Works contract

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sushant gurav (Querist)
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01 November 2013
Sir,
We are a pvt ltd company and we got a works contract from a well known limited company.

The work is for building a play ground/ mini stadium. We have deployed our machineries etc for excavation work and some workers for construction work. The contract is for 3 crores inclusive of all material and services.

so my question is whether service tax is applicable on construction i.e works contract. if yes, then how do you compute the service tax liability .
kindly use imaginary figures for reference.

AND Whether cenvat can be claimed.. with show some examples...

thanks sushant

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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01 November 2013 Yes,on this type of works contract also ST is aplicable.You have to take payments received on all services,like crane/earth mover charges,labour charges paid+profit,consultancy charges etc,other than the value of material used in the works e.g.cement,bricks,steel,timber etc.Such amount calculated is the taxable amount of ST @ 12.36%.....mjk