Service tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 November 2015 Dear Sir,

We have placed a work order for " Sand Blasting and painting work " ... paints our scope.

Contractor Scope : Sand, Labor and their equipment for fulfil the Job work. After completion of job their equipment will be returnable.

Now, Work was completed and supplier raised a Service tax Bill with 14%.

But our F&A Dept not accepting that bill, because of they have registered under type of services : 1. Manpower Supply/ recruitment agency
2. Works Contract Service.

and advised as : WCT applicable in this case and revise the invoice as per WCT.

Contractor regretted to revise the invoice. We are in this business since 1990s. Still we didnt face this type of problem.

How we will sort out the case smoothly.

Regards,
Pratap.A

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

20 November 2015 WCT not applicable as no transfer of property involved. Accept the views of contractor and make payment.

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Querist : Anonymous

Querist : Anonymous (Querist)

21 November 2015 Sir,
Your view point was conveyed to our F&A dept, who have expressed a different version as under:
Vendor is registered with Tax authorities for the following:

1. Manpower recruitment / Supply agency service

2. Works Contract Service

Therefore the Vendor cannot be considered for Service Tax and that the vendor should get himself registered with tax authorities for a different head: “Repair / Maintenance”.

Please advise.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

21 November 2015 Repair and maintenance service is a works contract service. Ask your F&A dept to see the Rule 2A of Service tax Determination of value rules 2006. They can also refer service tax abatement chart.
No need of further registration.

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