Issue of form h by an eou
KRISHNA RAO GOWD
(Querist) 19 November 2013
This query is : Resolved
We are an 100% EOU engaged in manufacturing and exporting of petrol run three wheelers from Andhra Pradesh. We bought CNG kits from a Pune party and issued a Form H against thier invoice. We have submitted the BL copy for the entire vehicle with CNG kits.
We have fitted these Kits to our vehicles and billed the same to a Merchant Exporter in India sending the goods directly to the port as prescribed in the customs and Central Excise rules and claimed the export benefits from DGFT.
Now the Pune dealer says the Sales Tax dept in his state has rejected the Form H saying under the Sales Tax rules the sale of goods purchased against Form H can not be sold to any body else and have to be directly exported. How a transaction which ia allowed by the Customs and Central Excise is invalid under the sales tax law?
R.K Nanda
(Expert) 20 November 2013
consult tax lawyer.
malipeddi jaggarao
(Expert) 20 November 2013
As you are an 100% EOU all your purchases are exported, you can issue 'H' form to your supplier, provided you sell/export the purchased goods directly,ie without using it to produce another product.
When you have fitted the kits and billed the same to a merchant export in India and obtained the Bill of Lading in his name the Customs might have allowed the shipment. But when you have produced the copy of Bill of lading as an evidence of export, it shows that the kits are not exported, they are fitted to the vehicles. This is the objection the Sale Tax Dept., is rising. Anyhow consult a Sales Tax Practitioner in Pune to get clarifications from the Department for refusing the Form H.
