In works contract i hav followibg doubts
1.When a bill is issued showing onlu aggregate of value of goods and service. What is the procedure to bifurcate goods and service ? Especially how is labour element identified small small job works like repairs. Whether an OH Absorption rate will do?. What is the treatment of GP included in gross bill?
2. If the final product of the works contract is covered under VAT Schedule then whether the full bill amount including labour and other service element is chargeable to VAT? (here bill is not bifurcated into labour and value of goods)
3. Under service tax law when VAT is paid on actual value of goods, such value is deductible while computing value of service. If so, then in Question 2 above since VAT is paid on full bill amount there will not be any service element. Is this logic correct
CAclubindia
