Reverse charge applicability

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This query is : Resolved

Lubhani (Querist)

11 June 2015 Kindly tell me whether a co-operative housing society making payment to Manpower supply agency/security services agency is required to pay service tax as a service recipient (100% ) on complete reverse charge basis.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

11 June 2015 Yes for the purpose of service tax it is included under body corporate liable for payment of 100% under reverse charge.

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CA AnKiT BoHrA (AB)

CA AnKiT BoHrA (AB) (Expert)

11 June 2015 Yes service tax under reverse chargesis applicable in this case

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Lubhani

Lubhani (Querist)

12 June 2015 However as per my knowledge 'co-operative society' is not included in the definition of body corporate as per definition in companies act. and hence no reverse charge should be applicable.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

12 June 2015 You are right as per companies act. But see my reply that I have clearly stated for the purpose of service tax it is included under body corporate.

Lubhani

Lubhani (Querist)

12 June 2015 Can you give me a notification/article which states so, bcoz in all the articles I found out it is written that societies are not liable .
Kindly see
1) https://skpatodia.in/wp-content/uploads/2012/08/FAQs-on-Reverse-Charge-Provision.pdf
2)https://taxguru.in/service-tax/reverse-charge-partial-reverse-charge-mechanism-service-tax.html

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

22 July 2025 Good discussion! Here's a clear summary regarding reverse charge applicability on cooperative housing societies for manpower/security services:

Key points:
Definition of “Body Corporate” under Service Tax:
For service tax purposes, the term “body corporate” is broadly interpreted and often includes cooperative societies (including housing societies), even though they may not strictly fall under the Companies Act definition.

Reverse Charge Applicability on Manpower/Security Services to Housing Societies:
According to Service Tax Law and Notifications (e.g., Notification No. 30/2012-ST) and related circulars, manpower supply and security services provided to a body corporate attract 100% reverse charge, meaning the service recipient pays the entire service tax.

Are Co-operative Housing Societies Included?
Most CBEC circulars and tax professionals interpret “body corporate” to include cooperative housing societies for service tax reverse charge on manpower supply and security services.

Your references:

The links you provided mention the debate but the general consensus and practice is that co-operative housing societies are liable under reverse charge for such services.

Some rulings and clarifications confirm this.

Important Notifications & Circulars:
Notification No. 30/2012-ST (26 June 2012): Specifies reverse charge on manpower supply services to a body corporate.

CBEC Circular No. 176/5/2013-ST dated 22 April 2013 clarifies interpretation and application of reverse charge on such services.

Conclusion:
For service tax reverse charge, cooperative housing societies are treated as body corporates.

So, when they procure manpower or security services, they are liable to pay 100% service tax under reverse charge.

If you want, I can help find the exact notification text or official clarifications for your submission.

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