Section 10 in The Kerala Value Added Tax Act, 2003
10. Deduction of tax at source.
(1)Every awarder shall deduct from every payment, including advance payment, made by him to any works contractor liable to pay tax under section 6, in relation to any works contract awarded, the tax payable by the contractor in respect of such contract under that section, whether the transfer of goods involved in the execution of works contract is in the form of goods or not, and remit it to Government, in the prescribed manner, on or before the fifth day of the month succeeding the month in which such deduction is made. Every such awarder shall also file such return as may be prescribed.Provided that in respect of works contract executed under the Sampurna Gramin Rozgar Yojana or the Beneficiary Committees using the Member of Parliament / Member of Legislative Assembly Funds or Natural Calamity Relief Funds of Sarva Siksha Abhiyan Funds, where the total amount in respect of individual contract does not exceed ten lakh rupees, the maximum amount deductable under this section shall not exceed four per cent of the whole contract amount.(2)For the purpose of sub - section (1), the contractor may produce a liability certificate in relation to such works contracts from the assessing authority showing the tax liability or tax remittance, as the case may be, of the contractor in relation to the work.(2A)In cases where a liability certificate has been produced as per subsection (2), payment shall be effected to a works contractor, on the basis of the said certificate; and,-(i)in case of work awarded by Government of Kerala, Kerala Water Authority or Local Authorities, after deducting four per cent of the amount paid as per the works contract; and.(ii)in other cases-(a)after deducting eight per cent of the amount paid as per the works contract in the case of contractors registered under this Act.(b)after deducting ten per cent of the amount paid as per the works contract in the case of other contractors:Provided that the awarder shall not insist from the contractor, not being a dealer registered under the provisions of the Central Sales Tax Act, 1956 (Central Act 74 of 1956) any certificate issued by the assessing authority showing the tax liability or tax remittances, as the case may be, of the contractor, in relation to the contract, if he has opted for payment of tax in accordance with the proviso to sub-clause (i) of clause (a) of section 8.;(3)If any awarder effects any payment without deduction of the taxes provided under sub-section (1) or after making such deductions, fails to remit the same to Government within the time limit specified under the said sub-section, the awarder and any person or persons responsible for such deduction on behalf of the awarder, including a Director, Manager, Secretary or other officer of a company, shall be jointly and severally liable for payment of such amounts to the Government forthwith as if it were a tax due from him.Explanation. - For the purposes of this section:(1)"Company'" means anybody corporate and includes a firm or other association of individuals, or a Co-operative society; and(2)"Director" in relation to a firm, means partner in the firm.
