Service tax applicability - Development of product

[Vijay Chitte]

We are service provider of product development, in this regard our clients are providing all material and we developed a new product for our client. DEVELOPMENT OF PRODUCT, IS IT TAXABLE SERVICE OR EXAMPT FROM SERVICE TAX?

[Madhukar N Hiregange]

The same maybe liable under consulting engineering sercvies or scientific and technicla research. Please also see in the new entry of design

it is a taxable service

AI Summary

Product development service tax: client-supplied materials may fall under consulting engineering or scientific research, affecting taxability.
Whether service tax applies to outsourced product development where the client supplies all materials is questioned. Respondents advised the activity may fall within consulting engineering services or scientific and technical research categories, with one respondent identifying it as a taxable service and another referring to a design services entry.