Taking input tax credit in respect of inputs and capital goods sent for job work
Section 19, CGST Act
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A principal can take ITC on inputs and capital goods sent to a job worker, even if sent directly to the job worker. If inputs are not returned or supplied within one year (capital goods three years), it is treated as a supply by the principal on the date sent. Moulds, dies, jigs, fixtures and tools are outside these time limits.
What this means in practice
The parts that actually decide cases — the things a practitioner checks first.
The one-year and three-year clocks run from the date the goods are SENT OUT, or from the date the job worker receives them where they are sent directly to him.
If the goods do not come back in time it is deemed a supply on the day they were sent out – which means tax plus interest from that earlier date, not from the expiry of the period.
Procedure sits in Rule 45: delivery challan, job-work register, and FORM ITC-04 half-yearly where turnover exceeds five crore rupees and annually below it.
Moulds, dies, jigs, fixtures and tools sent to a job worker are outside the time limits altogether.
Questions people actually ask
Real questions we get on this provision, answered straight.
Our job worker still has our inputs after fourteen months. What is the exposure?+
The dispatch is treated as a supply made on the day the inputs were sent out. You pay tax on that deemed supply with interest running from that original date, and you must report it accordingly. Returning the goods afterwards does not undo the deemed supply, though the job worker’s return can be treated as a fresh movement.
How this provision is built
The skeleton, clause by clause — useful when a notice cites a specific sub-clause.
The exact words of the law
2,324 characters, uneditedReproduced from the CBIC text. We explain it above — but you should always be able to read it yourself.
Read the full provision+
(1) The principal shall, subject to such conditions and restrictions as may be prescribed , be allowed input tax credit on inputs sent to a job worker for job work.
(2) Notwithstanding anything contained in clause
(b) of sub-section
(2) of section 16 , the principal shall be entitled to take credit of input tax on inputs even if the inputs are directly sent to a job worker for job work without being first brought to his place of business.
(3) Where the inputs sent for job work are not received back by the principal after completion of job work or otherwise or are not supplied from the place of business of the job worker in accordance with clause
(a) or clause
(b) of sub-section
(1) of section 143 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: Provided that where the inputs are sent directly to a job worker, the period of one year shall be counted from the date of receipt of inputs by the job worker.
(4) The principal shall, subject to such conditions and restrictions as may be prescribed , be allowed input tax credit on capital goods sent to a job worker for job work.
(5) Notwithstanding anything contained in clause
(b) of sub-section
(2) of section 16 , the principal shall be entitled to take credit of input tax on capital goods even if the capital goods are directly sent to a job worker for job work without being first brought to his place of business.
(6) Where the capital goods sent for job work are not received back by the principal within a period of three years of being sent out, it shall be deemed that such capital goods had been supplied by the principal to the job worker on the day when the said capital goods were sent out: Provided that where the capital goods are sent directly to a job worker, the period of three years shall be counted from the date of receipt of capital goods by the job worker.
(7) Nothing contained in sub-section
(3) or sub-section
(6) shall apply to moulds and dies, jigs and fixtures, or tools sent out to a job worker for job work. Explanation .- For the purpose of this section, "principal" means the person referred to in section 143 .
High Court cases on this section
Judgments in our index that cite this provision. Being listed does not make a case good law — it may have been appealed or distinguished since. Read it before relying on it.
M/S. SUSHEE HI-TECH CONSTRUCTION (P) LTD., v. COMMERCIAL TAX OFFICER BASHEERBAGH AND ANOTHER
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M.K.Aromatics v. The Assistant Commissioner (ST)
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PSR Associates v. The Assistant Commissioner (ST)
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M/s.Binjrajka Steel Tubes Limited v. The Deputy Commercial Tax Officer-II
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M/s.Binjrajka Value Steels Private Limited. v. The Commercial Tax Officer
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M/s.Stallion Tyres Limited v. The Commercial Tax Officer
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What changed, and when
The amendment trail, newest first — because the version that applies to your case depends on the period.
2017-07-01 · Commenced
Provision as originally enacted in the CGST Act, 2017 (Act 12 of 2017) and brought into force w.e.f. 01-07-2017.
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Where this comes from
Text reproduced from the Central Board of Indirect Taxes and Customs, as available on 2026-09-05. The explanation and practice notes above are GSTZone’s own, written for this hub. If you spot anything out of date, tell us and we’ll fix it — this hub is checked daily against CBIC.
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