Labour cess 1% deducted from our payment

This query is : Resolved 

09 November 2022 Dear Expert,

One of our parties has deducted Labour Cess @ 1 per cent from our payment. This is new to us, we don't know about it,

we have some questions/queries about it.

1) What is Labour Cess @ 1% and why is the party deducted from our payment?
2) Our job was to provide environmental services to the party, not do any construction work.
3) Can we take input/claim for Labour Cess @ 1%?

09 November 2022 1 It's payable to the government for labour welfare fund.
2 The levy of Cess on the cost of construction incurred by the employers on the building. and other construction works is a means for ensuring sufficient funds for the Welfare Boards to undertake social security schemes and welfare measures for building and other construction workers.
3 Charge it as expenses to p and l.

11 November 2022 Dear mr. Seetharaman,

We provide services only, if we do not do any construction work, then how can the party deduct labor cess 1%. Please explain and confirm.

11 November 2022 Are you providing services to construction work.
If not question the deduction of such cess.


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