Sales Tax Issue

In T&D, it is presumed a single order with separate annexures will be received for the following supplies or services. 1. Supply of Towers 2. Supply of Bought out items 3. Civil and Erection works.In some cases, there will be separate annexures for Civil works and Erection Works. Applicability of VAT/CST on above sales for 08-09 is given below in different states: Andhra Pradesh: Tower Sales : 4% VAT is applicable for sales within Andhra Pradesh. 2% CST is applicable for inter- state sales against Form C (sales from one state to another state). 4% CST is applicable for inter-state sales without Form C. Bought out items: Bought out items purchased and sold within Andhra Pradesh: APVAT @ 4% or 12.5% is applicable depending on the item. (4% rate items are available on vatlaws.com website). Bought out items purchased from other states Transit sale can be made in respect of bought out items purchased from outside Andhra Pradesh and sold to a customer within Andhra Pradesh. The following conditions are to be followed strictly. 1. The items sold on transit sale basis are to be mentioned as pure supply items in the purchase order. i.e., the items proposed to be sold on transit sale basis should not be linked with some services like installation etc. 2. The items purchased in one lot (quantity mentioned in invoice or Delivery Challan of supplier) should be sold in one lot to customer. No sales in part quantities are allowed. 3. LR should be endorsed in favour of customer as “Goods endorsed in favour of (mention name of customer)”. 4. Customer should acknowledge receipt of material by signing LR and stating “Goods Received”. The date on which goods received shall also be mentioned. 5. The difference in period between LR date and date of receipt of material should be reasonable. 6. The supplier shall issue E-1 Form and C Form has to be obtained from Customer. If the above conditions are not satisfied, sale of items purchased from outside the state will be treated as local VAT Sales in Andhra Pradesh and accordingly attract 4% or 12.5% VAT.

Important note for Andhra Pradesh Sales of goods other than Petrol, all kinds of Diesel Oils including C9, petroleum gases, lubricants, other minor petroleum products, Liquor, Automobiles, tyres and tubes and Cement, by a Register Dealer to,(a) The State Government Departments (b) Andhra Pradesh Power Generation Corporation (APGENCO) incorporated as a company under the provisions of Companies Act. (c) Transmission Corporation of Andhra Pradesh (APTRANSCO) incorporated as a company under the provisions of Companies Act. (d) Central Power Distribution Company of Andhra Pradesh Limited (APCPDCL). (e) Southern Power Distribution Company of Andhra Pradesh Limited (APSPDCL). (f) Eastern Power Distribution Company of Andhra Pradesh Limited (APEPDCL). (g) Northern Power Distribution Company of Andhra Pradesh Limited (APNPDCL). 39

[(h) The Kuppam Rural Electric Co-operative Society Limited, Kuppam.

(i) The Cheepurupalli Rural Electric Co-operative Society Limited, Cheepurupalli Vizianagaram District. (j) The Anakapalle Rural Electric Co-operative Society Limited, Kasimkota.] 43

[(k) Co-operative Electric Supply Society Limited, Sirsilla. attract VAT @ 4%.