Labour Cess

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..... Labour Cess
Query (Issue) Started By: - chandan jha Dated:- 4-10-2019 Last Reply Date:- 24-5-2020 Other Topics
Got 4 Replies
Indian Laws
When raising invoice to client along with labour cess like (civil works + labour cess), on labour cess, whether we need to charge GST or not. Kindly clarify, if any notification please provide me. Regards Chandan Reply By KASTURI SETHI: The Reply: .....

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..... No deduction is allowed on labour cess. GST has to be paid the value of civil works including cess). Also see replies posted against Issue Id No.115480 dated 2.10.19 Reply By PAWAN KUMAR: The Reply: The value of supply shall include any taxes, duties, cesses, fees and charges levied under any law for the time being in force other than CGST, IGST, UTGST act. As per the section 15 (2)(a) labour .....

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..... cess is also includible in value of supply. GST is payable on this component of labour cess. as per my view. Reply By Ganeshan Kalyani: The Reply: Yes the labour cess should be considered to charge GST. Reply By YAGAY andSUN: The Reply: In the case of Delhi Metro Rail Corporation vs Simplex Infrastructures Limited, Delhi High Court, 2011 = 2011 (8) TMI 1323 - DELHI HIGH COURT, where, the high .....

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..... court held that, the subject matter of the Cess Act is the activity of building and construction, the object is to augment the Welfare Fund under the BOCW Act and the essential purpose is to benefit the building and construction worker. The 'ultimate or incidental results or consequences' might be that contractors have to part with 1% of the bill amount towards the cess. However, that does not de .....

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..... tract from either the 'primary object' of the Cess Act or its 'essential purpose.' Applying the Hingir Rampur tests, it has to be held that the Cess Act cannot be construed to be a tax at all. Further in GST various types of cess, taxes, duties which was levied and collected as Indirect Taxes, were subsumes but cess like Building cess, Professional tax and labour etc. were not out of the purview .....

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..... of subsumed into GST as these are not Indirect Tax. In our view, on it GST is not applicable.
Discussion Forum - Knowledge Sharing .....

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