Applicability of service tax - Processing - job work

[BAL KRISHAN GARG]

Dear Madhwan & Mukesh Ji, Recalling of facts : A is processing B'sgoods intermediatary product in B's Factory on which B cleared the goods after duty .His labour obey the direction of A only & B is concerned with the processed goods only . there is no relation between labour and B . as liability under manpower there must be employee - employer relationship between A and Labour and labour is not employed contractually employed by the recipient but come under his direction.- F.No. B1/6/2005-TRU dated 27.7.05 , Hence S.tax not liable under man power.Supply means must not to be restricted to the goods must be out of premises & returned wherepremises in kilometers whether is it notpossible to give the goods for processing to Job worker in premises? May be i am not right but since we have to analysis the word meaning of supply . Here the intention of the law of supply at the intial stage we have to find I will be thankful you as you cleared many doubts.

AI Summary

Job work versus manpower supply: processing at recipient premises must be classified by control and contract to determine service tax applicability.
Applicability of service tax depends on whether processing of B's goods by A in B's factory is characterised as job work or as manpower supply. The described facts show labour directed by A, no contractual employer-employee relationship between B and labour, and a departmental reference suggesting absence of such a relationship argues against manpower supply. Classification requires detailed examination of contract terms, actual direction and control of labour, and the surrounding circumstances.