Whether production of RMC a business auxiliary service

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CS SAJU PHILIP MANALEL

Company Secretary in Practise

112 Points Posted on 20 July 2011

Dear All

Production or processing of goods for or on behalf of a client falls uder Business Auxiliary Service provided such activity doesnot amounts to 'manufacuture of excisable goods'.
Ready-Mix Concrete attracts excise duty and as such falls under excisable goods (i believe).
A company produces RMC for outside parties. Here my query is whether the company is liable to pay service tax in the following situations:
1) if the raw materials are supplied by the client
2) if the raw materials are used in-house.

If service tax is not applicable then whether Excise registration is required?.

Regards

CS Saju Philip
sajuphilipcs @ yahoo.com

Replies (2)

U S Sharma

glidor@gmail.com

21670 Points Posted on 20 July 2011

RMC produced at site of use is subject to service tax ( if inputs are provided by client)

RMC produced at site of use is subject to works contract ( if inputs are provided by vendor'/ job worker)

while RMC cleared from place of manufacture to the site is excisable goods and duty is payable on clearance value.

suresh reddy

ACCOUNTS EXECUTIVE

26 Points Posted on 13 January 2012

Please let us clarify... if ready mix concrete is produced at site and part of basic materials (only cement)are supplied by client..... in this case service tax applicable if applicable at what rate...... is any deduction of VAT on bill applicable.