GST – C FORM PURCHASES

Clarification Regarding the Inter-State Purchases Against C Form for Period Starting From 1st July 2017

Maharashtra sales tax department vide Trade circular no. 47T of 2017 dated 17th November,2017 has issued clarification regarding the inter-State purchases against C form for period starting from 1st July,2017

Background

The definition of “goods “in Central Sales Tax Act ,1956 in section 2(d) up to 30^th June ,2017 was as under: –

“(d) “Goods” includes all materials, articles, commodities, and all other kinds of movable property, but does not include newspapers, actionable claims, stocks, shares and securities.

In view of the constitution (one Hundred and first amendment) Act, 2016 dated 8^th September ,2016 the Central Government has amended the Central Sales Tax Act vide Taxation Laws (Amendment) Act, 2017 (18 of 2017) dated the 4^th May 2017

By virtue of this amendment the aforesaid definition of “goods “has been amended. The amended definition is reproduced as under: –

(d) “Goods “means-

Petroleum crude

High speed diesel;

Motor spirit

Natural gas;

Aviation turbine fuel; and

Alcoholic liquor for human consumption.

The Ministry of Finance, Department of Revenue, State Tax Division, New Delhi issued office memorandum dated the 7^th November, 2017 to clarify the inter-State purchases against C form for period starting from 1^st July ,2017. The clarification is reproduced as under: –

“The undersigned is directed to say that opinion of department of Legal Affairs, ministry of Law was solicited on the issue “Whether the definition of “goods “the phrase “manufacture or processing of goods” in section 8(3)(b) of the Central Sales Tax Act would be as per the definition provided under section 2(d) of the Central Sales Tax Act or that the word “goods ”when it appears in the phrase “manufacture or processing of goods” means any goods i.e. “goods” which fall with in GST as well as “goods” which do not come under the ambit of GST.

Department of Legal Affairs, Ministry of Law has confirmed that the term “goods “has been specifically defined under the Central sales Tax Act, 1956 and prima facie the term “Goods “referred to in section 8(3)(b) of the Central Sales Tax Act, 1956 will have same meaning as defined and amended under section 2(d) of the Central Sales Tax Act ,1956 vide tax laws Amendment Act,2017. However, it does not affect the provisions of section 8(3)(b) of CST Act relating to telecommunication network or mining or generation or distribution of electricity or any other form of power.”

In view of this clarification the following instructions as being issued

The clarification is applicable for the declarations in Form ‘C ’to be issued for the period from 1^st July onwards.

Form ‘C’ shall be used for the inter-State purchases of the “goods’’(as amended) only subject to purposes enumerated in (3) below: –

Declaration in Form ‘C’ for the periods starting from 1^st July 2017 shall be issued only if such goods are purchased for the purposes enumerated in the office memorandum issued by ministry of Finance, Department of Revenue, State Tax Division, New Delhi dated 7^thNovember 2017 such as:

Resale of above six goods;

Manufacturing of above six goods;

Use of above six commodities in the telecommunication network or mining or generation or distribution of electricity or any other form of power.