MVAT & Service Tax (MOST URGENT)

MOST URGENT

My client is doning electroplating works and using MAVT 80/20 scheme.. means charged MVAt @ 12.50% on 80% of sales value because they are using chemical coating on goods and on balance 20 % of sale value is labour charges on that there is no MVAT.

Now my question is wthether service tax applicable on 20% of sale value ?

Correct data is Total sales Rs. 1,00,00,000

80% taxable value is Rs. 80,00,000 on that they charged MVAT @ 12.50%

Balance 20% labour charges Rs. 20,00,000/- no tax charged

so pl guide me whether service tax applicable on 20% i.e. on rs. 20,00,000 or not pl advice me. Because this year he cross 1 cror amount.

Regards

Rajen Vora (vora.rajen @ rediffmail.com)