Service tax on manpower supply

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CA Chandra Kant Prasad (Querist)
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27 October 2012 one of proprietorship firm is registered as a GTA and man power agency. He is providing labour to a company for installation, lifting and unloading of safty product what is the proportion for the payment of service tax by receipient and providers or reverse charge scheme is applicable on this supply of labour

Suresh Mittal

Suresh Mittal (Expert)
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27 October 2012 If the labor is supplied and they work under the control of SR than only it will be called manpower supply, but if you have undertaken a specific job and you use your labour for that job than it will not cover under RCM. Rule 2(1)(g) defined manpower supply as “supply of manpower” means supply of manpower, temporarily or otherwise, to another person to work under his superintendence or control.’

CA Chandra Kant Prasad

CA Chandra Kant Prasad (Querist)
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28 October 2012 Hello sir,
labours which are supplied don't work under the superintendence or control of service receiver, it means that reverse charge will not be applicable on itn respect of services provided or agreed to be provided by way of supply of manpower for any purpose

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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24 July 2025 Here's a clear summary on **service tax and manpower supply** in your scenario:

* If the **labour supplied works under the supervision or control of the service receiver (SR)**, then the service qualifies as **Manpower Supply Service** and is covered under the **Reverse Charge Mechanism (RCM)**.

* Under RCM, the **service receiver (company receiving labour)** is liable to pay service tax, not the manpower supplier.

* However, if the **labour supplied does NOT work under the supervision or control of the service receiver**, and the manpower agency itself manages the labour to complete a specific job (like installation, lifting, unloading), then this is treated as a **contractual job work or labour supply service** by the provider.

* In this latter case, **RCM is NOT applicable**, and the **manpower agency (service provider) has to pay the service tax**.

So, **in your case:**

* Since the labour does **not** work under the control/supervision of the company (service receiver),
* The manpower supplier should pay service tax on the labour supply service,
* Reverse charge **does not apply**.

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**In short:**

* Labour under SR control = RCM → SR pays service tax
* Labour NOT under SR control = Provider pays service tax

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If you want, I can help you with the exact service tax notifications/rules that explain this. Would you like that?

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