Section 59B in The Gujarat Value Added Tax Act, 2003
59B. Deduction at source in certain cases.
(1)Notwithstanding that the assessment in respect of the specified sales is to be made for a year or part of a year, the tax on such sales shall be payable at source in accordance with the provisions of this section.(2)Nothing in sub-section (1) shall prejudice the levy of tax on the specified sales under section 7.(3)(a)Any person responsible for paying specified sale price to a contractor for carrying out any work in pursuance of a specified works contract, shall at the time of payment of the whole or part of the specified sale price, deduct from such price an amount [at the rate as may be specified by the State Government by Notification in the Official Gazette] [Substituted, by Gujarat Act No. 9 of 2008 Section 9(1) for the words 'equal to two paise in a rupee' w.e.f 1-4-08] of such payment as a tax on specified sales.(b)Any person being a contractor responsible for paying specified sale price to a subcontractor in pursuance of a contract with the sub-contractor for carrying out the whole or part of the work undertaken by the contractor in respect of a specified works contract, shall at the time of payment of the whole or part of the specified sale price deduct from such price an amount [at the rate as may be specified by the State Government [by Notification in the Official Gazette] [Substituted, by Gujarat Act No. 9 of 2008 Section 9(l) for the words 'equal to two paise in a rupee' w.e.f 1-4-08]] of such payment as a tax on specified sales.(c)The contractor, or as the case may be, sub-contractor shall furnish the prescribed statement to the person or, as the case may be, the contractor responsible for paying specified sale price and thereupon such person or contractor shall deduct the amount referred to in clause (a) or (b) on the basis of such statement.(4)If a person has entered into works contract with a contractor and the contractor has entered into a contract with a sub-contractor entrusting to the sub-contractor the carrying out of the whole or part of the work (hereinafter referred to as "the sub-contract") relating to the said works contract and the contractor has at the time of payment of the specified sale price in respect of the said sub-contract to the sub-contractor deducted an amount as a tax under clause (b) of sub-section (3) and has paid the same under subsection (7), then notwithstanding anything contained in clause (a) of the said sub-section (3), the person shall not at the time of payment of the specified sale price to the contractor deduct an amount under clause (a) of sub-section (3) equal to the amount of tax paid by the contractor under sub-section (7).(5)(a)Where the contractor or sub-contractor is not liable to pay tax under this Act on specified sales involved in any specified works contract, he shall make an application to the Commissioner in this behalf.(b)On receipt of the application under clause (a), if the Commissioner is satisfied that the contractor or sub-contractor is not liable to pay tax under this Act on specified sales involved in any specified works contract, he shall give a certificate to that effect in such form as may be prescribed.(c)Where any such certificate is given under clause (b), the person responsible for paying any specified sale price under clause (a) or clause (b) of sub- section (3) shall not deduct any amount as tax in respect of the specified works contract mentioned in the certificate.(6)Any amount deducted as tax in accordance with the provisions of sub-section (3), shall be deemed to be an amount received by the contractor or the sub-contractor as part of the specified sale price in pursuance of the specified works contract.(7)Any person deducting the amount as tax in accordance with the provisions of subsection (3) shall -(a)pay such amount into Government treasury in such manner and within such period as maybe prescribed,(b)obtain a treasury receipt therefore, and(c)furnish a copy of such receipt to the contractor or, as the case may be, the sub-contractor within thirty days form the date on which he obtains the receipt(8)Every person deducting the amount as tax in accordance with the provisions of sub-section (3) shall, at the time of payment of the whole or part of the specified sale price, furnish to the contractor or, as the case may be, the sub-contractor a certificate specifying the amount so deducted and such other particulars as may be prescribed.(9)Any deduction made in accordance with the provisions of sub-section (3) and paid into the Government treasury under sub-section (7) shall be treated as a payment of tax or, as the case may be, of lump sum by way of composition under section 14A on behalf of the contractor or, as the case may be, the sub-contractor, and, on the production of a certificate furnished to him under sub-section (8) alongwith copy of a treasury receipt given to him under sub-section (7), credit shall be given to him for the amount so deducted in the assessment of tax, if any, made under this Act for the relevant year or, as the case may be, in the payment of lump sum.(10)Where an amount as tax on specified sales has not been deducted in accordance with the provisions of this section, the tax on specified sales shall be payable by the contractor or, as the case may be, the sub-contractor directly.(11)Where any amount deducted under sub-section (3) remains unpaid after expiry of the time specified in sub-section (7), such amount shall be recoverable as an arrear of land revenue and the Commercial Tax Authorities shall, for the purpose of effecting recovery of the amount, exercise the powers conferred on them under section 46.(12)If any person does not deduct an amount under sub-section (3) or after deducting the amount under that sub-section, fails to pay the same into the Government treasury under sub-section (7), within the time specified therein, the Commissioner may, after giving an opportunity of being heard to such person, impose, by way of penalty, a sum not exceeding twenty-five per-cent, of the amount required to be deducted by him under sub-section (3).(13)Where a person deducting the amount of tax in accordance with the provisions of sub-section (3) does not pay the amount so deducted into the Government treasury under sub-section (7) within the time specified therein, there shall be paid by such person, in addition to the penalty imposed on him under sub-section (12) for the period commencing on the date of expiry of the time specified in sub-section (7) and ending on the date of payment of the amount into the Government treasury, simple interest at the rate of eighteen percent per annum on the amount of tax not so paid into Government treasury or any less amount thereof remaining unpaid during such period.(14)Every person deducting tax under this section shall furnish or cause to be furnished returns in such form and within such period as may be prescribed, to the Commercial Tax officer within whose jurisdiction the person resides or carries on his business.(15)[ ***] [Deleted by Government Act No. 9 of 2008 Section 9(2) w.e.f 1-4-08]
