To : All Administrative Department/Heads of Department/Deputy Commissioner / Sub-Divisional Officers (Civil).

Sub : Deduction of tax at source and steps for prompt deposit of such taxes under the Assam Value Added Tax Act, 2003.

As you are aware that the Assam Value Added Tax Act, 2003 has come into force with effect from 1.5.05 replacing the Assam General Sales Tax Act, 1993. The provision of Section 27 of the Assam General Sales Tax Act, 1993 has been replaced by the provision of Section 47 of the Assam Value Added Tax Act, 2003.

I am directed to draw your attention to the provision of Section 47 of the Assam Value Added Tax Act, 2003, requiring all Drawing and Disbursing Officer of Government Department and Government undertakings to deduct tax at source in respect of following transaction :-

a) In respect of supply of any "Taxable Goods" at the rate of tax specified in the Schedule attached to the said Act for the involved goods.

b) Transfer of property of Goods involved in execution of work contract at the rate of 12.5% of the taxable turnover of such work contract.

c) Transfer of right to use any goods (Lease transaction) at the rate of 12.5%.

Provided that non-deduction of tax or deduction of a lower quantum shall be allowed in case of supply of goods if such sale is certified by the prescribed authority as being not liable to tax or liable to tax at lower quantum. Such certificate shall in variably be embodied in each bill to be presented for payment.

It may however, be stated in this connection that the Government has notified a composition scheme for contractors vide Notification No. FTX-55/05/pt/14 dt. 29.04.05 which provides that if a contractor has opted for such composition then tax shall be deducted at the rate of 4% on the total aggregate value of work contract received or receivable by him. In such cases the contractor shall submit a copy of the permission for composition issued by the prescribed authority to the D.D.O. Concerned.

Further, every D.D.O. Responsible for making deduction of tax under Section 47 shall apply to the Prescribed Authority of the respective jurisdiction for allotment of sales tax deduction Account Number in Form 33 within 30 days time from the date of commencement of the Assam Value Added Tax Rule, 2005. He shall also file a return in Form 35 within two months from the end of each year before the Prescribed Authority. Moreover an account for each year has also to be maintained by such D.D.O. in Form 35 showing amount of tax deducted, certificate of tax deduction issued and the particulars of remittances made to the Government Account.

The tax deducted should be deposited into the designated bank by the appropriate challan in Form 25 within 10 days from the expiry of each calendar month. In the light of the above, I would request you kindly to issue suitable instruction to all D.D.O. under your control for taking immediate appropriate action.