THE CENTRAL GOODS AND SERVICES TAX ACT, 2017
PAYMENT OF TAX
Section 51: Tax deduction at source (Relevant Rule 12)
*(1) Notwithstanding
anything to the contrary contained in this Act, the Government may mandate,––
(a) a department or establishment of the Central Government or State
Government; or
(b) local authority; or
(c) Governmental agencies; or
(d) such persons or category of persons as may be notified by the Government on
the recommendations of the Council,
(hereafter in this section referred to as “the deductor”),
to deduct tax at the rate of one per cent. from the payment made or credited to
the supplier (hereafter in this section referred to as “the deductee”)
of taxable goods or services or both, where the total value of such supply,
under a contract, exceeds two lakh and fifty thousand rupees:
Provided that no deduction shall be made if the location of the supplier and
the place of supply is in a State or Union territory which is different from
the State or as the case may be, Union territory of registration of the
recipient.
Explanation.––For the purpose of deduction of tax specified above, the value of
supply shall be taken as the amount excluding the central tax, State tax, Union
territory tax, integrated tax and cess indicated in
the invoice.
(2) The amount deducted as tax under this section shall be paid to the Government by the deductor within ten days after the end of the month in which such deduction is made, in such manner as may be prescribed.
'1[(3)
A certificate of tax deduction at source shall be issued in such form and in
such manner as may be prescribed]
[helldod old[(3) The deductor shall furnish to the deductee a certificate mentioning therein the contract
value, rate of deduction, amount deducted, amount paid to the Government and
such other particulars in such manner as may be prescribed.] helldod]
[helldod
2omit(4) If any deductor fails to furnish to the deductee the certificate, after deducting the tax at
source, within five days of crediting the amount so deducted to the Government,
the deductor shall pay, by way of a late fee, a sum of
one hundred rupees per day from the day after the expiry of such five day period
until the failure is rectified, subject to a maximum amount of five thousand
rupee.] helldod]
(5) The deductee shall claim credit, in his
electronic cash ledger, of the tax deducted and reflected in the return of the deductor furnished under sub-section (3) of
section 39, in
such manner as may be prescribed.
(6) If any deductor fails to pay to the Government
the amount deducted as tax under sub-section (1), he shall pay interest in
accordance with the provisions of sub-section (1) of
section 50, in addition to
the amount of tax deducted.
(7) The determination of the amount in default under this section shall be made
in the manner specified in section 73 or
section74.
(8) The refund to the deductor or the deductee arising on account of excess or erroneous
deduction shall be dealt with in accordance with the provisions of
section 54:
Provided that no refund to the deductor shall be granted, if the amount deducted has been credited to the electronic cash ledger of the deductee.
1. Substituted Vide: Section 124 of Finance Act 2020 vide Notification No. 92/2020 - Central Tax (w.e.f. 01.01.2021)
2. Omitted Vide: Section 124 of Finance Act 2020 vide Notification No. 92/2020 - Central Tax (w.e.f. 01.01.2021)