Can trader send raw material for jobwork


This query is : Open 

30 December 2012 Dear Sir,
I have a Steel Rolling Mill were I manufacture Bars, I want to inquire wether a trader can send raw material for jobwork and does it attract any taxes.

Kindly note I'm not registered with central excise nor the trader.

Urgent reply is expected.
Thank you

31 December 2012 When the process of jobworking amounts to manufacture then you will automatically become a manufacturer. Therefore the issue needs factual analysis to conclude.

31 December 2012 When the process of jobworking amounts to manufacture then you will automatically become a manufacturer. Therefore the issue needs factual analysis to conclude.

31 December 2012 There is not require to pay any Excise Duty b'cos u r not registered


02 January 2013 Actually i had heard that trader cant send material for job work wether what i heard is right. Srinivasan sir i couldnt understand Your comment can you repost it again.
If i do jobwork wether the tax liablity is on me or the trader who send the material.
If the tax liablity is on me kindly narrate the Tax rates.

02 January 2013 Were the trader supplies material for jobwork and after jobwork is completed we issue him labour bill and we do not collect taxes on him.
Thus this attracts excise duty

03 January 2013 The matter is urgent.
Hoping that it will be resolved soon

06 January 2013 The job work is treated as manufacturing and if you ar in the braket of limit applicable for payment of Excise Duty then Excise Duty is applicable. Why it is so, if the trader purchases finished product from the rolling mill it is Excise Paid but if all the traders supply the rawmaterial to rolling mills for job work then the Govt will never get any Excise duty so all job works to be treated as manufacturing and the excise duty is to be paid by the manufacturing units.

07 January 2013 Agarwal Sir,
Im not registered for Excise wether jobwork attracts excise duty.
Because i have done jobwork.
So is there any step to reduce that duty.
I mean can i charge service tax on the labour bill. That is Rs. 7/-kg what i take charge for jobwork can i tax service charge on Rs. 7-kg?


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