Repair of Building and Service Tax

[Ashok Chopra]

Respected Forum,

I am manufacturer-exporter of ready made garment. I have done repair of building. Building material supplied by me to labour contractor. labour contractor with own and two-three workmen done the labour job. During audit, officer is of opine that this is work contract and i am liable to pay service tax under reverse charge mechanism.

Please guide me accordingly.

Thanks and regard

AI Summary

Manufacturer Seeks Clarity on Service Tax for Garment Repairs: Works Contract or Labor Service? Opinions Vary. A manufacturer-exporter of garments sought advice on whether repairs done by a labor contractor, using materials supplied by the manufacturer, qualify as a works contract liable for service tax under the reverse charge mechanism. Various forum members provided differing opinions. Some argued it was a works contract subject to partial reverse charge, while others contended it was purely a labor service, with the contractor responsible for the tax if the exemption threshold was exceeded. Another suggestion was to consider paying the tax to avoid litigation, despite differing interpretations of the service classification.