TDS on works contract

[THYAGARAJAN KALYANASUNDARAM]

Dear experts,

one of my client has not been deducted TDS on works contract under section 13 of Tnvat act for the past many years. Suddenly the enforcement wing officer came for audit of my client and says that for non deduction of TDS under works contract executed by the contractor in my client factory, will lead to the client has to pay the TDS along with interest n penalty. However, the contractor who executed the contract at my client place have paid tax under section 5 only. My question is whatever revenue to be paid everything has been collected by the contractor from my client and remit the same to the revenue authority. There is no revenue loss to the government. Some where I have gone through tribunal case laws to support this case. Can any one will share the tribunal case laws or any other cases to support this issue either high court of madras or Supreme Court. Kindly help me in this regards it's very urgently needed.

AI Summary

Client Challenges TDS Penalty Under Tnvat Act; No Revenue Loss as Contractor Paid Taxes Elsewhere A client failed to deduct TDS on a works contract under the Tnvat Act, leading to an audit by an enforcement officer who demanded payment of TDS with interest and penalty. The contractor had already paid taxes under a different section, resulting in no revenue loss to the government. The client seeks tribunal or court case precedents to support their case. Respondents suggest that despite the lack of revenue loss, compliance with TDS provisions is mandatory and penalties apply for lapses. They believe the case might succeed at the tribunal level, as similar instances exist in service and income tax contexts.