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2015 (4) TMI 570 - HC - VAT and Sales TaxLevy of value added tax (VAT) from main contractor where as works contract was executed by the Sub contractor - demand of tax on the amount retained as profit by the main contractor - Refund claim of tax already paid - Held that:- When the petitioner had sub contracted the entire work and also obtained the Form 20H certificate from the sub contractor who undertook to discharge the tax liability in respect of the entire work that was sub contracted, the amounts retained by the petitioner, from out of payments made by the awarder of the contract, represented only the profit element that accrued to the petitioner in his capacity as the main contractor. - In fact the very demand against the petitioner is only on the amount of ₹ 45,92,762.90 that was retained by him towards profit under the transaction with the awarder of the contract. In that view of the matter, there was no liability on the petitioner in terms of the Kerala Value Added Tax Act since there was no sale of material in the course of execution of works contract that emanated from the petitioner to the awarder of the contract. In the absence of any taxable event under the Kerala Value Added Tax Act, the respondent could not have demanded tax on the amounts retained by the petitioner as profits arising out of the transaction in question - Decided in favour of assessee.
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