List of Document

1.

Copy of Certificate of Incorporation or

Registration
2.
Copy of Company Permanent Account Number
(PAN)
3.
Copy of Company VAT Registration Certificate
4.
Copy of Company Memorandum of Association
5.
Copy of Company Articles of Association
6.
Copy of Director Identity Proof As PAN
--------------------------------------------------------------------------------7.
Copy of Development Agreement
8.
Copy of Share Distribution
9.
Copy of Land Revenue Receipt Latest
10.
Copy of Flat Address Proof (Electricity Bill)
11.
Copy of PAN of Akhilesh Kumar
12.
Copy of Address Proof of Akhilesh Kumar
(Telephone bill)
13.
Copy of PAN of Nitish Kumar

1. INTRODUCTION
There are certain type of forms which has been prescribed under central sales tax rules 1957,
form C for making interstate purchase at lower rate, form F used to transfer goods from one
branch to other in different state without making it as sale form E1 and E2 used when interstate
sale or purchase which are effected by mere transfer of document of title (subsequent sale).
2. ANALYSIS
A) C FORM

It is issued by VAT department to the registered dealer who makes interstate purchases of those
goods which are mentioned in his RC (registration certificate). While doing transaction
purchasing dealer furnish this form to selling dealer in course of interstate purchase to get
exemption/reduction in sales tax rate. It is defined under section 8(1) of CST act 1956.

*One C Form/One Quarter/Dealer

From above chart it is clear that firstly purchasing dealer will furnish form C to the selling dealer
of Jharkhand to claim tax exemption or reduced rates of taxes (2%) thereafter selling dealer will
submit these form to the department of VAT of Jharkhand.
One C form can be used for no of transactions for one quarter.
B) F FORM
With this, goods can be transferred/delivered from one state to another without recognising it as
a sale. For instance the head branch may transfer goods/stock from one state to another to its
branch or agent without becoming liable for CST.
It is issued by the VAT department on the request of the purchasing dealer (branch) the
purchasing dealer submits F form to the selling dealer to claim exemption from making it as CST
sale. As per section 6(A) of CST act F from is mandatory to prove transaction as stock transfer.

One F Form/One
Month/Dealer
Is F form required in case goods are returned? The answer is yes, decided by the honble
Supreme court in case of AMBIKA STEELS that the liability of furnishing F form would be still
there even if stock or goods are required to be sent back.
Registration certificate {RC} should contain the name and address of branches to which stock is
transferred against F FORM {branch transfer} to claim concessional/nil rate of tax. One F form
has to be issued for each month.
C) E1 AND E2 FORM
As per section 6(2) of CST act first interstate sale will be taxable, subsequent sale during
movement of good by way of transfer of document is exempt from tax. For making subsequent
sale exempt Form E1 & E2 are used.

Ashok has to dispatch goods to Chandan Jaipur (Rajasthan) but Invoice done on Bhanu in

Delhi

A will receive C Form from Bhanu of Delhi and will issue declaration in E-I form to
Bhanu

Bhanu Sells Goods to C in Jaipur-Rajasthan

Bhanu of Delhi will issue declaration in Form E-II to Chandan of Jaipur against which
Chandan will furnish C form to Bhanu (Delhi).

Chandan Ultimately receives the goods.

Chandan will issue C Form to Bhanu and will receive E-II Form from him.

From above illustration it is clear that how goods/document of title move from one place to
another. Actual delivery was received by C in Jaipur however between A, B there was only
transfer of title. Only the first sale will be taxable, other subsequent sale will be exempt if dealers
are registered.
In above example A of Mumbai will receive C form from B of Delhi & will issue declaration in
E-I form to B of Delhi .Later on B of Delhi will issue declaration in Form E-II to C of Jaipur
against which C will furnish C form to B (Delhi).
If above chain is broken then the exempt sale will get reversed and CST will be applied on these
transaction.
Provisions of C form applicable to E1/E2 forms: Some provisions which are applicable to C
forms are also applicable to E-I/E-II forms. For example one declaration for one quarter,

indemnity bond if form is lost, issue of duplicate form, sales tax concession is not available if the
forms are not submitted.
Latest case of Delhi High Court and Supreme courts verdict in A&G Projects and
Technologies Ltd case: The Supreme court in A & G Projects and Technologies Ltd v. State of
Karnataka [2209] 19 VST 239; [2009] 2 SCC 326 explained the scheme of section 6(2) of CST
Act and held that once the first inter-state sale has suffered CST then subsequent sales effected
by transfer of documents during transit will be exempt provided conditions prescribed u/s 6(2)
are satisfied. This has been done to remove the cascading effect. The observation of the Supreme
Court in the said case is provided as below
Analysing Section 6(2), it is clear that sub-section (2) has been introduced in Section 6 in order
to avoid cascading effect of multiple taxation. A subsequent sale falling under sub-section (2),
which satisfies the conditions mentioned in the proviso thereto, is exempt from tax as the first
sale has been subjected to tax under sub-section (1) of Section 6 of the CST ACT 1956. Thus, in
order to attract Section 6(2), it is essential that the concerned sale must be a subsequent interState sale affected by transfer of documents of title to the goods during the movement of the
goods from one State to another and it must be preceded by a prior inter-State sale. It is only then
that Section 6(2) may be attracted in order to make such subsequent sale exempt from levy of
sales tax. However, the proviso to sub-section (2) of Section 6 prescribes further conditions and
it is only on fulfilment of those conditions that the subsequent sale stands exempted. If those
conditions are not satisfied then, notwithstanding the fact that the sale is a subsequent sale, the
exemption would not be admissible to such subsequent sales. This is the scheme of Section 6 of
the CST ACT 1956.
In a recent case namely Mitsubishi Corp. Ind. Ltd. Vs Value Added Tax officer decided by
Delhi High court wherein sighting the above observation of the Supreme court it was argued by
the counsel for the state that if the first Inter State sales is an exempted sale then the subsequent
sales should not get the benefit of Section 6(2) of CST Act even if all the conditions u/s 6(2) are
satisfied since the first sales had not suffered tax. The Delhi High Court in this regard observed
as under:
A reading of the said portion of the Supreme Court decision only indicates that where the first
sale is taxed, the second sale would be exempted because of the object of avoiding the cascading
effect. However, the Supreme Court decision cannot be understood to mean that where the first
sale is exempted, the second sale must be taxed even though the conditions under Section 6(2)
for exemption stand satisfied.
Thus even if the first sales was exempted due to exemption on tax available in the state where
from the first sale is made the subsequent sales in other state will be exempted if the conditions
u/s 6(2) of CST Act are satisfied.
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