Service tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 March 2015 Dear expert.
i have taken contract for painting of building, materials is provided by the contractor. my Question is if the contract amount is 200000 will i have to charge 12.36% on 200000. is this correct.or does this contract will cover under reverse charges.
if contractee individual and contractor company

Nilesh

Nilesh (Expert)
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16 March 2015 You need to charge 12.36% on contract value Rs 2lacs. This contract is pure labour work and hence RCM is not applicable

Querist : Anonymous

Querist : Anonymous (Querist)

16 March 2015 Dear Nilesh Sir,
some tax expert has said. reverse charges is to be consider as per
if the service provider is individual, HUF, firm, AOP, and the service recipient is body corporate, not on basis of whether it was pure labour contract or it was with include materials..

Nilesh

Nilesh (Expert)
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16 March 2015 My friend reverse charge is applicable in case services provided by Ind/HUF/AOP to body corporate and service should be works contract..

In the given fact material is supplied by service receiver and you are not providing any material and hence in my view it is not works contract and it contract for services. Accordingly, you need to pay service tax on entire value

Querist : Anonymous

Querist : Anonymous (Querist)

16 March 2015 But sir
the contractor has also issue the bill for that materials. he has consider as sale and i have consider as purchase

Nilesh

Nilesh (Expert)
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16 March 2015 In that case it will be treated as works contract and reverse charge will be applicable