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WCT on Construction of New Factory Building

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Amit Bhatkar

Service

164 Points Posted on 28 July 2008

Our company is planning to start construction of new factory building on one of our vacant plot. ( Maharashtra )

Company is inviting the quotation from different contractors in this regard..

As account person I need the clarification on below mentioned points.

Point 1 ] What type of precautions our company should take in granting the Works Contract ?

Point 2] Do we need to apply for WC TIN under Sales Tax Act ? We already have VAT TIN for our normal course of trading.

Point 3] At what rate company should deduct the TDS AND also on what amount ?

Point 4] What about Service Tax ?

Point 5] Will the company eligible for set-off of WCT against trading sales tax libility ?

I will be very helpful if anyone could spare some time to elaborate on my query.

Many Thanks

Amit

Replies (1)

Rajendra Jain

CA Practice

28 Points Posted on 29 July 2008

You do not need to register with sales tax deptt. for any additional wct registration no. the existing vat tin no. is more than enough.

although the contractor or sub contractor needs to get registered with sales tax deptt.if they are registered then wct @ 2% and tds @ normal rates u/s 194 c needs to be deducted and paid. else wct @ 4% and tds at normal rates needs to be decucted and paid to govt.of india and accordingly form no. 401 and form 16a for tds needs to be issued to them.

rajendra jain