Ap vat and tds
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
25 November 2011
Dear Sirs, I have the following query, pls express ur opinion :
A Govt. Department of Andhra Pradesh has a scheme of installing Drip Irrigation Systems to the marginal farmers. For this purpose this Department has entrusted the work of supervision to one Quasi-Govt. Aganecy and keep the funds at the disposal of such agency. Under this arrangement the Quasi-Govt. Agency does the following works.
1. Select the Contractor for supply of material as well as errection of the Drip Irrigation System.
2. Negotiate the price with the Contractor for supply and execution of work at the site of the farmers.
3. To supervise the work and issue Certificate for the satisfactory completion of work.
4. To make the payment to the Contractor.
The contractor belongs to a State out side of Andrha Pradesh and supplied material from there to the sites of the farmers in Andhra Pradesh and carried out the errection work and raise the Bill on the Quasi-Govt. Agency i.e. Supervising Agency).
In the above situation I seek the advise on the following matters :
i) Whether the above transaction is a Sale or Works Contract ?
ii) Point of incidence of VAT !
iii) Whether the Quasi-Govt. Aganecy (i.e. Supervising Agency) is under the bligation to make TDS, if so, on what amount ?
iv) Whether the Quasi-Govt. Agency (i.e. Supervising Agency) is liable to pay VAT ? If so on what amount ?
I humbly seek expert opinion.
A Govt. Department of Andhra Pradesh has a scheme of installing Drip Irrigation Systems to the marginal farmers. For this purpose this Department has entrusted the work of supervision to one Quasi-Govt. Aganecy and keep the funds at the disposal of such agency. Under this arrangement the Quasi-Govt. Agency does the following works.
1. Select the Contractor for supply of material as well as errection of the Drip Irrigation System.
2. Negotiate the price with the Contractor for supply and execution of work at the site of the farmers.
3. To supervise the work and issue Certificate for the satisfactory completion of work.
4. To make the payment to the Contractor.
The contractor belongs to a State out side of Andrha Pradesh and supplied material from there to the sites of the farmers in Andhra Pradesh and carried out the errection work and raise the Bill on the Quasi-Govt. Agency i.e. Supervising Agency).
In the above situation I seek the advise on the following matters :
i) Whether the above transaction is a Sale or Works Contract ?
ii) Point of incidence of VAT !
iii) Whether the Quasi-Govt. Aganecy (i.e. Supervising Agency) is under the bligation to make TDS, if so, on what amount ?
iv) Whether the Quasi-Govt. Agency (i.e. Supervising Agency) is liable to pay VAT ? If so on what amount ?
I humbly seek expert opinion.
25 November 2011
Mr. Author,
A dealer from other state also can take up the supply and installation work of drip irrigation in AP.As the order wil be for supply and installation(labour) it becomes a works contract.You can issue bills from a registration of another state as I/S WCT.The quasi-govt agency would in the normal course do the TDS at their rates.But that will be of no help to you.As such tds amount goes to AP govt and you have to pay CST again in your state, you have to impress upon them not to do tds on your bills.You are not required to pay any tax to AP govt if you are doing an interstate works contract,i.e. you are carrying all the required material from outside AP.You pay tax in own state as I/S WCT.
MJK
A dealer from other state also can take up the supply and installation work of drip irrigation in AP.As the order wil be for supply and installation(labour) it becomes a works contract.You can issue bills from a registration of another state as I/S WCT.The quasi-govt agency would in the normal course do the TDS at their rates.But that will be of no help to you.As such tds amount goes to AP govt and you have to pay CST again in your state, you have to impress upon them not to do tds on your bills.You are not required to pay any tax to AP govt if you are doing an interstate works contract,i.e. you are carrying all the required material from outside AP.You pay tax in own state as I/S WCT.
MJK
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