Work contract
This query is : Resolved
22 February 2014
Whether Construction of Factory is Covered under Work Contract?
Service provider Is Firm
Service Receiver is PVt Ltd
We Service receiver (Pvt Ltd) said Reverse Charges mechanism applicable So Service tax Liability shared by us 50% Only you Should Coliect of (40% of total bill Value)
but Firm (Service provider) Saying that we not collected vat in this bill .So we wii collect entire portion (4.94% of Bill value)
kindly clarify pls
Whether Construction of Factory is Covered under Work Contract?
Service provider Is Firm
Service Receiver is PVt Ltd
We Service receiver (Pvt Ltd) said Reverse Charges mechanism applicable So Service tax Liability shared by us 50% Only you Should Coliect of (40% of total bill Value)
but Firm (Service provider) Saying that we not collected vat in this bill .So we wii collect entire portion (4.94% of Bill value)
kindly clarify pls
24 February 2014
Argument given by Service Provider is baseless. Both VAT and Service Tax will be chargeable subject to taxable turnover of service provider.
Service recipient Pvt. Ltd . company will be liable to pay 50% portion of service tax and balance 50% service tax by service provider.
Service recipient Pvt. Ltd . company will be liable to pay 50% portion of service tax and balance 50% service tax by service provider.
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