VAT Audit- Back to Old Days

In Maharashtra state, there is requirement to comply with the VAT Audit provision. Last date for completing the VAT Audit is 15^th January 2019. This is the last compliance under the old act. After that one has to comply for GST Audit. 

Some basic terms under VAT Audit:

1) Relevant Schedules applicable, as per type of return

2) Different annexure under VAT Audit

3) Different Forms under VAT Audit

1. Relevant Schedules applicable, as per type of return

Sr.	Type of Return filed	Relevant Schedule
A	Form 231	Schedule I
B	Form 232	Schedule II
C	Form 233	Schedule III
D	Form 234	Schedule IV
E	Form 235	Schedule V
F	Form III E (CST)	Schedule VI
G	Dealer filing different types of returns (as mentioned in Sr. No. A to F above)	Different combinations of Schedules as applicable depending upon the types of returns filed

The difference between amount as per returns and amount as per Audit gets calculated in respective Schedules which are filled by the dealer.

2) Different annexure under VAT Audit

• In Annexure-A details of amount of tax paid as per returns / challan under MVAT Act and interest paid u/s 30(2) are to be filled. The details of Refund Adjustment Order issued and amount adjusted against the tax payable for the period under Audit are also to be filled in this annexure.
• In Annexure-B details of amount of tax paid as per returns / challan and interest paid under Section 9(2A) of CST Act are to be filled. The details of Refund Adjustment Order issued and amount adjusted against the tax payable for the period under Audit are also to be filled in this annexure.
• In Annexure-C(N) details of tax deducted at sources certificate received by the dealer are to be filled.
• In Annexure-D(N) details of tax deducted at sources certificate issued by the dealer are to be filled.
• In Annexure D1- details of tax collected at source certificates received by the dealer are to be filled.
• In annexure E-details of purchases on which the set-off is claimed by the dealer are to be filled. The details regarding set-off on capital assets, non-admissibility of set-off under rule 54, reduction of set-off under rule 53 etc. are to be filled in this annexure. Section-1:-Total tax paid, purchases effected from unregistered dealer during the period under audit (including capital assets) and total purchase tax paid- (purchases of cotton and oilseeds from un registered dealer as per section 6A and 6B)
• In annexure F(N)-details about stocks, assets, receipt, turnover of sales and purchases as per profit and loss account, non-sales income, out of Maharashtra purchases which are capitalized. Also, the credits availed in Tran-1 of MGST ACT, 2017 need to be filled.
• In annexure G(N)-details about declarations or certificates received and not receivedunder the Central Sales Tax Act, 1956 is to be filled. TIN of the customer should be filled in applicable cases. The tax liability as per annexure G (N), if any, gets reflected in figure as per audit row (xi) of Table-3 of Para-4 of Part-1.

• The sale annexure-is for filling in the information of customer wise local and OMS sales.
• The purchase annexure-is for filling in the information of local and OMS supplier wise purchases.
• In annexure H (N) –determination of gross turnover of sales and purchases along with reconciliation with profit and loss account, trial balance/ sales and purchase register.3) Different Forms under VAT AuditForm ‘C’ 
  • It will attracted if transaction taken place between the two states or it is inter state transaction
  • The buying dealer from another state issues ‘C Form’ for compliance of ‘CST Rules’ of the state of selling dealer.
  • The buyer can purchase goods at concessional rates, against ‘C Form’, in the inter-state sale. ‘C Form’ can be issued only by a registered dealer to another registered dealer.
  • It can be issued, generally, in respect of raw materials, packing materials goods covered by the certificate of registration of the issuing dealer.
  • If the buying dealer fails to provide ‘C Form’, the selling dealer has to pay full CST in due course, therefore it is advisable to obtain appropriate security until the Form is received by the selling dealer.

  Form ‘F’

  • ‘F form’ is required for stock transfer to branches/ consignment agents or vice-versa from one state to another, without attracting charge of CST.
  • As per section 6A(1) of the CST Act, submission of ‘F form’ with complete details of movement of goods is mandatory to prove stock transfer. Otherwise, the transaction will be treated as normal central sale for all purposes of CST Act including for charging CST at applicable rates.
  • In fact ‘F Form’ is an evidence to prove that the goods are sent out to other states on ‘stock transfer basis’ and not on ‘sale basis’.
  • The consignment agent/ branch/ HO receiving such stock transfer consignment is required to issue ‘F Form’ to the selling outlet (HO/ Branch/ Consignment Agent) or transferor dealer.

  Form ‘H’ 

  • ‘H Form’ under CST is issued when the inter-state buyer is an exporter and buys the goods for the purpose of exports.
  • If the exporter buyer (who belong to other state) issues ‘H form’, the selling dealer is not required to charge or pay any CST on the transaction.
  • The selling dealer should obtain ‘Form H’ from the exporter buyer in due course along with Bill of Lading for onward submission to the VAT Dept. or else eventually the selling dealer has to pay CST at full rate as may be applicable.

  It may be noted that ‘H form’ is meant to facilitate exports/ penultimate sale of the same goods only, thru a merchant exporter, i.e. ‘H form’ should not be used for buying raw materials for the purpose of use in manufacture of finished goods which are proposed to be exported.

   

CA Monika Rathi