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2016 (4) TMI 1018 - HC - VAT and Sales TaxSeeking direction for refund an amount - Excess amount deducted from the sixth and seventh running account bills of the petitioner for execution of work pertaining to an agreement and further Accountant General, Bihar, restraining them from making deduction of sales tax under the Bihar VAT Act, 2005 from the gross amount of running account bills and to do so strictly in accordance with Section 41 ibid read with Rule 29 of the Bihar Vat Rules, 2005. Held that:- the issue is squarely covered by the directions of this Court in the case of M/s. Debashree Constructions (India) Pvt. Ltd. Vs. Ircon International Limited & ors. [2015 (7) TMI 1081 - PATNA HIGH COURT] and its analogous cases. It has been clearly held by this Court in the said order that it is the obligation of the authorities to comply with the provisions of the Bihar VAT Act and the Rules and if the Act and the Rules provide that deduction shall not be made with regard to certain items, it is not permissible for the person making the deduction of tax at source to continue to make deduction of the entire amount from the bills without giving the benefit as provided under the Rules which is couched in the form of injunction and violation of the same is legally impermissible. The deducting authorities were, accordingly, directed to strictly comply with the provisions of Section 41 of the Bihar VAT Act and Rule 29 of the Bihar VAT Rules in the matter of making deduction and wherever the details were provided to them by the petitioner-contractor or were available to them then they were obliged not to make deduction with regard to the heads mentioned therein and the TDS was to be deducted with respect to the remaining part of the bills. In view of the aforesaid directions of this Court it is not open to any person deducting tax at source under the Bihar VAT Act to do so otherwise than directed and doing so would be a clear attempt to override the direction of this Court. In view of the aforesaid directions of this Court it is not open to any person deducting tax at source under the Bihar VAT Act to do so otherwise than directed and doing so would be a clear attempt to override the direction of this Court. The stand of the Accountant General is that they have done so on the basis of the circular issued by the Department and also the decision of this Court in the case of Abdul Majeed Khan vs. The State of Bihar & Ors.. In the aforesaid view of the matter, the impugned letter of the Accountant General (Audit), Bihar, in so far as it directs the deduction on the gross amount of the bill, is quashed. The respondents are further directed not to make any deduction contrary to the provisions of Section 41 and Rule 29 of the Rules as have been explained by this Court in M/s Debashree Constructions case (supra). Any excess amount deducted by the respondents shall be refunded to the petitioner. - Decided in favour of petitioner
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