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WCT on mobilisation advance

03 November 2008

Dear Friend, Pls clarify me whether WCT need to be deducted from mobilisation advance or it will be deducted only against bills for work done.

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9 Replies

CA. C V SURYAM (Practising Chartered Accountant) (865 Points)
Replied 03 November 2008

WCT is applicable under any State VAT provisions when there is involved transfer of property. Thus in case of mobilization advances, there is no transfer of property involved and hence no WCT is applicable. WCT is applicable on the value of transfer of property for a particular RA bill or on gross bill value in case of composition subject to certain adjustments.

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S.Srinivasaraghavan (Chief Financial Officer and Co) (11318 Points)
Replied 04 November 2008

I support the view of Mr.Suryam

(Guest)

whether mobilisation advance can be transfered in VAT or nt if s or no plz send me case study

(Guest)

WHETHER MOBILISATION ADVANCE CAN BE TRANSFERED IN VAT OR NT IF YES OR NO PLEASE SEND ME THE CASE STUDY

(Guest)

Originally posted by :CA. C V SURYAM
"	WCT is applicable under any State VAT provisions when there is involved transfer of property. Thus in case of mobilization advances, there is no transfer of property involved and hence no WCT is applicable. WCT is applicable on the value of transfer of property for a particular RA bill or on gross bill value in case of composition subject to certain adjustments.	"

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TANVIR AKHTAR (PROFESSIONAL) (22 Points)
Replied 24 March 2010

WCT is only applicable on transfer of property or goods to the contractee (as per the Tax Liability on Works Contract in VAT regime). In Mobilization Advance, there is no transfer of Property is involved and the Mobilization Advance is not a part payment or advance payment towards consideration of Works Contract to be executed. Whereas Mobilization Advance is to be recovered from Gross Value of R.A Bills along with the WCT being deducted on Gross Value of R.A Bills. Hence, WCT is not applicable on Mobilization Advance.

Venkataraman (Manager) (34 Points)
Replied 10 May 2010

yes i agree WCT on mobilisation adance is not equired as there is no transfer of property

but what to be done on WCT TDS on mobilisation advance

M P Singh (Service - Finance & Taxation) (180 Points)
Replied 10 May 2010

No WCT TDS obligation on the dealer on payment of mobilasation advance .....refer case of "DELHI ELECTRIC SUPPLY UNDERTAKING Vs Commissioner of Sales Tax ,(2006) 146 STC 72 (ALL.) and Hindustan Construction Co. Ltd . Vs state of Haryana ( 1998) 109 STC 600 ( P & H )