The document discusses various aspects of job work under GST including: - The definition of job work as any treatment or process undertaken on goods belonging to another registered person. - Input tax credit provisions for inputs and capital goods sent for job work. - The procedure for sending inputs/capital goods to a job worker without payment of tax and bringing them back after job work. - Transactional provisions for inputs/goods sent to a job worker before the GST appointed date. - Requirements for maintaining proper accounts and reconciling supplies between the principal and job worker.

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2. Job
work
Definition –
Section 2(68)
Registration –
Section 22
InputTax Credit
– Section 19
and Rule 10
Procedure –
Section 143
Transactional
provisions
Reconciliations
and others
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3. What is the Job work
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The activity undertaken by small industries to complete the process on raw
material/semi-finished goods as desired by principal manufacturer is known as "Job
Work".
It has various nomenclatures
1. "job work" or "sub-contracting" in
engineering or FMCG industry,
2. "processing" in chemical or textile
industry
3. loan licensee" in pharmaceutical
industry.

4. Definition – Section 2(68)
“job work” means any treatment or process undertaken by a person on
goods belonging to another registered person and the expression “job worker”
shall be construed accordingly
Include all activities or process whether relates to manufacturing or any
operation to complete the process.
Goods belongs to Registered Person.
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5. Registration – Section 22 1. Job work’ is a service,
2. the job worker would be required to obtain
registration
3. if his aggregate turnover exceeds the prescribed
threshold Rs.20 lakh,
4. in case NE Rs.10 lakh)
Explanation (ii) to Section 22 : the supply of goods, after completion of job work, by a
registered job worker shall be treated as the supply of goods by the principal referred
to in section 143, and the value of such goods shall not be included in the aggregate
turnover of the registered job worker;
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6. Applicability of Provisions
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1.1.1.1. The provisions relating to job work are applicable onlyThe provisions relating to job work are applicable onlyThe provisions relating to job work are applicable onlyThe provisions relating to job work are applicable only whenwhenwhenwhen registered taxableregistered taxableregistered taxableregistered taxable
person intends to send taxable goodsperson intends to send taxable goodsperson intends to send taxable goodsperson intends to send taxable goods....
InInInIn other words, these provisions are not applicable to exempted or nonother words, these provisions are not applicable to exempted or nonother words, these provisions are not applicable to exempted or nonother words, these provisions are not applicable to exempted or non----taxabletaxabletaxabletaxable
goods or when the sender is a person other than registered taxable person.goods or when the sender is a person other than registered taxable person.goods or when the sender is a person other than registered taxable person.goods or when the sender is a person other than registered taxable person.

7. Applicability of Provisions
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1.1.1.1. ItItItIt isisisis notnotnotnot compulsorycompulsorycompulsorycompulsory thatthatthatthat jobjobjobjob workworkworkwork provisionsprovisionsprovisionsprovisions shouldshouldshouldshould bebebebe followedfollowedfollowedfollowed bybybyby thethethethe principalprincipalprincipalprincipal....
a.a.a.a. TheTheTheThe principalprincipalprincipalprincipal cancancancan sendsendsendsend thethethethe inputsinputsinputsinputs orororor capitalcapitalcapitalcapital goodsgoodsgoodsgoods afterafterafterafter paymentpaymentpaymentpayment ofofofof GSTGSTGSTGST withoutwithoutwithoutwithout
followingfollowingfollowingfollowing thethethethe specialspecialspecialspecial procedureprocedureprocedureprocedure....
b.b.b.b. InInInIn suchsuchsuchsuch aaaa case,case,case,case, thethethethe jobjobjobjob----workerworkerworkerworker wouldwouldwouldwould taketaketaketake thethethethe inputinputinputinput taxtaxtaxtax creditcreditcreditcredit andandandand supplysupplysupplysupply backbackbackback thethethethe
processedprocessedprocessedprocessed goodsgoodsgoodsgoods (after(after(after(after completioncompletioncompletioncompletion ofofofof jobjobjobjob----work)work)work)work) onononon paymentpaymentpaymentpayment ofofofof GSTGSTGSTGST....

