Under CST Act 1956 there are lot of Forms and declarations which help in saving CST on the interstate transactions. C form is an important and foremost common among dealers registered under CST Act 1956 engaged in interstate sales or purchases.
Although the CST Act 1956 is on the verge of its end with the advent of GST knocking at the doors, waiting to change the whole picture of indirect taxation in India. But still I feel its worth to discuss some issues relating to C forms under CST Act as lot of Assessments are pending under VAT and CST Acts and many dealers are facing problems in getting and producing the C forms for finalization of their assessments. Some important issues relating to the C forms are discussed as below for the benefit of dealers all around India:
What is C form: As per section 8(1) (b) of CST Act 1956 sales tax on interstate sales is 2% or state rate whichever is lower, if the sale is to a registered dealer and goods are covered in the registration certificate of the purchasing dealer. Otherwise the tax applicable is the state rate applicable on the goods sold.
If the selling dealer pays CST @ 2% i.e @ concessional rate then he has to produce proof to his sales tax assessing authorities that the purchasing dealer is eligible to get these goods at concessional rate. Otherwise the selling dealer will be asked to pay balance tax payable plus penalty as applicable. Therefore section 8(4)(a) provides that concessional rate is applicable only if purchasing dealer submits a declaration in prescribed form C.
Where from to get the C forms: The blank C forms are issued by the sales tax authorities to the purchasing dealer who has made interstate purchases on concessional rate of CST. A dealer is entitled to obtain blank C forms from the sales tax authorities. If the registration is wrong, authorities can amend or cancel the same. However, as long as his registration is in force, blank C forms must be issued to him– Colourgraphs v. STO-(1993) 88 STC 347 (Ker HC).
Similarly it was held in Quality Enterprises v. ADCTO(2002) 127 STC 504 (Mad HC) that issue of blank C forms cannot be denied on the ground that transaction of dealer is taxable only as local purchases. Once a dealer pays necessary charges for C forms, the blank C forms must be issued. If he misuses C forms, he is liable to penalties contemplated in the Act.
However the CST rules may provide for non issue of blank C forms to a defaulting dealer in which case no blank forms may be issued. Similar rule was upheld as valid in S.N.E (India) P Ltd v. CST (2003) 131 STC 417 (Del HC DB).
Number of Transactions per C forms: One declaration in C form can cover all transactions in one quarter, irrespective of total amount/value of transactions during the quarter. (Quarter means period of three months). If a transaction covers more than one quarter, separate C form is required to be issued for each quarter.
Original, Duplicate and Counterfoil copy of C forms: The C form has been prescribed in three parts Original, Duplicate and Counterfoil. All three parts are identical in contents.
Section 8(4) of and Rule 12(1) do not specify which part of C form should be produced before the assessing authority.
Hence, in Manganese Ore (India)Ltd. v. CST MP (1991)TC (MP HC DB), it has been held that filing of copy marked Duplicate is enough compliance of the law and concessional sales tax rate will be available even if copy marked Original is not produced.
However, if CST rules as amended by states require submission of original copy, then only that copy will have to be submitted.
Therefore one need to check the relevant CST state rules if any, amended to this effect before furnishing the duplicate copy of C form.
If the buyer sends both the copies of C form marked as Original and Duplicate to seller and if both are lost, then the following procedure should be followed:
If duly completed C form is lost when it was in the custody of purchasing dealer or when the form was in transit to selling dealer, the purchasing dealer will have to furnish Indemnity Bond to sales tax authorities from whom the blank C form was obtained. If the duly completed C form is lost by the seller, then he has to submit indemnity bond to sales tax authorities of his state. The prescribed form of Indemnity bond is in Form G.
If C form is lost(both original and Duplicate copies), the purchasing dealer can issue duplicate declaration in C form with clear declaration in red ink that this is a duplicate declaration being submitted. Details of earlier lost certificate number and of selling dealer has to be given.
It may be noted that there is no provision to submit certified Xerox copy of earlier certificate and Xerox copy is not acceptable– J N Jetiwa v. state of Maharashtra- (1995) 11 MTJ 491 (Mah Trib).
Selling dealer is not liable for false declaration by buyer: The purchasing dealer can issue C form for purchase of only those goods which are mentioned in his registration certificate, for other goods no C form can be issued by the buyer, if the buyer so issues C form for goods not mentioned in his R.C. then it will be misuse of C form and the penalty can be imposed on buyer.
But the selling dealer has only the obligation to satisfy himself that the purchasing dealer is a registered dealer for this he can rely upon the representation made by the buyer in the C form. If the purchaser misapplies the goods, the penalty can be imposed on the buyer, but selling dealer, who has relied upon C form issued to him, cannot be held liable.
