installation service, pure labour contract - JOB work - 12% or 18% - reg

[vivek kontact]

we are providing installation of equipments like, wiring of coaches, fitting of lights, fan etc in coaches and testing of coaches for coach to run the operations. all items and equipments are provided by Indian Railways and we with our technical skills, our people, and consumables, we execute the work. will this so called JOB WORK or services will fall under the definition of JW and what rate of tax shall be applicable, 12% or 18% w.e.f 01.10.2019. only after we finish our work, and further work by railway people, the coach manufacturing can be completed wholly. in erstwhile service tax, these job work services, was exempted under clasue 30(C) of notification 25/2012. any job worker or intermediary process, amounting to manufacturing activity........like that.

[PAWAN KUMAR]

Dear Sir,

As per my view since you are providing services of installation and fittings of equipments into coaches of indian railways, it is not the job work services. you may check the list of services under GST and as per my view 9954 with GST Rate 12% should be payable.

[vivek kontact]

tq pawanji. but if the services dont fall under JOB work, then it cannot be 12% tax. cos only for JOB work , rate of tax is reduced from 18% to 12% w.e.f 01.10.19.

NEXT, yes i feel our kind of work will fall under 995468, other installation srvice n.e.c, but should be 18%, as it is not job work.

Hope i m going right. still, dept is in dilemma as well.

[Atul Rathod]

Job work is 12% but that service also shall be manufacturing service on goods owned by others. I do not think, installation service can be called as manufacturing service in first instance. If the answer is no, rate shall be 18%.

[PAWAN KUMAR]

Dear Sir,

Domestic services also fall under 18% tax rate. the entry as specified by you n.e. also liable for 18%.

[YAGAY andSUN]

In our view also the rate of tax will be 18% since such services will not tantamount to manufacturing services, per se.

AI Summary

Tax classification of installation services likely treated as standard installation service, attracting the higher GST rate under revised rules. Installation and testing of supplied railway equipment performed using the supplier's labour and consumables raises whether the activity is job work (a manufacturing service on goods owned by others) eligible for the concessional job-work rate. The documented view is that such installation does not ordinarily constitute manufacturing service and should be classified as other installation services, thereby attracting the standard GST rate rather than the reduced job-work rate.