service tax or vat or excise and which service

[PRAJAPATI JAGADISH]

SIR we are furniture manufacturer and work contractor for making furniture and in following cases what is applicable (i.e. service tax VAT Excise Duty) and situations are following
1. own material and make furniture thereafter sold to customer.
2. own material and entered into a contract for making furniture (movable) on their sites.
3. own material and entered into a contract for making fixtures (immovable) on their sites.
4.Material provided by other party and labour provided by us and furniture is movable.
5. Material provided by other party and labour provided by us and fixtures is immovable.

[YAGAY and SUN]

On point No. 1 VAT/CST will be applicable.

On Point No 2, 3 WCT under VAT Act on material and Service tax under WCT Service will be applicable.

On Point No. 4 Service Tax on WCT service will be applicable.

On Point No.5 VAT and Service Tax both will be applicable.

[PRAJAPATI JAGADISH]

thanks but i have stills a confusion regarding service tax that we only provide labour so under which service it will be taxable

[YAGAY and SUN]

Under Works Contract Services.

[PRAJAPATI JAGADISH]

again tanx but if there is no contract between the parties than what will be applicable in earlier situations and  we provide only labour the under which service it will be taxable

[YAGAY and SUN]

On labour charges you would have to pay the service tax.  Kindly check the Works Contract Services in details.

[sanjeev bajaj]

I am not clear, how VAT is leviable in point no. 5.  As there is no transger of property in goods as the same belongs to the owner

[YAGAY and SUN]

Under Composition Scheme as applicable w.e.f. 01-04-2013 VAT(WCT) will be applicable.

[sanjeev bajaj]

Option of composition is different matter.

Suppose I am not a composition dealer, than in normal course, no vat leviable.

[YAGAY and SUN]

Facts, Nature and scope of work would determine the taxability of VAT (WCT), Service etc.

[S S KONAR]

Applicability of Taxes will be as under:

For Sl No.

1. VAT or CST according to the nature of sales   (This is is a case of sale of goods)

2. VAT and Servise Tax both are applicable. In both case abatement is available (This is a case of Works Contract)

3.                                     DO

4.Only Service Tax is applicable. (This is a case of laboure contract)

5.                Do

 

AI Summary

Works contract services: labour-only and on-site furniture contracts attract service tax while sales of finished furniture attract VAT.
Tax treatment depends on whether the transaction is a sale of goods, a works contract, or a labour-only service and on material ownership. Sales of finished furniture made from contractor's own materials attract VAT/CST. On-site contracts using the contractor's materials to produce movable furniture or install fixtures typically fall within Works Contract Services and may attract service tax and works-contract taxation with possible abatements. Where the customer supplies materials and the contractor supplies only labour, service tax on labour/works-contract services generally applies; VAT is not normally leviable unless transfer of property or composition rules make VAT applicable.