Very Urgent Query Regarding VAT-TDS

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This query is : Resolved

Baljeet Singh (Querist)
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12 October 2010 Respected all,

we have executed a contract at delhi for the construction of a building at Haryana. We have deducted the Tds (Under W.C.T.) from the payment made to the party and deposited the same at delhi. We have been issued the notice from haryana sales tax dept. claiming that the tds(V.A.T WCT.) has to be deposited at haryana as construction is taking place at haryana. When we approached to the delhi sales tax dept. for refund of tax, we were denied by giving explanation that " liability to deposit tax in a state arises where the contract/deed is executed not where the construction takes place" kindly clarify the situation in this regard, and suggest us where the VAT tds is to be deposited.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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12 October 2010 No, Delhi sales tax authority explanation is totaly wrong. They has has to refund the amount. Since there was no tax liability no act will be applicable. it is only amount.

Explanation of delhi sales tax is against constitution also. sales tax comes under the purview of state, where transaction occured. The property sale under works contract transacted in the state of haryana. You can appeal directly in High court.

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