August 2009
Amendment to Rule 58 by inserting Sub-Rule (1A) : Notification No. VAT-1507/CR-53/Taxation-1, dated 1-6-2009.
By Pinky Shah, Sonalee Godbole, Gaurang Gandhi, Tarun Ghia, Nimesh Dedhia, Vijay Kewalramani
Chartered Accountants
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Part B : Indirect taxes
Updates in VAT and Service Tax :
MVAT UPDATE
Mvat Notifications
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Amendment to Rule 58 by inserting Sub-Rule (1A) :
Notification No. VAT-1507/CR-53/Taxation-1, dated 1-6-2009.
By this Notification, the Commissioner has amen-ded Rule 58
by inserting Sub-Rule (1A) after Sub-Rule (1) with retrospective effect from
20-6-2006.
New Sub-Rule (1A) lays down the method of valuation of
goods transferred in the execution of construction contracts wherein, along
with the immovable property, the land or interest in the land, underlying the
immovable property is to be conveyed. The value of the said goods at the time
of the transfer shall be calculated after making deductions under Sub-Rule (1)
and for the cost of the land from the total agreement value. The cost of the
land shall be determined in accordance with the guidelines appended to the
Annual Statement of Rates prepared under the provisions of the Bombay Stamp
(Determination of True Market Value of Property) Rules, 1995, as applicable on
the 1st January of the year in which the agreement to sell the property is
registered. Deduction towards cost of land under this sub-rule shall not
exceed 70% of the agreement value.
