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What is the Job Workers?

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A Job Workers is the person who manufactures goods on behalf of some other person.

Example:-

Suppose i have a factory. It is not necessary that all the manufacturing or processing is done by me. Some of it may be outsourced to some other person, like coloring, dyeing, repairing. This person is called Job Workers.

Normal Case  (No Job Worker).jpg

Goods Received by Factory.jpg

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What is meant by Goods Sent Directly to Jobworker?

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Suppose manufacturer purchases the goods from A LTD 

He ask A LTD not to delivered to goods to him, but sent directly to the Jobworker, this is called goods sent directly to Job Worker.

Goods Sent Directly to Job workers.jpg


Goods Sent Directly to Job workers &  Sold by Job Worker.jpg

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In GST, Can the Manufacturer take input on Goods Received directly by Jobworker?

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Input can be taken by Manufacturer on the Date Goods are Received by Job Worker

  • However, it should be received by Factory or Sold from Job Worker premises within 1 year of Receipt of Goods
  • If not received back or sold within 1 year, then it will be Deemed that Goods were sold to Job worker and duty will be paid on it to gather with interest
  • This interest shall be calculated from date of receipt of goods
  • This period is 3 years in case of Capital Goods

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What are the time period of Return of Goods?

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                       Time Period  for Return of Goods
Inputs One Year
Capital Gods Three Years
Mould/Dies Not applicable as these are consumed in Production

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  1. GST - Goods and Services Tax, India
  2. GST Computation & Accounting
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About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 7 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .
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