Taxability under service tax on process of production of goods
“Production of goods” means working upon raw materials or semi-finished goods so as to complete part or whole of production, subject to the condition that such production does not amount to “manufacture” within the meaning of Central Excise Act, 1944
- Service tax is payable if the activity does not amount to manufacture.
- No service tax is payable when the activity amounts to manufacture under Central Excise law.
Job Worker is not liable to service tax under notified taxable service of “Business Auxiliary Service” when the activity does not amount to manufacture.i.e.Production of goods on behalf of the client is leviable to service tax under ‘business auxiliary service’ only if such production activity does not amount to manufacture.