TaxTMI 
TaxTMI 
Dear Expert
Please advice what DVAT rate applicable on job work in garment industry
Thanks
Sanjay
DVAT on Job Work ( Garment Trade )
24 Sep 2012 
1 Reply 
12511 Views Asked by
VAT on works contracts: taxability, valuation methods and withholding obligations for transfers of property in goods.
Works contracts for manufacture, processing or fabrication that transfer property in goods are taxable under DVAT; taxation relies on either book-ascertained bifurcation excluding specified labour and service charges or statutory percentage apportionment when bifurcation is not ascertainable. Turnover arises when consideration for transfer of property in goods is received or receivable in the tax period. Contractees (and contractors paying subcontractors) must deduct tax at source on payments attributable to transfer of property in goods, comply with certificate issuance and TAN registration, and retain records to substantiate valuations. (AI Summary)
Works contracts for manufacture, processing or fabrication that transfer property in goods are taxable under DVAT; taxation relies on either book-ascertained bifurcation excluding specified labour and service charges or statutory percentage apportionment when bifurcation is not ascertainable. Turnover arises when consideration for transfer of property in goods is received or receivable in the tax period. Contractees (and contractors paying subcontractors) must deduct tax at source on payments attributable to transfer of property in goods, comply with certificate issuance and TAN registration, and retain records to substantiate valuations. (AI Summary)