i want to confirm that one of my client is contractor not having the valid vat certificate at the time when the wct has been deducted while making payment to him under maharashtra vat act @ 2%.further the party liable to deduct wct withheld an additional amount of WCT @ 2% with interest for any future liability form Maharashtra Vat Givt. Now the contractor has got the valid vat certificate form the maharashtra vat deptt claiming his additional 2% wct with interest back from the party and has issued a indemnity bond saying that in case of any future liability form maharashtra vat govt, he will indemnify the same. Please advise, what should the party do...should he has to refund the amount or pay the withhold amount to the maharashtra govt."?
1 Replies
Ravi Prasad
(Self employed)
(148 Points)
Replied 08 November 2010
Taxation is not related to the registration status of the individual. You have to pay the taxes, even if you are unregistered. Hence compute the tax liability and then declare the same to the Department and if more amount has been deducted, your client can always claim the refund. Please also verify whether your client is eligible to claim input tax rebate as your client is an unregistered dealer.
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