Relating to circular applicable to sub-contractors
This query is : Open
19 August 2011
A XYZ company gets a contract to built a 100 kms highway from NHAI – he in turn sub-contracts 25 kms of it to another contractor - ABC LTD on back to back basis and starts construction of the rest of the 75 kms by himself . SO IS ABC EXEMPT FROM SERVICE TAX?
IS THERE ANY SUCH PROVISION THAT ABC WOULD BE EXEMPT FROM SERVICE TAX ONLY IF XYZ SUB CONTRACTS 100 % OF THE CONTRACT TO ABC LTD? IF ONLY A PART OF CONTRACT IS SUB CONTRACTED, IS THE SUB CONTRACTOR LIABLE TO SERVICE TAX ?
IS THERE ANY SUCH PROVISION THAT ABC WOULD BE EXEMPT FROM SERVICE TAX ONLY IF XYZ SUB CONTRACTS 100 % OF THE CONTRACT TO ABC LTD? IF ONLY A PART OF CONTRACT IS SUB CONTRACTED, IS THE SUB CONTRACTOR LIABLE TO SERVICE TAX ?
19 August 2011
CBE&C circular No. 138/7/2011-ST dated 6-5-2011 speaks about the latest position on such issues. Construction of road is an exempted service. Therefore, contractor as well as sub contractor is exempted from service tax.
19 August 2011
Dear Sir,
Thank you very much. Further i would like to know that if the contractor is receiving Rs 100 and he sub contracts the same for Rs 80, is he liable to service tax on the diferrence of Rs 20/- ??
Thank you very much. Further i would like to know that if the contractor is receiving Rs 100 and he sub contracts the same for Rs 80, is he liable to service tax on the diferrence of Rs 20/- ??
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