business auxilary service

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CA Hemant T Dewani (Querist)

22 December 2007 recevied materials from party who are not registered in exice.they are scrap trader
job works are done in our premises total labou charges are blow taxable but some materils are laying in our premises this materials are not given back. we further processed and sold in the market our purchases are nill but sales are about rs 7 lacks whether we are liable to srvice tax.total lab charges are around rs.6 lakhs.our unit is ssi unit total exemption is rs 1.5 cores to ssi unit whether both labour charges and manufactures are clubed in srvice tax and exice pl.clerify my qury as early as possible.any notification or circulers are there pl.give me
thanks/

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

22 December 2007 If you are already a processor, handling the goods of others, other than the dealer you are referring to how are you handling the Ed, ST formalities for your other processes? I mean is this query on account of your processing the goods of scrap dealer or selling the left over goods?

annapurna

annapurna (Expert)

26 December 2007 Your query contain lots of facts. As per my understanding the excise duty is liable on manufacture of goods, service tax is liable on provision of service. The exemption limit is different under excise law and service tax law. For SSI unit it is 1.5 crores and under service tax law it is Rs. 8 lakhs. The labour charges are incurred to manufacture the goods. Where the labour charges incurred are Rs.6 lakhs and sales is seven lakhs there is no impact of service tax as there is no provision of service

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