CBEC circular-Meaning of Gross Amount in works contract services under composite scheme

0 comments Wednesday, February 8, 2012

CBEC has issued the following circular explaining the applicability of  Explanation to Rule 3(1) of the Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007 w.e.f 07/07/2009 only. The said circular explains that Gross Receipts for the purpose of composite scheme would include free of cost goods and services supplied only in those works contracts execution of which has commenced w.e.f 07/07/2009 only. In respect of other works contracts whose execution has started before 07/07/2009 would not be effected by the said explanation.
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No Interest charged in assessment order, no interest could be charged in notice of demand

When Assessing officer did not levy any interest in the assessment order, no interest could be charged in the notice of demand issued under Section 156 of the Act, this has been held by Uttrakhand High Court in an important following case.

Facts: In this case the Assessing Officer in an order u/s 143(3)/148  wrote"Initiate penalty proceedings under section 271(1)(c) for not offering the above income of taxation. Penalty proceedings under section 271B are also initiated as the assessee’s business turnover exceeds Rs. 40 lakhs and accounts are not audited as per section 44AB issue demand notice and challan.”
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