Service tax and excise on Ready Mix concrete

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

12 January 2011 Dear All,

What are the taxes and duties applicable on RMC (Ready Mix Concrete?

Present our RMC supplier charging state VAT in his bill. We asked him to install plant at our construction site and then we will buy and supply all material needed for concrete mix to him and we will pay service charges to him along with service tax applicable.

My question is my approach is correct? As State VAT exemption is there for our plant, no input tax for us. In this situation how can we avoid state sales tax? Can we go for service contract with him?

Please give your valuable suggestion?

Thanking you,
Swamy.K

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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12 January 2011 In case of VAT , always write the name of state.

You can take the service by supplying the material and after job work sold in the market.

Yes you have to go for service contract in this case.

Querist : Anonymous

Querist : Anonymous (Querist)

13 January 2011 sir, thanks for your reply.

I am from Vizag, A.P, present on purchase of RMC we are paying VAT/sales tax @ 14.5% on sale bill. He is not charging excise duty in his sale bill.

As we can't claim any input tax on VAT/sales tax paid, we are planning to enter a service contract with him.

Suppose, after entering RMC service contract, if he supplied any material like cement etc. along with service, can he claim exemption in his service bill for goods supplied along with service as per service tax act.

Plese explain sir,
Swamy.K

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