Sale in transit / CST without C -Form

[ashok sharma]

Dear Sir,

Our firm is registered in delhi (A), we purchace the nonwoven fabric from gujarat based manucacturer (B) and want to sell it in mumbai based customer (C). 

We want to supply this material directly Gujarat to Mumbai and mumbai based customer sell this fabric in many states.

So, what should i do? (My CA has informed about E1/E2 form, but i am not clear).

Gujarat based company (B) will issue the form E1 to me and what i will do next?

Sales tax is exempted on Nonwoven Fabric in Gujarat. So, what should i charged from Mumbai based customer.

Please help.

Regards,

Ashok Sharma

M:9971480050

 

[YAGAY andSUN]

You won't charge tax to Mumbai based customer but you will pass on the tax to Mumbai based customer which was charged to you by B i.e. Gujarat Based supplier.

AI Summary

Sale in transit: treat direct Gujarat to Mumbai supply as inter state without charging local tax, pass supplier tax to buyer. A Delhi dealer buying nonwoven fabric from a Gujarat supplier for direct delivery to a Mumbai buyer should treat the sale as inter state and not charge local sales tax to the Mumbai customer; any tax levied on the dealer by the Gujarat supplier may be passed on to the Mumbai customer as a cost. E1/E2 movement documentation is identified as relevant for the inter state transit.