Mvat tax on wct under central sales tax
tanaji
(Querist) 02 July 2014
This query is : Resolved
one of my clint has taken a contract for installation and commissioning of tower to orisa. My client is in maharashtra. He has raise invoice to company of Rs 6000000/- for installation and commissioning of tower. for such contract material cost is around 10%, labour cost is 40% and 50% is profit margin. But sales tax officer has taxed whole transaction @12.5%. can any one provide the tax solution for MVAT of CST
R K JAIN
(Expert) 03 July 2014
Refer the Honourable Supreme Court Decision reported as 88STC204 and case of M/s Kone Elevator India Pvt Ltd reported as 71VST1SC. Tax can be imposed on the value of goods plus proportionate profit related to goods. In your case tax has to be calculated on 20% value since 10% is the cost and 10% is the profit related to goods.
T. Kalaiselvan, Advocate
(Expert) 05 July 2014
You may consult a tax consultant and with his advise you may initiate further action on the subject.
