Individual labour contractor provides labour component only (without material) to a company for more than Rs. 1000000/-. (1) What is the liability of company . (2) What is the liabliry of contractor. Please give expert opinion.
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Service tax on labour work
Replies (2)
Stat liab:
If contractor is not company,
if supervisor of labour is contractor only then contractor is liable for stax. Otherwise stax reverse charge for manpower supply.
For esi also company is liable however company can make contract with contractorand trnsfr its liability.
Also compaany is liable to deduct tds @ 1% for indi and huf & 2 % for othersl
In my opinion the contractor performing labour portion of contract will not amount to "supply of manpower service" since he retains the control over his workers.
K. Damodarareddy Vs.CCE [2010] 25 STT 69]
Ritesh Enterprises Vs. CCE [(2010) 24 STT 283]
As per Service Tax Rules, “supply of manpower” means supply of manpower, temporarily or otherwise, to another person to work under his superintendence or control
Hence reverse charge provisons are not applicable and contractor will be liable to pay service tax.
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