What the "F" form means under Cst Act ?

You may be familiar with the word "f". But today i
am here to demystify the concept of F forms under CST ACT.

The following conversation between Ankur and Aashish will help you to understand the concept in a great manner.


Ankur : Hi Aashish !!,  wassup buddy ??

Aashish : Nothing man, feeling anger on the Indian govt for making nonsense laws. I was transferring my stock from delhi to gurgaon and the tax officer put a penalty on that with no reason and was talking about something f like form. M completely upset.

Ankur : (ohh, may be that would be the case of form F under cst act about which he does not have knowledge) Hey Aashish don't worry and just chill, now i am with you and will tell you about that.

Aashish : Hmmm.

Ankur : Aashish as you know that if you make sale of your goods then you will have to pay vat if the sale is within the state and cst if you sold the goods into other state.

Aashish : Yes i know this thing.

Ankur : buddy, if you are transferring stock to your depot in other state then  how will you prove that you was transferring these goods to your depot and not selling the goods to someone else and thereby evading the taxes thereon ? and Aashish mere words can't prove your intention.

Aashish : Then what to do ??

Ankur : for that purpose Govt introduced the concept of Form - "F" under cst act.
F form is required to be produced as proof of stock transfer. As per section 6A(1) submission of F form is mandatory to prove stock transfer. Otherwise, the transaction will be treated as sale for all purposes of CST Act.
F Form is issued by the branch office/consignment agent receiving goods as branch/stock transfer to its head office/principal who is sending the goods by way of  stock/ branch transfer. The H.O./Principal produces such F forms to its assessing authority to prove such stock/branch transfer.

Aashish : Anka, i got an idea, i will make the complete sell by using f form and how the hell Govt will get to know about it that whether i am selling these goods or transferring it to my depot ?

Ankur : NEVER EVER EVER THINK LIKE THAT ( in arnab goswami style ) because F form is not a conclusive evidence but it is conclusive after assessing officer passes the order.

Aashish : Oh sorry, and how many f form can i get ?

Ankur : Actually as per First Proviso to Rule 5 of CST Rules 1957 provides that one F form covering receipts during the month can be issued. If space in F form is not adequate, a separate list may be attached as annexure to form F giving details, provided that the annexure is firmly attached to the form. The blank form has to be obtained from sales tax authority in which the transferee is situated, i.e. State where goods were received. If the form is lost, indemnity bond has to be given and duplicate form clearly marked as Duplicate can be issued.

Aashish : Anky any thing else about f form ?

Ankur : Yes , click on the link given below to know about the famous case of Ambica Steels and Ashok Leyland Vs State of T.N.

http://indiankanoon.org/doc/1274355/
http://ckbajpai.blogspot.in/2012/04/f-form-requirement-jobwork-and-goods.html

Regards,

Ankur Yadav
+91-9718101968
ca.ankuryadav@gmail.com
taxsapient@gmail.com