8. InputTax Credit – Section 19
Provision InputTax Credit
Section 19 (1) Principal shall be allowed input tax credit on inputs sent to a job worker for job work
Section 19 (2) principal shall be entitled to take credit of input tax on inputs even if the inputs are directly sent to a
job worker for job work without being first brought to his place of business
Section 19 (3) inputs sent for job work are not received back by the principal within one year it shall be deemed that
such inputs had been supplied by the principal to the job worker
Section 19 (4) principal shall be allowed input tax credit on capital goods sent to a job worker for job work
Section 19 (5) principal shall be entitled to take credit of input tax on capital goods even if the capital goods are
directly sent to a job worker for job work without being first brought to his place of business
Section 19 (6) Capital goods sent for job work are not received back by the principal within three year it shall be
deemed that such inputs had been supplied by the principal to the job worker.
Section 19 (7) Exception for dies, jigs and fixtures, or tools sent out to a job worker for job work
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9. InputTax Credit –Rule 10 of ITC Rules Conditions and restrictions in respect of inputs and capital goods sent
to the job worker
1.1.1.1. TheTheTheThe inputs,inputs,inputs,inputs, semisemisemisemi----finishedfinishedfinishedfinished goodsgoodsgoodsgoods orororor capitalcapitalcapitalcapital goodsgoodsgoodsgoods shallshallshallshall bebebebe sentsentsentsent totototo thethethethe jobjobjobjob workerworkerworkerworker underunderunderunder thethethethe covercovercovercover
ofofofof aaaa challanchallanchallanchallan issuedissuedissuedissued bybybyby thethethethe principal,principal,principal,principal, includingincludingincludingincluding wherewherewherewhere suchsuchsuchsuch goodsgoodsgoodsgoods areareareare sentsentsentsent directlydirectlydirectlydirectly totototo aaaa jobjobjobjob----workerworkerworkerworker....
2.2.2.2. TheTheTheThe challanchallanchallanchallan issuedissuedissuedissued bybybyby thethethethe principalprincipalprincipalprincipal totototo thethethethe jobjobjobjob workerworkerworkerworker shallshallshallshall containcontaincontaincontain thethethethe detailsdetailsdetailsdetails specifiedspecifiedspecifiedspecified inininin rulerulerulerule
InvoiceInvoiceInvoiceInvoice....10101010::::
3.3.3.3. TheTheTheThe detailsdetailsdetailsdetails ofofofof challanschallanschallanschallans inininin respectrespectrespectrespect ofofofof goodsgoodsgoodsgoods dispatcheddispatcheddispatcheddispatched totototo aaaa jobjobjobjob workerworkerworkerworker orororor receivedreceivedreceivedreceived fromfromfromfrom aaaa jobjobjobjob
workerworkerworkerworker duringduringduringduring aaaa taxtaxtaxtax periodperiodperiodperiod shallshallshallshall bebebebe includedincludedincludedincluded inininin FORMFORMFORMFORM GSTRGSTRGSTRGSTR----1111 furnishedfurnishedfurnishedfurnished forforforfor thatthatthatthat periodperiodperiodperiod....
4.4.4.4. WhereWhereWhereWhere thethethethe inputsinputsinputsinputs orororor capitalcapitalcapitalcapital goodsgoodsgoodsgoods areareareare notnotnotnot returnedreturnedreturnedreturned totototo thethethethe principalprincipalprincipalprincipal withinwithinwithinwithin thethethethe timetimetimetime stipulatedstipulatedstipulatedstipulated inininin
sectionsectionsectionsection 143143143143,,,, thethethethe challanchallanchallanchallan issuedissuedissuedissued underunderunderunder subsubsubsub----rulerulerulerule ((((1111)))) shallshallshallshall bebebebe deemeddeemeddeemeddeemed totototo bebebebe anananan invoiceinvoiceinvoiceinvoice forforforfor thethethethe
purposespurposespurposespurposes ofofofof thethethethe ActActActAct....
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10. Procedure – Section 143
Provisions Job work procedure
Section 143 (1) A registered person may under intimation send any inputs or capital goods, without payment of tax,
to a job worker for job work
Section 143 (1a) bring back inputs or capital goods, after completion of job work with in one year or three years
respectively with out payment of duty
Section 143 (2) the responsibility for keeping proper accounts for the inputs or capital goods shall lie with the
principal
Section 143 (3) inputs sent for job work are not received back by the principal after completion of job work within a
period of one year, it shall be deemed that such inputs had been supplied by the principal to the job
worker
Section 143 (4) Capital goods sent for job work are not received back by the principal after completion of job work
within a period of three year, it shall be deemed that such capital goods had been supplied by the
principal to the job worker
Section 143 (5) Any waste and scrap generated during the job work may be supplied by the job worker directly from
his place of business on payment of tax, if such job worker is registered, or by the principal, if the job
worker is not registered
Section 143 (5) Explanation.––For the purposes of job work, input includes intermediate goods
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11. • Inputs sent to job worker before the appointed day and is received back
from job worker after the appointed day, NO GST shall be payable if
received within 6 months from appointed day which may further be
extended to 2 months by commissioner.
• If goods are not received back in 6 + 2 months CCR claimed on such inputs
in previous shall also be recovered.
Section 141(1) input sent to job worker
before appointed day
Transactional provisions

