Reverse charge mechanism on labour supply

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c pradeep (Querist)
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17 October 2013 I am auditing a maufacturing company. They have paid bonus to contractor who supplies manpower on the eve of festival. I want to know, whether reverse charge mechanism provisions apply and can I they claim Service tax credit on bonus?

CA Abhishek Malpani

CA Abhishek Malpani (Expert)
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17 October 2013 In case company has paid the bonus to manpower supplier for the labor provided to them, then reverse charge will be applicable on the bonus paid.

@VaibhavJ

@VaibhavJ (Expert)
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17 October 2013 Hi,

Yes Reverse charge is applicable if Service provider is not a corporate.

If you pay ST on that you can claim cenvat for that amount.

Thanks//VaibhavJ

c pradeep

c pradeep (Querist)
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18 October 2013 Thanks for the replies

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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18 October 2013 Agreed with Vaibhav.

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