Rule 41: Collection and refund of cess

Finin2min analysis — operative rule mechanics

Full notified text — Rule 41

41. Collection and refund of cess.– (1) (a) Every employer, within sixty days from the date of
commencement of his work or payment of cess, as the case may be, furnish to the assessing officer,
information in Form-XV.

(b) Any change or modification in the information furnished under clause (a) shall be communicated
to the assessing officer in Form-XV incorporating details of such modifications immediately but not
later than thirty days from the date of affecting the modification or change.

(2) (a) The cess levied under sub-section (1) of section 100 shall be paid by an employer in advance,
on the basis of his self-assessment duly certified by a chartered engineer at the time of approval or
before the commencement of the work.

(b) For the purpose of self-assessment of cost of construction, the employer shall calculate the cost of
construction work on the uniform rate or rates of construction as specified by respective State‘s Public
Works Department (PWD) or the Central Public Works Department (CPWD) or any other schedule of
rates applicable to such building or construction work or rates as per return or document submitted to
the Real Estate Regulatory Authority for a building work (where Real Estate Regulatory Authority is
applicable), applicable for that particular year in which the commencement of building or other
construction work took place in Form-XVI.

(c) Notwithstanding the provisions contained in clauses (a) and (b), where the approval of a
construction work by a local authority or such other authority notified by the State Government, as the
case may be, is required, every application for such approval shall be accompanied by proof of online
payment made in favour of the State Building Workers‘ Welfare Board for an amount of cess payable
on the basis of self-assessment duly certified by the chartered engineer:

        Provided that if the duration of the project is likely to exceed one year, the amount of cess
payment may be for the amount of cess payable on cost of construction self-assessed to be incurred
during one year from the date of commencement of the concerned building or other construction work
and further payments of due cess shall be made as per the provisions of clause (b).

(d) Notwithstanding the provisions of clauses (a) and (b), where the levy of cess pertains to building
or other construction work of a Government or of a public sector undertaking, such Government or
the public sector undertaking shall deduct, or cause to be deducted, the cess payable at the notified
rates from the bills paid for such works. This deducted cess shall be deposited with the respective
State Building Workers‘ Welfare Board within a period of thirty days from the date of such deduction
made along with the details of the construction work to the assessing officer of the area concerned.

(e) In case, there is any stoppage or reduction of building or other construction work, employer shall
furnish the information in Form-XVII, to the assessing officer within sixty days of such stoppage or
reduction of building or other construction work.

(f) Every employer on completion of building or other construction work, shall be required to submit
a return in Form-XVIII, to the assessing officer within sixty days of each completed project.

(g) Advance cess paid under the aforementioned provision shall be adjusted in the final assessment
order made by assessing officer.

(3) (a) The proceeds of the cess collected under sub-rule (2), shall be transferred by such Central or
State Government office, public sector undertaking, local authority or such other authority notified by

the State Government, or assessing officer, as the case may be, in the bank account of the State
Building Workers‘ Welfare Board, electronically through online payment system.

(b) The amount so collected shall be transferred to such Board‘s fund within thirty days of its
collection through online payment system.

(c) The State Building Workers‘ Welfare Board shall periodically reconcile the amount of cess
collected, with the concerned authorities of the State Government or Central Government or Public
Sector Undertaking of the State Government or the Central Government or any such other authority,
as specified by the appropriate Government.

(d) The State Building Workers‘ Welfare Board shall submit half-yearly report, to the State
Government with a copy to the Central Government, on the amount of cess collected, cumulative and
during the period, expenditure incurred during the period, number of live building or other
construction workers, for such period and with such details, as specified by the Central Government.

(4) (a) The assessing officer, on receipt of information of return and cess paid from an employer in
Form-XVIII, may conduct a scrutiny of such information furnished and, if he is satisfied about the
correctness of the particulars so furnished, he shall make an order of assessment within a period not
exceeding one hundred and eighty days from the date of receipt of such information, indicating the
amount of cess payable by the employer and endorse a copy thereof to the employer and to the cess-
collector and to the Building Workers‘ Welfare Board and despatch such order within five days of the
date on which such order is made:

        Provided that such scrutiny shall be done by the assessing officer only where the amount of
cess based on self-assessment exceeds rupees ten lakhs:

        Provided further that if the assessing officer fails to make the order of assessment within a
period of one hundred and eighty days, the self-assessment shall be deemed to be final.

