Job work or sale?

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ajay kumar (Querist)
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16 July 2013 Hello, we are involved in a business of coating small particles of Aluminium with precious metals like gold and silver for aviation industry. Such particles are given by the purchaser itself and we will just put in labour and gold for coating purpose.
My question is, whether it will come under job work or sale? Whether i am liable to pay VAT or Service Tax?

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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16 July 2013 Certainly you job worker & No service tax is payable on ‘any process amounting to manufacture or production of goods’ job-worker, as that activity falls under the negative list under Section 66D (f) of the Finance Act, 1944. Also, S. No. 30 (c) of notification no. 25/2012-ST dated June 20, 2012 exempts ‘carrying out any intermediate production process as job-work in relation to any goods on which appropriate duty is payable by the principal manufacturer’. S. No. 30 also covers certain other activities of job-work.

Therefore You don't need to pay either Service Tax or Vat