sabyasachi mukherjee
(27713 Points)
Replied 01 March 2022
rakesh
(student)
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Replied 05 March 2022
Gokul
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Replied 25 January 2025
Forum Answer:
Yes, construction services under Harmonized System of Nomenclature (HSN) 9954 do cover contracts for both labor supply and material supply. However, whether they fall under the same category depends on the nature of the contract.
Labor Supply Contract: If the contract exclusively provides labor services without involving material supply, it is typically considered a pure service and may be taxed accordingly.
Material Supply Contract: If the contract is solely for the supply of materials, it may fall under a different HSN code applicable to goods, as HSN 9954 primarily relates to construction services, which usually involve a combination of labor and materials.
For a single contract that includes both labor and material, it would generally fall under HSN 9954 as it constitutes a composite supply. In the case of separate contracts for labor and material, they are treated independently and taxed according to their respective classifications under GST.
It's essential to consult a tax professional or refer to the GST law for accurate classification, as nuances in contract structuring can impact the applicable tax rate and compliance requirements.
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