By CA Ankit Gulgulia (Jain)
B.COM(H), CA, CIFRS, CBV, LLB*
“49 LUMPSUM SCHEME IN RESPECT OF CONTRACTORS OTHER THAN DEVELOPER (section 9)
(1) A contractor other than developer falling under rule 49A liable to pay tax under the Act, may, in respect of works contract awarded to him for execution in the State, pay in lieu of tax payable by him under the Act on the transfer of property (whether as goods or in some other form) involved in the execution of the contract, a lump sum calculated at five per cent of the total valuable consideration receivable for the execution of the
contract, by making an application to the appropriate assessing authority within thirty days of the award of the contract to him, containing the following particulars:
(1) Name of the applicant contractor;
(Append application for registration, if not registered or not applied for registration);
(3) Name of the contractee;
(4) Date of award of the contract;
(5) Place of execution of the contract;
(6) Total cost of the contract;
(7) Period of execution; and
(8) A copy of the contract or such part thereof as relates to total cost and payments.
(2) The application shall be signed by a person authorised to make an application for registration. On receipt of the application, the assessing authority shall, after satisfying itself that the contents of the application are correct, allow the same and such contractor whose application is allowed shall be called lump sum contractor.
(3) The lump sum contractor shall be liable to make payment of lump sum monthly calculated at five per cent of the payments received or receivable by him during the month for execution of the contract. The payment of lump sum so calculated shall be made within twenty one days following the close of the month after deducting therefrom the amount paid by the contractee on behalf of the contractor under section 24 for that month. The treasury receipt in proof of payment made and certificate(s) of tax deduction and payment obtained from the contractee shall be furnished with the quarterly return.
(4) The lump sum contractor shall file returns at quarterly intervals in Form VAT-R6 within a month of the close of the quarter and shall pay lump sum, if any, due from him according to such return after adjusting the amount paid under sub rule (3).
(5) The lump sum contractor shall be entitled to make purchase of goods for use in execution of the contract both on the authority of declaration in Central form C as well as Form VAT-D1 prescribed under clause (a) of sub-section (3) of section 7 and for this purpose he shall be deemed to be a manufacturer.
(6) The lump sum contractor shall maintain complete account of, declarations in Central form C and Form VAT-D1 used by him and, the utilization of the goods purchased on the authority of these forms. He shall also keep complete account of, payments receivable by him for the execution of the contract and, the payments actually
received by him.
(7) A lump sum contractor shall have to pay lump sum in respect of every works contract awarded to him after the award of the contract in respect of which he first elected to pay lump sum and he shall continue to pay tax in respect of contracts awarded before as if he is not a lump sum contractor.
(8) A lump sum contractor may at any time by appearing before the appropriate assessing authority himself or through an authorised agent express in writing his intention to opt out of the scheme of payment of lump sum in lieu of tax payable under the Act. Such contractor in respect of the contracts awarded to him thereafter shall not be liable to pay lump sum in lieu of tax payable under the Act but in respect of the other contract(s)
he shall continue to pay lump sum in lieu of tax payable under the Act till the completion of each of such contract(s).
(9) A lump sum contractor may, when rate of lump sum is revised, opt out of the scheme of payment of lump sum in lieu of tax payable under the Act by appearing before the appropriate assessing authority himself or through an authorised agent within fifteen days of such revision and expressing in writing his intention to opt out of the scheme of payment of lump sum. Such contractor shall be liable to pay lump sum for the period
before the revision in lump sum rate at the un-revised rate and in respect of transfer of property in any goods, whether as goods or in some other form, involved in the execution of the contract(s) thereafter he shall be liable to pay tax as a contractor not being a lump sum contractor.
(10) A lump sum contractor shall be eligible to claim set off of TDS only if on the date of filing of return, he is in possession of original TDS Certificate issued to him by the person making the deductions.
(11) The Excise and Taxation Commissioner shall be competent to issue the detailed guidelines, specifying the procedure and the forms etc for the purpose of availing, compliance and monitoring of the above scheme.”;