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St liability on job work services under reverse charge

Bal Mukund Thakur (Assistant Audit Manager) (34 Points)

17 January 2013

Is there any liability for the company to deposit Service Tax on Job Work Services (received from individual) under Reverse Charge Machanism? If Yes then @ what Rate company should deposit ST on it. Plz reply......

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4 Replies

PARMITA MAZUMDER (CA- Practice) (386 Points)
Replied 17 January 2013

JOB worker services is not covered under reverse charge. But can you tell me what exactly is he doing?

1 Like

shikhar (LEARNER ) (1394 Points)
Replied 17 January 2013

No service tax is payable by job-workers on processes amounting to manufacture'.........

1 Like

vittakaushik (articles) (71 Points)
Replied 18 January 2013

In Job work if it a pure labour or service charges it does not become a works contract and accordingly reverse charge mechanism is not applicable.

However in some cases the Job worker may put some material on his own on the material supplied by us for completing the work.In such case he charges vat also as there is transfer of property.This may qualify as works contract as the revised definition of works contract covers movable property also.

If the job work qualifies a works contract and the service provider is non corporate entity reverse charge mechanism becomes applicable.

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Amrit Bhattarai (1 Points)
Replied 01 September 2016

Whether RCM and WCT is applicable if invoice mention JOB WORK only and output doesnt amounts to Manufacture ?? Service is done on Factory of client , no own material is used, and invoice raised by party (without VAT and service tax ) ??