22A. Determination of taxable turnover incase of transfer of property in goods (whether as goods or in some other forms) involved in the execution of a work contract

(1) Notwithstanding anything contained in rule 22, the taxable turnover for levying tax under sub-section (1) of section 4 of the Act, in case of transfer of property in goods whether as goods or in some other form involved in the execution of a work contract,may be determined by effecting  the following deductions from the gross value of the cotract,in so far as the amounts relating to the deduction pertaining to the said work contract-

(a) on which no tax is leviable under the Act;

(b) which has been exempted from tax;

(bb) on which tax has been paid by the sub-contractor ;

(c) labour and service charges of the execution of the works;

(d) charges for planning, designing,and architect's fees;

(e) charges for obtaining on hire or otherwise, machinery and tools for execution of the work contract;

(f) cost of consumables such as water, electricity, fuel, used in the execution of work contract,where the property is not transferred in the course of the execution of the work contract;

(g) cost of establishment of the contractor to the extent to which it is related to the supply of the said labour and services;

(h) other similar expenses related to the said supply of labour and services, where  the labour and services are subsequent to the said transfer of property;and

(i) pofit earned by the contractor to the extent it is related to the supply of labour and services;

Provided that where the contractor has not maintained accounts which enable a proper evaluation of the different deductions as above or where the assessing authority is of the opinion that accounts maintained by the contractor are not sufficiently clear and intelligible, or is considered  to be unreasonable high in view of the nature of the contract ,the deduction provided above shall be allowed by the assessing authority according to the limit laid down in Column 3 for the type of contract specified in Column 2 of the table given below;  

Note : The percentage is to be applied after deduction from the total value of the contract, the cost of land determined under sub-rule (3),if any, and the quantum of tax separately charged by the contractor if the contract provides for separate charging of tax.

(2) In case of construction contract,where along with the immovable property,the land or, as the case may be, interest in the land,underlying the immovable property is to be conveyed, and the property  in the goods (Whether  as goods or in some other form) involved in the execution of the contract is also transferred to the purchaser, such transfer is liable to tax under this rule. The value of the said goods at the time of transfer shall be calculated after making the deduction under sub-rule (1) and the cost of the land as determined under sub-rule (3) from the total value of agreement.

(3) The cost of land shall be determined in accordance with the rates as recommended or determined under rule 58 of the Rajasthan Stamps Rules,2004, as applicable on the 1st January of the year in which the agreement to sell the property is made;

(4) Where the dealer who undertake the construction of flats, dwelling or building, premises  and transfer them in pursuance of an agreement along with the land or interest underlying the land, then after deduction under sub-rule (1) and (3) from the total agreement value, the sale price shall be determined depending upon the stage at which the agreement with the purchaser is entered,according to the limit laid down in   Column 3 for the type of contract specified in Column 2 of the table given below:

 (5) The value of goods so arrived at under sub-rule(1) shall, for the purpose of levy of tax, be the sale price or, as the case be,the purchaser price relating the transfer of property in goods(whether as goods or in some other form) invoved in the  execution of work contract.

(6) Where a worker contractor who has expired option of exemption fees under a notification issued under sub-section (3) of section 8 of the act or has opted for payment in lump sum in lieu of tax, awards whole or part of such contract to a sub-contractor, while determining the taxable turnover of subcontractor apart from deduction  provided under subrule(1),the turnover of transfer of property in goods involved  in execution of such-contract, shall be deducted.

Provided that where the contractor has opted for option A under  notification number F.12(23)FD/Tax/2015-206 dated 09.03.2015 the sub-contractor shall purchase goods inthe execution of the work contract from the registered dealer of the State, and in case of use of any goods     in the execution of the work, contract , which is procured or purchased from the dealer other than the registered dealer of the State, the sub-contractor shall be liable to pay an amount equal to the amount of tax that would have been payable shall be liable to pay an amount equal to the amount of tax that would have been payable had the goods been purchased in the state, from the registered dealer.  

(7) Where any dealer commonly known as developer/builder has opted for payment in lump sum in lieu of tax under section 5 of the Act, awards any work contract to any person,he shall obtain Awarded Identication Certificate, and shall at the time of payment of any sum to such person deduct an amount as may be notified by the State Government, in the manner as provided in rule 40 of these rules, and all the provisions of the said rule shall mutatis mutandis apply, While determining the taxable turnover of such dealer the turnover  of the work contract awarded by him shall be deducted.