TaxTMI 
TaxTMI 
Applicability of GST on manufacturing activity done by contractor
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....pplicability of GST on manufacturing activity done by contractor<br> Query (Issue) Started By: - MohanLal tiwari Dated:- 19-12-2018 Last Reply Date:- 21-12-2018 Goods and Services Tax - GST<br>Got 8 Replies<br>GST<br>Dear Panelists, We are manufacturer of castings / machinery parts (mainly for Railways) falling under 8607. In our factory premises, we are providing all required materials, machiner....
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....y & equipment etc and getting in-process manufacturing activities done through contractors for various operation like molding / finishing / machining etc. During Excise & Service tax regime, such services were not attributable to service tax. Now, most of contractors are GST compliance and issuing invoices charging GST @18% which is getting accumulated with us by way of ITC. Kindly advise how fa....
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....r it is correct to charge GST for in-process manufacturing activities getting done by the contractors. Also advise remedy to avoid charging GST as the ITC is getting accumulated with us. Reply By KASTURI SETHI: The Reply: In my view, it is a case of Man Power Supply. Contractor is supplier. Manpower is no more under RCM. Reply By MohanLal tiwari: The Reply: Dear Kalyani sir, Thanks for your ....
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....suggestion, but in our case its not labor supply contract. The contract is for in-process manufacturing operation. We really want to avoid applicability of GST. Kindly suggest. Reply By KASTURI SETHI: The Reply: Dear Querist, Has Contractor not supplied labour to your factory ? Whatever purpose may be. Reply By KASTURI SETHI: The Reply: Supposing it is job work, even then it is taxable as und....
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....er GST job work is taxable supply of service. In pre-GST era, Central Excise duty was leviable depending upon the nature of processes. GST cannot be avoided in any situation. Reply By MohanLal tiwari: The Reply: Dear Sethi Sir, Thanks for clarification. Reply By DR.MARIAPPAN GOVINDARAJAN: The Reply: I endorse the views of Shri Sethi. Avoiding to charge the tax is not the objective of GST law....
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....s. You can plan according to the provisions of tax and not with intention to avoid tax. Reply By MohanLal tiwari: The Reply: Govindrajan Sir, Thanks. I appreciate your views. Reply By KASTURI SETHI: The Reply: Tax avoidance is legal but tax evasion is illegal.<br> Discussion Forum - Knowledge Sharing ....