12. • SemiSemiSemiSemi finishedfinishedfinishedfinished goodsgoodsgoodsgoods sentsentsentsent totototo jobjobjobjob workerworkerworkerworker beforebeforebeforebefore thethethethe appointedappointedappointedappointed daydaydayday andandandand isisisis
receivedreceivedreceivedreceived backbackbackback fromfromfromfrom jobjobjobjob workerworkerworkerworker afterafterafterafter thethethethe appointedappointedappointedappointed day,day,day,day, NONONONO GSTGSTGSTGST shallshallshallshall bebebebe
payablepayablepayablepayable ifififif receivedreceivedreceivedreceived withinwithinwithinwithin 6666 monthsmonthsmonthsmonths fromfromfromfrom appointedappointedappointedappointed daydaydayday whichwhichwhichwhich maymaymaymay furtherfurtherfurtherfurther bebebebe
extendedextendedextendedextended totototo 2222 monthsmonthsmonthsmonths bybybyby commissionercommissionercommissionercommissioner....
• IfIfIfIf goodsgoodsgoodsgoods areareareare notnotnotnot receivedreceivedreceivedreceived backbackbackback inininin 6666 ++++ 2222 monthsmonthsmonthsmonths CCRCCRCCRCCR claimedclaimedclaimedclaimed onononon inputsinputsinputsinputs
containedcontainedcontainedcontained inininin suchsuchsuchsuch semisemisemisemi finishedfinishedfinishedfinished goodsgoodsgoodsgoods inininin previouspreviouspreviousprevious shallshallshallshall alsoalsoalsoalso bebebebe recoveredrecoveredrecoveredrecovered....
• GoodsGoodsGoodsGoods maymaymaymay clearedclearedclearedcleared fromfromfromfrom thethethethe jobjobjobjob workerworkerworkerworker premisespremisespremisespremises totototo anyanyanyany otherotherotherother registeredregisteredregisteredregistered
personpersonpersonperson onononon paymentpaymentpaymentpayment ofofofof GSTGSTGSTGST orororor maymaymaymay bebebebe exportedexportedexportedexported withoutwithoutwithoutwithout paymentpaymentpaymentpayment ofofofof GSTGSTGSTGST....
Section 141(2) Semi finished goods sent
to job worker before appointed day
Transactional provisions

13. • FinishedFinishedFinishedFinished goodsgoodsgoodsgoods sentsentsentsent totototo jobjobjobjob workerworkerworkerworker beforebeforebeforebefore thethethethe appointedappointedappointedappointed daydaydayday andandandand isisisis receivedreceivedreceivedreceived
backbackbackback fromfromfromfrom jobjobjobjob workerworkerworkerworker afterafterafterafter thethethethe appointedappointedappointedappointed day,day,day,day, NONONONO GSTGSTGSTGST shallshallshallshall bebebebe payablepayablepayablepayable ifififif
receivedreceivedreceivedreceived withinwithinwithinwithin 6666 monthsmonthsmonthsmonths fromfromfromfrom appointedappointedappointedappointed daydaydayday whichwhichwhichwhich maymaymaymay furtherfurtherfurtherfurther bebebebe extendedextendedextendedextended
totototo 2222 monthsmonthsmonthsmonths bybybyby commissionercommissionercommissionercommissioner....
• IfIfIfIf goodsgoodsgoodsgoods areareareare notnotnotnot receivedreceivedreceivedreceived backbackbackback inininin 6666 ++++ 2222 monthsmonthsmonthsmonths CCRCCRCCRCCR claimedclaimedclaimedclaimed onononon inputsinputsinputsinputs
containedcontainedcontainedcontained inininin suchsuchsuchsuch semisemisemisemi finishedfinishedfinishedfinished goodsgoodsgoodsgoods inininin previouspreviouspreviousprevious shallshallshallshall alsoalsoalsoalso bebebebe recoveredrecoveredrecoveredrecovered....
• GoodsGoodsGoodsGoods maymaymaymay clearedclearedclearedcleared fromfromfromfrom thethethethe jobjobjobjob workerworkerworkerworker premisespremisespremisespremises totototo anyanyanyany otherotherotherother registeredregisteredregisteredregistered
personpersonpersonperson onononon paymentpaymentpaymentpayment ofofofof GSTGSTGSTGST orororor maymaymaymay bebebebe exportedexportedexportedexported withoutwithoutwithoutwithout paymentpaymentpaymentpayment ofofofof GSTGSTGSTGST....
Section 141(3) Finished goods sent to job
worker before appointed day
Transactional provisions

