To constitute interstate sales, one of the basic requirement is that there should be sale. If a person sends goods outside from its state to its branch office in another state then it is not sale because you cannot sell goods to yourself. Similarly if a dealer sends goods to its agent in another state who stocks and sells goods on behalf of the dealer, such agent is called consignment agent and such stock transfer is also not considered as interstate sales since there is no sales involved in it, sales will take place when such agent will sell goods. But to prove such stock/branch transfer, F form is required to be produced as proof.

F form required for stock transfer– F form is required to be produced as proof of stock transfer. As per section 6A(1) submission of F form is mandatory to prove stock transfer. Otherwise, the transaction will be treated as sale for all purposes of CST Act.

F Form is issued by the branch office/consignment agent receiving goods as branch/stock transfer to its head office/principal who is sending the goods by way of  stock/ branch transfer. The H.O./Principal produces such F forms to its assessing authority to prove such stock/branch transfer.

One F Form for one month: First Proviso to Rule 5 of CST Rules 1957 provides that one F form covering receipts during the month can be issued. If space in F form is not adequate, a separate list may be attached as annexure to form F giving details, provided that the annexure is firmly attached to the form. The blank form has to be obtained from sales tax authority in which the transferee is situated, i.e. State where goods were received. If the form is lost, indemnity bond has to be given and duplicate form clearly marked as Duplicate can be issued.

When Stock transfer is treated as Inter state sales: When goods are dispatched to Branch office or consignment agent in other state and thereafter these goods are sold from the branch office or by the consignment agent then it is not a sales and is stock or branch transfer hence no CST liability arises.

However, if the movement of goods is occasioned on account of sales, the movement will be treated as interstate sales. It can be explained with an example

Suppose the dealer A registered in Punjab who manufactures some goods and send these goods after manufacturing to its branch office situated at Delhi wherefrom the goods are sold in Delhi. Now the movement of goods from Punjab to Delhi will be treated as stock transfer or branch transfer and for which no CST liability arises and F form will be issued by Delhi Branch to Punjab dealer.

But if a person B in Delhi wants to purchase some goods of special description which is not normaly manufactured by A and Mr B places order with A in Punjab for manufacturing special descriptioned goods. Now if A manufactures such ordered goods and send them to its branch at Delhi then such movement will be an interstate sales and not a branch transfer since the movement of goods was due to a predetermined contract of sales.

Thus where goods were sold through branch, but buyer was known and identified before goods were dispatched from factory. Obviously this was held as inter state sales and not a stock transfer- Electric Construction and Equipment Co. Ltd. V State of Haryana- (1990) 77 STC 424 (P&H HC DB)

In South India Viscose Ltd. v. State of Tamilnadu-(1981) 48 STC 232 (SC)= AIR 1981 SC 1604 it was held that if there is a conceivable link between contract of sale and the movement of goods from one state to another in order to discharge the obligation under the contract of sale, the interposition of the agent of seller who may temporarily intercept the movement will not alter the interstate character of the sale.

F form is not a conclusive evidence but it is conclusive after assessing officer passes an order: Submitting F form is not a conclusive evidence per se to prove beyond doubt any stock or branch transfer. The assessing officer may make enquiry as to whether declaration furnished by dealer are true or not. The sales tax authorties can investigate if they are of the opinion that the movement of goods is an interstate sale and not stock transfer.

Section 6A(1) provides that the dealer may submit form F, along with evidence of dispatch of goods. If Dealer fails to furnish such declaration, the movement shall be deemed for all purposes of the Act to have been occasioned as a result of sale. Section  6A(2) provides that if assessing authority is satisfied after making enquiry that the declaration furnished by dealer are true, he shall make an order to that effect and thereupon, the movement of goods to which the declaration relates shall be deemed for the purpose of the CST Act to have been occasioned other than as a result of sale.

