In respect of contracts, which have entered into and commenced before 1st April, 2005 and continued thereafter, the dealer is required to discharge his tax liability, under the MVAT Act, in accordance with the provisions of earlier law (i.e., old Works Contract Tax Act). Thus the dealer shall be liable to pay tax on such ongoing works contracts at the rate/s prescribed (or as per the old composition scheme, if so adopted) under the earlier law. And such a dealer shall not be entitled for any set-off on purchases of goods used in the execution of such on-going works contracts.
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