valuation i.r.o.service tax on construction service.

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Dear sirs,

If construction service provided by a contractor of a builder does not come under definition of works contract because of non compliance of sales tax, then in this case how will the valuation for S.T be calculated w.e.f. 2012. I think Valuation Rules,2006 is silent over this aspect.After all,the contractor should not be charged s.t on the material portion of the construction.where can i find the provision of valuation in such case.

AI Summary

Contractor Faces Service Tax Valuation Issues; Experts Recommend Using Notifications No. 24/12-ST and 30/12 for Guidance A contractor providing construction services is facing issues with service tax valuation due to non-compliance with sales tax provisions, which disqualifies the service from being considered a works contract. The Valuation Rules, 2006, do not address this situation. Experts suggest using Notification No. 24/12-ST and Notification No. 30/12 to determine the service tax on the service portion. They argue that sales tax payment is not a prerequisite for works contract classification, and retrospective amendments provide alternative valuation methods. The contractor seeks advice on obtaining a rebate for material costs without full sales tax compliance or a written contract.