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service tax Demand raised for the year 2016-17
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....ervice tax Demand raised for the year 2016-17<br> Query (Issue) Started By: - THYAGARAJAN KALYANASUNDARAM Dated:- 10-10-2022 Last Reply Date:- 25-10-2022 Service Tax<br>Got 2 Replies<br>Service Tax<br>Dear Experts, One of my clients executed a civil contract with a government department on a sub-contract basis. Now, he received the order by demanding huge service tax liability to my client. Is t....
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....here Mega Notification no.25/2012 that will be applicable to sub-contracts too? Thanks in advance. Reply By KASTURI SETHI: The Reply: Relevant extract of Education Guide released by Board on 19.6.12 (effective from 1.7.12). These are guidelines. 7.11.11 Whether the exemption provided in the mega-exemption to services by way of construction of roads, airports, railways, transport terminals....
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...., bridges, tunnels, dams etc., is also available to the sub-contractors who provide input service to these main contractors in relation to such construction? As per clause (1) of section 66Freference to a service by nature or description in the Act will not include reference to a service used for providing such service. Therefore, if any person is providing services, in respect of projects involv....
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....ing construction of roads, airports, railways, transport terminals, bridges, tunnels, dams etc., such as architect service, consulting engineer service., which are used by the contractor in relation to such construction, the benefit of the specified entries in the mega-exemption would not be available to such persons unless the activities carried out by the sub-contractor independently and by itse....
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....lf falls in the ambit of the exemption. It has to be appreciated that the wordings used in the exemption are 'services by way of construction of roads etc' and not 'services in relation to construction of roads etc'. It is thus apparent that just because the main contractor is providing the service by way of construction of roads, airports, railways, transport terminals, bridges, tunnels, dams et....
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....c., it would not automatically lead to the classification of services being provided by the sub-contractor to the contractor as an exempt service. However, a sub-contractor providing services by way of works contract to the main contractor, providing exempt works contract services, has been exempted from service tax under the mega exemption if the main contractor is engaged in providing exempt se....
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....rvices of works contracts. It may be noted that the exemption is available to sub-contractors engaged in works contracts and not to other. Reply By Aakash Deb: The Reply: First of all Service Tax demands are now time barred. There are innumerable judgements available where the high courts have quashed the demand notices. No need to worry or submit any documents to the dept., burden to prove guil....
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....ty is on the dept. Secondly if a contract was executed between the sub contractor and the govt department then mega exemption will be applicable.<br> Discussion Forum - Knowledge Sharing ....