The Hindu Business Line : Textile industry in a fix over `C' form shortage

THE commercial tax instrument `C' form — that allows concessional Central Sales Tax (CST) rate for inter-State transaction has been the latest worry for the manufacturing industry, including the predominant cotton textile sector here.

The reported shortage of the `C' forms has forced industry to press the panic button, as the transactions recorded without the `C' form would attract penal levy.

This means the assessee (or dealer) who does the transaction without submitting the `C' form would be required to pay double the rate of CST on the product sold.

The trade here has claimed the non-availability of the `C' forms printed by the Government and made available by the Commercial Taxes Department is caused partly by the recent notification on the CST that has called for filing of `C' forms on a quarterly basis instead of the annual filing hitherto in vogue.

This has created a demand surge for `C' forms in this industrial region, which accounts for large-scale inter-State transaction of goods.

With the textile industry in the region heavily dependent on raw cotton from Punjab, Haryana, Gujarat and Maharashtra and the new cotton season having commenced in right earnest now, the cotton industry is worried about the paucity of `C' forms, as the sellers of raw cotton from the North insist on submission of `C' forms to enable them to file the transactions with their respective jurisdictional sales tax authorities.

Similarly, the mills in the State too sell their cotton yarn through inter-State transactions and, hence, these are to be brought under the CST route.

"This problem has arisen out of the shortage of the `C' forms and has been represented to the sales tax authorities. To tackle this, we have also suggested filing of a statement comprising the details of transactions with invoice and the volume which could be accepted by the Government as a record," Mr S.V. Arumugham, Chairman of the Southern India Mills Association (SIMA), said.

The sources in the sales tax department here say that though there has been a shortage in the `C' forms, the local commercial tax officials have sought to provide some relief to the assessees by way of diverting some 25,000/30,000 `C' forms from other divisions of the Commercial Tax Department to Coimbatore so that the immediate needs of the trade here is met.

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