Chargiability of service tax - construction service – commercial or industrial service

[Vijay Chitte]

One of our service provider providing service in the catergory of construction service – commercial or industrial service to us, in our case, we have contract that all the material (i.e. cement, still etc.) will be supply by our company. Question is: Can service provider charge the service tax (33% on gross amount) on services and material also, if materials supplied by the clients? Or Service tax charge only on construction services? Any one can provide me any case law?

AI Summary

Debate on Service Tax: Charge on Construction Services or Include Client-Supplied Materials? Consider WCT and VAT Options. A query was raised regarding the applicability of service tax on construction services, specifically when the client supplies materials like cement and steel. The question was whether the service provider can charge service tax on both the services and the materials provided by the client, or only on the construction services. A respondent suggested two approaches: either apply a 12.5% Works Contract Tax (WCT) on the total amount or charge VAT on the materials and service tax solely on the construction services.