Service Tax v/s In house Contractors

[Ashok Chopra]

I am an exporter of Readymade Garments and having valid Registration Certificate of Service Tax.  I am receiving services of In House Jobworker for stitching and finishing on piece rate basis.  They are raising me invoices and are not charging any service tax, but their transaction of each job worker  is much more than stipulated limited. I am deducting TDS and paying regularly to Income Tax Department

My queries:-

1. Whether i am liable to pay service tax? if yes, what next i should do?

2. Should i insist Job worker to get themself registered with Service Tax and charge Service Tax on their bills and i should book entire bill amount inclusive of service tax as expense in my books of accounts?

3. Can i get refund of this Service Tax paid to In House Job Worker from Service Tax Department? If yes, please tell me the procedure.

4. I am not registered with Central Excise, can i file refund under Rule 5 of CENVAT Rules? if yes, please let me know the procedure.

I shall be thankful, if anyone will advice me parawise

Regards

AI Summary

Exporter Seeks Clarity on Service Tax Exemption for In-House Job Workers Under Notification No. 25/2012-ST An exporter of readymade garments inquires about the liability for service tax on services received from in-house job workers for stitching and finishing. The job workers do not charge service tax, although their transactions exceed the stipulated limit. The exporter seeks advice on whether to insist on job worker registration for service tax, the possibility of claiming a refund, and filing under Rule 5 of CENVAT Rules. In response, it is clarified that an exemption under Notification No. 25/2012-ST applies to textile processing, negating service tax liability. Further details are requested regarding applicability to wooden furniture manufacturing and related excise duty concerns.