SERVICE TAX ON LABOUR CHARGE

[Rajeev Khulbe]

GOOD EVENING SIR,

WE WAS GIVE TO CONTRACT FOR NEW CONSTRUCTION.CONTRACTOR SUPPLY ONLY THEIR LABOUR. MATERIAL SUPPLY BY US.SIR TOTAL LABOUR CHARGES AMOUNT IS 14 LAKH. SIR MY QUERY IS THAT WHO WILL DEPOSIT SERVICE TAX ON IT. WILL SERVICE TAX DEPOSITED BY AS PER FOLLOWING MANNER

SERVICE PROVIDER SERVICE RECEIVER

50 %

AI Summary

Service Tax Responsibility in Labor-Only Construction Contracts: Provider Pays Entire Tax, Unlike Split in Works Contracts. A discussion on a forum addressed the responsibility for depositing service tax on a labor-only construction contract with charges amounting to 14 lakh. The consensus among participants was that in a pure labor contract, the service provider is responsible for paying the entire service tax. This differs from a works contract, where both materials and services are provided by the contractor, requiring a split of the tax payment between the service provider and the receiver. One participant noted a pending adjudication in the Apex Court regarding the inclusion of materials supplied by the service recipient.