Karnataka wct/vat
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
18 January 2012
As per karnataka 2003 KVAT act, it is very clear that WCT/VAT has to be deducted by a Government Undertaking Body on payable value of contract.
However in one of our turnkey project which was awarded by one of Karnataka Government Electrical Distribution Company during financial year 2007-08,no deductions were made in our bills till as late as october 2011. Hence being dealer we have complied and already remitted VAT/WCT based on turnover every assessment yea. Now the Distribution company is stating that as it had not deducted any WCT /VAT from 2007 to 2011 in our bills it will deducted from final bills now present with them.
1) As we have finished our VAT assesment till 2011 March, can they deduct VAT for previous financial year transaction?
2) If deductions are done know for entire project value know, then payment made by me already as VAT/WCT for project turnover will be additional loss /burden?
How to procees in the matter?
However in one of our turnkey project which was awarded by one of Karnataka Government Electrical Distribution Company during financial year 2007-08,no deductions were made in our bills till as late as october 2011. Hence being dealer we have complied and already remitted VAT/WCT based on turnover every assessment yea. Now the Distribution company is stating that as it had not deducted any WCT /VAT from 2007 to 2011 in our bills it will deducted from final bills now present with them.
1) As we have finished our VAT assesment till 2011 March, can they deduct VAT for previous financial year transaction?
2) If deductions are done know for entire project value know, then payment made by me already as VAT/WCT for project turnover will be additional loss /burden?
How to procees in the matter?
18 January 2012
Mr Author,
As you have stated the Electrical distribution company has failed in its statutory obligation of making TDS in all the payments made to your company.If they now make all the deductions collectively it will be inconvenient to your company/dealer.The follwing remedy can be suggested in this situation:
1)Although making TDS is compulsory for the PSUs and government bodies no action will be taken against them for not deducting TDS from any bill.You can convince them by producing copies of the returns with details to show that taxes have already been paid and there is nonecessity to do deductions belatedly now.
2)If the client do not cooperate and still insist on TDS, get the certificate of tds from them and claim refund from the department.
3)Alternately,if you are regularly carrying out some more works this excess TDS can get adjusted also in few months in the returns.It will not be a loss to you.
MJK
As you have stated the Electrical distribution company has failed in its statutory obligation of making TDS in all the payments made to your company.If they now make all the deductions collectively it will be inconvenient to your company/dealer.The follwing remedy can be suggested in this situation:
1)Although making TDS is compulsory for the PSUs and government bodies no action will be taken against them for not deducting TDS from any bill.You can convince them by producing copies of the returns with details to show that taxes have already been paid and there is nonecessity to do deductions belatedly now.
2)If the client do not cooperate and still insist on TDS, get the certificate of tds from them and claim refund from the department.
3)Alternately,if you are regularly carrying out some more works this excess TDS can get adjusted also in few months in the returns.It will not be a loss to you.
MJK
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Querist : Anonymous
Querist :
Anonymous
(Querist)
20 January 2012
Dear Sir,
Thank You Majority of my confusion has been got resolved.
However Further can I give an Indimnity letter to the customer, stating that liablity concerned to previous year is our responsbility?
Thank You
Further in case if final payment payable to me is lesser
Thank You Majority of my confusion has been got resolved.
However Further can I give an Indimnity letter to the customer, stating that liablity concerned to previous year is our responsbility?
Thank You
Further in case if final payment payable to me is lesser
21 January 2012
Mr Author,
If you satisfy the clients that how you have declared all the receipts of their work in your returns they should not go for TDS of previous years.You can also give an indemnity bond type assurance for stopping your client from doing tds of all previous years and bills.In case the final bill is lesser than the tds amount calculated by your client,then let them restrict it to the bill value only . there will be no problem to any one....MJK
If you satisfy the clients that how you have declared all the receipts of their work in your returns they should not go for TDS of previous years.You can also give an indemnity bond type assurance for stopping your client from doing tds of all previous years and bills.In case the final bill is lesser than the tds amount calculated by your client,then let them restrict it to the bill value only . there will be no problem to any one....MJK
21 January 2012
Mr Author,
If you satisfy the clients that how you have declared all the receipts of their work in your returns they should not go for TDS of previous years.You can also give an indemnity bond type assurance for stopping your client from doing tds of all previous years and bills.In case the final bill is lesser than the tds amount calculated by your client,then let them restrict it to the bill value only . there will be no problem to any one....MJK
If you satisfy the clients that how you have declared all the receipts of their work in your returns they should not go for TDS of previous years.You can also give an indemnity bond type assurance for stopping your client from doing tds of all previous years and bills.In case the final bill is lesser than the tds amount calculated by your client,then let them restrict it to the bill value only . there will be no problem to any one....MJK
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