Dear Sir, We have one order to be executed at our Unit under the following Conditions : Customer will issue us required Free Issue Material for working. We will undergo for a Fabrication work (Labor Charges Only) at our shop (without any material belonging to our ownership, not even consumables). We will bill them only for Labor Charges. We require your advise on following ground : We are the complications in nature of Excise & Custom formalities for import of Free Issue material and Export of Finished Product. What is the regulation in terms of Service Tax because we are billing them for labor charges – Whether Service Tax will be leviable or not ?
Regards,
Hitendra dave
Understanding Tax and Customs for Importing Free Issue Materials: Key Considerations for Labor Charges and Excisable Goods A user inquired about the procedures and tax implications for importing free issue materials for a fabrication project in their unit. The customer provides the materials, and the user charges only for labor. They sought advice on customs and excise formalities for importing these materials and exporting the finished product, specifically questioning the applicability of service tax on labor charges. The response highlighted the need to determine whether the finished goods are considered manufactured and excisable, as this would clarify the service tax obligations on the labor charges. (AI Summary)
TaxTMI 
TaxTMI 
