Expert’s Opinion are Invited:
Company XYZ Pvt Ltd. (A manufacturing unit) has got an Invoice for Reparing Work (Construction) done for its Godowns, for Rs. 100000.
Is Company liable for any Service Tax ? If yes, for what amount ?
1 Replies
Nirav Worah
(CHARTERED ACCOUNTANT)
(396 Points)
Replied 01 June 2013
Reverse charge would apply if it is a works contract and service is received from an individual, HUF or a partnership firm.
If it is a pure service contract, then reverese charge would not apply. However, if there is transfer of property in execution of contract it will be works contract and covered under other works contarct. Under works contract if service receiver is individual. HUF or partnership then reverse charge would apply and service receiver and service provider both are required to discharge 50% of the service tax liability.
Abatement at the rate of 40% is available under other works contract. [Notification no 24/2012]
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