Selling dealer is not required to hold an enquiry with regard to purpose for which the materials have been purchased by purchasing dealer. Once he furnishes necessary declaration forms from purchasing dealer, nothing more is required to be done.- K G Industries v. STO (1999) 113 STC 49 (MP HC).
Duly filled C form should be issued to seller: Sometimes, C form is obtained in advance and particulars of invoice etc. are filled in later. This is not legally correct, as section 8(4)(a) uses the words ‘to whom goods are sold’. Thus, duly completed C form should be obtained only after sale. Otherwise C form can be rejected.- Salem Magnesite v. State of Tamil Nadu (1999) 116 STC 110 (Mad HC DB)
Issue/receipt of C form against goods used in works contract: Goods used in executing works contract are deemed to be sold and there is sale of material used in the execution of works contract. Hence C form can be issued for materials used in works contract, if the goods are included in the registration certificate of the dealer- United Ltd. v. CTO (1991) 83 STC 207(AP HC)
No C form for rejected goods: It was held in Lakshmi and co. v. State of Kerala ( 2001) 121 STC 423 (Ker HC DB) F form can be issued only in case of completed transactions and not in case of rejection goods. Decision in this case of F forms should also be applicable on C forms. The reason is if goods are rejected, buyer cannot issue a certificate that the goods are for manufacture or for resale.
Declaration in C form cannot be rejected for minor defects: In Rajsthan Pipes v. CTO (2004) 138 STC 383 (Cal HC), it was held that benefit cannot be denied on ground of omission like date of registration and minor variation in amount.
The authorities should allow rectification of defects in declarations: If there are minor defects in the C form submitted (e.g. challan no., date etc. not mentioned, or name of dealer is mis-spelt), the officer should give reasonable opportunity to the dealer to remove the defects- Anil Kumar Dutta v. Addl Member (1967) 20 STC 528 (Cal)
In State of Orrisa v. Orissa Polish Works (1970) 26 STC 480 (Ori HC), it was held that C form should be returned to the selling dealer for rectification. Selling dealer should be allowed reasonable opportunity for this purpose.
When to submit the C form with the authorities by the seller: As per rule 12(7) C form can be submitted to the assessing authority within three months after the end of period to which it relates. STO can allow further time for submission of the form, if there is sufficient cause for not submitting the form in time.
C form can be submitted even at appellate stage if sufficient cause shown: I have already earlier written an article on this topic referring the judgement of Punjab and Haryana High court in R S Cotton Mills v. State of Punjab wherein it was decided that C or D forms could be filled even after the filling of the return or at the appellate stage and same could be taken cognizance of.
Hence the C forms can be submitted even after the filling of annual statement i.e. at the time of assessment or afterwards and the same can be taken cognizance of since no loss is caused to the revenue by not filling the C forms along with annual statement.
C forms generally should be submitted before the first assessing authority. After the assessment, appellate authority can allow submission of C forms if sufficient cause is shown for not submitting the C form before the assessing authority. This is because the appellate authority has powers of reassessment. Appeal in taxation matters is different from power of appellate court in civil matters. The appellate authority is in nature of revising authority. He can revise every process which led to the ultimate computation or assessment- State of AP v Hyderabad Asbestos Cement Products 94 STC 410.
It is advisable that the dealer should maintain proper record of follow up and efforts made with buyer to obtain C forms to prove that he made all possible attempts to obtain C forms within time. In such case it will help proving the sufficient cause for not submitting the C form within time and appellate authority will accept the C forms at appellate stage if obtained after assessment.
If sufficient cause is shown for late submission of C forms, the assessment can be reopened as it was held in Dtate of Tamilnadu v. Arulmurugan and co.- (1982) 51 STC 381(Mad HC DB)
—————-
Author Bio
I am continously following with my client(purchaser) to give c form but the purchaser is giving various reasons and sales tax authorities have collected the tax amounts against the c forms from us (seller) why should i pay for my clients can someone give me a solution please
i have done 5% cst sales in ap state to small arms factory- kanpur, now on which tax rate i have to pay to commercial tax department ( wheather 5% or 14.5%
Can we issue the C-Forms for multi quarters for same Financial Year ?
Dear Sirs,
Can we issue single C-Form for multi quarters?
If my VAT returns are not completely filled , then can i get form c
If we receive the material in one quarter and we book the material in next quarter (reason can be we received the material in next quarter. Eg. material sent on 20 March and received on 5 april. ) In such case we will book the material in april and we will get the C form with correct purchase date as per vendor invoice but the C form will be issued in the quarter next than the issuing date. Is this acceptable?
Please clarify my doubt ,
The andhra pradesh is divided into Two states and the seller has got New TIN no after dividing, while entering the purchase invoices we have entered the new TIN no, but while generating the C-Forms we are not able to generate the C-forms..
please help in this regard
If a party issues a C form for a particular Qtr, and for some reasons
misses out few invoices while generating such C-Form, is there any
provision in CST Act, wherein an additional C-Form can be
generated/issued by department for the same qtr for left out invoices??
