1. Central Sales Tax is an indirect tax which is levied by the Central Government. 2.

In this case, the taxable event is sale of goods inter-state. 3. CST applies to the whole of India including the state of Jammu & Kashmir. 4. CST is payable in the state in which the movement of goods commences. 5. Though it is called CST, it is actually assessed, collected & administered by the local
(i.e. State) sales tax authorities only. 6. It is possible that each such element of sale may be distributed over more than one state.

For e.g. : the seller is in one state, the buyer is in another state, transfer takes place in the third state, consideration may pass in the fourth state etc. Object: 1. To formulate principles for determining when a sale or purchase of goods takes place : (a) In the course of interstate trade or commerce (Sec 3) (b) Outside a state (Sec 4) (c) In the course of import into or export from India (Sec 5). What if dealer has business in different states (which state Govt is to be considered as Govt authority) (a) in relation to a dealer who has one or more places of business situated in the same state, that state. (b) In relation to a dealer who has places of business situated in different states, every such state with respect to the place or places of business situated within its territory. Deemed Dealers : Explanation 1 : Every person who acts as an agent, in any State (a) A mercantile agent as defined in the Sale of Goods Act, 1930, or 350 Central Sales

Tax Act, 1956

(b) An agent for handling of goods or documents of title relating to goods, or (c) An agent for the collection or the payment of the sale price of goods or as a guarantor Deemed Sale : Pursuant to amendment of Article 366 of the Constitution, the following deemed transactions are also covered: 1. A transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration; 2. A transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract; 3. A delivery of goods on hire-purchase or any system of payment by instalments; 4. A transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; 5. A supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration; 6. A supply, by way of or as part of any service of goods, being food or any other article for human consumption or any drink (whether or not intoxication), where such supply or service is for cash, deferred payment or other valuable consideration.

Cost including for sales tax: 1. Excise duty 2. Packing material and packing charges 3. Bonus discount and incentive bonus 4. Insurance charges

5. Compulsory warranty charges 6. Weighing charges 7. Subsidy and incentive paid to supplier Cost excluding for sales tax: 1. Freight and transport for delivery of goods 2. Cash discount 3. Trade discount 4. Insurance on transit (incurred by buyer) 5. Goods returned within 6 months of date of sale 6. Goods rejected 7.