Supplying Directly From the Job Worker's Premises

Supplying Directly 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.

Sending finished goods back to the principal only to ship them out again is pure waste — a freight leg, a handling cost and days of transit for nothing. Section 143(1)(b) removes it, but only through one of three gateways.

Section 143(1)(b) lets the principal supply the goods from the job worker's place of business within the one-year and three-year periods, on payment of tax within India, or with or without payment of tax for export. Its proviso bars that "unless the said principal declares the place of business of the job worker 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. Where the job worker is registered, the supply "shall be treated as the supply of goods by the principal" and its value is not included in the job worker's aggregate turnover.

The three gateways

The Handbook states the position in the Return of Goods chapter:

"after the completion of job work, such goods can be directly supplied from the place of the job worker to the customer if: (a) the job worker is registered; or (b) the job worker is not registered but his place of business is declared as additional place of business by the principal."

And the statutory proviso adds a third: where "the principal is engaged in the supply of such goods as may be notified by the Commissioner".

Gateway one is the commercially normal case, and the reason principals prefer registered job workers even where the job worker's turnover would not require registration. A job worker below the threshold may register voluntarily under section 25(3) precisely to open this route for his customers.

Gateway two costs the principal a registration amendment. Declaring an APOB means the premises appear on the principal's registration certificate, with the record-keeping consequences that follow under section 35 and rules 56 to 58.

Whose supply is it, and whose turnover

"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 and the value of such goods shall not be included in the aggregate turnover of the registered job worker."

Two consequences follow.

The principal invoices the customer. The goods are the principal's; the supply is the principal's; the tax invoice carries the principal's GSTIN. The job worker's own invoice covers only his job work charges.

The job worker's turnover is unaffected. He does not add the value of the goods to his aggregate turnover, and does not approach a registration threshold on someone else's stock. That is the same protection given by explanation (ii) to section 22 on the inbound side. Registration and aggregate turnover →

But the protection is for a registered job worker. Where both the principal and the job worker are unregistered, the Handbook records the opposite outcome — the value of the goods becomes the job worker's supply and enters his turnover.

The documents that make it work

The Handbook's Scenario 3 sets out the paperwork for a direct customer supply from the job worker's premises:

From the principal to the job worker, with the goods:

1. Goods sent for job work;
2. Delivery challan in duplicate;
3. E-way bill in case of inter-State movement;
4. The invoice for the supply, to be given to the customer.

From the job worker to the principal:

1. Invoice for job work charges;
2. Second copy of the delivery challan issued by the principal.

From the job worker to the final customer:

1. Goods;
2. E-way bill;
3. The invoice for supply, to be given to the customer.

Note item 4 in the first list. The principal's tax invoice for the sale travels to the job worker in advance so that it can accompany the goods when they leave for the customer. The job worker is dispatching against the principal's document, not his own.

The place of supply, which is not where the goods are

This is where direct supply from a job worker most often goes wrong, and the Handbook is precise. Where the registered job worker and the principal are in different States and goods are removed directly from the job worker's place:

• "If the principal (supplier of the goods) and recipient (buyer of the goods) are in the same State, then SGST and CGST shall be levied, though the job worker is in a different State."
• "If the principal and recipient are in different States, then IGST shall be levied, even though the recipient is in the State where the job worker is situated."

The job worker's location is irrelevant to the head of tax. The supply is between the principal and the customer; the goods merely start their journey from a third party's premises. A Maharashtra principal selling to a Maharashtra customer out of a Gujarat job worker's factory charges CGST and SGST, not IGST.

That produces a document that looks wrong and is not — an intra-State invoice against goods physically moving between two States. The e-way bill records the actual movement; the invoice records the actual supply.

The deadline still applies

Section 143(1)(b) is an exit from the time limit, not an exception to it. The supply from the job worker's premises must happen within one year (inputs) or three years (capital goods) of the goods being sent out, extendable by the Commissioner by a further one year / two years.

Goods that sit finished at the job worker's premises awaiting a buyer are still on the clock. Neither exit has been taken, and on expiry sections 143(3)/(4) deem a supply backdated to the day of despatch. Time limits and deemed supply →

And the movement is reportable. Goods directly supplied from the premises of the job worker are one of the four movements to be furnished in ITC-04.

Key takeaways

• Section 143(1)(b) permits supply from the job worker's premises, in India on payment of tax, or for export with or without payment.
• Three gateways: registered job worker, premises declared as the principal's APOB, or goods notified by the Commissioner.
• A registered job worker's supply is the principal's supply, and its value is not in the job worker's turnover.
• The principal invoices the customer; the job worker invoices only his charges.
• The principal's sale invoice travels to the job worker in advance to accompany the goods.
• Place of supply follows the principal and the customer, not the job worker's State — an intra-State supply can move inter-State.
• The one-year / three-year clock still runs; finished goods awaiting a buyer are not safe.
• Direct supplies from the job worker's premises are reported in ITC-04.

Read next

• Job Worker Registration and Aggregate Turnover
• Job Work Rates Under HSN 9988, and the Place of Supply
• ITC-04: The Specified Period and the ₹5 Crore Split

Disclaimer: Positions stated as on 5 September 2026, based on sections 22, 25, 35 and 143 of the CGST Act, 2017, section 12(2) of the IGST Act, 2017 and rules 45, 55 to 58 and 138 of the CGST Rules, 2017, as reproduced in the ICAI Handbook on Job Work under GST (4th edition, June 2026).