Job Work Issue

[ANKUR JINDAL]

We are manufacturing  Towers as well as doing Job Work and we have three situations:-

1)      If we manufacture Tower by using Own Steel & Own Zinc- We are charging Excise Duty-No Issue

2)      If we manufacture Tower by using Own Zink and Steel is supplied by customer- We are charging Excise on this transaction.

Quarry:- Here some of our customers have view that as per NN 214/86 we should not charge any duty. Is we are doing wrong? 

3)      If we manufacture Tower by using steel & Zinc supplied by customer- We are charging Service Tax on it under Business Auxiliary Head.

Quarry:- Here some of our customers have view that being this is a manufacturing activity. Hence we should not charge any Service Tax and Excise duty is Exempt as per  NN 214/86.Is we are doing right?

Thanks & Regards

Ankur Jindal

AI Summary

Job work exemption: customer declaration avoids excise liability; service tax only applies if processing is not manufacture.
Where the customer supplies inputs and the customer files the declaration required by the job-work exemption notification, the job worker is not liable to excise duty provided the notification's procedural conditions are complied with; service tax is not leviable where the processing legally amounts to manufacture, and any service tax paid contrary to that legal characterisation may be refundable subject to unjust enrichment and limitation rules.