Fortious Infradevelopers LLP Vs Additional Commissioner of Commercial Taxes (Zone)-1 (Karnataka High Court)
Karnataka High Court held that total consideration under composition scheme doesn’t include amount received from customer towards land. Thus, consideration for works contract under composition Scheme of KVAT doesn’t include receipt for land cost.
Facts- Appellant-Assessee is a Limited Liability Partnership (LLP) engaged in the business of executing civil works, building residential & commercial complexes and performing other allied works.
Respondent No.1 issued a notice alleging that the Assessee having opted for the Composition Scheme, the only allowable deduction is for payments to subcontractor and the taxes collected; the deduction towards land cost is not permissible in terms of section 15 of the Act; hence, the total receipts of Rs.28,06,53,150/- to be considered for payment of VAT. Further, the notice also proposed to verify the details of purchase of materials and URD purchases.
Assessee filed reply dated 16.02.2022 inter alia, contending that the total turnover including tax collected for the period 2015-16 is Rs.5,61,16,709/- after deducting land cost, tax collected, sub-contractor payment and the turnover adopted by the Respondent No.1 in a sum of Rs.28,06,53,150/- is incorrect. Aggrieved by the revisional orders, Assessee has filed these Appeals.