Sir please clarify my doubt,
All the requisit C forms against interstate sales to TVS Motorcycles ltd., were not given to us on time even after regular follow ups during year 2006-07. During this period our then accounts in-charge filed the returns.The department never sent any communication till the year 2014.
For our surprise a notice was sent to us recently as the department did not have the new address, even though change of address was sent to them in the year 2010. We realised only after receiving the notice that c forms were not submitted earliar. Now we took up seriously and collected the pending c forms and were submitted to the Dept auditing authority.
We could not understand why we were demanded to pay the differential amount with interest and penalty. Why this unduly harassment as we were not in a position to pay this huge ammount??
My company wrongly put 5 % cst in invoice rather than 2 %. what to do?
Dear Sir,
Plz clarify my dought please sir,
In odisha, we have purchased material , but material is rejected, then we have made rejection out. we have issue waybill. Now we want to know material rejected. not issue C form. We know about c form issue or not.
pls. help my same quarry
saving a/c valid in vat registration in ahmedabad,gujarat?
thanks & rehards
beena patel
pl inform me the cst rate on pharma and drug items with or without c form in the year 2006 -2007. Thanks Satish Mehra
sir, we are generating Form”C” through online. upto april-2015 we generated the Form and taken prints. But, c form can be generated, only if the value in Col.9.11.1 in VAT 100/105 Return of that Period Matches With the total of All invoices of type c-form in Interstate purchases of Upass of the Same Period.
if vat rate is 2% and the same item sales to other state on 2% cst , then C-form required or not pl.clerify
Sir
Can I adjusted of CST deposited in Ist Qtr. of F.Y. 2015-16 to IInd Qtr. of F.Y. 2015-16 because I deposited the CST against Form -C against my cancelled bill now I want to adjusted in 2nd Qtr. bill (Same Amount)
Dear sir,
Can you provide me any judgement,caselaw related to interquarter issue of c form.
Assessing authorities in U.P are not accepting form which have invoices appearing of other quarters.. for eg
30 June invoices consider by purchasing party in july. And hence included in second quarter form.
though there is a notification by Andrapradesh authority in this matter. If any such notification is there in u.p kindly provide the same.
sir, we are generating Form”C” through online. upto april-2015 we generated the Form and taken prints. But, while generating for the month of May-2015 there is a message appears that” it is needs verification and contact assessment circle”.why?
when i contacted the assessment circle they replied to give in sales & purchase details in hard copy. Actually there was no sales in the said month of May-15. please advise in the matter.
Hello,
Can i issue C Form on my purchasing Purticular or TI Company.
Please clarify my dought Sir,
Sir We have Purchased for Aluminium Winding Wire at delhi for 6 bills but In this bills
In small Defeats on materials We have to send back the materials to in our Suppliers What is the procedure for this type of Problems the value of materals is 162000/-
dear Sir,
we have wrong invoice date uploaded the receipt c form through Vat Website.
please suggest to modify on this.
Dear Sir.
I done a wrong in c Form can it recertify. wrong thing is this in place of Karnataka i wrote Tamilnadu. if it is possible than what i have to do please sir help me to solve my problem. Please sir.
I just want to know that, can we sale the IEC (Licence) against the ‘C’ Form on the concessional @ of 2%.
sir please clarify my dought please sir
my name is venkatesh prop to sai teja enterprise in the financial year interstate sales are done so i will pay CST tax timely but there sent C forms from that states how to take credit using that C forms and at the time of CST filling
We sold material to customer on CST in Feb 2015, the same material was rejected by customer and send back on June 2015 with his Invoice.
The same customer is asking Cform for material returned.
1] Should C Form be applicable for Goods return in different Financial year
2] Should C Form be issued by Both Parties to each other ?
Please clarify?
While generating ‘c’ form instead of generating with 11 digit TIN generated by 10 digit, ‘c’form is valid or not? examble. Maharastra or Delhi TIN No start from 0 while generating zero is omitted.
after generating the C form its possible to make a changes.
if yes plz give me the related web site details.
respected sir,
i have lost my original part of c form,i produce duplicate portion of c for again in cst appeal.but officer can not accept my duplicate c form and reject my appeal.so give me a replay for what can i do for in my case.c form original part lost by me.
thanking u
Dear Sir,
We have supplied goods from our end in the month of JUNE’2014 after change in TIN to our stockiest in AP under CST. Can we ask the stockiest to issue C-Form.
kindly reply.
Dear Sir,
We have supplied from our end in the month of JUNE’2014 after change in TIN to our stockiest in AP under CST. Can we ask the stockiest to issue C-Form.
kindly reply.
We sold goods to the purchaser at other state. Purchaser was suppose to provide C Form against the purchase. Now purchaser is not giving us C form after lot of reminder and call. I have two question for you in this regard.
