Taxapps.in

45. Certain agents liable to tax for sales on behalf of principal:-

(1) Where any person specified in sub-clause (a), (b) or (c) of clause (8) of section 2, ¹[sells or purchases any taxable goods] on behalf of his principal, the person as well as the principal shall both be jointly and severally liable to pay the taxes on the ²[turnover of such sales or purchases].

(2) If the principal, on whose behalf the said person has ³[sold or purchased any] goods, shows to the satisfaction of the Commissioner that, the tax has been paid by the said person on such goods under sub-section (1), the principal shall not be liable to pay the tax again in respect of the same transaction and where the person shows to the satisfaction of the Commissioner that the principal has paid such tax, the person shall not be liable to pay the tax again in respect of the same transaction.

(3) Where an agent of a non-resident dealer, ⁴[sells or purchases] any goods on behalf of the non-resident dealer in the State, then the non-resident dealer and the agent residing in the State, shall be jointly and severally liable to pay tax on the ²[turnover of such sales or purchases] :

Provided that, if the non-resident dealer shows to the satisfaction of the Commissioner that the tax payable in respect of ⁵[such sale or purchase] has been paid by the agent residing in the State, then the non-resident dealer shall not be liable to pay tax again in respect of the same transaction and where the agent shows to the satisfaction of the Commissioner that the non-resident dealer has paid such tax, the agent shall not be liable to pay the tax again in respect of the same transaction.

(4) Where any sale has been effected by way of transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract and the contractor has executed the works contract awarded to him, through a sub-contractor, directly or otherwise, then notwithstanding anything contained in any law or agreement to the contrary, the relationship between the contractor and the person who has actually executed the works contract or part of it as a sub-contractor shall be deemed to be that of the principal and agent and accordingly,-

(a) where such principal assigns the whole or part of the execution of the works contract to different such agents resulting into the distribution of the turnover of the said sales amongst the principal and the agents or wholly amongst the agents whereby the principal escapes the liability to pay tax on the whole or part of the turnover of sales, then, having regard to the total turnover of sales, including the total turnover of sales in respect of execution of such contract, of the principal in the year of assessment being such that the principal would have been liable to pay tax under this Act if such works contract had been executed by himself alone the liability to pay tax on such total turnover of sales shall be that of the principal;

(b) where such agent executes such works contract on behalf of the principal and each or either of them is liable to pay tax, then notwithstanding anything contained in any other law or any contract to the contrary, the principal and the agent shall be jointly and severally liable to pay tax in respect of the transfer of property in goods involved in the execution of such works contract;

(c) if the principal shows to the satisfaction of the Commissioner that tax has actually been paid by the agent on the turnover of sales, the principal shall not be liable to pay tax again in respect of the same turnover of sales on which the agent has paid tax;

(d) if the agent shows to the satisfaction of the Commissioner that the tax has been actually paid by his principal on the turnover of sales on which he is liable to pay tax under this Act, then the agent shall not be liable to pay tax again on the same turnover of sales on which the principal has paid tax;

(e) no deduction from payment of tax under the preceding clauses shall be given to the principal or to the agent, unless a duly signed certificate in the prescribed form is produced;

(f) a contract or assigning execution of a works contract (either in whole or in part) to a sub-contractor registered under this Act, may deduct from his total contract value or, as the case may be, the turnover of sales, the value or the turnover of sales in respect of works contract executed through the said sub-contractor provided a declaration in the prescribed form signed by such sub-contractor is produced;

(g) a sub-contractor who has been assigned execution of works contract (either in whole or in part) by a contractor may deduct from his total contract value or, as the case may be, the turnover of sales, the value or the turnover of sales in respect of such works contract executed by him provided a declaration in the prescribed form signed by such contractor is produced.

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1. These words were substituted by Mah. Act No. VIII of 2012 25.4.2012 w.e.f.1.5.2012 Prior to substitution these words were read as: â€œsells *[***] any taxable goodsâ€