Dept of Trade and Taxes, Delhi has issued a public notice regarding the applicability of Delhi VAT to Contractors/ builders/collaborators/developers etc on 6th Feb 2013. It has a far reaching implication as the land prices are very high in delhi and even construction of three or four story building in a single 50 sq.yard plot will value more than 10 lakh in remote areas of the state , this notification covers almost all small time contractors or developers . Similarly property owners must be careful in submission of information regarding the redevelepment of their property in time otherwise the entire tax liability will be on them.
The Salient Features are as under :
1.
Air Contractors/ Builders/ Developers/ Collaborators, etc. (in short contractor) engaged in development / construction of immovable properties in Delhi are required to get registration and pay VAT under Delhi Value Added Tax (DVAT) Act, 2004, in case their turnover during a financial year exceeds 10 Lakhs.
2.In case of Collaboration / development agreement between property owner and contractor for development of property , the contractor who supplies material and undertake construction activity is liable for registration under DVAT.
3. In such case property owner is not liable for registration under VAT.
4. In case the property owner sells the building or a part of the building before completion of construction , becomes deemed contractor for such buyers and hence liable for registration under VAT.
5.The owners of the property are, therefore, has to provide the information regarding details of contractors and amount paid/payable to them, immediately after commencement of any construction / repair / modification etc. undertaken by them.
6.
In case of non-submission of information by the owners, and especially in cases where property is not under self-use, it may be presumed that the owner is himself a contractor for the buyers of the property and thus would become liable for VAT payment.
To view a copy of the public notice issued by the trade tax dept. pl click the link given below:
http://cmaglobal.net.in/OtherpageTheme11024.ASPX?PAGENAME=Value%20Added%20Tax%20(VAT)&CompanyID=1577
CMA Krishna Dasan.A
2, DDA Commercial Complex,
C2C Block, Pocket 2,
Janak Puri , New Delhi-110058
Mob: 98711-28831
Email: aknair2002@cmaglobal.net.in
Website: www.cmaglobal.net.in
