Is service tax applicable on job work charges ?
This query is : Resolved
Binu Raphel C
(Querist)
08 October 2013
Dear All,
I am working in a consortium of Ayurvedic Medicine Manufacturing Companies. We also undertake job works for our members & raise job work bills to them. The principal buyer will send us main drug. At the time of manufaturing, we need to add some of our stores like gelatin,glycerin,preservatives etc. My question is whether Value Added Tax is applicable to excipient cost & Service Tax is applicable on the Labour charges & Intellectual Charges. waiting your kind replay
I am working in a consortium of Ayurvedic Medicine Manufacturing Companies. We also undertake job works for our members & raise job work bills to them. The principal buyer will send us main drug. At the time of manufaturing, we need to add some of our stores like gelatin,glycerin,preservatives etc. My question is whether Value Added Tax is applicable to excipient cost & Service Tax is applicable on the Labour charges & Intellectual Charges. waiting your kind replay
Arun Biyani
(Expert)
08 October 2013
No service tax applicable. Job charge is out of service tax purview..if you show excipient cost separately then VAT is to be charged, otherwise if the CCPS is already agreed as per Loan and License agrmnt then charge CCPS straight away and no need to show excipient cost separately and hence no VAT to charge.
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Binu Raphel C
(Querist)
08 October 2013
Can u say me what u mean by CCPS ?
Arun Biyani
(Expert)
08 October 2013
CCPC is a term used in pharma job section which stands for Conversion charges Production charges..
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08 October 2013
Agree with Arunji
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