Dear sir/madam, Our company is a trader of yarn having its operations in UP. We are registered agents of a mill (supplier) X in Maharashtra. We will be obtaining these goods under F Form from X. Following are the queries that i have with regards to F Form sale
1) What are the documents required to prove that it was only a stock transfer & not deemed sale to evade taxes. Would a transport L/R be sufficient?
2) Can we show profits in our books on the sale. Eg. goods are transferred at Rs. 150/- per piece & sold at Rs. 155/. Can we show Rs. 5 as a profit in our books?
3) Is there a minimum time period for which the goods need to be shown as stock?
4)Does the registered agent need to compulsorily have & show a godown?
5) What is the liability of a registered trader in case the tax authotiry implies that goods were sent as deemed sales.
6) X of Maharashtra would be transferring the goods to us at UP under F form. We in turn would sell these goods interstate to Mr. Y of Rajasthan under C-form & Mr. Y would be selling the same goods in transit to Mr. Z of Punjab under E-1 Form. What will the flow of forms be in this scenario? I would really appreciate a clarity on this matter as we have not dealt with F forms earlier. Many thanks in advance