23. Tax Deduction at Source
(1)(a) Where a works contract is awarded to a VAT dealer by any contractee and where the contractee is liable for deduction of tax at source of Advance Tax, as specified in the notification issued under Section 44 of the Act, by the State Government in this behalf, the tax shall be deducted from the payment of the valuable consideration after deducting :-
(i) the amount of labour charges, services and the transactions falling under Section 3, 4 and 5 of the CST Act 1956.
(2) the amount of Advance Tax so deducted by the Contractee in pursuance to the notification issued in this behalf, the same shall be deposited in the Government Treasury in the following manner: -
(a) In the circumstances, when the contractee is the department of the State Government, it will deduct the Advance Tax from the bills of the contractor, in accordance to the rules, as provided by the Government for such respective departments and shall remit to the Government Treasury for credit therein into the respective "0040 Head", and a copy of such Schedule forwarded to the Prescribed Authorities of the appropriate circle.
(b) In the circumstances, where the contractee is other than the contractee mentioned in sub-rule (a) of this Rule, such person shall deposit the deducted Advance tax into the Head "0040", directly into the Government Treasury through a prescribed Challan, in the name of such contractor(s), from whose bills such deduction has been made, and furnish a statement to be submitted to the respective Circle In-charge for each month on the 15th day of the following month along with copies of challans.
(c) Every person or Government Department referred in this Rule, shall issue to the contractor, a certificate of tax deduction at source in Form JVAT 400 deducted for the respective year.
Provided that, a Certificate issued to the contractor in Form JVAT 400, shall be accepted and adjusted against the tax payable by such contractor, by the Assessing Authority, where the contractor is registered.