24 September 2011
One of the my client is engaged in the business of machining jobwork, i.e., processing on metal parts.
He receives raw material or semi finished goods from principal and return the processed semi finished goods to principal. The principal may be excisable or not excisable unit. In this case, whether there is any liability to pay service tax on job-worker?
You can claim exemption of service tax if your activity does not amount to manufacture and principal in turn uses the processed goods into dutiable goods.
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