SARMA (PROFESSIONAL) (32 Points)
26 March 2009ONE WOODWORK CONTRACTOR MADE A TABLE CHARGED Rs.100/- FOR MATERIAL AND SERVICE CHARGES PLUS SERVICE TAX. IS IT IS RIGHT TO CHARGE THE SERVICE TAX ON BOTH SERVICE CHARGES AND MATERIAL COST. AS PER THE AGREEMENT HE IS TO BE SUPPLY A TABLE FOR Rs.100/-
Ex. TABLE COST = 100
Ser.Tax 10.3% = 10.3
TOTAL COST = 110.3
IS IT RIGHT TO PAY THE SERVICE TAX ON BOTH MATERIAL AND SERVICE CHARGES ? AND HE IS NOT SEPERATED THE SERVICE CHARGES AND MATERIAL COST IN THE INVOICE.
satynarayan tiwar
(Professional)
(61 Points)
Replied 26 March 2009
If they are unable to separate disclosed material value and labour charges then your calculation is correct.
Rajesh Kumar
(Advocate- Tax)
(7806 Points)
Replied 27 March 2009
It is a transaction in goods, no service tax is payable.
Even if it is taken that it is a work contract, he can take abatement of 67% in value.
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