Service tax on Works contract-reg

[N Balachandran]

 

Sir,

When we execute the Turnkey contract ( EPC contract ) and the price for each activities are given seperately like; Design Engg, Supply, Erection and Civil works.   Can we opt the  payment of service tax under composition scheme only for Civil Works and remit the service tax @ 10.3% on Design Engg and Erection.?. 

My understanding is that, once the tax payable under composition scheme,  we have to pay @ 4.12% on the  Total value of the contract includes Design, supply , erection including civil works.  Civil works alone not eligibile for Composition scheme.  Is it correct?.

Pl clarify. 

N.Balachandran

AI Summary

Composition scheme applicability to works contracts: cannot be confined to separately priced civil works and applies to total contract value.
A works contract is treated as a single taxable service for composition purposes when its gross value includes the value of all goods used in or in relation to execution, so the composition levy cannot be applied only to a separately priced civil-works line item where design, supply or erection form part of the same integrated contract.