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TDS of Sale Tax from Contractor by Coop Societies

Office of The Registrar Cooperative Societies
Govt.of N.C.T.of Delhi: Old Court's Building
Parliament Street: New Delhi - 11001 

No.35(195)2000/COOP/EDP/2214 Date: 06/12/2000


Govt. of NCT of Delhi has brought into force, the Delhi Sales Tax on Works Contract Act, 1999 and Delhi Sales Tax on works Contract Rules, 1999 w.e.f 01.02.99. By implementation of this Act, Sales Tax Department expects to generate additional Revenue, The Salient features of the said Act is as follows:

1. Work contract include any agreement for carrying out the building construction, manufacture, processing, fabrication, erection, installation, fitting out, improvement, repair or commissioning of any movable or immovable property.

2. By this Act, all contractors I sub-contractors who arc engaged in the transfer of property in goods involving execution of works contract and whose turnover during 1998 - 99 was more than Rs.5 lakhs or whose taxable turnover during 1999 - 2000 has crossed the limit of Rs.5 lakhs, are required to get themselves registered within 30 days of notification of this Act, i.e., 30.12.99.

3. As per provisions of this act, it is mandatory for the agencies awarding contract (Contractee) to award contract to such contractors only, who hold a valid tax clearance certificate from Sales Tax Deptt. In Form XI (To be issued by the Works Contracts Cell) given as annexure to the works contract Rules, 1999.

4. The contractee shall have to furnish information about the conctract entered into, for value of over Rs.50,000/- within fifteen days from the signing of contract or issue of letter of intention Form — XII annexed to the Works Contract Act, 1999.

5. The contractees shall also have to deduct tax 2% at the time of making payment to the contractor. This would be known as TDS or tax deduction at source.

6. And Similarly, the contractor shall make deduction @ 2% from the payments being made to sub-contractors. The amount so deducted shall have to be deposited with the scheduled banks in Form V within 15 days of the next month.

7. Tax 8% shall be levied on such execution of works contracts but after deducting charges towards labout service and other like charges at the specified rates.

8. The assessee can also opt for composition of tax which will be of the total value of work contract.

9. The registered dealers / assessee would be required to file Quarterly return on the pattern of Sales Tax returns.

In case of any difficulty, please contact P.R.O. at Receiption Centre 1st Floor, Bikrikar Bhawan or Asstt. Commissioiier (Works Contract) at Room No.502, 51b Floor, Bikrikar Bhawan, Delhi

All the Registered Cooperative Societies are, therefore, directed to adhere to the provisions of the Delhi Sales Tax on Works Contract Act, 1999 and Delhi Sales Tax on Works Contracts Rules, 1999; and to ensure deduction of Tax in accordance with the stipulations as mentioned above.

(R. K. Shrivastava)

Copy to:

1. All the Registered Societies through concerned Asstt. Registrars
2. Joint Registrars / Dy. Registrars / Asstt. Registrars
3. The Chief Executive Officer
Delhi State Coop. Union Ltd.,
31 Netaji Subhash Marg,
Darya Ganj, Delhi — with the request to publish in “SEHKARI PATRIKA”
4. Commissioner Sales Tax - for his kind information

(R.K. Shrivastava)

Last Updated Date :- 22-06-2018

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