Entry and Octroi Taxes

Indian E-Commerce: Demystifying Shipping Forms and Octroi Charges

We've been running our online store for more than a year now and the plan was simple when we started out - let's help riders across the country by making the best cycling products on the planet available for their riding pleasure. How hard could it be to pack and ship products via the courier companies strewn across our city landscape?

Little did we know about the horror of city specific shipping forms, entry taxes and octroi charges! A few product returns and upset riders later, we understood logistics is crucial for any online store. Delivering on time reflects efficiency and reliability. 

Living in a BIG country like India, rules pretty much change state to state. Understanding rules and digging out respective forms is cumbersome. Some need to be filled by the end buyer, you, and some by the seller, us. Either-ways, if forms are not duly filled, the shipments get struck at state check post for weeks together with absolutely zilch updates.

The government has all these forms to ensure fair trade but is unfortunately not a hassle free process and can be quite slow.

We have carefully documented form requirements across the country and have a small list of states that insist that the end buyer shares some of this horror too. If you're from any of the states mentioned below, you MIGHT be asked to have the form ready and also pay some form of entry tax.

State

Form

Remarks

Arunachal Pradesh

DG - 01

 

Bihar

Affidavit Copy

Shipments below Rs.10000 do not require FORM but Entry Tax will be applicable on them

Himachal Pradesh

Entry Tax

TIN No. is must if not mentioned then Entry Tax is levied. Individual & Non Registered Dealers, Entry Tax is levied @5% on the value & Government Bodies @3%

Jammu & Kashmir

Entry Tax

Value of Goods upto Rs.4999/- may be moved without restriction. Entry Tax is levied in case of Non Registered Dealers and Individual.

Jharkhand

FORM JVAT 502 (OR) FORM JVAT 503

Sugam P (JVAT504 P) is mandatory for Intra state movement. (If Invoice Value more than Rs.50000) The FORM has to be generated online from JVAT

Karnataka

Tax Invoice with Declaration

SUGAM is applicable on all the notified Goods for outbound from Karnataka & intra state. Shipments of Banks/ Financial and Educational Institutions who are not registered with sales Tax department can travel with a Printed Declaration on Letter head from respective Institution. If value exceeds from Rs. 49999/- then these shipments can travel with the Permission of Joint Commissioner of Commercial Tax department

Madhya Pradesh

FORM 50

Declaration & Photo ID is must for Individual Cons. 

Maharashtra

Entry Tax

 

Punjab

Affidavit From Consignee on Stamp Paper

Value of Goods upto Rs.9999/- may be moved out without restriction.

Sikkim

Tax Invoice with Declaration & Entry Tax @ 1 %

Seal, Signature of Consignee and Shipper along with Sales Tax Dept.is mandatory

West Bengal

FORM 50A & Entry Tax @ 1%

TIN No.and PAN No.are mandatory

Kerala Form 16 - Online Form   To be filled by the customer online on the Kerala Government website

 

Entry Tax / Octroi Charges

Some state government levy something called an OCTROI when your purchase enters the state. These charges are applicable in Maharashtra and Gujarat and the charges fluctuate as per the Government regulations. We tried, but were unable to confirm the exact amount. We see that the octroi varies from 3% to 6% of the purchase value.

The octroi charge is payable by the recipient at the time of delivery or at the nearby check post. The courier company will collect the octroi amount from the recipient at the time of delivery.

Bigger companies in the likes of Flipkart, Amazon typically absorb these charges and pay the courier companies directly to avoid delays in the shipment. Smaller companies like ours don't typically have this advantage as courier companies are not willing to pay octroi on our behalf. Hence this quick guide to demystify the charges.

If you need further assistance on this, please do reach out to us (phone/email) and our logistics team would be more than happy to sort you out.

    If we have missed out something, please do let us know.