24. Non-deduction of Tax at Source from the bills of Supplier and Works Contractors

(1) No deduction shall be made under Section 45 -

(a) if the dealer is not liable to pay tax under Section 14, 49 & 57 of the Act;

(b) if the supplier, being a dealer registered under Section 25 or 26 of the Act, produces before the deducting authority a certificate in Form JVAT 407 issued by the in charge of the circle in which he is registered.

(2) Further; no deduction shall also be made under Section 44 -

(a) if the works contractor, in course of execution of works contract, involves such goods in the transfer of property in goods in the same form or in some other forms: and such goods are not liable to tax under Section 14, 49 & 57 of the Act; or

(b) if the works contractor, being a registered dealer: and has opted for composition of tax under Section 58 of the Act, and is registered in terms of Rule 4 of this Rule, and produces before the deducting authority a certificate in Form JVAT 407 issued by the in-charge of the circle; in which he is registered.

(3) A supplier or the works contractor, registered under the Act, for the purpose of obtaining the certificate in Form JVAT 407, shall apply for the same, in Form JVAT 120 and the authority specified in Rule 57, after verifying the particulars furnished in the application, shall issue the certificate in Form JVAT 407.

(4) The provisions of sub rules (2) of Rule 23 shall apply mutatis mutandis in so far as they relate to deductions, deposits, returns and certificates.