14. • ConditionConditionConditionCondition for Section 141(1), 141(2) & 141(3) & Rule 2 of Transactional Provisionfor Section 141(1), 141(2) & 141(3) & Rule 2 of Transactional Provisionfor Section 141(1), 141(2) & 141(3) & Rule 2 of Transactional Provisionfor Section 141(1), 141(2) & 141(3) & Rule 2 of Transactional Provision
• Both Job worker and principal manufacture have to declare the stock held byBoth Job worker and principal manufacture have to declare the stock held byBoth Job worker and principal manufacture have to declare the stock held byBoth Job worker and principal manufacture have to declare the stock held by
job worker on the appointed day in such form and time as may be prescribed.job worker on the appointed day in such form and time as may be prescribed.job worker on the appointed day in such form and time as may be prescribed.job worker on the appointed day in such form and time as may be prescribed.
Section 141(4) - DeclarationTransactional provisions

15. Responsibility for Record
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ItItItIt isisisis completelycompletelycompletelycompletely thethethethe responsibilityresponsibilityresponsibilityresponsibility ofofofof thethethethe principalprincipalprincipalprincipal totototo
maintainmaintainmaintainmaintain properproperproperproper accountsaccountsaccountsaccounts ofofofof jobjobjobjob workworkworkwork relatedrelatedrelatedrelated inputsinputsinputsinputs
andandandand capitalcapitalcapitalcapital goodsgoodsgoodsgoods....

16. Reconciliation of Inward and Outward Supplies
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IfIfIfIf theretheretherethere isisisis aaaa mismatchmismatchmismatchmismatch betweenbetweenbetweenbetween thethethethe detailsdetailsdetailsdetails ofofofof
outwardoutwardoutwardoutward suppliessuppliessuppliessupplies
andandandand inwardinwardinwardinward supplysupplysupplysupply
andandandand notnotnotnot rectifiedrectifiedrectifiedrectified inininin thethethethe monthmonthmonthmonth ofofofof communication,communication,communication,communication, thethethethe
recipientrecipientrecipientrecipient isisisis liableliableliableliable totototo paypaypaypay thethethethe GSTGSTGSTGST alongalongalongalong withwithwithwith interestinterestinterestinterest inininin thethethethe
subsequentsubsequentsubsequentsubsequent monthmonthmonthmonth

17. Location of job worker and principal manufacturer
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In respect to location of Both parties, it is not required to be situated at oneIn respect to location of Both parties, it is not required to be situated at oneIn respect to location of Both parties, it is not required to be situated at oneIn respect to location of Both parties, it is not required to be situated at one
state.state.state.state.
ProvisionsProvisionsProvisionsProvisions relating to job work have been adopted in the IGST Act as well asrelating to job work have been adopted in the IGST Act as well asrelating to job work have been adopted in the IGST Act as well asrelating to job work have been adopted in the IGST Act as well as
in UTGST Actin UTGST Actin UTGST Actin UTGST Act ((((CHAPTERCHAPTERCHAPTERCHAPTER IX ,MISCELLANEOUS),IX ,MISCELLANEOUS),IX ,MISCELLANEOUS),IX ,MISCELLANEOUS),
HenceHenceHenceHence jobjobjobjob----workerworkerworkerworker and principal can be locatedand principal can be locatedand principal can be locatedand principal can be located
a.a.a.a. eithereithereithereither is same Stateis same Stateis same Stateis same State
b.b.b.b. orororor in same Union Territoryin same Union Territoryin same Union Territoryin same Union Territory
c.c.c.c. orororor in different Statesin different Statesin different Statesin different States
d.d.d.d. orororor Union TerritoriesUnion TerritoriesUnion TerritoriesUnion Territories

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