We are dealing in aluminium fabrication work and getting work contract from our clients for the project like commercial, residential, industrial, institutional, hotels etc.. In India we got the information that some fabricators are doing this activity under service tax and some are under excise.
As specially we are getting the contract for Aluminium Doors, Windows, Partitions, Glazing, Cladding etc. and working as per the client's requirement and specifications. We make the particulars some times at party's site and some times under our premises.
For this kind of projects 1st we get the work order from the party and than as per their requirement and specs. we procure the material and than do cut the aluminium sections. Than after we assamble the material. To assamble we required the materials like Aluminium Sections, Glass and hardware materials. And for all these we give the job work to labour contractor.
Now our question is that is this activity under service tax or excise?
Thanking you and waiting for your reply and very oblidge for the same.
Section 65 (105) (zzzza) (Works Contract Services) of the Finance Act 1994 is adequately covering the works contract which has been explained by you.
It is true that Chapter 76 10 and 83 02 of Central Excise Tariff Act 1985 cover your process under Central Excise. But your work is not just production of doors/windows using aluminium etc in a regular manufacturing process.
But it involves a work on civil structure or a part thereof primarily for commerce or industry. Some times it could be for existing buildings too, as repair/alteration/renovation or similar services.
Hence yours is a Works Contract service. But if you can give details of your annual turnover tax planning could be thought of, since excise and service tax are STRICTLY 'mutually exclusive'.
CAclubindia
