Category - Labour supply

[sunil mehta]

A proprietory firm supplies labourers to a developer for civil construction work relating to resi./comm.activities. Query:(a)whether the above services will fall under 'construction of....' or 'Manpower recruitment.....'? The proprietoir raises the bill as follows: Unskilled workers.....15000/ Supervisors..... 5000/ Management chgs........4000/(20% of 20000) Service tax @12.24%... 2938/ Total.................26938/ (b)Whether above billing is correct? Thanking you,

[Surender Gupta]

Apparently the service is falling in the category of "Manpower recruitment service. However, details analysis of contract terms and circumstances would guide us the correct situation.

[Madhukar N Hiregange]

This is clearly a manpower supply and not a construction activity since the responsibility of construction is with the customer. The method of raising bill is propeor excpe tthat the ST and EC should be disclosed separately.

AI Summary

Manpower supply classification: personnel provision typically treated as manpower recruitment service, with tax components shown separately. Where a developer retains responsibility for execution and outcome, provision of workers and supervisors by a proprietorship is characterised as manpower recruitment/supply rather than a construction service; classification depends on contract terms and factual control. Invoicing should itemise labour categories and separately disclose statutory tax components rather than aggregating them with service charges.