Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding


  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram
Discussions Forum
Home Forum Service Tax This
A Public Forum.
Anyone can participate to share knowledge.
We acknowledge the contributions of Experts/ Authors.

Submit new Issue / Query

Repair of Building and Service Tax, Service Tax

Issue Id: - 111683
Dated: 23-3-2017
By:- Ashok Chopra

Repair of Building and Service Tax


  • Contents

Respected Forum,

I am manufacturer-exporter of ready made garment. I have done repair of building. Building material supplied by me to labour contractor. labour contractor with own and two-three workmen done the labour job. During audit, officer is of opine that this is work contract and i am liable to pay service tax under reverse charge mechanism.

Please guide me accordingly.

Thanks and regard

Posts / Replies

Showing Replies 1 to 7 of 7 Records

Page: 1


1 Dated: 23-3-2017
By:- Himansu Sha

Sir,

In my view, the materialks given to the contractor are deemed to be the transfer of propertty of goods towards the job undertaken. The main ingredient of works contract is when fulfilled, the services can be works contract services. If you are a company liability under sec. 68(2) arises. The cenvat credit will not be available to you as prohibited under rule 2(l) of CCR .

Another school of thought categorise it as manpower service. Why I differ is due to the fact that the payments are not done on man days basis, rather on work measurement basis.

Another group is of the opinion that the entire service is construction services. Hence no liability on receiver. Even if the liability is on the contractoir, the exemption limit comes to his resume

There are thus dfivergent views. But I feel wcs is the appropriate one.


2 Dated: 23-3-2017
By:- MARIAPPAN GOVINDARAJAN

In my view also it is works contract.


3 Dated: 23-3-2017
By:- Ramaswamy S

its Works Contract and attracts partial reverse charge mechanism.

Regards

S.Ramaswamy


4 Dated: 23-3-2017
By:- KASTURI SETHI

Dear Querist,

With due respect to all experts, I differ and express my views as under:-

Since the contractor has provided construction service (without material i.e. material supplied by you), so it is a case of pure labour and pure labour cannot be classified under the category, "Works Contract Service". 100% ST is to be paid by the contractor after collecting from you under Section 68(1) of the Finance Act,1994. If the contractor has not exceeded the threshold exemption of ₹ 10 lakhs, no service tax is payable.No RCM is applicable. No direct liability upon you.If the Contractor has crossed threshold exemption limit, he will collect ST from you and deposit into Central Govt. after getting registration.

This service cannot be classified under, "Manpower Supply & Recruitment Agency" because hired labourers remained under the supervision and control of the Contractor and not under you supposing that there is no agreement between you and the contractor which may prove 'Manpower' remained under your control.

This service falls under the category of 'Other Than Negative List' or under erstwhile "BAS".

 


5 Dated: 23-3-2017
By:- Ganeshan Kalyani

I concur with the views of Sri Kasturi Sir, on the ground that service provider has rendered only service and had not supplied any material during construction. He has just used the material supplied by you to construct. Thus it is not works contract service. Thanks.


6 Dated: 24-3-2017
By:- Rajagopalan Ranganathan

Sir,

I agree with the views expressed by Shri. Kasthuri Sir and Shri. Ganesan Kalyani Sir.


7 Dated: 24-3-2017
By:- YAGAY AND SUN

If the stake involved are not too high, then, just to keep the litigation away and adopting conservation view in your matter, please pay it off and relax.


Page: 1

Old Query - New Comments are closed.

Quick Updates:Latest Updates