Service tax under rcm
This query is : Resolved
30 June 2013
Dear Sir,
please let me know if chairs, cupboards are repaired in a office.Party has given given bill of Labour+Material. In such case whether receiver of the service has to pay service tax to Govt? If yes, on what amount?
Also inform me whether we can avail cenvat of service tax paid ?
Chandrashekhar Kulkarni
please let me know if chairs, cupboards are repaired in a office.Party has given given bill of Labour+Material. In such case whether receiver of the service has to pay service tax to Govt? If yes, on what amount?
Also inform me whether we can avail cenvat of service tax paid ?
Chandrashekhar Kulkarni
30 June 2013
In my view Reverse Charge Mechanish will not be applicable.
Wait for the views of other experts.
Wait for the views of other experts.
30 June 2013
1)Basically, ‘works contract’ is a composite contract where intention of parties is not to consider supply of material and provision of service as independent contracts.
in my opinion..also reverse charge not applicable in your case
because in your case contract of repairs would not be a works contract.
‘custom of trade’ and ‘substance over form’ are important.
The custom of the trade of repairs has always been to treat the two activities (supply of material and provision of service) as separate contracts. In substance also, these are two independent contracts.
2)However, in case of comprehensive maintenance contracts like AMC, it is a composite contract and intention of parties is not to treat the supply of material and provision of service as two separate contracts. In such cases, it will be a ‘works contract’.and consequently reverse charge applicable.and there fore reverse charge applicable here
Thanks & regards
Ganesh babu k
in my opinion..also reverse charge not applicable in your case
because in your case contract of repairs would not be a works contract.
‘custom of trade’ and ‘substance over form’ are important.
The custom of the trade of repairs has always been to treat the two activities (supply of material and provision of service) as separate contracts. In substance also, these are two independent contracts.
2)However, in case of comprehensive maintenance contracts like AMC, it is a composite contract and intention of parties is not to treat the supply of material and provision of service as two separate contracts. In such cases, it will be a ‘works contract’.and consequently reverse charge applicable.and there fore reverse charge applicable here
Thanks & regards
Ganesh babu k
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