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Issue ID : 111450
- 0 -

Service Tax Laibility

Date 01 Feb 2017
Replies6 Answers
Views 1352 Views
Asked By

Hello Sir This is Kamal Negi my query is following:-

1) We are a excisable unit situated in sonepat (HR), can we do job work for a unit situated in Exempted Zone like Uttarakhand & Himanchal and what will be role for Service Tax.

2) We are not registered in Excise but registered with service tax, can we do job work of a excisable unit giving us material on terms of 62% recovery of 100% material at conversion charge of ₹ 8/- Per Kg. We are receiving material from franchise of excisable unit and sending material after processing to another job worker on behalf of excisable unit for further process. Please clear service tax role and if any other laibility.

Kindly reply sir.

Rgds

K.S.Negi

6 answers
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- 0
Replied on Feb 1, 2017
1.

In my view you can do job work for the unit at exemption area. If the process amounts to manufacture then no service tax otherwise yes.

- 0
Replied on Feb 2, 2017
2.

Sh.Negi Ji,

I agree with Sh.Ganeshan Kalyani, an expert. I further add as under:-

If finished excisable goods are dutiable but exempted by virtue of Notification (may be area based exemption or value based exemption i.e.SSI) and process amounts to manufacture, you will have to pay CE duty on job-worked goods as exemption from CE duty under Notification No.214/86-CE as amended from time to time, is conditional. Exemption on job-worked goods is available if principal manufacturer pays the duty payable thereon. If principal manufacturer does not pay duty on finished products by virtue of areas based exemption, duty has to be paid by job-worker on the said goods up to the processes undertaken by him(job-worker). There are also other conditions mentioned in the above notification. Duty must be paid on finished goods or duty should be paid on job-worked goods (semi-finished/intermediate goods). So you will have to get yourself registered with Central Excise Department for manufacture and clearance of job-worked goods on payment of duty.

- 0
Replied on Feb 2, 2017
3.

We endorse the views of the experts.

- 0
Replied on Feb 2, 2017
4.

M/s.YAGAY AND SUN,

THANK YOU, DEAR SIRS.

- 0
Replied on Feb 3, 2017
5.

Thanks Sri Kasturi Sir for detailed reply. It enriched my knowledge. Thanks.

- 0
Replied on Feb 6, 2017
6.

I also endorse the views of Shri Sethi.

Old Query - New Comments are closed.

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