reconditioning charges, Service Tax

[jagadesh kumar bhojanapalli Kumar]

The over seas supplier company(X) is supplying their product(tools) to various Indian companies/Buyers (Manufacturers). The X company has made a contract agreement with Indian Company i.e., A who is a job worker to make the tool for reconditioning is charging reconditioning charges in USD (A to X).

The A Company is using their imported inputs (availing CVD) in connection with reconditioning process. How to comply under Central Excise and as well as Service Tax.

Awaiting yr response at the earliest.

Jagadesh

Posts / Replies

[KASTURI SETHI]

Reconditioning does not amount to manufacture. Therefore, it would attract Service Tax. A Company will have to pay Service Tax on reconditioning charges. A will pay ST after availing small Scale exemption limit of ₹ 10 lakhs under Notification No.33/2012-ST dated 20.6.2012.