Service Tax on labour contract for construction services

[NANDKUMAR SAGWEKAR]

Dear All Learned Members

Education institute registered as a charitable trust had undertaken construction of education complex consisting of office , guest house, gaints and ladies hostel, class room , laboratory rooms etc . The said trust is providing all materials like cement , steel, sand ,colour and contractor has to construct the building with materials. The per square feet rates are decided by trust and contractor mutually as per each type of work like plinth, slabs , walls etc.

In this case whether contractor is liable to pay the service contract before and after 30-June-2012 , or he is exempt from service tax upto 30-June-2012.

Views of members are invited.

 

Thanks

 

A M SHEMBEKAR

 

AI Summary

Service Tax on Educational Institute Construction: Applicable Post-July 1, 2012, Unless Exempted for Governmental Purposes. An educational institute registered as a charitable trust is constructing an educational complex and queries whether the contractor must pay service tax on the construction services before and after June 30, 2012. It was clarified that before July 1, 2012, service tax was not applicable to non-commercial constructions like educational institutes. However, post-July 1, 2012, service tax applies to all services unless exempted, and construction for educational purposes is taxable unless it is for the government or a governmental authority. The clarification was appreciated by the inquirer.