Service tax on man power provided by c&fa

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

21 April 2015 Dear sir/madam,

I am working in a food manufacturing company

My company having clearing & forwarding agenets throught pan india to facilitate the goods dispatch in short period.

With Every CFA my company having an agreement to receive service from tham.

As part of service CFAs has to provide one or two man power for billing works and for some CFAs labor also where require.

For consideration of services my company has to pay for 1. Rent amount of CFA
2. Man power charges and 3. Management fees.

Rent and Man power are reimbursements. first they pay and later they get reimbursement from my company.

we have the agreement only to receive CFA services.

Here my doubt is
1. do my company has to pay service tax on manpower as per reverse charge mechanism.
I am in assumption that since my company dont have agreement specifically for man power we no need to pay ST in RCM.
2. for rental do my company need to deduct tds @10% or 2%.
I am in assumption that since my company have agreement for CFA services tds applicable @ 2% only.

Please suggest.

Regards,

Rama Sekhar

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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21 April 2015 1. Yes your company has to pay service tax on manpower under reverse charge.
It is tax on the transaction of providing a service for a consideration. Agreement is not required.
2. If the building is rented in the name of the company deduct 10%.
3. Deduct TDS at 2% on all payments.

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