Advisory in relation to E-way Bill in case of Job Work transactions
Advisory in relation to E-way Bill in case of Job Work transactions
Sending material on Job Work to the Job Worker is a regular transaction in most of the Industries. Here is a very brief advisory on this issue:-
1. In every case where material is sent on Job Work within the state E-way bill is required where the value of material sent is more than Rs. 50,000/-. Please mind that following 2 things are to be checked for this:-
a. Value of material sent is more than Rs. 50,000/- (here cost of Job Work has nothing to do except that it adds to the value at the time of returning the material)
b. Material is carried on in a motorised vehicle
Please mind that there is no distance limit of 10Kms or 50Kms, E-way bill is to be prepared. Even where material is carried in a nearby workshop across 50 Meters in a motorised vehicle such as Truck, pickup, e-rickshaw, Motor bike etc.
2. In case if Job Worker is unregistered than E-way bill is to be prepared by Manufacturer himself for returning back of material.
3. In case where material is sent on Inter-state Job Work E-way bill is required to be prepared even where the Value of material is less than Rs. 50,000/-.
4. Whenever the material is sent for Job Work, a Delivery Challan is to be prepared, where tentative value of material is to be filled. However in case if material is sent to Job Worker details of tax are not required to be filled as per sec 55 and E-way bill can also be sent without filling tax therein.
Please note where material is sent for Job Work; or from one premises to other premises of own; tax amounts are not required to be filled in Delivery Challan as well as E-way bill.
In Delivery Challan tax is required to be filled only when material is sent for selling the same to the other party and Invoice could not be issued at that time.
5. In case if material is sent by one Job Worker to another job worker then the material can be sent on the Delivery Challan of the Job Worker and E-way bill can also be prepared by the Job Worker.
I hope this would resolve the issue of charging tax in the Delivery Challan to a large extent.
Regards,
CA Ranjan Mehta
+91-9672372075
If you already have a premium membership, Sign In.
CA Ranjan Mehta
CA Ranjan Mehta is a Fellow Chartered Accountant of Institute of Chartered Accountants of India and currently proprietor of M/s Ranjan Mehta & Associates. His area of specialization includes Indirect taxes specially GST, Excise, VAT and Service Tax. He is a faculty for GST. He has presented more than 100 papers on GST at various levels of ICAI, trade bodies, corporate seminars.
