Cst

Querist : Anonymous (Querist) 26 December 2010 This query is : Resolved
what is E1 & E2 Transactions

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R.Ramachandran (Expert) 26 December 2010
When inter-state sales is made then the seller has to obtain Form'C' from the buyer. If the buyer "B" furnishes Form-C, then the original seller "A" would charge concessional rate of 2% CST; otherwise normal VAT would apply.

While the goods in the inter-state sale are in transit, further sale can be effected by the buyer "B" by getting Form 'C' from new purchaser say "X".

In such a situation, the original seller "A" would issue E-I form to the original buyer "B" and the original buyer "B" would get 'C' form from the subsequent buyer "X".

In case the "X" effects any sale of the said goods while the goods is still in transit to say another buyer "Z", then "Z" has to furnish form "C" to "X", and "B" has to issue Form E-II to "X".

This is called Form E-I and E-II sales.

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