(b) The order shall, inter-alia, specify the amount of cess due, cess already paid by the employer or
deducted at source and the balance amount payable and the date, consistent with the provision of sub-
rule (2), by which the cess shall be paid to the cess collector.

(c) If on the scrutiny of information furnished by the employer in Form-XVIII, the Assessing Officer
is of the opinion that employer has undervalued or miscalculated the cost of construction or has
calculated less amount of cess payable, he shall issue notice to the employer for assessment of the
cess.

(d) On receipt of such notice the employer shall furnish to the Assessing Officer a reply together with
copies of documentary or other evidences in support of his claim, within thirty days of the receipt of
the notice:

        Provided that the Assessing Officer may, in the course of assessment afford an opportunity to
the assessee to be heard in person, if he so requests to substantiate his claim.

(e) If the employer fails to furnish the reply within the stipulated period specified under clause (d) or
where any employer fails to furnish information in Form-XVIII, the Assessing Officer shall proceed
to make the assessment on the basis of the available records and other information incidental thereto.

(f) The assessing officer may, at any time while the work is in progress or in the process of assessment
of cost of construction authorise an officer to make such enquiry at the work site or from documentary
evidence or in any other manner as he may think fit for the purpose of estimating the cost of
construction as accurately as possible.

(5) (a) Where the employer has deposited the cess in advance and the employer decides to withdraw
from or foreclose the works or modifies the plan of construction thereby reducing the cost of
construction undertaken or has been forced by other circumstances to call off the completion of the
work undertaken, he may seek refund of the excess amount of advance cess paid by submitting
information in Form-XVIIto the Assessing Officer giving details of such reduction or stoppage of
work.

(b) The Assessing Officer, on receipt of information in Form-XVII from an employer shall make a
scrutiny of such information furnished and, if he is satisfied about the correctness of the particulars so
furnished, he shall make an order of assessment within a period not exceeding thirty days of receipt of
such information.

(c) Following the assessment order made on receipt of Form-XVII as per clause (b), the assessing
officer shall, wherever necessary, endorse a copy of the such assessment to the respective Building
Workers‘ Welfare Board, cess collector and to such other persons as he thinks appropriate, for making
the refund of excess cess as ordered in the assessment made under clause (b).

(d) The State Building Workers‘ Welfare Board shall, within thirty days of receipt of the endorsement
from the assessing officer under clause (c), refund the amount specified in the order to the employer
through electronic payment system in the bank account as per details furnished by the employer for
that purpose.

(e) Where the appellate authority has modified the order of assessment reducing the amount of cess,
refund shall be made within such time as may be specified in that order or in the manner and time as
specified under clause (d).

Application and evidence

1. Primary statutory test — (1) (a) Every employer, within sixty days from the date of commencement of his work or payment of cess, as the case may be, furnish to the assessing officer, information in Form-XV.
2. Additional operative limb — (b) Any change or modification in the information furnished under clause (a) shall be communicated to the assessing officer in Form-XV incorporating details of such modifications immediately but not later than thirty days from the date of affecting the modification or change.
3. Qualification / exception to test — Provided that if the duration of the project is likely to exceed one year, the amount of cess payment may be for the amount of cess payable on cost of construction self-assessed to be incurred during one year from the date of commencement of the concerned building or other construction work and further payments of due cess shall be made as per the…
4. Numerical or timing control — Collection and refund of cess.– (1) (a) Every employer, within sixty days from the date of commencement of his work or payment of cess, as the case may be, furnish to the assessing officer, information in Form-XV.
5. Code Section mapping — 100, 103. Read the mapped provision together with this text rather than treating the concordance as a substitute for it.
6. Prescribed-form link recorded in the corpus — XV, XVI, XVII, XVIII. Confirm the current notified form/version before filing.

Cross-references & prescribed forms

Worked example

Q&A — Rule 41

Primary sources