Reverse charge mechanism on works contract

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This query is : Resolved

CA Parth Rajendra Almaula (Querist)

22 April 2015 Greetings of the Day,

Please provide your suggestion in following case regarding whether RCM will be applicable:

One of party is issuing only Labour bill to us for making of furniture and installing roof tops. The status of that party is Individual and the status of my organization is Pvt. Ltd. However, the bill for the material is issued by other party.

So whether we will be covered under RCM and have to pay service tax on the portion of labour bill???

Awaiting for your reply.

Thanks in advance

CA Amit K. Ganar

CA Amit K. Ganar (Expert)

22 April 2015 Dear Parth

If material bill is issued separately, then it is out of works contract and only labour part is concerned. Labour part is now "contract for installation of roof top" and not covered under supply of man power and no RCM is applicable.

This is all subject to PO issued to the party.

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