The Institute of Chartered Accountants of India (ICAI), through its GST & Indirect Taxes Committee, has released the revised edition of the Handbook on Job Work under GST (June 2026 Edition). The publication incorporates all significant legislative amendments, procedural changes, notifications and circulars issued up to 31 May 2026, providing comprehensive guidance to taxpayers, manufacturers, job workers and tax professionals.
Job Work Continues to Receive Special Facilitation under GST
Under Section 2(68) of the CGST Act, 2017, job work refers to any treatment or process undertaken on goods belonging to another registered person. The GST law continues to facilitate seamless movement of inputs and capital goods for processing without payment of tax, thereby supporting manufacturing efficiency and reducing working capital blockage for businesses.
Principal Allowed to Send Goods Without Payment of GST
The revised handbook reiterates that registered principals may send inputs, semi-finished goods and capital goods to job workers without payment of GST under Section 143 of the CGST Act. Such movement is required to be supported by a delivery challan and other prescribed documentation, ensuring smooth compliance while maintaining traceability of goods.
Important Time Limits Prescribed for Return of Goods
The GST framework prescribes specific timelines for return or supply of goods sent for job work:
- Inputs and semi-finished goods must be returned within one year.
- Capital goods must be returned within three years.
- Moulds, dies, jigs, fixtures and tools are exempt from these time restrictions.
Failure to comply with these timelines results in a deemed supply by the principal from the date the goods were originally sent, attracting applicable GST along with interest.
Filing of Form GST ITC-04 Rationalised
The revised guidance highlights the present compliance requirements for Form GST ITC-04. Principals having aggregate turnover exceeding ₹5 crore are required to furnish details every six months, while other taxpayers are required to file the statement annually. The filing continues to serve as an important mechanism for reporting movement of goods sent for job work.
Input Tax Credit Benefits Preserved
GST law continues to allow principals to avail Input Tax Credit (ITC) on inputs and capital goods sent for job work, even where such goods are dispatched directly to the premises of the job worker without first reaching the principal’s place of business. This provision supports uninterrupted credit flow and simplifies procurement and manufacturing arrangements.
Direct Supply from Job Worker’s Premises Permitted
The handbook reiterates that goods may be supplied directly from the premises of the job worker after completion of processing, subject to prescribed conditions. Such supplies are treated as supplies made by the principal, ensuring continuity of the tax chain while reducing logistical costs.
Mandatory E-Way Bill Requirement for Inter-State Job Work Movement
The publication emphasizes that e-way bills remain mandatory for inter-State movement of goods relating to job work, irrespective of the consignment value, thereby strengthening compliance monitoring and documentation requirements.
Clarification on Waste and Scrap Disposal
The GST provisions permit registered job workers to directly clear waste and scrap generated during processing on payment of applicable tax. In cases where the job worker is unregistered, such waste and scrap are required to be supplied by the principal in accordance with prescribed procedures.
GST Rates on Job Work Services Remain Sector-Specific
The handbook consolidates applicable GST rates for job work services under Heading 9988. Concessional rates continue for specified sectors such as food products, textiles, leather, printing and handicrafts, while general job work services remain taxable at the standard prescribed rate.
Multiple CBIC Circulars Consolidated for Stakeholder Guidance
The revised publication compiles and discusses important CBIC circulars issued between 2017 and 2024 relating to job work procedures, valuation, compliance obligations, registration requirements and movement of goods. This provides a single reference point for businesses and professionals dealing with job work transactions.
Industry-Friendly Compliance Framework Expected to Support Manufacturing Sector
The updated guidance is expected to facilitate greater compliance certainty for manufacturers and job workers operating across supply chains. By consolidating statutory provisions, procedural requirements and practical illustrations, the revised handbook seeks to improve awareness and ensure uniform implementation of job work provisions under GST across the country.
The Handbook can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2026/06/Handbook-on-Job-Work-under-GST_June-4th-2026-Edition.pdf
