Service Tax – production of cycles, rickshaws and sewing machines – 70% abatement.
Production or processing of parts and accessories used in the manufacture of cycles, cycle rickshaws and hand-operated sewing machines, for, or on behalf of, the client falling under the category of Business auxiliary service is to be provided an abatement of 70% from the gross amount to compute the Service Tax subject to the condition that the gross amount charged from the client is inclusive of the cost of inputs and input services, whether or not supplied by the client.
If the client is supplying the inputs, where is the question of charging him for that?
Notification. No. dated the 2nd June, 2006