Another suggests it is a local sale if delivery occurs within the state. A third opinion states it is a CST sale if the manufacturer's additional business is not declared in Chennai, as the ultimate sale is in Uttarakhand.