MJ Krishnamurthy's Expert Profile

Queries Replied : 1703

About me

I am a retired Assistant Commisioner of Commercial Taxes of Karnataka. I retired in 1998 at the age of 58.During this service I tried to go in detail about sales tax laws. Immeadiately after retirement some companies wanted to retain me as their consultant. That is how my touch with the subject of VAT laws continued.The website of CAclub india is giving a good opportunity to share my knowledge with others. I am an exserviceman from IAF. So, Iam a little different from other taxmen. We should do some service to the community that has offered us so much, That is my purpose.....Bye.

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sachin says : WCT_in Karnataka
we had subcontracted local vendor for civil work in Karnataka SEZ, Now We are going to Bill to Public Ltd Co. billing description are as below. Our query in this regards are as following 1. we unable to keep track record of Material to be used in WCT can we use composition tax if yes then what rate should we charge to OMPL 5% or 5.5% 2. Can we get set off in composition scheme 3. What is the Regular Tax Rate in Karnataka for WCT (CIVIL, Installation of Plant & Machinery, ERECTION & Commissioning ) 4. If Public Ltd (principal Contractor)Company undertake to pay Tax we will get exemption but what about our subcontractor they will also get exemption or we have to bear tax

sachin says : WCT_in Karnataka
we had subcontracted local vendor for civil work in Karnataka SEZ, Now We are going to Bill to Public Ltd Co. billing description are as below. Our query in this regards are as following 1. we unable to keep track record of Material to be used in WCT can we use composition tax if yes then what rate should we charge to OMPL 5% or 5.5% 2. Can we get set off in composition scheme 3. What is the Regular Tax Rate in Karnataka for WCT (CIVIL, Installation of Plant & Machinery, ERECTION & Commissioning ) 4. If Public Ltd (principal Contractor)Company undertake to pay Tax we will get exemption but what about our subcontractor they will also get exemption or we have to bear tax

MJ Krishnamurthy says :
Mr Harsh, If the contractor has taken option to pay tax as per a special notification, then for the agreements made after October 2010 1% VAT can be colleted on the entire receipts.Under norrmal composition scheme it will be 5% on the value left out after deducting cost of land ,amenities,like lub,swimming pool etc and deposits,if,any. in norrmal vat method,after reducing the aove said amounts the cost of labour is also to be removed from the total i.e. 30%. The material cost is liable for full rate of tax 12.5% or whatever. Although the dealer has registerd in Oct,12 he will have to pay tax on all flats.The builders generally do not issue an invoice. They opt for a composiiton scheme convenient to them and collect tax at ...the highest rate. In order to escape from such mischief one should insist on an invoice or pay only the lowest i.e. 1% on the total receipts.If a tussle ensues a lawer notice for moving a civil or consumer court has to be served on the builder....MJK

MJ Krishnamurthy says : Branch issue of 'F' form
Mr Bagrecha, If the banch is in the same state there is no necessity of 'F' form. If it is in another state then a diffrent rigistration it will be having and certainly 'F' form has to be issued for a stock transfer.....MJK

harsh says : VAT on under construction Flat/bldg.
Dear Sir, I have following your valuable assistance and guiding flat owners. Sir, I have similar query related to applicable VAT for my under construction bldg for which I need your guidance & assistance. The details are as follows: 1) Agreement value of flat is Rs. 30 lacs and document was registered in March 2010 in Navi Mumbai. 2) Bldg recently got Occupancy certificate from authority and builder has raised demand letter for last 5% payment along with 5% MVAT on agreement value prior to possession. 3) Builder is not willing to provide any tax invoice or debit note for VAT. The gov. of Maharashtra ( Sales tax deptt) has laid down different methods of calculating MVAT vide circular 18T dtd 26/09/2012. 4) I have also gathered information that builder has recently done VAT registration (in Oct 2012 just prior to deadline given by Sales Tax deptt)and his return is showing quarterly assessment for period 2010-11,2011-12 & 2012-13. As we know that MVAT of 5% on agreement value is not correct (if properly not calculated) and builder is also not willing to listen so, please advise me on : i) whether builder can ask for MVAT for period prior to his VAT registration i.e for period 2010-12 ( MVAT regd done in Oct 2012) ii) what is way forward to convince him even after making 100% payments (as per agreement value + dev charges, car parking, club membership, service tax etc) and take legal possession. Regards,