(1) The declaration specified in sub-section (2) of section 10 shall be in Form No. 20, the quarterly certificate in Form No. 20 A and the liability certificate shall be in Form No. 20 B.

Provided that in the case of a contractor who has opted for compounding under section 8, the permission granted in Form No. 4D shall be treated as the quarterly certificate and the amount shown in Form No. 4D shall be deducted in the proportion of the amount disbursed.

(2) Every awarder making deduction from the payments made to a contractor under subsection (1) of Section 10 shall pay the amount so deducted to the assessing authority, with whom the contractor is registered as a dealer, and if he is not so registered, to the assessing authority having jurisdiction over the area where the works contract is executed, by means of cheque or by a crossed demand draft in favour of the assessing authority or by remitting the amount in the treasury in the name of the contractor and producing the chalan before such authority, along with a statement in Form No. 20C, within the time limit specified under section10:

Provided that no amount shall be deducted under sub-section (1) of section 10 if there is no transfer of goods involved in the execution of the works contract or the goods which are transferred in the execution of the works contract are only those falling under the First Schedule or where the payment relates to that portion of a contract which relates to transfer of goods involved in the execution of works contract other than those executed in the state.

(3) where a contractor has opted for payment of tax at compounded rates in respect of a works contract in accordance with the provisions of section 8, the assessing authority shall specify, in the permission granted in Form No. 4D, the rate of compounded tax to be paid in respect of each contract. No certificate in Form No. 20A or Form No. 20B shall be required in respect of a contract for which the assessing authority has permitted payment of tax under section 8. The tax so recovered shall be remitted to government as provided for under sub-rule (2) above.

(4) Where an awarder deducts tax under sub- rule (2) or sub-rule (3) from the payment due to any contractor, he shall issue a certificate to such contractor in Form No.20 F and the contractor shall issue a certificate in Form No. 20G to the awarder.

(5) Notwithstanding anything contained in sub-rule (2) or sub-rule (3), any contractor who pays tax regularly in accordance with the rules, on production of a certificate issued to that effect by the assessing authority in Form. No. 20 E, shall be entitled to payment of the contract amount without deduction of sales tax due on the contract for a period of six months, to the extent of the works contract specified in the certificate, provided that final payment shall not be made unless the contractor produces a liability certificate issued by the assessing authority in Form No. 20B.

(5A) Where any contractor, to whom a certificate in Form No. 20 E had been issued, makes default, either in the filing of any return or in the payment of any tax due, the assessing authority shall cancel the certificate, with due notice to the contractor, and direct the awarder to deduct tax payable by the contractor in accordance with the provisions of section 10.

(6) Any contractor may apply to the assessing authority in Form No.20 D for the issue of such certificate. The assessing authority, if it is satisfied that the applicant complies with the requirement of sub-rule (5), may issue a certificate in Form No. 20 E

(8) The amount deducted by the awarder from the payments due to the contractor and remitted under sub-rule (2) shall be adjusted against the tax or other amount due from the contractor for the return period during which such deduction is made.

(9) Where the awarder supplies any material to the contractor for use in the works contract and the price of the goods is deducted from the payment made to the contractor, the awarder shall furnish the details to the assessing authority along with the return filed under Rule 32.