Construction Services / Commercial or Industrial Construction Services — Instructions

Construction of complex service: builders, contractors subject to service tax when activities constitute works contracts, taxable on gross charges

Service tax applies to construction activities where statutory definitions and judicial pronouncements treat builder undertakings for prospective purchasers as works contract or taxable services rather than sale. For Construction of Complex Service, builders and contractors can both be liable as independent service providers. Taxable value is the gross amount charged by the service provider, inclusive of goods and materials, subject only to the prescribed abatement on the gross amount and no other deductions in composite contracts.