A. K. Sikri, J.

(STA No. 2 of 2011 and C.M. No. 9435-9436 of 2011)

This appeal pertains to the tax period second quarter for the assessment year 2005-06. For that quarter, the appellant/assessee had filed its VAT return dated November 10, 2005. As per this return, he had shown the turnover in the sum of Rs. 15,36,120. Notice under section 59(3) dated December 14, 2005 under the Delhi Value Added Tax Act was issued to the appellant/assessee. The assessee filed the reply thereto. Thereafter, notice of default dated July 18, 2006 under section 32 of the Delhi VAT Act was issued creating a demand of tax of Rs. 4,52,126 and interest thereupon in the sum of Rs. 67,819.

We may note in this case that, as per the tax authorities, the assessee had deducted the tax at source in the sum of Rs. 61,30,514 and therefore, the work done/turnover was of the aforesaid amount and not Rs. 15,36,120 which led to issuance of default assessment notice. The assessee explained before the VAT Officer that the assessee was in the business of construction activities on contract basis and, therefore, as per the provisions of section 5(2) of the Act, he had right to disclose the turnover after excluding