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TMI Blog2016 (8) TMI 1116X X X X Extracts X X X X X X X X Extracts X X X X ..... y certified by the contractee, together with Form VAT 200 by the 20th of the month, following the month in which the payment was received by them. On deducting tax at source from the bills of the contractor, the contractee is obligated to remit the tax deducted at source to the Government. Filing Form-501-A, along with their monthly returns, would enable the contractor to adjust the tax deducted at source, from their bills by the contractee, with the tax payable by them on their turnover. That does not absolve the contractee to deduct tax at source as it is a statutory obligation cast on them under Section 22 (3) of the Act. Assessing authority, while examining whether a part of the turnover on which tax has been levied on the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, they have invoked the jurisdiction of this Court under Article 226 of the Constitution of India. Sri Karan Talwar, learned counsel for the petitioner, would fairly state that, while the petitioner did not raise any contention, regarding their failure to deduct TDS from the bills of the contractor, before the assessing authority, they had put forward elaborate submissions, both oral and written, before the appellate authority, contending that the turnover, which was subjected to tax for failure to comply with Section 22 (3) of the Act, included Inter-State works contracts and pure service contracts, both of which fell outside the ambit of the provisions of the Act. Learned counsel would take us through the grounds of appeal, and the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the deemed sale of goods involved in the execution of local works contracts, had been levied on the contractors. While submitting that, in terms of Rule 18 (1) (a) of the Rules, the contractor ought to have made an application to the Assistant Commissioner for a provisional assessment, and their failure to do so obligated the petitoner to deduct tax at source in terms of Section 22 (3) of the Act, Sri S. Suri Babu, learned Standing Counsel for Commercial Taxes, would fairly state that, as the appellate authority had considered the objections raised by the petitioner, the matter could be remanded to the assessing authority instead of the appellate authority as, even if the matter were to be remanded to the appellate authority, he would, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levy tax under the Act is only on Intra-State works contracts, and not on Inter-State works contracts or pure service contracts. We are, however, not impressed with the submission of Sri Karan Talwar, learned counsel for the petitioner, that failure of the contractor to furnish Form-501-A to the contractee, in terms of Rule 18 (1) (bc) of the Rules, absolved the petitoner of their obligation to deduct tax at source. On a conjoint reading of Rules 18 (1) (bc) and (bd), it is evident that the contractor is required to obtain Form-501-A from the Assistant Commissioner, and supply the same to the contractee; the contractee is required to complete the Form and supply the same to the contractor within fifteen days from the date of each paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng whether a part of the turnover on which tax has been levied on the petitioner consists of Inter-State works contracts and pure service contracts, shall also consider whether, even in respect of local works contracts, the contractors had paid tax thereon and, if the petitioner furnishes proof of payment of tax by the contractors on the very same turnover, to then consider whether tax can be levied on the petitioner as it may then amount to taxing the very same deemed sale of goods twice. The amount already paid by the petitioner i.e., for ₹ 4.27 Crores, shall remain with the Department till a fresh assessment order is passed. The assessing authority shall, after giving the petitioner an opportunity of being heard and a personal hear ..... X X X X Extracts X X X X X X X X Extracts X X X X
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