QUESTION

We have outsource for JOB work of Goods to JOB Worker and dispatched the goods in Parts i.e. Packing Material, Consumable and Semifinished Battery on differnt challan. Further we have received the Complete Battery on challan issued by Principal challan copy with endorsement of semifinished battery challan but Packing Material and Consumable item has not been returned on challan as already clubbed in final product given by JOB worker. So please suggest how to show in JOB Worker return and close the challan on portal.

ANSWER

Facts of the case: Goods dispatched to job worker in Parts i.e. Packing Material, Consumable and Semi-finished Battery on different challan and received the Complete Battery on challan issued by Principal challan copy with endorsement of semi-finished battery challan but Packing Material and Consumable item has not been returned on challan as already clubbed in final product given by Job worker. How to show in Job Worker return and close the challan on portal.

Reply: As per Section 143 of the CGST Act the inputs/capital goods can be sent for job work outside the premises of the Registered person. This is based on CENVAT credit Rule 4(5)(a). There was a similar register required to be maintained in Central Excise named Annexure -IV.

The term input used in GST includes identifiable inputs like casting, forging, battery box etc as well as consumables like oil, lubricants, paint and packing material etc.

In practical it is not possible to mention each Challan No. of material sent (Column 2, 3 of Table-4 of ITC-04) against Challan No. of material received. (Column 7, 8 of Table-5A of ITC-04).

Considering this problem Instruction No. 3 is added in ITC-04. The same is as follows:
Form GST ITC-04

Instructions:

3. Columns (7) & (8) in Table (A), Table (B) and Table (C) may not be filled where one-to-one correspondence between goods sent for job work and goods received back after job work is not possible.

Now the problem will arise that the challan issued in Table 4 will remain unreturned (unknock off). To sought out this problem, you should write in Column 4 of Table 4, consumables with the item description. It will be better if you are keeping different challan book for Job work i.e. for consumables, for identifiable goods and for capital goods with separate serial number so that you can reconcile it easily. (Reply dt. 15/07/2021)