27 October 2010
We are engaged in EPC contract of Solar Projects. Activities Include Detailed Project Reports (DPRs), provide consultancy services to clients for setting up of Grid Interactive Solar Power Plants till the Final Taking Over of the project.
For the Above project we need to procure Materials from different part of the country and in some cases need to import them and then to Install them at project site. We are also makes arrangements for freight and insurance during construction.
We have offices in Gujarat, Karnataka & Haryana. Now we have taken up EPC contract at Haryana. The EPC contract covers the following services to be completed : • Procurement from one party and supplying to Contractee (This procurement is done interstate and also within Himachal) • Also procurement of Batteries(or some other part) can be done from Spain and supplied to the Party (Cotractee), Himachal. • Provide designing, engineering and construction services • Sub contract the EPC by dividing the whole project into different parts • Provide insurance of the workmen/material/project against any injury and/or damage and/or theft of material that may be caused. • Provide operation & maintenance services for 10 years.
For providing the above functions we faces following issues related to taxes: • Which are the Taxes Applicable [ VAT, CST, Customs, Service Tax , any other if any.] • How can we manage to pay lower taxes in case of interstate /within state of purchase ? [How can we save taxes] • If the material are imported, can we pass on the custom duty ? Can we claim Credit of it ? • Of the total contract value 80% material & 20% service part which method is much better for both Service tax as well as for VAT ? [Composition or other] • What kind of permissions are to be taken if we provides EPC services outside India?
12 February 2011
In an EPC contract, the EPC contractor (EPCC) agrees to deliver the keys of a commissioned plant to the owner for an agreed amount, just as a builder hands over the keys of a flat to the purchaser. The EPC way of executing a project is gaining importance worldwide. But it is also a way that needs good understanding, by the EPCC, for a profitable contract execution. An owner decides for an EPC contract for several vital reasons.
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