Service Tax on Labour Charges

[Asked by Guest]

Sir,

Our is LLP firm engaged in iron & steel fabrication work for turnkey projects.

We have engaged one fabrication unit (proprietor) to do some fabrication work, we supply material to them for fabrication [after that we directly transferred that fabricated structure to our turnkey project location]

That unit charges us by giving bill of labour charges only. So the question is whether service tax is chargeable under RCM?

Also if yes, in any case, can we shift the burden of service tax payment on service provider?

Note : All design for fabrication work was provided by us, but all labour work under direction of service provider only.

AI Summary

Reverse charge applicability: services from individuals to LLPs do not trigger reverse charge; provider must discharge service tax.
Under Service Tax Rules a limited liability partnership is treated as a partnership, so services from an individual proprietorship to an LLP do not attract the reverse charge applying to services to a body corporate; the individual provider must charge and discharge service tax unless law specifically casts liability on the recipient, and contractual allocation of payment does not change statutory liability.