Tax deduction at source on bus hiring payments upheld under VAT law; no substantial question of law was shown.

A corporation constituted under a State Act was liable to deduct tax at source under section 35 of the Uttarakhand Value Added Tax Act, 2005 on payments for hiring buses, because the provision applies to agreements transferring the right to use goods at the prescribed rate. Its status as such a body did not exempt it from the deduction obligation, and its own request for exemption from the tax regime supported that conclusion. The Tribunal had already reduced the penalty, and no substantial question of law was shown to warrant interference in revision. The liability to deduct tax at source was therefore upheld.

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Issues: Whether the revisionist corporation was liable to deduct tax at source under section 35 of the Uttarakhand Value Added Tax Act, 2005 on payments made for hiring buses, and whether any substantial question of law arose for interference in revision.

Analysis: Section 35 requires deduction at source at the prescribed rate where payment is made for an agreement transferring the right to use goods, including payments made by a corporation constituted under a State Act. The corporation was admittedly such a body, and the record also showed that it had sought exemption from the tax regime, which negatived any claim of exemption from compliance with the deduction obligation. The Tribunal had already granted substantial relief by reducing the penalty, and no substantial question of law was shown to justify interference.

Conclusion: The liability to deduct tax at source under section 35 was upheld and the revisionist's challenge failed.

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