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Service Tax Liability for Lime Industry. - Service TaxExtract Respected Colleagues, We are in Lime minerals business. We purchase limestone, calcine it, process it and make certain chemicals from it. Ours is labor intensive industry. We have given the responsibility of daily production to a contractor. He brings his own labor, which work on our machines and manufacture final products. We pay the contractor on piece rate basis, eg - 500 Rs for one ton of lime produced. We calculate the work done by the contractor and make payment to him accordingly. We are not concerned with the number of labor he employees to get the job done. He may bring 50 labor or 100 labor for the job, it is his look out. We are just concerned with the actual output and calculate our liability accordingly. My query is, wether this system would come under the scope of Supply of manpower service and attract Service tax on RCM, or it can be classified as Job Work or Business Auxillary Service or any other head ?
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