1996 (11) TMI 355 - SUPREME COURT

Payment and recovery of tax in works contract - Held that:- Appeal allowed. Notwithstanding anything contained in sub-rule (2), any contractor who pays tax regularly in accordance with the rules, shall be entitled to payment of the full contract amount without any deduction by the awarder, if he produces a certificate issued by the assessing authority to the effect that no tax is due from him. All these provisions are designed to ensure due realisation of the tax due.

No exception can be taken thereto. The attack upon rule 30A is equally untenable. It merely provides the procedure according to which the option to come under the alternate method of taxation provided by sub-section (7) or (7A) of section 7 is to be exercised. The Division Bench was, therefore, in error in declaring the said rules as invalid.