TaxTMI 
TaxTMI 
Applicability of Service Tax on Jobwork on goods exported.
18 Jan 2006 
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Service tax on jobwork: taxable when the jobworker's process is not excluded and principal pays no applicable duty.
Service tax on jobwork for exported goods hinges on two operative points: processes amounting to manufacture by the job-worker are excluded under the negative list, and an exemption applies to intermediate production processes performed as jobwork when the principal manufacturer is liable to pay appropriate duty. If the principal faces nil duty on export, the jobwork does not qualify for that exemption and service tax may be payable on the job-worker's services. (AI Summary)
Service tax on jobwork for exported goods hinges on two operative points: processes amounting to manufacture by the job-worker are excluded under the negative list, and an exemption applies to intermediate production processes performed as jobwork when the principal manufacturer is liable to pay appropriate duty. If the principal faces nil duty on export, the jobwork does not qualify for that exemption and service tax may be payable on the job-worker's services. (AI Summary)
if an individual undertakes a jobwork on behalf of other individual and the goods are exported whether service tax is applicable