Section 143: The Job Work Procedure, Clause by Clause

Section 143 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

Section 143 is a permission with a deadline attached. It lets goods leave without tax on the promise that one of two things will happen within a fixed time — and if neither does, the section itself converts the movement into a supply, backdated to the day the goods went out.

Section 143(1) — a registered person (the principal) may, under intimation and subject to prescribed conditions, send inputs or capital goods without payment of tax to a job worker, and from there to another job worker, and shall either (a) bring them back to any of his places of business within one year (inputs) or three years (capital goods), or (b) supply them from the job worker's place of business within the same periods. Sub-sections (3) and (4) deem an unreturned consignment to have been supplied on the day it was sent out. Sub-section (2) puts the accounts responsibility on the principal, and sub-section (5) deals with waste and scrap.

Sub-section (1): the permission and its two exits

The permission is to send inputs or capital goods, without payment of tax, to a job worker "and from there subsequently send to another job worker and likewise" — so a chain of job workers is expressly contemplated.

Exit (a) — bring them back. "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 and three years, respectively, of their being sent out, to any of his place of business, without payment of tax."

Read "to any of his place of business" carefully. The Handbook draws it out: "Inputs after job work activities can be received back at any of the place of business of the principal. Therefore, inputs can be received back at the principal place of business or even at any of the place registered as an additional place of business." The same applies to capital goods. Goods do not have to return to the factory they left.

And note "or otherwise". The goods may come back without the job work having been done — an abandoned process, a rejected batch — and still be within the section.

Exit (b) — supply from the job worker's premises, within the same one-year and three-year periods, "on payment of tax within India, or with or without payment of tax for export".

Exit (b) has a proviso. The principal may not supply from the job worker's place of business unless he declares that place as his additional place of business, except where (i) the job worker is registered under section 25, or (ii) the principal is engaged in the supply of such goods as may be notified by the Commissioner. Supplying from the job worker's premises →

The extension. A second proviso, inserted by section 29 of the CGST (Amendment) Act, 2018, notified through Notification No. 2/2019-CT dated 29.01.2019, w.e.f. 01.02.2019, allows the Commissioner, on sufficient cause being shown, to extend the one-year and three-year periods by a further period not exceeding one year and two years respectively.

Sub-sections (3) and (4): the deeming, and its backdating

Sub-section (3) — inputs. Where inputs are neither received back under clause (a) nor supplied under clause (b) within one year of being sent out, "it shall be deemed that such inputs had been supplied by the principal to the job worker on the day when the said inputs were sent out."

Sub-section (4) — capital goods, other than moulds and dies, jigs and fixtures or tools, on the same terms over three years.

The backdating is the sting. The supply is not deemed to occur when the deadline expires; it is deemed to have occurred on the day the goods left. Interest therefore runs from that earlier date.

Circular No. 38/12/2018 sets out what the principal must actually do: "the principal would issue invoice for the same and declare such supplies in his return for that particular month in which the time period of one year / three years or extended period has expired. The principal is required to pay GST along with interest considering the supply was made by the principal to the job worker when the principal had sent the goods first for job work."

So the invoice is current-dated, the liability is backdated. That combination has a useful consequence for the job worker's credit. Section 19 and the credit chain →

And the value is fixed by the challan. "Value of such deemed supply will be the value declared in the challan by the principal while sending the goods to job worker i.e., without including cost of transportation and job work charges."

Rule 45(4) supplies the reporting mechanics: the deemed supply "shall be declared in FORM GSTR-1 and the principal shall be liable to pay the tax along with applicable interest."

Two situations the deeming does not cover

Goods lost or destroyed at the job worker's premises. The Handbook poses the question — is this a section 17(5)(h) credit reversal or a section 19(3) deemed supply? — and answers it:

"Since goods are lost or destroyed, section 17(5)(h) will be applicable and the principal is required to reverse the credit on inputs or capital goods, and it will not be treated as deemed supply."

A dispute in which the job worker retains the goods. Where goods are not returned because of a dispute over job work charges, and the job worker sells them in the open market, the valuation question is whose value applies. The Handbook: "It is a well settled position in earlier laws that the valuation for the same goods should be considered transaction value by the job worker and not market value of the said goods by the principal. The same was decided by the Hon'ble Supreme Court in Pawan Biscuits & Co. [2000 (120) ELT (24)]."

Sub-section (2): whose books

"The responsibility for keeping proper accounts for the inputs or capital goods shall lie with the principal."

Not the job worker. The Handbook restates it: "In terms of section 143(2) of CGST Act, 2017 the principal shall be responsible for keeping proper accounts for the inputs or capital goods or waste/scrap lying with the job-worker."

That single sub-section explains the whole documentary regime — the challan, the ITC-04, the GSTR-1 reporting of challans. The goods are off-site and untaxed; the only record of them is the principal's.

Sub-section (5): waste and scrap

"Notwithstanding anything contained in sub-sections (1) and (2), 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." Waste and scrap →

The intimation, and what serves as it

Section 143(1) requires the movement to be "under intimation". In practice that requirement is met by the return:

"The principal is required to file Form GST ITC-04 by the 25th day of the month succeeding the . The said form will serve as intimation as envisaged under section 143 of the CGST Act, 2017."

So there is no separate intimation letter. ITC-04 and the specified period →

Section 141: the transitional provision that still explains old files

Section 141 covers inputs and semi-finished goods removed to a job worker before the appointed day under the erstwhile law and returned afterwards. No tax is payable if they are returned within six months from the appointed day, extendable by the Commissioner by a further two months. If not returned in time, "the input tax credit shall be liable to be recovered" under section 142(8)(a).

Sub-section (3) covers excisable goods removed without payment of duty for tests or other processes not amounting to manufacture, on the same six-month terms.

And sub-section (4) makes the relief conditional on a declaration — the tax is not payable "only if the manufacturer and the job worker declare the details of the inputs or goods held in stock by the job worker on behalf of the manufacturer on the appointed day". Under rule 119 read with rule 117, that declaration was FORM GST TRAN-1, within 90 days of the appointed day (extendable by a further 90 days) — furnished by the principal as well as the job worker.

Key takeaways

• Section 143 permits movement without payment of tax, under intimation — and ITC-04 serves as the intimation.
• Two exits: bring back to any place of business, or supply from the job worker's premises — both within one year / three years.
• The Commissioner may extend by a further one year / two years — second proviso, w.e.f. 01.02.2019.
• Failure deems a supply on the day the goods were sent out — invoice in the month the period expires, tax with interest from the original date.
• The value is the challan value, excluding transportation and job work charges.
• Goods lost or destroyed are a section 17(5)(h) reversal, not a deemed supply.
• Where a job worker sells retained goods in a dispute, his transaction value applies — Pawan Biscuits.
• Accounts are the principal's responsibility under sub-section (2).
• Section 141 transitional relief needed a TRAN-1 declaration by both parties.

Read next

• Job Work Time Limits, Deemed Supply and the Commissioner's Extension
• Rule 45 and Rule 55: The Job Work Delivery Challan
• Supplying Directly From the Job Worker's Premises

Disclaimer: Positions stated as on 5 September 2026, based on sections 141, 142(8), 143 and 17(5)(h) of the CGST Act, 2017, rules 45, 117 and 119 of the CGST Rules, 2017, Notification No. 2/2019-Central Tax dated 29 January 2019 and Circular No. 38/12/2018-GST, as reproduced in the ICAI Handbook on Job Work under GST (4th edition, June 2026, updated to 31 May 2026).