Filling & packing service

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Aanand Jha (Querist)

30 August 2016 In our manufacturing plant, Pouch filling and packing services are being carried on by contractor. Is this service liable to service tax? Can it not be considered as manufacturing process?

Anil Verma

Anil Verma (Expert)

30 August 2016 Yes it is liable to service tax.. check for the exemption limit w.r.t. turnover

Aanand Jha

Aanand Jha (Querist)

30 August 2016 We are manufacturing edible oil, Filling and packing of edible oil is part of our manufacturing process.
If it is still liable to service tax, then which kind manufacturing process covered in negative list? Please elaborate and provide references.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

30 August 2016 Filling and packing of edible oil is considered as part of manufacturing process, not liable for service tax.

Aanand Jha

Aanand Jha (Querist)

06 September 2016 Seetharaman Sir,
I agree with your opinion but our company consultant's logic is "Contractor is not manufacturing oil, only packing hnce process is not manufacturing". Can you give me any reference of case law, circulars etc...?
Anil Verma Sir,
Is your opinion based on above logic?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

06 September 2016 Refer job work notification of excise(search google you will get it). No service tax applicable on job works in the nature of manufacturing process. Manufacturing work can be out sourced and excise duty is only payable on it not service tax.

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