Works contract
This query is : Resolved
20 December 2012
We manufacture speciality chemicals used for cleaning metals. We have recieved a purchase order for rs.1 lakh from our client for cleaning silver articles at his place.We do the cleaning work using our chemicals and outside manpower. We cannot raise seperate invoice for labour and the chemical used by us.pl advice whether
1.I have to pay service tax or vat. If so on what amount
badly in need of your suggestion.
kindly help
thanks in advance
1.I have to pay service tax or vat. If so on what amount
badly in need of your suggestion.
kindly help
thanks in advance
21 December 2012
Hi Venkatesh,
"works contract" means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such property;
Your Case: In personal view when the goods delivered as consumables then it is not works contract , hence liable to tax labour contract, you are using chemical as consumables not transferring it to the customer.
Thanks
"works contract" means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such property;
Your Case: In personal view when the goods delivered as consumables then it is not works contract , hence liable to tax labour contract, you are using chemical as consumables not transferring it to the customer.
Thanks
24 December 2012
i agree with Kausik sir.
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