TaxTMI 
TaxTMI 
TaxTMI 
Category - 'telephone cable' and applicability of service tax
sunil mehta
Dear Sir, A company gets work-order to lay down 'telephone cables' underneath the road surface in different areas.The 'tel.cables' and machinery for digging are supplied by the main service receiver. 1)The company has to 'dig' out the road surface(excavate the ground) 2)& then it lay down the telephone cables at a predetermined depth under ground 3)and then re-surface' it('back-filling' of earth mud) after job is over. service receiver pays the company on the basis of 'length kms.'work completed.Machines used in 'digging'/resurfacing ' road is supplied by service receiver. or taken on hire by the company. Note:The rates quoted for both the work i.e.excavation of earth (for cable laying) and actual laying of cables & back-filling of earth are separately given in work order. The company either(i) employs its own labour or(ii)It takes labour work force from labour supply contractor or(iii)Sub-lets part of the work to another contractor. Query:1)Under which category the work of : a)excavation work i.e digging of earth/road will be covered/ b)actual cable laying under ground and 'back-filling' of earth work will be covered? c)what about ser.tax applicability to sub-contractors(may be 2 or 3sub-contractors)?
Clarification Sought on Service Tax for Cable Laying and Subcontractors Under Erection, Commissioning, and Installation Services A company received a work order to lay telephone cables under roads, with equipment and machinery provided by the service receiver. The tasks include excavation, cable laying, and back-filling, with payment based on completed length. The company may use its own labor, hire workers, or subcontract. The query seeks clarification on the service tax category for excavation and cable laying, and tax applicability to subcontractors. One reply categorizes the service under 'Erection, Commissioning and Installation' services, indicating subcontractors are not exempt from service tax. Another reply suggests service tax is not applicable for cable laying, citing legal precedents and a departmental circular. (AI Summary)
