Labour Job

[SURYAKANT MITHBAVKAR]

We are manufacturer of pharma machine registered under Excise Act.

We are having one associate company manufacturing pharma machine registered under Excise Act

Can we do labour job for each other issuing service tax invoice and using 214/86 Challan for movement of material.

AI Summary

Pharmaceutical Machine Maker Queries Excise Duty vs. Service Tax for Labor Jobs Under Notification 214/86-CE A manufacturer of pharmaceutical machines, registered under the Excise Act, inquired about the feasibility of performing labor jobs for an associate company, also registered under the Excise Act, using service tax invoices and the 214/86 Challan for material movement. Responses clarified that if the process amounts to manufacturing, excise duty applies, otherwise service tax applies. Notification No. 214/1986-CE allows for the return of processed goods without duty payment if the process is manufacturing. Pure labor jobs attract service tax, but job work under Notification 214/86 does not. The principal manufacturer must pay excise duty, exempting the job worker.