# Construction Service Exemptions

## Entry 10 — Pure Labour Contracts under Housing for All / PMAY

Services provided by way of pure labour contracts of:

construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of
a civil structure or any other original works
pertaining to beneficiary-led individual house construction/enhancement
under Housing for All (Urban) Mission or Pradhan Mantri Awas Yojana (PMAY).

### Background

Housing for All (Urban) Mission / PMAY launched by MoHUPA.
Objective: housing for urban poor through slum rehabilitation, affordable housing, subsidies for EWS to construct/enhance houses by 75th year of independence.

### Definition of 'Original Works'

All new constructions;
All additions and alterations to abandoned/damaged structures on land required to make them workable;
Erection, commissioning or installation of plant, machinery, equipment or structures, pre-fabricated or otherwise.

## Entry 10A — Electricity Distribution Infrastructure to Farmers

Services supplied by Electricity Distribution Utilities by way of construction, erection, commissioning, or installation of infrastructure for extending electricity distribution network up to the tube well of the farmer or agriculturalist for agricultural use.

## Entry 11 — Pure Labour Contracts for Single Residential Unit

Services by way of pure labour contracts of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex.

### Key Definitions

Residential Complex: Complex comprising of building/buildings, having more than one single residential unit.
Single Residential Unit: A self-contained unit designed for residential use by one family.

## Critical Conditions

Entry	Type of Contract	Type of Work	Beneficiary
10	Pure labour	Civil structure / original works	PMAY / Housing for All beneficiary
10A	(Not restricted to pure labour)	Construction of electricity infra	Farmer's tube well
11	Pure labour	Original works	Single residential unit (NOT part of complex)

Worked example

### Example 1

Example 1 — Pure labour for PMAY beneficiary: Mr. X (PMAY beneficiary) hires a contractor for labour only (Rs. 80,000) to construct his house; materials bought separately by Mr. X. Taxability?

Solution: EXEMPT under Entry 10. Pure labour contract for beneficiary-led house construction under PMAY.

### Example 2

Example 2 — Composite contract for PMAY: Mr. Y (PMAY beneficiary) gives a turnkey contract (labour + material) to a contractor for Rs. 5,00,000. Taxability?

Solution: NOT exempt under Entry 10 since it is NOT a pure labour contract. Entry 10 covers only pure labour contracts.

### Example 3

Example 3 — Single residential unit: Mr. Z builds a single bungalow (not part of a residential complex) and engages a labour-only contractor for Rs. 3,00,000. Taxability?

Solution: EXEMPT under Entry 11. It is a pure labour contract for original works of a single residential unit not being part of a complex.

### Example 4

Example 4 — Apartment in complex: Pure labour contract for construction of one flat within a 20-flat residential complex. Exempt under Entry 11?

Solution: NOT exempt. The flat is part of a 'residential complex' (more than one single residential unit), so Entry 11 doesn't apply.

⚠️ Common exam mistakes

Extending Entry 10/11 to composite works contracts (labour + material) — these entries cover ONLY pure labour contracts.
Applying Entry 11 to flats within a residential complex — Entry 11 is for single residential units OTHERWISE THAN as part of a residential complex.
Confusing PMAY beneficiary-led construction (Entry 10) with general affordable housing — Entry 10 is specifically for beneficiary-led individual construction under PMAY.
Ignoring the definition of 'original works' — repairs/maintenance qualify under Entry 10 but for Entry 11 it must be 'original works' (new construction or additions to make abandoned structures workable).

Reference: Entries 10, 10A and 11 — Notification No. 12/2017-CT(R) dated 28.06.2017

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Construction Services Exemptions (Entries 10, 10A, 11)

Worked example

⚠️ Common exam mistakes