Manikanta (Accounts Manager) (9 Points)
25 May 2017A man installed the Computer systems in a place which is using for the conducting online examinations. The companies like(TCS,SIFY.etc) are giving contracts to the man saying this much systemd required for the examination. per system they will pay the amount. For invigilators and electricity amount will be reimbursed.
Let me know is it a works contract or purely service. and rate of tax applicable.?
CA Bhargav Nathwani
(CA in Practice)
(8307 Points)
Replied 25 May 2017
System are bought and installed by asseessee (i.e. Men) then it will be only service and not a works contract.
However, it should be noted that, For invigilators and electricity amount of reimbursed will be added to Gross amount of service.
in short following calculation will have to do for service tax:
Amount received per system XXXX
Add: Reimbursed from service reciver XXXX
Assessable value of service XXXX
Service tax @ 14% XXXX
SBC @ 0.5%
KKC @ 0.5%
Landmark Judgments: Important Provisions of the EPF & ESI Act interpreted by the Honorable Supreme Court of India
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