Service tax attract on bonus paid to labor contract and Leave pay

[Asked by Guest]

Dear Sir,

We are company labor contractor is a individual labor contractor raised invoice for yearly bonus and yearly leave pay with is yearly benefit and we paid to the contractor my question is whether on this yearly payment to contractor attract to service tax under reverse charge mechanism ?

If yes after paid we are eligible for Input Service tax credit or not ?

labor contractor provide labor for Hose keeping as well as gardening work so we paid the service tax on that so service tax eligible for input service on house keeping and gardening work ?

Regards

Swapneswar Muduli

[KASTURI SETHI]

Dear Sh. Swapneswar muduli,

You are a regular visitor of this forum. On this issue reply has been posted twice about two or three months back. You can yourself trace out reply or you may take help from TMI Officers in this context.No need to repeat.

[Ganeshan Kalyani]

Yes, I am also of the same view as submitted by Sri Kasturi Sir. There was a discussion on this topic in detail. You will get it from find option in the forum. If you do not find it, please let us know. Thanks.

AI Summary

Reverse charge on labour contractor payments questioned; forum refers to prior guidance on service tax and input credit applicability.
Whether annual bonus and yearly leave pay made by a principal to an individual labour contractor attract service tax under the reverse charge mechanism and whether the principal is eligible to claim input service tax credit for those payments and for contractor-provided housekeeping and gardening services are the central questions; forum replies merely refer to prior detailed discussions without providing a fresh substantive determination.