• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Please explain the concept of works contract.

Manish Sinha, email

Works contract typically is a composite contract for both supply of goods and services with there being no break-up in the invoice as to how much is charged for materials and how much for services. Before the Constitution Amendment made in 1986 this dual character of the contract came handy to avoid sales tax.

But after the amendment, sales tax laws have got the right to ferret out the value of materials used in execution of such composite contracts so that sales tax could be imposed on the materials portion.

S. MURLIDHARAN

More Stories on : Taxation | For the Asking

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line