Service tax on Job Work

[Murari Agrawal]

Branded shoe owner supplies raw materials, components, packing box for manufacturing and packing finished shoes to us on job work basis. The shoes are below the value of Rs.500/-. Is there any Service tax liability upon us for carrying out such activity.

AI Summary

Service Tax Debate: Liability on Job Work for Shoes Under Rs. 500 When Turnover Exceeds Rs. 10 Lakhs A discussion on service tax liability for job work in manufacturing shoes valued below Rs. 500. A branded shoe owner supplies materials for job work, raising the question of service tax applicability. A participant clarifies that if the taxable turnover exceeds Rs. 10 lakhs, service tax is applicable, as the final product is exempted from excise duty. Another participant mentions a Board Circular indicating that service tax may not apply if the process qualifies as manufacturing under the Central Excise Act, even if the excise duty is exempted. The discussion also touches on Cenvat credit implications.