Notification -25/2012

[Guest]

I would like to know that whether manpower services provided by the contractor in respect of maintenance of Effluent Treatment Plant at factory is exempt from service tax under reverse charge mechanism ?

[Ganeshan Kalyani]

The service provided by you is manpower supply and the factory management is utilising the supplied manpower for upkeep of effluent treatment plant. Thus supply of manpower service provided by you is not exempt from tax. However the service provided by a common effluent treatment plant operator for treatment of effluent is exempt from service tax from 01.04.2015.Thus you are not covered under the said exemption.

[Rajagopalan Ranganathan]

Sir,

Sl. No. 43 of Notification No. 25/2012-ST dated 20.6.2012 as amended (with effect from 1.7.2012) states that "Services by operator of Common Effluent Treatment Plant by way of treatment of effluent" is exempted. This means treating effluents is exempted service. However man power services which utilised for treatment of effluents is not exempted from service tax. In my opinion any service provided to execute an exempted service is not exempted from service tax unless it is specifically provided by exemption Notification.

[KASTURI SETHI]

I endorse views of both experts. Well interpreted and accurately conveyed the essence/message of 'Manpower Supply' and Notification No.25/12-ST by both Sh.Ganeshan Kalyani, Sir and Sh.Rajagopalan Ranganathan, Sir

[Ganeshan Kalyani]

Thanks Kasturi Sir for your appreciation.

AI Summary

Manpower supply taxability: manpower provided for in-house ETP maintenance remains taxable, not covered by CEPT operator exemption. Manpower supply for maintenance of a factory's Effluent Treatment Plant is taxable as manpower services and is not covered by the exemption granted to operators of Common Effluent Treatment Plants for treatment of effluent; services undertaken to execute an exempted service are not themselves exempt unless explicitly stated in the exemption notification.