Turnover for works contract

Source : https://220.227.161.86/21025guide_44AB_dtc.pdf

According to Note (i) of the Guide to Company Audit  issued by the Institute

Note (i) The term ‘turnover’ would mean the total sales after
deducting therefrom goods returned, price adjustments, trade
discount and cancellation of bills for the period of audit, if any.  
Adjustments which do not relate to turnover should not be made e.g.
writing off bad debts, royalty etc.  Where excise duty is included in
turnover, the corresponding amount should be distinctly shown as a
debit item in the profit and loss account.”

5.6  The term ‘turnover’ for the purposes of this clause may be
interpreted to mean the aggregate amount for which sales are effected o
services rendered by an enterprise. If sales tax and excise duty are
included in the sale price, no adjustment in respect thereof should be
made for considering the quantum of turnover. Trade discounts can be
deducted from sales but not the commission allowed to third parties. If
however, the Excise duty an / or sales tax recovered are credited
separately to Excise duty or Sales  tax Account (being separate accounts
and payments to the authority are debited in the same account, they
would not be included in the turnover. However, sales of scrap shown
separately under the heading ‘miscellaneous income’ will have to be
included in turnover.

(Read whole para 5  Pg. 27 for more details)

Therefore the cost of material can not be deducted from turnover.