Wct with service tax
This query is : Resolved
Rahul Agrawal
(Querist)
18 January 2012
If WCT is applicable on a company, then how we will treat Service Tax on it..???
Will Service Tax will be applicable on it or not..????
If Service Tax applicability will be there on the company, what Rates of Service Tax will apply on such company..??
Are there any other terms and conditions regarding a company having WCT applicability and how Service Tax will be treated on that company..??
Plz. do Rply, Thanks.
Will Service Tax will be applicable on it or not..????
If Service Tax applicability will be there on the company, what Rates of Service Tax will apply on such company..??
Are there any other terms and conditions regarding a company having WCT applicability and how Service Tax will be treated on that company..??
Plz. do Rply, Thanks.
Hari Wadhwa
(Expert)
19 January 2012
Dear Rahul
The Supreme Court of India, in its various landmark judgments has explained the difference between a normal sale and an indivisible / composite works contract;
“In a contract of sale, the main object is the transfer of Property and delivery of the possession of Chattel as a Chattel to the buyer, where it is not so, it is a contract of Works & Labour” (Hindustan Aeronautics Ltd. 55-STC 314-SC).
Further, if WCT is applicable on contract, No separate service tax or VAT need to be computed on the same.
However, if the contractor chooses to maintain proper books of accounts & opt to pay VAT on the material value & service tax on the labour & other service portion, WCT would not be applicable, even in the case of indivisible contracts.
The Supreme Court of India, in its various landmark judgments has explained the difference between a normal sale and an indivisible / composite works contract;
“In a contract of sale, the main object is the transfer of Property and delivery of the possession of Chattel as a Chattel to the buyer, where it is not so, it is a contract of Works & Labour” (Hindustan Aeronautics Ltd. 55-STC 314-SC).
Further, if WCT is applicable on contract, No separate service tax or VAT need to be computed on the same.
However, if the contractor chooses to maintain proper books of accounts & opt to pay VAT on the material value & service tax on the labour & other service portion, WCT would not be applicable, even in the case of indivisible contracts.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Query on effect of registration of property
- Visiting card purchase
- GST on reimbursement of expenses
- Due date for filing return for the partner in partnership subjected to Tax Audit
- Number of years as per AS amortisation of Goodwill
- Equity Share Sale and Purchase
- Additional trade name
- Goodwill transfer of deceased father’s firm – ICAI applying a 27.04.2026 cut-off to the 3 year limit
- Whether output tax is taken credit by purchaser
- Wrong CMPo8 file
- Classification of income of P Ltd company as business or profession
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- "Please ensure that the Total of the Deductions u/s 54F match the same in Table D in Sch CG"
- Need to correct "Whether it is last installment " response in Form 26 QB
- " Income from House Property " in joint names of co-owners
- REGARDING TDS RETURN OF FORM 27Q
- Notice under e-Verification Scheme
- GST demand notice for ITC reversal against exempted supply.
- RCM ON SECURITY CHARGES FROM INDIVIDUALS
- How to get money back from delisted company
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
