In response to a representation seeking clarification on the issue regarding leviability of service tax under Business Auxiliary Service (BAS) on computer embroidery work carried out on job work, the Central Board of Excise and Customs has clarified that embroidery work being a manufacturing activity falling under Chapter heading 5810 of the Central Excise Tariff Act, would not fall under BAS.
The definition of BAS as provided under Section 65 (105)(zzb) read with Section 65 (19) of the Finance Act, 1994, does not include any activity that amounts to manufacture of excisable goods. It also mentions that excisable goods has the meaning assigned to it in clause (d) of section 2 of the Central Excise Act, 1944 and manufacture has the meaning assigned to it in clause (f) of section 2 of the Central Excise Act 1944.
Once the activity is a manufacturing activity of goods specified under Central Excise Tariff Act, the said activity is not covered in the purview of BAS. When the activity is not a taxable service, the provisions of Notification No. 8/2005 - ST dated 01.03.2005 cannot be applied. The said notification can be applicable only in cases where the activity of the service provider does not amount to "manufacture" within the meaning of clause (f) of section 2 of the Central Excise Act, 1944(1 of 1944)
[Dy. No.2305/Commr(ST)/2011 dated: July 15, 2011]
No comments:
Post a Comment