Liable for Service Tax Reg.

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Querist : Anonymous

Querist : Anonymous (Querist)

10 August 2010 Dear All,

One of my friend is in business of Contractor (Labour). He is registered with Labour, ESIC & EPF authorities. He have to types of contracts. .

1. Fabrication of Steels on Kgs/ Pcs Rate Basis with own labour only (Plant, Machinery, Raw Materials, Consumable Items provided by the client.)

2. Instillation & Commissioning of Automation machineries (Conveyors, Robots, Lifts etc on Labour rate per day basis tools tackles etc provided by the client.)

His FY 2009-10 Turnover is approx 12 Lacs

in which approx 9.5 Lacs is fabrication turnover and 2.5 Lacs is Instillation & Commissioning turnover.

My query is
1. Is he liable to pay service tax on Fabrication turnover.

2. If he is liable to pay service tax on which taxable service he will pay service tax please also mentioned accounting code if possible.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

10 August 2010 Your total work covered under Erection,Commissioning or Installation service sec.65(39a), your total turnover is Rs.12 you need to register under service tax

Querist : Anonymous

Querist : Anonymous (Querist)

11 August 2010 Dear Sir,
Thanks for replay

Please clear my doubt

wordings of Sec.65 (39a) as under:

“erection, commissioning or installation” means any service provided by a commissioning and installation agency, in relation to,—
(i) erection, commissioning or installation of plant, “machinery, equipment or structures, whether pre-fabricated or otherwise” or
(ii) installation of—
(a) electrical and electronic devices, including wirings or fittings therefor; or
(b) plumbing, drain laying or other installations for transport of fluids; or
(c) heating, ventilation or air-conditioning including related pipe work, duct work and sheet metal work; or
(d) thermal insulation, sound insulation, fire proofing or water proofing; or
(e) lift and escalator, fire escape staircases or travelators; or
(f) such other similar services;

In above we do not find "FABRICATION" we find pre-fabricated

"machinery, equipment or structures, whether pre-fabricated or otherwise"
As i have mentioned earlier We are doing fabrication (Raw Materials used steel Plates, Angel, Beams, Channels, Pipes, Box Pipes etc. with the help of Welding Machine, Cutting Machine, Bending Machine)

i am in little confusion please clear my doubt. Waiting for your replay.

regards,

Jaipal

Querist : Anonymous

Querist : Anonymous (Querist)

11 August 2010 Sir,
One more thing i want to share that the FABRICATED items/ products are excise able our client Charge Excise on dispatch the materials.
Can we charge excise & service tax booth on same items/products.

regards,

Jaipal

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

21 August 2010 Erection of Fabricated or pre fabricated steels only attract service tax, fabricating steel is a manfacturing activity so service tax not applicable for that

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