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service tax aplicability

Queries 617 views 2 replies

Mr.x's business profile in a lay man language:
He purchases every material required in building repair work + purchases bathroom sanitary materials.
He has labours on wage basis and simply performs the building repair works with the purchased materials employing his waged labours.

His Gross-turn over come to 30-35 lakhs & and after deducting allowable exps, his net profit comes to 3-4 lakhs. he files only income tax return,   Experts told that he is liable for service tax. I am new to service tax.

Q. service tax limit depends on turnover or net profit.

Replies (2)
Originally posted by : john


Mr.x's business profile in a lay man language:
He purchases every material required in building repair work + purchases bathroom sanitary materials.
He has labours on wage basis and simply performs the building repair works with the purchased materials employing his waged labours.

His Gross-turn over come to 30-35 lakhs & and after deducting allowable exps, his net profit comes to 3-4 lakhs. he files only income tax return,   Experts told that he is liable for service tax. I am new to service tax.

Q. service tax limit depends on turnover or net profit.

Dear John,

Please examine the entries under commercial construction, complex construction, erection installation and commissioning and works contract. It appears that you client may fall in WC ( wef 1.6.2007) where the initial exemption is only for Rs.10 lakhs that also where the previous years turnover is less than 10 lakhs. If doing individual houses then there maybe an exclusion. Otherwsie appears to be liable.

Sir Madhukar N Hiregange

its my pleasure to have reply from you

sir if suppose his work covers 50% residential BLDGs, CHS   &  50% commercial, or say 80%-20% respectively, than we need to consider only the commercial portion accountable for service tax.?

thanks in advance.


CCI Pro

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