In Assam Company (India) Ltd. v. CT, Assam (1997) 107 STC 154 (Gau HC DB), it was held that F form is not conclusive. Sales Tax Officer can make enquiry whether the declaration is true and can reject the F form, if the transaction is found not to be genuine.

In D Dhandapani v. State of Tamilnadu-(1995) 96 STC 98(Mad HC DB), it was held that section 6A(2) of CST Act authorizes Assessing officer to make enquiry that particulars contained in the declaration furnished by the dealer are true and for this purpose other evidence produced by dealer is also to be considered. Authority can call for other information to verify the truth of particulars contained in form F. The dealer has to prove that details in form F are true. If he is unable to do so, transfer of goods can be taken as on account of inter state sales.

It has been held that by production of form F and providing proof of dispatch of goods, the initial burden of proof on the dealer is discharged- State of AP v. Dairy Development Corporation Ltd- (1994) 95 STC 478 (AP HC)

Once assessing officer had made enquiry and passed order that the particulars stated are correct, the presumption that the movement has occasioned otherwise that as a result of sale is conclusive. Reopening of assessment under State Sales Tax would not be permissible only on limited grounds of fraud, collusion, misrepresentation or suppression of material facts- Ashok Leyland Ltd v. State of Tamilnadu 2004AIR SCW 1001.

(Author – Amit Bajaj Advocate, Bajaj & Bajaj Advocates, 128, Sangam complex, Milap chowk, Jalandhar City (Punjab), Email:, M +919815243335)
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93 responses to “All about F forms under CST Act, 1956”

  1. Ashokkumar says:

    I had made branch transfer of non taxable goods ( (as per Kerala vat rules) toBangalore from Kerala in 2011-12.But I had not submitted F forms Please inform me if there is any tax liability

  2. chandrakanth says:

    sir, the Interstate stock transfer outwards of capital goods by the company from one state (Head office) to its branch situated outside the state and vice versa, whether F-Form declaration required or not under CST Act,1956. Please clarify.

  3. veerendar kumar bhandari says:

    can F-form be submit to Head Office at Net Value i.e. after setting of Goods Return from Total Goods Transferred from Head Office.

    Thanks for your information it would be appreciated if any citation is given for this





  5. Prashant says:

    I am distributor for whole state of one company based in other state.
    Is it possible for the principal company to transfer the goods against form F?
    Who will bear the tax liabilities and in how much %

  6. Mehul mevawalla says:

    Hi i am importer of Computer accessories in mumbai. i want to transfer goods to my Gujarat godown & then sale the products from there. Which form should i send with transporter for goods transfer ? also my billing will be done from Mumbai office & my Gujarat representative will deliver & collect payment for clients. should i take VAT/CST registration in Mumbai or Gujarat ? please advise

  7. Baata Sastry says:

    Form F is issued by consignee (who receives the stock) to the consignor (who had sent the stock). Therefore, I feel your assessing officer asking for form F is not justified. Form 38 (or challan 4(5)(a)) should have been issued by the consignor, wherein the consignor would have mentioned that the goods were not for sale but for repair & return. That should be sufficient proof that you have not purchased that machinery.

  8. Ankush Mundhra says:

    Dear Sir,
    We have manufacturing unit in Baddi (H.P.) and anther is goa . we are approx 26 branches in all over india.

    FY 2012-13 we have transfer some of Raw Material and Packing Material to our goa plant and not receive any form f. We have received form F only for Finish Goods.

    Our Assessing Authority is demand Form F for Raw and packing Material stock transfer but we have received form F only for Finish Goods.

    So requested to you kindly suggest or advise what we will be do?

  9. vinay says:

    Dear Sir,

    We have transfer stocks from Gurgoan to Bangalore and Chennai in May 2015. Now some stocks were not sold and get Expired.

    now Consignee is denying to issue F form and Demanding the Tax of 14.5% for stocks laying in his Godown, is company as to give tax

    suppose if consignee is not giving F form what should be the Next Step



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