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    4.1 Execution of Requirement: Customer

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    satyamehta
    This document discusses the process of order execution between a manufacturer, dealer, and customer. It outlines the transactions involved, including the manufacturer paying excise duty to the government and collecting it from the dealer. For inter-state transactions, a concessional central sales tax of 4% applies when the dealer provides a C-Form to the manufacturer. The dealer then collects the C-Form from the customer. Locally within a state, different sales tax rates apply depending on the product. Material delivery is documented using a lorry receipt, which can be endorsed to transfer ownership between parties.

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    4.1 Execution of Requirement: Customer

    Uploaded by

    satyamehta
    47 views5 pages
    This document discusses the process of order execution between a manufacturer, dealer, and customer. It outlines the transactions involved, including the manufacturer paying excise duty to the government and collecting it from the dealer. For inter-state transactions, a concessional central sales tax of 4% applies when the dealer provides a C-Form to the manufacturer. The dealer then collects the C-Form from the customer. Locally within a state, different sales tax rates apply depending on the product. Material delivery is documented using a lorry receipt, which can be endorsed to transfer ownership between parties.

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    4 Transactions

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    This document discusses the process of order execution between a manufacturer, dealer, and customer. It outlines the transactions involved, including the manufacturer paying excise duty to the government and collecting it from the dealer. For inter-state transactions, a concessional central sales tax of 4% applies when the dealer provides a C-Form to the manufacturer. The dealer then collects the C-Form from the customer. Locally within a state, different sales tax rates apply depending on the product. Material delivery is documented using a lorry receipt, which can be endorsed to transfer ownership between parties.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    47 views5 pages

    4.1 Execution of Requirement: Customer

    Uploaded by

    satyamehta
    This document discusses the process of order execution between a manufacturer, dealer, and customer. It outlines the transactions involved, including the manufacturer paying excise duty to the government and collecting it from the dealer. For inter-state transactions, a concessional central sales tax of 4% applies when the dealer provides a C-Form to the manufacturer. The dealer then collects the C-Form from the customer. Locally within a state, different sales tax rates apply depending on the product. Material delivery is documented using a lorry receipt, which can be endorsed to transfer ownership between parties.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    You are on page 1of 5

    Greaves : An Analysis of Product Quality & Customer Satisfaction

    4.1 EXECUTION OF REQUIREMENT


    Customer

    Inquiry Quotati on Execution Via Dealer Order Order Dealer

    Manufacturer

    The customer forwards Inquiry as per his actual requirement and application. The Dealer after consulting the manufacturer submits the most appropriate Quotation meeting all technical requirements of the customer. Customer on scrutinizing, modifying & negotiating with the dealer places the order with definite terms & conditions. The Dealer in turn places his order on manufacturer narrating all the requirements & commitments made by him to the customer. The manufacturer processes the order placed & executes it via Dealer.

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    Greaves : An Analysis of Product Quality & Customer Satisfaction

    4.1.1 TRANSACTION
    As the material is ready for dispatch , manufacturer has to pay Excise Duty1 to the Government & collect it from the Dealer @ 16% . In support of this manufacturer gives Excise Duty Gate Pass which in business language is more commonly known as EDGP. Dealer uses EDGP for collecting Excise Duty amount from the customer. Customer uses EDGP for claiming CENVAT from Government. Over & above excise duty manufacturer is also charging Sales Tax either CST ( Central Sales Tax ) or GST (Gujarat Sales Tax) as required.

    4.1.2 CENTRAL SALES TAX (CST) :


    CST is applicable when the transaction takes place between two states. i.e. When Manufacturer & Dealer are stationed in Different States. Concessional rate of CST is @ 4% against C FORM. Whenever a firm is started, for carrying out transactions between states the firm has to obtain CST NO. from the Sales Tax Department. The firm not registered with the Sales Tax Department has to pay full rate of tax i.e. 10% instead of Concessional rate of 4%.

    4.1.3 C - FORM
    C- FORM is a very special type of form which is issued only to the Sales Tax registered trader/ manufacturer & time to time a firm has to submit details about use of C- Form to Sales Tax department. Customer C-FORM Dealer Manufacture r C- FORM

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    Greaves : An Analysis of Product Quality & Customer Satisfaction

    ________________________________
    1

    EXCISE DUTY is the tax levied upon the manufacturer by the government.As per the new Budget for the year 2004-05 government has levied additional cess of 2% on Excise duty amount.

    4.1.4 TRANSACTION FOR C-FORM


    Manufacturer collects C- Form from Dealer, & Dealer collects C- Form from the ultimate Customer. In case if customer is not a registered Firm then Dealer has to charge the full rate of Tax i.e. 10%. In case if he fails to do so, then Dealer is responsible for paying the full rate of Tax to Government. Thus by carrying out transactions with C-Form our Government is exercising control over all transactions so there is no revenue loss to them.

    4.1.5 LOCAL SALES TAX


    It is applicable when the transaction takes place within the state i.e. When the manufacturer & Dealer both are stationed in the same state. In Gujarat it is known as Gujarat Sales Tax (GST) The rate applicable for GST is different for different products. Concession for GST is given to agricultural products. The GST applicable on different products of GREAVES is as follows

    PRODUCTS Gensets Diesel Engine Gear Box Fluid Coupling

    GST 8% 4% 8% 8%

    All Construction 12% Equipments Agricultural Pump 4% Set Power Tiller 4% Tractor 4%

    21

    Greaves : An Analysis of Product Quality & Customer Satisfaction

    4.2 LORRY RECEIPT


    Lorry Receipt more commonly known as LR is a Negotiable instrument & a proof given by approved & reliable Transporter to manufacturer in return of Material dispatched through them to various destinations. LR covers Name of Consignor Name of the Firm (Manufacturer) handing over the Material Consignee Name of Customer (Dealer & also final Customer) to whom the material is to be delivered. LR also covers the destination where the material is to be taken, brief description of the material, approximate weight, freight amount & value.

    4.2.1 LR TRANSACTION
    Consignor when endorses LR in favor of Consignee, Consignee automatically becomes the owner of the material. Consignee Dealer can then endorse again the same LR in favor of ultimate customer. Dealer at that time collects the payment in exchange of LR. This Transaction is known as RR SALE2 in business language.

    Manufactu rer LR

    Transporter

    Dealer

    Customer

    LR

    LR

    For C- Form transactions only LR is traded or endorsed without taking delivery of the actual material by the Dealer. In case if the

    22

    Greaves : An Analysis of Product Quality & Customer Satisfaction

    Dealer takes delivery of the material he is liable to pay the Local Sales Tax while delivering it to the ultimate customer. _____________________________
    2

    RR SALE is Railway Receipt Sale, which is nothing but the sale of LR.

    23

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