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Interstate Sales Exempt – With Form C (VAT)

You can record interstate sales against Form C at 0% CST using Interstate Sales Exempt – With Form C.

Interstate sales have to be taxed at 0% CST rate against Form C when:

• It is a transit transaction against Form E2.
• The goods are taxed at 0% under section 8(5) of the CST Act, read with section 8(4) (against Form C).

This nature of transaction is provided for Andhra Pradesh, Assam, Chandigarh, Chhattisgarh, Delhi, Goa, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Madhya Pradesh, Maharashtra, Puducherry, Punjab, Rajasthan, Tamil Nadu, Telangana, Uttarakhand, Uttar Pradesh, and West Bengal.

The option Is under CST exemption is provided for states enabled to support VAT for Chandigarh, Chhattisgarh, Gujarat, Madhya Pradesh, Maharashtra, Puducherry, Punjab, and West Bengal. After selecting the Form to receive as C Form, you can set this option to:

Yes if the goods are taxed at 0% when sold against Form C.

No if the transaction is against Form E1/E2.

To record an invoice for exempt interstate sales against Form C

1. Gateway of Tally > Vouchers > press F8 (Sales).
   Alternatively, press Alt+G (Go To) > Create Voucher > press F8 (Sales).
2. Select the party ledger in the field Party A/c name.
   • In the Party Details screen, set the option Is Against C Form to Yes. This option appears only when the State selected is other than the State selected in the Company VAT Details screen.
   • As always, press Alt+C, to create a master on the fly. Alternatively, press Alt+G (Go To) > Create Master > type or select Ledger > press Enter.
3. Select the sales ledger predefined with the nature of transaction Interstate Sales Exempt – With Form C.
   As in other transactions, you can create the ledger on the fly by pressing Alt+C. Alternatively, press Alt+G (Go To) > Create Master > type or select Ledger > and press Enter.
4. Select the stock item. Enter the Quantity and Rate.
5. Set the option Provide VAT details to Yes. In the Statutory Details screen
   • Set the options as shown below:
     
     

     Note: Options in the above screen appear based on the State selected in the Company VAT Details screen.

   • Press Enter to save. The sales invoice appears as shown below:
     
6. Accept the screen. As always, you can press Ctrl+A to save.

The value of this transaction gets captured in the relevant fields of state-specific VAT/CST forms and annexures.