Applicability of Service Tax

This query is : Resolved

BAL KRISHAN GARG (Querist)
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02 May 2009 One of my client say A doing job work alongwith his labour for B in the premises of B on the material of B .he is billing on the completion of Pieces and raising bills on monthly basis and B is making payment through cheque in favour of A's Firm after deducing TDS .
Whether the service tax authority can held liable under ser.tax for manpower recruitment agency although he is not providing labour . moreover B is assessable under excise and he is also paying excise duty on the material processed by A .
I have produced all the copies of bills and form 16 A AND bank account with ledger in the books of B and after receing my reply the authority asked the details from B and B has confirmed the fact also by his submission to the authority that A is doing job work for us for which we are making payments .

My query is after all correspondence with A and B whether the authority can held A liable for non payment of Ser.tax although he is not providing any labour to B and moreover notification 8/2005 exempt his job work also.whether the authority can hassase A ?

my e-mail id is gargbk2001@yahoo.com

Madhukar N Hiregange

Madhukar N Hiregange (Expert)
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02 May 2009 Where the job work amounts to manufacture there is no liability under ST. If X is converted into Z then there is no liability.
Further under not.8/2005 as long as the final product sufferrs duty the job worker is exempt.
Of course if the harassment takes place inspite of that complaint to the higher officer in writing normally stops this activity.

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