Work Contract Tax

[MANOJKUMAR MUKHIJA]

(a) What is Work Contract Tax and what are the works and services covered under Work Contract Tax in Jammu.

(b) Recently my company invited the tender for SITC of batteries in Jammu. In the tender document, it was clearly written that the work is for Supply, Installation, Testing and Commissioning of Batteries which includes replacement of old batteries. After completion of the work, the party submitted their bill and was contesting that no WCT is to be deducted as they have supplied the batteries and they have not charged any amount for their services.

My question is whether WCT is to be deducted on such supply where the tender condition clearly says that the work is SITC and party after going through the tender document has submitted their offer.

Party's contention also seems to be right because they have supplied the batteries as the end product.

Please reply at the earliest because I have to clear the payment.

AI Summary

Dispute Over Work Contract Tax Deduction for Battery Supply and Installation Contract in Jammu A company in Jammu issued a tender for the Supply, Installation, Testing, and Commissioning (SITC) of batteries, including the replacement of old ones. After the work was completed, the contractor argued that Work Contract Tax (WCT) should not be deducted since they only charged for the batteries, not the services. The forum discusses whether WCT applies, noting that VAT applies to materials, and service tax is not applicable in Jammu & Kashmir. Despite differing views, one contributor concluded that WCT should be deducted as SITC implies a taxable service component.