Serviec tax on jobwork

[Guest]

Dear Sir,

We are a job worker and we are not registered under central excise we received material from Excisable unit we doing only job work and further we send these material to another job worker for any other process. and after receiving these material we send back to principal manufacturer and the principal manufacturer clearance the material with payment of appropriate duty.

My query is the third party job worker billed us and he charge the vat as well as service tax both in his bill.

Is this charged in the invoice both service tax and vat is correct or not ?

Regards

Swapneswar

AI Summary

Clarification on VAT and Service Tax for Job Workers: No VAT on Non-Sale Transactions, Service Tax Exemption Per Notification No. 25/2012-ST. A job worker inquires about the applicability of VAT and service tax on transactions involving multiple job workers and a principal manufacturer. The principal manufacturer provides materials to the first job worker, who then sends them to a second job worker for further processing. The second job worker charges both VAT and service tax. Responses clarify that VAT is not applicable as the transaction does not involve a sale, and service tax is exempt if the principal manufacturer pays duty on the final product, per Notification No. 25/2012-ST. The discussion seeks clarity on the correct tax treatment for these transactions.