Manner of Taking ITC in respect of goods transfer for Job Work & Job work procedure [ section 19 & 143 of CGST Act] - GST Ready Reckoner - GST

Manner of Taking ITC in respect of goods transfer for Job Work Job work procedure Taking input tax credit in respect of inputs or capital goods sent for job work[ section 19 of CGST Act read along with rule 45 of CGST Rules ] The principal shall be allowed input tax credit on inputs or capital goods sent to a job work for job-work. Notwithstanding anything contained in section 16(2)(b) , The principal shall be entitled to take credit of input tax on inputs or capital goods even if the inputs are directly sent to a job worker for job-work without being first brought to his place of business. The inputs, semi-finished goods or capital goods shall be sent to the job worker by the principal under the cover of a challan issued by the principal, including where such goods are sent directly to a job-worker and where the goods are sent from one job worker to another job worker, the challan may be issued either by the principal or the job worker sending the goods to another job worker: The challan issued by the principal to the job worker where such goods are sent directly to a job-worker shall contain the details specified in rule 55. Details of challans in respect of supply of goods dispatched to be included in return to a job work or received from job worker shall be furnished in following manner :- Particular Period Due Date Form If Aggregate turnover exceeds 5 crore during the immediately preceding financial year The period of 6 consecutive Months from a)1st April to 30th September, and b) 1st October to 31 March 25th of succeeding month ITC -04 In other Case Financial year 25th of succeeding month Job work procedure ( section 143 of CGST Act ) The principal registered person may under intimation and subject to such conditions as may be prescribed, send any inputs or capital goods, without payment of tax, to a job worker for job work and from there subsequently send to another job worker and likewise, and shall, (a) bring back inputs, after completion of job work or otherwise, or capital goods, other than moulds and dies, jigs and fixtures, or tools, within one year (inputs) and three years (capital goods), of their being sent out, to any of his place of business, without payment of tax. (b) supply such inputs, after completion of job work or otherwise, or capital goods, other than moulds and dies, jigs and fixtures, or tools, within one year (inputs) and three years (capital goods), of their being sent out from the place of business of a job worker on payment of tax within India, or with or without payment of tax for export, as the case may be: (c) The principal shall not supply the goods from the place of business of a job worker in accordance with the provisions of this clause unless the said principal declares the place of business of the job worker as his additional place of business except in a case- (i) where the job worker is registered under section 25; or (ii) where the principal is engaged in the supply of such goods as may be notified by the Commissioner (d) Where the inputs are sent directly to a job worker, the period of one year shall be counted from the date of receipt of inputs by the job worker. (e) Extension of period - The period of one year( inputs) and three years (capital goods) may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding one year and two years respectively (f) Inputs or Capital goods not bring back or supply:- If inputs or capital goods sent for job work are not received back or are not supplied from the place of business of the job worker by principal within time stipulated in section 143, it shall be deemed that such inputs had been supplied by the principal to job worker on the day when the said inputs or capital goods were sent out and the said supply shall be declared in Form GSTR-1 and principal liable to pay the tax along with applicable interested according to section 50 of this act. (g) Notwithstanding anything contained in sub-sections (1) and (2) of Section 143, 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.