When the option Sales/purchases against Form C? is enabled in VAT Details screen of a party ledger, all transactions involving the party are marked against Form C by default.
Alternatively, the field Is against C Form? in Party Details screen (supplementary details) of a transaction can be enabled to mark the transaction as against Form C. However, this field is by default enabled in a transaction, if the option in party ledger is set to Yes. This is done to disallow overriding form selection at transaction level. Since, any conflict in master and transaction settings will result in an exception, which will require a review before the transaction gets included in the returns.
Depending on your business's interstate sales policy, Form C selection can be enabled at master or transaction level to meet your requirements, as shown below:
● Form C is issued consistently for all interstate transactions: In this case, enable Sales/purchases against Form C? in the party master. This will ensure that you do not have to set Is against C Form? to Yes in Party Details in every invoice for such dealer.
● Form C is not issued: In this case, do not enable Sales/purchases against Form C?. This will set Is against C Form? to No in Party Details for all transactions as there is no Form C implication for such party.
● Form C is issued occasionally, there is no definite rule followed for issuing the form but is arbitrary: In this case, do not enable Sales/purchases against Form C?. This will allow you to set Is against C Form? to Yes in Party Details for the invoice which has Form C implication.
● Form C is issued consistently, except on rare occasions: In this case, enable Sales/purchases against Form C?. In transactions where Form C is not available, click F12: Configure in the invoice and enable the option Allow modification of tax details for VAT?, select sales ledger and select the option Interstate Sales- Taxable in the VAT Classification Details screen that appears. Now, if you select CST ledger, tax is calculated based on local rate.
In case of interstate purchase of tax free or exempt items, the status of C form selected in party ledger is not considered. These transactions are not marked as against C form and not pushed to declaration forms list. The nature of transaction applied in the transaction takes precedence over C form status in party ledger master.
To avoid updating interstate transactions with tax free and exempts goods in declaration forms list, the following conditions are applied while recording transactions:
● When the option Sales/purchases against Form C? is enabled in interstate party master and Interstate Purchase - Against Form C is selected as nature of transaction, the voucher is marked against form C.
● When the option Sales/purchases against Form C? is enabled in interstate party master, but Interstate Purchase - Against Form C is not selected as nature of transaction, then nature of transaction selected in the voucher takes precedence for reporting.
● When the option Sales/purchases against Form C? is set to No in interstate party master, and Is against C Form? is enabled in Party Details screen, the voucher is marked against form C.
● When the option Sales/purchases against Form C? is set to No in interstate party master, and Is against C Form? is also set to No in Party Details screen, then nature of transaction selected in the voucher takes precedence for reporting.