Monday, 23 April 2018

HC : Rejects standard deduction for works-contract tax, where voluminous records of actual expenses available


HC quashes re-assessment proceedings which allowed 30% deduction towards labour and like charges in respect of works contract under Rule 3(2)(m) of Karnataka VAT Rules, when actual amounts were ascertainable; Observes, assessee maintained proper books of accounts but since it was practically difficult to produce them in entirety due to their copious size, Revenue was requested to examine the books at its business premises or else allow production of documents for specific expenses incurred; Hence, in view of the fact that assessee was willing to produce the books of account before Revenue, it cannot be held that the assessee did not maintain the books or was not willing to produce the same, observes HC; Remarks, “A cartload of books of accounts requires to be examined by the Prescribed Authority to ascertain the genuineness of the claim made”, and accordingly, allows deduction towards actual labour and other like charges under Rule 3(2)(l)  : Karnataka HC

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