1. Is there anyway can we find out whether purchaser obtain C Form from the department against the seller or not?
2. Is there anyway to inform respective state sales tax department and take action against the purchaser who does not provide C form after repeated reminder.
Dear Sir,
If a buyer does not issue C forms,inspite of availing concessional benifit,
whom to lodge complaints so that action can be taken against such firms/co.
Most of the C form defaulters are corporate house,and pvt.ltd companies.
Neither ROC nor commercial tax department is bothered to take actions.
All liabilites on seller to pay differene of amount with interest and penalty.
Is it right on part of Govt.?
plz. clarify my doubt
i’m from bihar and my outside selling deler is asking for form-“C”
but i’m confused that which value should be put in c-form application ( value- net taxable value /or gross bill amount including cst.)
Dear Sir,
I require C Form from 01.10.2013 to 31.03.2015. what documents i need to be given.
Dear Sir/Mam
If any buddy want to collect there Pending C-form/D-form please contact me i will help you to collect such form and for that you have to email me [email protected] or you can call me also 8108803100 on my phone number.
Regards
Sachin Chavan
8108803100
[email protected]
[email protected]
K. G. INDUSTRIES Vs. STO Case not on the commodity mismatch its only on false declaration that goods are purchased by the purchasing dealer for what purpose use.
false declaration given by the purchasing dealer on the time of purchase goods on behalf of the c form for which commodity that not mentioned in there registration certificate issued by the assessing authority. what liability of selling dealer for those transaction
please give the answer as soon as possible with the supreme court or high courts citations.
thanks
I wish to issue Form C from previous quarters, but i dont have data for vehicle number in which the goods were delivered.
What should I do ?
The Cforms we submitted to the sales tax dept have been lost by them and the dept has sent us an Assessment Order asking us to pay 3.5 Lakhs for non submission of c forms…..what to do please advice…is going for appeal the only way. ?? ( TN sales tax dept’,,, Chennai. ).
Dear Sir
Duplicate Form-C issue requirement documents in Gujarat Sales Tax office
YR RPLY IS GOOD. BUT I WANT TO KNOW THAT WHETHER m.p. govt. can issue the c-form for year 2009-20010
above information is ok but i want to know that whether C-form can be obtain in M.P. FOR YEAR 2009-2010
please clarify, that a delaer can apply ‘C” form in Tamilnadu in the case of accident.
In other words,Last month on 23/02/2015, one of my delaer got goods dispatched from Haridwar with the Invoice but this vehicle has been met with accident and return back to factory-haridwar. but this will again come back after reqpir and necessary correction after one month or so., but the excise invoice will be same. with dummy invoice only this goods will come back. but the as a company we need the C form within the original exicse invoice.
so kindly guide is it possible to generate the C form without entry tax and entry tax will pay bu the dealer once he physically received the goods?
plz. clarify my doubt
i’m from bihar and my outside selling deler is asking for form-“C”
but i’m confused that which value should be put in c-form application ( value- net taxable value /or gross bill amount including cst.)
9534816563
Dear sir, My distributor has asked me to clarify something which I think is very ridiculous and awkward. They are telling me the 4 ‘C’Forms for Q4 2013-2014, Q1 2014-15, Q2 2014-15 and Q3 2014-2015 which I have sent on timely basis are being rejected by their area taxation commissioner. And they want me to give them a fresh C-Form or a written verification letter of those 4 C Forms from my area taxation dept. what surprised me is that I have submitted my c-Form after every end and assessment of the concerned quarters. And I have also received the 2% CST amounts also. I also have the impression that they also do their assessment after every quarter for the ‘F-form’ just as I am doing for C-form. And they are raising these issues after a year and that too after they have already settled the 2% CST. So, educate me on this matter and advise me what I should do and whether it is possible to submit more than one C- Form of the same firm for the completed quarters
Dear Sir,
We have some questions relating to CST act, 1956. Here questions are:-
1. Can we purchase Non Billable material against form C?
2. If it is Non Billable who will be liable to pay entry Tax?
3. Al though it is non billable material client may not issue any form C. So department is liable to change any VAT on that Transactions?
Please provide us with any order or Judgement.
Thanks for your help in this regards.
Shambhu
Sir,
If a party issues a C form for a particular Qtr, and for some reasons misses out few invoices while generating such C-Form, is there any provision in CST Act, wherein an additional C-Form can be generated/issued by department for the same qtr for left out invoices??
I want to issue c from for purchased from Maharasthra & i working in MP
Dear sir,
Can a purchaser deny C form as they have not received reminder from the seller. Is reminder is mandatory for issuing C form by the pruchaser. If so what is the time limit for sending reminder.
regards
Can we issue c form for goods delivered in state other than state of registration. Can we have cst registration in multiple states.