Transcript Central Sales Tax Act - GCG-42

Central Sales Tax Act
1956
Types of Taxes
• Direct Taxes
• Indirect taxes
• Income tax
• Wealth tax
•
•
•
•
Sales tax
Customs duty
Service tax
Excise duty etc.
Scheme of Act
(applicable to whole India)
•
•
•
•
•
Ch. 1 – definitions
Ch. 2 – indicates if sale is inter state or not
Ch. 3 – deals with liability to pay tax
Ch. 4 – goods of special importance
Ch. 5 – rules regarding liability in case of
liquidation of a company
• Ch. 6 – Central Sales Tax Appellate Authority
Current Taxes in India
Octroi – 0.5 to 5%
Interstate purchase
(CST)
Imports
Customs Duty
Basic – 10%
CVD – 12%
Ed. Cess – 3%
Local purchase
VAT – 5%/12.5%
Local purchase
VAT – 5%/12.5%
Dealer
Retailer

Factory
Intra-State
Ex. Duty – 12%
Edu. Cess – 3%
VAT– 5%/12.5%
Service Provider
Serv. Tax – 12.36%
Goods Transporter
Serv. Tax-12.36%
Other
Service Provider
Serv. Tax – 12.36%
Other
Service Provider
Serv. Tax – 12.36%

Stock transfer
(No tax)
Toll Manufacturer
Inter-State
Ex. Duty – 12%
Edu. Cess – 3%
CST – 2%
Central Levy
State Levy
VAT rate may range from 12.5-15% depending on
the State
Features of CST Act
• The act provides for tax on inter state sales
• Tax levied by central government but collected
by respective state governments
• With regards to provisions like returns,
assessments & appeals, VAT provisions apply
• Lower rate of CST is charged on concessional
forms like FORM C
• No sales tax on Stock transfers and export
import.
Definitions (Section 2)
•
•
•
•
•
•
•
•
•
•
Sec 2(a) Sec 2(aa) Sec 2(b) Sec 2(c) Sec 2(d) Sec 2(dd) Sec 2(g) Sec 2(h) Sec 2(k) Sec 2(j) -
Appropriate State
Business
Dealer
Declared Goods
Goods
Place of Business
Sale
Sale Price
Year
Turnover
Principles of Central Sales Tax
• Section 3 :
Inter State Sales
3(a) : Sale from one
state to another
3 (b) : Sale by transfer of
documents
• Section 4 :
Sales outside a state
a sale which is inside a
state is outside for all
the other states in
matters regarding sales
tax.
Section 5
(sales in course of export & import)
• Any sale which occasions any export
• Any sale which occasions any import
• Last sale for the purpose of complying with terms
of an export
• Seller furnishes a duly filed declaration by the
exporter
• If designated carrier purchases ATF for
international flights
Registration of a dealer
• Compulsory registration
• Voluntary registration
• No initial exemption is
allowed , registration is
required for interstate
dealers even for a small
amount.
• Provision mainly useful
when the dealer makes
purchases in inter state
but all his sales are
within the state.
Procedure of registration
•
•
•
•
•
•
•
Application for registration
Deemed to be liable
Condition for issue of certificate
Grant of certificate of registration
Demand of security
Surety bond
Amendment in certificate
Cancellation of registration
• By authority
•
•
•
•
•
When dealer has
Ceased to exist
Stopped business
Failed to comply with
provisions
Failed to pay penalty
Any other sufficient
reason
• By dealer
When the dealer has
• Stopped business
• Is not liable to pay tax
• Any other sufficient
reason
Exemptions from CST
•
•
•
•
•
•
Subsequent sales
SEZ units and developers
Foreign missionaries
Sale in course of export
Penultimate sale
Sale in course of import
Sales Tax Authorities Hierarchy
•
•
•
•
•
•
Excise and taxation commissioner
Joint excise and taxation commissioner
Deputy excise and taxation commissioner
Assistant excise and taxation commissioner
Excise and taxation officer
Excise and taxation inspector
Powers and functions of Authorities
•
•
•
•
•
•
Demand production of accounts books
Power to seize the books
Power to search
Power to seize the goods
Reassessment
Power to call for information from banking
companies
Powers of State Governments with
regards to Sales Tax
•
•
•
•
Power to exempt goods
Power to exempt certain class of industry
Power to amend schedule “c”*
Power to make rules
• *by giving notification not less than 21 days
notice of its intention to do so
Goods of special importance
•
•
•
•
•
•
•
•
•
•
•
Cereals
Coal
Cotton
Crude oil
Iron and steel
Jute
Oil seeds
Pulses
Man made fabrics
Sugar
LPG
Declaration Forms
•
•
•
•
•
•
•
•
•
•
•
FORM A
FORM B
FORM C
FORM D
FORM E-I
FORM E-II
FORM F
FORM G
FORM H
FORM I
FORM J
application for registration
certificate of registration
concessional form , sales tax @ 2%
certificate for government dealer
certificate by 1st dealer in case of section 6(2)
certificate by 2nd dealer in case of section 6(2)
transfers otherwise than sale
indemnity bond for loss of form
certificate of export
certificate by SEZ unit
certificate by UN agency in India