On works contract

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Hetvi (Querist)
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20 July 2015 Sir/ Madam...

what is difference between "in respect of services provided or agreed to be provided by way of supply of manpower for any purpose..S. provider 25% & S. receiver 75 %"
and
"in respect of services provided or agreed to be provided in service portion in execution of works contract..S. Provi 50% & S. Rece 50%"

One of our client do business with PGVCL (Govt. Elect. Co) on Tender Contract basis and manufacture various cement products use bu PGVCL..
Cements and other raw material supply by PGVCL and bill amount include only labour charger.
than which of the above option available for us...
please rely me fast...

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 July 2015 The second option applicable to you. That is service portion in execution of works contract(SP 50% and SR 50%).
under the former SP will supply man power only, under the later he has to take material from SR and make cement products by employing his labour.

Hetvi

Hetvi (Querist)
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20 July 2015 Thanku
Seetharaman Sir..

But now my Que. is if we register as Works Contract in service Tax...then is it compulsory for us to pay VAT on bill amount...as in Gujarat 2% VAT payable on works contract...

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 July 2015 Please see whether you can term it as labour contract and avoid VAT.

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