TaxTMI 
TaxTMI 
Sir
If our Factory Building is constructed by us then we are liable to pay Service Tax or not.
Please inform me at earliest.
With thanks and regards
Samik Chaudhuri.
Service Tax on Civil Construction
05 Feb 2015 
3 Replies 
2563 Views Asked by
Service tax on construction: taxable when rendered by a contractor, and service tax credit not available for works contract inputs.
Construction executed by a contractor constitutes a taxable construction/works contract service and attracts service tax, whereas self construction by the owner (without engaging a contractor) is not treated as a taxable service. Under Rule 2(l) of the Cenvat Credit Rules, 2004 the service portion of works contract and specified construction services used for constructing a building or laying foundations for capital goods is excluded from input service; hence service tax paid on such works cannot be claimed as input/Cenvat credit. (AI Summary)
Construction executed by a contractor constitutes a taxable construction/works contract service and attracts service tax, whereas self construction by the owner (without engaging a contractor) is not treated as a taxable service. Under Rule 2(l) of the Cenvat Credit Rules, 2004 the service portion of works contract and specified construction services used for constructing a building or laying foundations for capital goods is excluded from input service; hence service tax paid on such works cannot be claimed as input/Cenvat credit. (AI Summary)