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raajjhesh (MANAGER SALES)     12 December 2010

CHANGE IN CST ACT

FOR DEBATE AND IF ALL THE EXPERTS AGRRIES, MAY BE HELPFUL TO CHANGE THE PRESENT CST ACT TO MAXIMISE TAX COLLECTION.

 

Maharashtra Sale tax dept’s VISION STATEMENT says that: -

 

“We aim to be an efficient and effective tax administration respected for fairness, transparency and professionalism.”

 

If a registered dealer/company is not issuing form C, even though the same is mentioned in their purchase order, the invoices are raised accordingly, why sale tax dept collects additional tax, penalty from the Seller & the Buyer (main culprit) is not penalized?

 

No questions are asked to the Buyer for non issuing of Form C, against applicable purchases! On what basis the sale tax dept allows Buyer to continue the business, and indirectly helping him to evade the tax?  

 

Various experts & sale tax authorities says that Seller can raise the debit note towards non receipt of C form on Buyer to recover the amount, and if required file the suit in the Court.  That means sale tax dept not interested to collect further VAT (if applicable). So what is the gain to State?  

 

Mission statement of Sale tax dept says: -

 

To administer the Value Added Tax Act and allied statutes and the Profession Tax Act in an impartial, uniform and efficient manner so as to maximise tax collection through universal coverage of all eligible tax payers.

 

If Buyer is not issuing form C, and sale tax dept is not taking any action, means sale tax dept allows further sale / consumption of material without collecting the tax, indirectly helping Buyer to sale without bill which is net revenue loss for sate.

 

What is the aim – to collect the sale tax and no one should evade the same. By mere presentation of C form, it proves that there is no evasion of tax or the same is exempted under 6(2), but if one can’t then the same is not exempted?  

 

When we say that we have established IT network, we have entire information, statistic available, why not the same has been used?  When sale tax dept has records of seller as well as buyer, why Sale tax dept doesn’t take efforts to cross check to maximize the tax collection?

 

Please comment.

 

 

 



Learning

 4 Replies

M.V.GIRI (ADVOCATE & TAX CONSULTANT)     20 December 2010

dear what is your querry? please give details

raajjhesh (MANAGER SALES)     02 January 2011

My Question is:-

Maharashtra Sale tax dept’s VISION STATEMENT says that: –

“We aim to be an efficient and effective tax administration respected for fairness, transparency and professionalism.”

"A" & "B" has entered into contract, wherin "A" has obtained the purchase order from "B" to supply the goods as & when required, against " Form C" .

If “B” doesn’t  issue the Form C  to “A”,   within time i.e. before/at the time of assesment of "A", sale tax dept collects additional tax, penalty from the Seller i.e. “A”  & the Buyer i.e. “B”  is not penalized?

 No questions are asked to the Buyer i.e. to “B” for non issuing of Form C, against applicable purchases! Sale tax dept allows “B”, to continue the business, and indirectly helping him to evade the tax?  

 If Buyer is not issuing form C, and sale tax dept is not taking any action, means sale tax dept allows further sale / consumption of material without collecting the tax, indirectly helping Buyer to sale without bill which is net revenue loss for sate.

 What is the aim –“to maximize tax collection through universal coverage of all eligible tax payers, by administering in an impartial, uniform and efficient manner”

 Whether the same has been followed?

 By mere presentation of C /E-I/E-II form, it proves that there is no evasion of tax or the same is exempted under 6(2), but if one can’t produce then the same is not exempted?  It is taxable with “A”, because he was the seller of goods to “B” and unable to get the Form C? And at the same time “B” is not charged, he is free to sale without tax?

 When we say that we have established IT network, we have entire information, statistic available, why not the same has been used?  When sale tax dept has records of seller as well as buyer, why Sale tax dept doesn’t take efforts to cross check to maximize the tax collection?

 Once the Seller gives the data to Sale tax dept, Isn’t it better if Buyer has to prove his transactions against form C, instead of seller? With this do you all agree that sale tax revenue will go up?

 

Please comment.

M.V.GIRI (ADVOCATE & TAX CONSULTANT)     02 January 2011

Dear Sir,

Logically you are correct. But the Act doesn't say about the levy tax on buyer if he is not issuing 'C' forms to the seller. It is contract between the seller and the buyer and it is the duty of the seller to produce the 'C' form for claiming concessional rate of tax . Otherwise he has to pay full rate of tax. Even if the Dept has data, as per the Act burdon to prove lies on the seller and not on the buyer or on the department.

raajjhesh (MANAGER SALES)     07 January 2011

Dear Sir,

Thanks for your reply. At least you agree that my views are logically correct.

In your reply, what you have mentioned is the present Act, but weather the said Act is correct? If Govt wants more revenue, and which they must, if applicable.

So why not with the help of experts like you, we should present the case to the Govt, to change/modify the Act for our own benefit?

 


 


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