Vat Actupdated - RS Goyal & Associates
Vat Actupdated - RS Goyal & Associates
Vat Actupdated - RS Goyal & Associates
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42<br />
(6) The tax paid under this Section shall be adjusted towards the tax assessed or reassessed<br />
under Section 20.<br />
26 : Deduction and payment of tax in certain cases<br />
(1) Any person responsible for making payment of any sum to any dealer as a consideration<br />
for the sale or supply of any goods in pursuance of a contract between such dealer and the<br />
Central Government or a State Government (hereinafter referred to in this Section as the<br />
purchaser), shall before crediting such sum to the account of the dealer or before payment<br />
thereof in cash or by issue of a cheque or draft or by any other mode, deduct an amount<br />
equal to the amount payable by the purchaser to the dealer by way of tax, 4 whether or not<br />
such amount as is shown by the dealer separately in his bill 4 , where the total amount of the<br />
bill exceeds rupees five thousand and shall pay it to the State Government in such manner<br />
as may be prescribed.<br />
3/4 (2) Notwithstanding anything contained in any other provision of this Act, any person<br />
letting out a works contract of value exceeding three lac rupees to a contractor involving sale<br />
of any goods in the course of execution thereof by the contractor shall before making the<br />
payment of any amount towards the value of such contract to him, deduct at the rate of two<br />
percent or the prescribed rate for lump sum, in respect of a contractor who has opted for<br />
composition under section 11A , an amount towards the tax payable by the contractor under<br />
this Act : 3/4<br />
[ Provided that if the value of labour involved in the contract is more than fifty percent<br />
of the contract, the deduction towards the tax payable shall be made at the rate of one<br />
percent. 3/4 -- 1.4.2006 to 31.3.2007 ]<br />
6 Provided that if the value of labour involved in the contract is more than fifty percent<br />
of the contract value and the contractor has not opted for composition under section 11-A,<br />
the deduction towards the tax payable shall be made at the rate of one percent.<br />
Provided further that no deduction shall be made in respect of any sale or purchase<br />
taking place outside the State of Madhya Pradesh or in the course of inter-State trade or<br />
commerce or in the course of import of goods into the territory of India.<br />
Provided also that no deduction shall be made from any payment made to any subcontractor<br />
by a contractor where the contractor has opted for composition under section 11-<br />
A. 6<br />
(3) On deduction of the amount under sub-section (1), or sub-section (2) the person making<br />
such deduction shall issue to the dealer or the contractor, as the case may be, a<br />
certificate therefor 6 in the prescribed form which is obtained in the prescribed manner 6 and<br />
shall deposit such amount in to the Government Treasury in such manner and within such<br />
period as may be prescribed.<br />
(4) Any person making the payment under sub-section (1) or sub-section (2) shall be<br />
deemed to have made the payment on the authority and on behalf of the dealer or the<br />
contractor and the receipt for such payment shall constitute a good and sufficient discharge<br />
of the liability of the purchaser to the dealer or the contractor to the extent of the amount<br />
specified in the receipt.