Wct and maintenance of books of accounts

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Rekha (Querist)
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30 April 2015 I have a client facing a problem related to WCT under DVAT. He has done works contract under DVAT but hasn't maintain proper books of accounts. He has paid WCT on the basis of proportion of material and services as decided in agreement. Now his case has been scruitinized. My query is whether portion of material & services decided in agreement can be considered equivalent to maintenance of books of accounts. Please solve my query as soon as possible. Also attach the case law (in WCT) for reference (if any).

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Vishnu Saboo

Vishnu Saboo (Expert)
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30 April 2015 in case of WCT, either you must have proper records of material consumption etc, then you have to add GP and then to calculate the tax.
if proper consumption records are not there you have to opt ratio given in act/rule.
deciding tax on the basis of agreement is not proper way.

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Rekha

Rekha (Querist)
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01 May 2015 Client has already paid tax and we have put the case in appeal against the demand. Isn't there any case law by referring which we can prove that the ratio decided in agreement can be considered as equivalent to maintained books of accounts.

Vishnu Saboo

Vishnu Saboo (Expert)
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01 May 2015 i dont think so there would be any case law in favour of same, as in agreement you can decide at lower rate of tax, you have to follow the rules made, if you did it but still AO demanding then you can interpenetrate, but on the basis of your agreement it is too difficult.

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Rekha

Rekha (Querist)
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01 May 2015 OK
Thanks for the suggestion

Vishnu Saboo

Vishnu Saboo (Expert)
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04 May 2015 you are welcome, pleasure to help you

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