printing-service tax or vat

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CMA Mahesh Giri (Querist)
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21 May 2011 this query was asked by someone way back in 2010 ..now i am also facing the same thing..kindly suggest a solution as early as possible..

a private company undertaking printing work mainly from govt bodies, for journals magazines etc.

At times, they are provided the paper/material on which the printing is required, and at times they use thier own.

now the question is :

1)when the client is giving them paper to print on, they are merely providing printing services, will VAT be attracted here? if not
will service tax be attracted?? i just saw the 80 services covered under service tax gamut, and i dont see any printing services. In case service tax is applicable, under business auxilary or under works contract, please direct me to the specific provisions and computation for my further reading and understanding.

2)when their client does not provide them paper/material, they source it themselves and give the clients the printed material.
i am pretty sure this printed material will attract 4% VAT, but is there a chance of attracting service tax too ?? if yes, then in what ratio, and how to go about the computation.

i really appreciate you going through this long querry, even if you can just point me in the right direction i will be very thankful!

U S Sharma

U S Sharma (Expert)
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22 May 2011 as the printing works use consumables in it, viz ink, reducer, and other chemicals, please ensure that no credit has been availed by the printer on such items.

1) if the paper is provided under cenvat challan, or 214/86 under excise rules then absolutely no service tax.

a) if the paper is provided other than 1) above, but the consumables are purchased with full tax and no input credit is availed either in cenvat or vat, then after the specified limit under state vat it would go in works contract,

2) if the paper is supplied by printer, then he has to bill for complete materials, not mere "abc printed on xyz" but he has to bill for " form abc 5000 nos", in this case the complete materials would go taxed under "excise ( subject to 150 lacs exemption limit)" and vat applicable.

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