Vat liability on jobwork

This query is : Resolved

Ravi (Querist)
Follow

15 May 2012 If a person wants to start jobwork of making parts, will he be liable to VAT ? Here the machineries will be provided by the job-provider.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
Follow

15 May 2012 Mr Ravi,
If the material required for the making parts are provided by the client then only it becomes a job work and exempt from VAT.
MJK

NILESHKUMAR

NILESHKUMAR (Expert)
Follow

16 May 2012 If the Raw material is provided by principle and job workers is just converting/asembling than no , if job worker is using its own rm othern that RM supplied by principl, VAT will be applicable to the extent of value of RM used by job worker in manufacting job work goods.

Upgrade to CAclubindia Pro. Subscribe Now!