Service Tax Liability

Querist : Anonymous (Querist) 30 April 2011 This query is : Resolved
Dear Friends,

one of my client is a Small Scale Industries. They are doing Galvanizing activity only on Labour Charges Now from the Union Budget 2011-2012 Galvanizing process is amount to manufacturing activity., till we are paying service tax on the said process. Now which Law will applicable "Service Tax or Central Excise". please advice.

Thanks

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R.Ramachandran (Expert) 30 April 2011
If the process that you are undertaking (galvanising) amounts to 'manufacture' and that the goods that you manufacture is 'dutiable' (i.e. excise duty payable on that), then only you need not pay service tax. If any one of the two conditions are not satisfied, then you have to pay the service tax.

soumitra basu (Expert) 30 April 2011
Since it has been defined as Manufacture, then you shall only have to pay central excise duty provided your turnover is above the basic exemption limit.

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