Works Contract Service

[Asked by Guest]

Dear Sir,

Please explain us whether Service provider can charge Service tax 50% i.e 7% on full value and 50% under not any category i.e 40% or 70% of works contract service i.e 7% service tax liability of us as a Service receipent. Therefore please explain us whether he has rightly charged. Pls give us any references regarding this. Thanks & regards.

AI Summary

Works contract service reverse charge: recipient must pay its share when supplier fails to charge, AMC uses higher service valuation.
Works contract services attract a split service tax liability under reverse charge: the service portion of contract value varies by type (original works lower; other than original works including AMC higher), tax is computed on that service portion, and where the supplier does not charge tax the recipient must adopt the standard valuation and pay its reverse charge share in cash while claiming input credit as permitted.