Work contract - reverse charge

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Arihant (Querist)
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24 August 2013 If two separate bills are raised for a work done, one for material and one for labor, can the reverse charge liability of service tax be avoided for work contract as first can be treated sale from that party and second can be treated as pure labor contract with that party and since pure labor contract are outside the purview of reverse charge for work contract and only a contract in which VAT paid material is also transferred along with the labor are covered ?

CA Suresh Jain

CA Suresh Jain (Expert)
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24 August 2013 If it is not a naturally bundled service this planning could within the four cornors of the law and the service tax under RCM could be avoided but service tax shall have to be paid by the service provider

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