Contractor's labour works in factroy premises

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 September 2012 Respected Sir,

our is Excisable unit,some of mtrl we manufacture & some mtrl we used to sent to Job worker u/s old 57(f)2 rule.they do not charge Service tax.Apart from this We have also engaged some contractors for fabrication,rework painting etc.of Elect components,They work in our premises all the matrl is ours,we pay them as per Kg or Per Pc rate,all the workers are controled & supervise by contractor.
Contractors are not regd.under Ser tax, Wheter Service tax will applicable or Not ,What Will be the impect of Reverse charge , Pls repply Urgently

CA Suresh Jain

CA Suresh Jain (Expert)
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05 September 2012 Let me make my understanding clear that the fabrication of the goods within the factory by the job worker is that of the final or intermediate product finally being cleared by you against payment of duty. In this case please refer to clause 30 of notification 25/2012 according to which service of Carrying out an intermediate production process as job work in relation to any goods on which appropriate duty is payable by the principal manufacturer is exempted from service tax.

The service is that of fabrication etc. and not of supply of manpower or works contract as defined under the provision of service tax law and therefore RCM is not applicable.

For further clarification please mail the query at sureshjain.nj@gmail.com chargeable Rs. 100 to 500 donation to the "KADAM" institute engaged in education to children of construction labours.

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2012 Thanks Jain Sb for valuable guidence. Sir please provide address Or account No to contribute Yatha Shakti , It will my pleasure to do the something.

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