St on labour charges - reverse charge

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

06 June 2013 Dear Sir,
We get some work done by a carpentar. He raised invoice on plan paper for Rs. 1 Lacs towards the Labour charges. He does not have ST No.
As a Pvt Ltd company are we required to deposit service tax under reverse charge basis ?
PLS guide with your exper openion.

Regards:
Rahul

Ganeshbabu K

Ganeshbabu K (Expert)
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06 June 2013 Reverse charge will be applicable only if work is done under control of principal employer i.e, under supervision of service receiver

who is responsible for completion of work..

if it is responsibility of labour contractor to complete work and there is no supervision on work being done by service receiver no reverse charge is applicable because it is not considered as manpower supply it is labour contract

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Querist : Anonymous

Querist : Anonymous (Querist)

07 June 2013 Dera Sir,
fully agreed with your expert openion but i think it can be covered under work contracts and company will be required to pay 50% of ST. under reverse charge.
aM i correct ?

Ganeshbabu K

Ganeshbabu K (Expert)
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07 June 2013 it is work contract if material value also included in his labour charges bill..

but you have supplied material and only work is done by him no work contract

Note important:
Person approaching himself and company appointing him on contract basis is not manpower supply service.

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