Service Tax on labour contract for construction services

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..... Service Tax on labour contract for construction services
Query (Issue) Started By: - ANAND SHEMBEKAR Dated:- 19-3-2013 Last Reply Date:- 20-3-2013 Service Tax
Got 2 Replies
Service Tax
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 , .....

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..... 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 .....

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..... exempt from service tax upto 30-June-2012. Views of members are invited. Thanks A M SHEMBEKAR Reply By dipsang vadhel: The Reply: Prior to 01.07.2012, ST was payable on services defined as taxable services under the Finance Act. Accordingly, only commercial constrction was liable to service tax.Constructions which is for use of organisations or institutions being established soley for educa .....

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..... tional, religious,charitable,health,sanitation or philanthropic purposes and not for the purpose of profit are not taxable,being non commercial in nature. (Board's circular No.80/10/2004-St dated 17.09.2004). If construction of Educational Institute in your case is not commercial in nture then NO ST. On or after 01.07.2012 ST is payable on all services except services covered in Negative List o .....

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..... r exemption list. As per my analysis,construction of Educational Institute even if for non commercial purpose is neither covered in Netive list nor exemption list. At present, such exemption is availble for construction of educational institute is availble only if such construction is for government. Therefore,construction of Educational Institute in your case is liable to ST even if such construc .....

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..... tion is for non commercial purpose. Refer Educational guidance released by CBECparticularly 7.9.4 I am engaged in construction of hospitals and educational institutes. Am I required to pay service tax? If you are constructing such structures for the government, a local authority or a governmental authority, you are not required to pay service tax. If you are constructing for others, you are requ .....

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..... ired to pay tax. regards, dipsang vadhel Reply By ANAND SHEMBEKAR: The Reply: Dear Mr. Dipsang vadhel I am very much thankful to you for prompt reply Thanks A M SHEMBEKAR
Discussion Forum - Knowledge Sharing .....

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