Work contract tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 October 2016 Is Work contract tax(WCT) Allowable Expenses in profit & loss a/c as per income tax act.
(Taxpayer is real estate company . company makes affordable flats for municipal corporation. municipal corporation deduct works contract tax. company taken WCT in p&l as expenses. it is allowable or not. is any case law related with WCT taken as expenses? & what is the reasult?)

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

02 October 2016 See the terms of contract agreement, if it provides for payment of applicable works contract tax then WCT should not be taken to p&l, to be adjusted against claim. If the agreement does not provide the claim then charging to p&l is allowed.