Dispute b/w works contract or supply and service

This query is : Resolved

Kishan (Querist)
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18 August 2017 Dear all,
I have a query,
The Supplier supplies Electrical Material for Rs. 8 Lakhs, and he charges 2 lakh for installation.
1. Will he charge 28% on 8 Lakh and 18% on 2 Lakh?
2. 18% on whole 10 Lakh considering it as works contract done?
3. 28% on 10 Lakhs as major supply is electrical material?
Kindly clarify.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 August 2017 He will charge 28% on 8 Lakh and 18% on 2 Lakh.
This will fall under supply and service.

CA Suresh Jain

CA Suresh Jain (Expert)
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18 August 2017 It is dependent the contract entered into by you with the customer. If it is a works contract the rate of tax applicable to Electrical installations under heading 995461 is 18% even though rate of tax to electrical is higher.

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