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Job work in manufacturers premises and service tax

Service Tax - Started By: - Narendra Soni - Dated:- 11-4-2016 Last Replied Date:- 12-4-2016 - Dear Sir, We are working for two cases, both the cases are independed to each other,kindly suggest seperetly for both the cases: X is a manufacturer of Polypropelene Bags/Flexible intermediate bulk bags (FIBC) products.Process:- Pp Granaules>PP Yarn>PP Fabric>Cutting/stiching and finaly FIBC &PP Bags produced. 1. Labour provided by contractor for production, Manufacturer pay at piece rate o .....

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in the factory of X on the RM/product provided by X (m/cs are installed in manufactures factory X ) and return the processed products to X and X will finally export the said products under bond/LUT/on payment of duty .Contractor (Job worker) will charge rate per piece from X.Labour will work under control & supervision of his contractor only. Kindly suggest Is service tax is applicable in this job work process in the hand of X or in the hand of contractor.Please provide reference of relevan .....

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e apparel exporters in relation to fabrication of garments. Please check if you were to quote some other Circular. Thanks. - Reply By Ganeshan Kalyani - The Reply = Sir, my views on your second query is as follows:If the process undertaken by the processor amounts to manufacture then Central Excise duty becomes applicable and If that is only intermediate goods and not final goods then service tax becomes applicable on job work charges. But as you have mentioned in your qurry that the processor i .....

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rvice tax will become payable by the processor. This is my views. Thanks. - Reply By KASTURI SETHI - The Reply = Sh.Ganeshan Kalyani Ji, Sir, Renting of machinery is covered under the erstwhile category of Right to Use of Tangible Goods Sevices . Moreover, this is not a simple query. So many factors/aspects are involved. Needs to go through again. - Reply By Ganeshan Kalyani - The Reply = Sri Kasturi Sir, I full agree with your views and I agree that my views will be full proof only if had gone .....

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gs.Kindly suggest.In second query, Rm/Semi processed material is given by manufacturer to job worker, the job worker further carried our some process and return to manufacturer,the manufacturer may further work on the processed goods or export as it.Job work is carried out in the factory of manufacturer on the machines installed and belongs to manufacturer but leased to job worker.In both the cases, agreements made where in payment term is piece rate and labour will work under supervision & .....

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