2007 (11) TMI 574

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....ince in these cases the tax liability is at compounded rate and the tax deducted at source being at the same percentage, no further liability on the part of the contractors to pay any amount of tax arose, since the entire amount of tax payable by them at such compounded rate has been deducted at source. Assessments were completed and it was found that the deduction at source made by the awarder and paid over to the department is in excess of the actual tax due and payable by the assessee. Now I may proceed to consider the case in O.P. No. 7190 of 2000. The assessment orders produced in O.P. No. 7190 of 2000 are exhibits P1 to P5 for the years 1994-95, 1995-96, 1996-97, 1997-98 and 1998-99. In exhibit P1 order it was found that the excess am....

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....urt drew the distinction between the excess tax collected and excess tax remitted and held that section 46A(1) of the KGST Act provides for forfeiture of excess tax collected. That provision has no application towards the excess tax remitted. To add, I may say even when the assessee contests the matter and because of the fact that he has not obtained a stay, he might have paid the tax. So however, if it is found that the tax liability is either reduced or found to be nil, he is certainly entitled for refund of the excess tax paid. Unless it is a case where he has already collected tax, of course in which case the specific provision contained in section 46 of the Act will govern. This court in such circumstances, held that the provisions ....

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....which specifically refers to the tax on purchases, reads as follows: "Notwithstanding anything contained in sub-section (1) of section 5 every contractor not covered by sub-section (7) may at his option, instead of paying tax in accordance with the said section, pay tax on the whole amount of contract at the rate of seventy per cent of the rates shown in the Fourth Schedule against such contract, less any tax paid by him under this Act on the purchase of any goods used in such contract, the transfer of which to the works contract was effected without any processing or manufacture." Therefore, section 7(12) is directly referable to the tax on purchases covered under sub-section (7A). Further sub-section (7A) provides for payment of tax....