Download 1511 13/2010 31.03.2016 Labour oriented jobs as

CTD Order No. A.O. No.19/2016
GOVERNMENT OF ANDHRA PRADESH
COMMERCIAL TAXES DEPARTMENT
PROCEEDINGS OF THE AUTHORITY FOR CLARIFICATION AND
ADVANCE RULINGS
Present: Sri M. Pampapathi, Additional Commissioner(Policy)
Sri G.Venkateswarlu,Additional Commissioner (Legal)
Sri T. Ramesh Babu Joint Commissioner (Computers)
*****
A.R.Com/ 13 /2010.
Dated:- 31- 03- 2016
CLARIFICATION
(Per Goondla Venkateswarlu)
I.
M/s. Durha Constructions (P) Ltd, New Delhi, has filed this application and sought
clarification on the following items under Section 67 of APVAT Act, 2005, (Act for
short) read with Rule 66(2)(i) of APVAT Rules, 2005, (Rules for short) along with
the application fee of Rs.1,000.
II. The applicant on behalf of dealer filed this application and requested for clarification
on the following issues :
A. That, I am not eligible to get exemption from WCT on from 501D from APVAT
office, in labour oriented job as sub-contractor.
B. That can purchase machinery against ‘C’ form to process the contractual work
having only local APVAT no. In Andhra Pradesh.
C. Is there any penalty for late filing of returns in cae where there is only labour
GTOs no tax liability?
III. . No representative attended the personal hearing, though offered.
IV. The issue has been examined with the reference to the provisions of the Act,
and the APVAT Rules as under:FACTS: The applicant VAT dealer has stated that it is a sub-contractor for M/s.BHEL, at
Visakhpatnam; that it had executed only labour oriented jobs for M/s. BHEL; that
all the required materials are being supplied by M/s.BHEL; that no material
whatsoever of the applicant is being incorporated in the works; and that M/s.BHEL
is making TDS on certain amounts while making payments to it.
It sought clarification on the following issues:Issue-wise discussion is as under:
Issue (A) : Whether the applicant is not eligible to get the exemption from works
contract tax in labour oriented jobs as a sub-contractor?
Reply : If the material given by the main contractor is being incorporated by the
applicant-sub-contractor in the works of the contractee, there is incorporation of
goods not belonging to the contractee in the works of the contract. In that event, it
is not job work. It is a work contract. Hence, on that portion of the sub-contracted
work, the works contract liability is not on the main contractor, provided the
relevant contracts liabilities are not got compounded. It is on the sub-contractorapplicant itself. However, all the incorporation value of the goods will be exempted
in the hands of the main contractor i.e., M/s.BHEL., Visakhapatnam.
This is clear from the Rule 17(1)( c) of the APVAT Rules, 2005. This rule is
applicable only when the tax liability of the main contractor are not got
compounded i.e., where the liability is required to be determined under Rule
17(1)(a) of the APVAT Rules, 2005.
However, where the main-contractor had got the liabilities of its works
compounded, the applicant sub-contractror is exempted from levy of tax in the light
of the proviso to Section 4(7) (b) of the APVAT Act, 2005.
Issue (B) : Whether the applicant sub-contractor can purchase machinery against
the declarations in Form ‘C’, if the said machinery is required to execute the subcontract work?
Reply : This issue is falling under the provisions of the CST Act and this clarification
Authority is not empowered to issue any clarification under the CST Act, 1956.
Issue (C) : Is there any penalty on the late filing of returns in case where there is
only labour gross turnovers, but no tax liability?
Reply : Yes. There is a penalty which is @ Rs.2500 under Section 50 (1) of APVAT
Act, 2005.
No other issues are sought to be clarified.
In view of the above, the application is disposed off accordingly.
Sd/- T. Ramesh Babu
Jt. Commr. (Computers)
Sd/- G.Venkateswarlu
ADDL. CCT(Legal)
Sd/- M. Pampapathi,
ADDL.CCT(Policy)
NOTE:- An appeal against these orders can be filed before the Hon’ble APVAT
Appellate Tribunal, at Hyderabad within 30 days .
To
M/s. Durha Constructions (P) Ltd, New Delhi
Copy to Sri Nikhil Kumar popli, Advocate, Address :- RL-12, Ganga Ram Vatika,
Tilak Nagar, New Delhi- 110018 with a request to serve this Advance Ruling Order
to the Dealer.
Copy submitted to the Commissioner of Commercial Taxes, A.P. at Hyderabad