Labour supply contract
This query is : Resolved
01 October 2014
HOW TO DISTINGUISH BETWEEN WORKS CONTRACT AND LABOUR SUPPLY CONTRACT, IF THE WORK ORDER DOES NOT SPECIFY IT AND SUPPLIES SOME MATERIALS TO CONTRACTOR FOR EXECUTION OF WORK.
IN THE ABOVE CASE, IF THE CONTRACTOR PURCHASES ANY VAT PAID GOODS, WHETHER THE SAME CAN BE DEDUCTED FORM GROSS VALUE OF CONTRACTS FOR SERVICE TAX PAYABLE? OR IF THE COMPANY DEDUCTS VAT FROM GROSS VALUE, WHETHER THE CONTRACTOR IS LIABLE TO PAY SERVICE TAX?
IN THE ABOVE CASE, IF THE CONTRACTOR PURCHASES ANY VAT PAID GOODS, WHETHER THE SAME CAN BE DEDUCTED FORM GROSS VALUE OF CONTRACTS FOR SERVICE TAX PAYABLE? OR IF THE COMPANY DEDUCTS VAT FROM GROSS VALUE, WHETHER THE CONTRACTOR IS LIABLE TO PAY SERVICE TAX?
02 October 2014
If no material supply is involved it is labour supply contract. Please refer the following for valuation.
https://www.caclubindia.com/articles/st-on-works-contract-service-under-reverse-charge-mechanism-19190.asp#.VCzJ02eSyik
https://www.caclubindia.com/articles/st-on-works-contract-service-under-reverse-charge-mechanism-19190.asp#.VCzJ02eSyik
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