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Contractor service tax

Ksreddy (Md) (53 Points)

13 December 2013

Hello,

I am into a business which involves lot of earth work. I had employed a contractor to do a part of work and had paid him accordingly. I also deducted TDS on his payments and gave him TDS certificates. Now if he doesnt pay service tax, will I have any responsiblity of the same. As per my understanding my obligation is only till TDS and service tax is his responsibility as service provider. Please advise on same,

Regards,

k.s.reddy

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6 Replies

Arun Kumar Singh (GST Advocate) (15188 Points)
Replied 13 December 2013

Under the reverse charge system recipient will pay the service tax on work contract services on the value of 50% under Notification No. 30/2012-ST.

Ksreddy (Md) (53 Points)
Replied 13 December 2013

Dear Mr. Singh, Thanks a lot for your feedback. What is the date of this notification and what about the services availed before the date of this notification. Regards, Srikanth reddy

FCA FCS Neeraj Kr (Taxation Cum Auditing professional) (129 Points)
Replied 13 December 2013

For Work Contract Services Refer Notification No.24/2012. Services availed w e.f.1/7/12 are covered under the Reverse charge mechanism. Regards CA Neeraj

Piyush Agarwal (Manager(Accounts)) (29 Points)
Replied 14 December 2013

ST on contract services before 01/07/12 is payable by the service provider.

DIBYENDU (SERVICE) (266 Points)
Replied 16 December 2013

If the sevice is excavation of earth then it is purely labour job, not in works contract. if the labour/s engaged in earthwork under direct control & supervision of your contrctor i.e you pay bill your contyractor under quantity basis then it 's fail under Business Auxiliary service and service tax payment liability will be fail under the scope of your contractor but when the labours works under your control & supervision i.e you pay your contractor under daily head basis then it will fail under Manpower Supply Service & 75% of total service tax liability will be fail on your scope of liability.