Service Tax Credit on Construction Consultancy Charges

[Bhairob Chandra Bor]

Dear Expert,

we are under the construction of a factory cum office building . Basement, Ground and 1st Floor for Factory and 2nd floor for office. we are not available service tax credit on the construction bills. Kindly advice for the following:

1. are service tax credit available on Architect Fee, Electrical and Interior design consultancy etc.?

2. are service tax credit available on charges on electrical fitting, ac installation and other charges, if separate contract are given for the factory part and office portion ?

3. also advice if separate contracts are given to a same supplier for supply of materials and erection/installation then are service tax liable for materials also (materials are supplied along with applicable tax rates) ?

4. is the labour cess applicable for construction of factory building also? like in our case?

Kindly advice.

kind regards,

bcb

AI Summary

Service tax credit eligibility limited to modernization/repair; supply contracts not taxable and labour cess applies.
Services for setting up a new factory or office are excluded from CENVAT credit as input services, whereas separately procured services for modernization, repair or maintenance of factory or office premises are eligible for credit; separate contracts for supply of materials are treated as supply-only (not subject to service tax) while service/erection contracts are taxable; labour cess is applicable to the construction activity.