“Real estate sector loses tax battle”( Business Line , November 7) is full of errors about the statutory provisions decision of the Apex Court.

There is confusion regarding the same levy which is known by different names in different States. What is levied as works contract tax (WCT) in Maharashtra is levied as sales tax (till March 2005) and as value added tax in Karnataka. Both are levied under entry no. 54 of the State list, Seventh Schedule, of the Constitution.

What the States are levying is only sales tax/VAT on the value of transfer of property involved in the execution of works contracts and not two separate taxes. Karnataka started levying VAT in place of sales tax with effect from April 2005 and not 2003.

The legal position and the law laid down by the Apex Court is that no VAT or sales tax or WCT will be applicable on sale of completed building.

Besides, the example of a property costing Rs 20 lakh and applicability of WCT on Rs 10 lakh and VAT balance portion of Rs 10 lakh is incorrect. And although the author concludes that “the wide definition of the term works contract could mean that service tax could be slapped on some of these transactions”, the fact is that all works contracts are already liable for service tax under the Finance Act 1994.

L. K. Kathare

Bangalore

Educate women

Islam does not prohibit women from learning; it encourages education to enlighten families and communities (“Mehsud’s crimes against women”, Business Line , November 5). In Kerala, there is a resurgence among Muslim women to become judges, doctors, scientists, politicians and social workers.

I wish Taliban changes its image and becomes an organisation for the betterment of society. There are no winners in a violent society.

K.V. Peter

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