Goods and Service Tax (GST) is a tax levied on goods and services supplied. Job-work and job-worker is defined by section 2(68) as, any treatment or process undertaken by a person on goods belonging to another registered person and the expression “job worker” shall be construed accordingly.
Job-work is any treatment or process undertaken on goods belonging to another registered person, and job-worker is one who undertakes this treatment or process.
Here the word is used as ANOTHER REGISTERED PERSON, what if person is not registered or in other terms whether job-work services provided to unregistered customer should be treated as job-work or normal supply of service and goods?
Section 143 of the CGST Act, 2017 specifies the conditions and procedures applicable to goods sent for Job-work. As per sub-section (1) of section 143, a registered person (principal) may under intimation and subject to such conditions as may be prescribed, send any input of capital goods, without payment of tax, to a job worker.
Yes, as per section 143 principal can send his input goods or capital goods for job-works without payment of tax.
However, there are certain conditions which should be satisfied to claim the exemption from payment of tax at the time of supply of goods for job-work.
Further it should be noted that if goods are not brought back or supplied as per above explanation, then it will be considered that goods were supplied to job-worker on the day goods were sent out.
Yes, a job-worker is liable for registration under GST. A job-worker has to get himself registered if his turnover during the financial year exceeds Rs. 20 Lakh.
Clause 3 of schedule II of CGST Act, 2017, classifies treatment or process Any treatment or process which is applied to another person's goods is a supply of services.
Since job-worker is providing a service, he will be liable to registration under section 22 of CGST Act, 2017.
No, as per the explanation provided in 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.
Section 19 of CGST Act, 2017 contains the provision concerning availing of input credit on input goods or capital goods sent for job-work.
The taxable person who sends input goods to a job-worker for job-work can take input credit subject to conditions and restrictions prescribed.
Even if goods are directly sent to place of job-worker, input tax credit can be taken by principal.
Similarly input can be taken on capital goods sent to job-worker for job-work, even if goods are directly sent to job worker.
Further it should be noted that if goods sent for job-work are not brought back or supplied within a period specified above (section 143), it shall be deemed that such goods were supplied to job-worker on the day goods sent out by principal. In case goods were directly sent to job-worker without receiving them at any of the place of principal then date should taken when goods were received by job-worker.
No, these provisions are applicable only in case of registered person sending the goods for job-work. These provisions are not attracted when the person sending goods is not registered under GST.
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