Service tax

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Nitin G Haldikar (Querist)
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15 January 2014 We are edible oil manufacturer for packing of oil we purhcased tin plate same is giving to Job work for making of Tins & Jars in that situation which tax we have to pay, it come under services tax (Reverse machanisim)?

Nitin Haldikar

Annu Agarwal

Annu Agarwal (Expert)
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15 January 2014 Job work related to manufacture of dutiable goods is exempted from service tax by virtue of entry no. 30 of the mega exemption list.

Nitin G Haldikar

Nitin G Haldikar (Querist)
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16 January 2014 sir,

Edible refind oil manufacturing is exempted from excise duty.

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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24 July 2025 Thanks for the clarification. Since you're an edible oil manufacturer, and you're sending tin plates to a job worker to fabricate tins and jars for packing, you're wondering whether this job work is liable to service tax, especially under reverse charge mechanism, as of 15 January 2014.

Let’s go step by step and analyze based on Service Tax law applicable at that time.

✅ 1. Nature of Service: Job Work for Manufacturing Tins/Jars
You purchase tin plates → send them to job worker

Job worker manufactures tins/jars for your edible oil packaging

🧾 Service Tax Implication – Mega Exemption Notification No. 25/2012-ST
✅ Entry No. 30 (as amended up to Jan 2014):
Exempts job work in relation to:

“any goods on which appropriate duty of excise is payable by the principal manufacturer.”

However, the exemption does not apply when the final product is exempt from excise.

❌ Your Case:
Your final product (edible refined oil) is exempt from excise duty
(as you stated, edible oil is exempt under Notification No. 12/2012-CE)

➡️ Therefore, Entry 30 exemption does NOT apply to you.

✅ 2. Is Service Tax Applicable on Job Work?
✔️ Yes, job work is taxable under service tax if the final product is exempt from excise.

So, if you're sending inputs (tin plates) to a job worker who converts them into tins/jars for you, and your final product is exempt from excise — the job worker must charge service tax.

✅ 3. Reverse Charge Mechanism?
As of Jan 2014, job work is not covered under reverse charge mechanism, unless it falls under:

Manpower supply

Works contract

Goods transport

Security service

➡️ Fabrication of tins/jars as job work is NOT under reverse charge, so:

❌ You (recipient) are NOT liable to pay under reverse charge
✔️ Job worker (service provider) is liable to charge and pay service tax.

✅ 4. Summary:
Aspect Treatment
Final product (edible oil) Exempt from excise
Job work done on your raw material Taxable under service tax
Reverse charge applicable? ❌ No, service provider (job worker) pays the tax
Can exemption under Entry 30 apply? ❌ No, because final product is excise-exempt
What tax to pay? Service tax at 12.36% (as applicable in Jan 2014) on job work charges

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