application of service tax

[NARESH BANSAL]

Respected Sir,

we are offset printers of educational books. Doing job work only .The paper is supplied by publisher and he is paying excise duty on paper.But printing ink, plates and chemicals are used by our side.Further the binding is done by another person.

Sir, whether service tax is applicable or not

AI Summary

Service tax applicability on job work: exempt if principal has paid excise duty; otherwise taxable on gross value.
Two forum responses differ on tax characterization. One treats the printing job as subject to Works Contract Tax under local VAT because printer-supplied materials are used and denies service tax applicability. The other relies on the job work exemption: if the principal manufacturer has paid excise duty on the goods, job work is exempt from service tax; if no duty is paid, service tax is payable on the gross value. Credit of duty paid on supplied paper may be taken but its value must be included in the taxable value where service tax applies.