Service tax on general repairs

Hi Gunasekar,

General Repairs, (which doesn't involve any material) will not be covered under Reverse Charge Mechanism (RCM).

In case, where there is involvment of material along with the provision of service, then it becomes works contract service. 

Only if the service provider is any one of the following catagories - 

1. Individual
2. Partnership Firm
3. Hindu Undivided Family (HUF)
4. Association of Persons (AOP)

and service receiver is the business entity registered as body corporate, then only reverse charge attracts on such work contract services.

Further, when reverse charge attracts, Rule 7 of Point of Taxation Rules, 2011 will be applicable.

point of taxation in respect of the persons required to pay tax as recipients of service under the rules made in this regard in respect of services notified under sub-section (2) of section 68 of the Act, shall be the date on which payment is made:
 

Provided that where the payment is not made within a period of three months of the date of invoice, the point of taxation shall be the date immediately following the said period of three months

In your case, as service tax is paid on invoice value. Then, not required to pay service tax once again on the material value.

Hi Uday Kumar,

Thanks....

Please clarify if RCM will applicable for the following:

If the invoice descripttions showing, this is the purchase of spares / materials means?

If no labour only spare part / material charges?

If only labour bill?

.