GST: CBIC relaxes Requirement of Filing Job Work Declaration in Form GST ITC-04

The Central Board of Indirect Taxes and Customs (CBIC) has announced that the filing of employment work declarations in Form GST ITC-04 is no longer required.

The term “job work” refers to the process of a person working on items that belong to another registered person. The main manufacturer retains ownership of the items, which does not pass to the job-worker. The job worker’s role is to carry out the process that the main manufacturer specifies on the goods that are delivered to him. A job worker is someone who does job-related tasks.

For instance, a large belt manufacturer (principal) delivers half-finished belts (upper section) to smaller manufacturers (job employees) to punch the hole. The belts are sent back to the big manufacturer (principal) by the smaller manufacturers (job workers).

Taxpayers whose annual aggregate turnover in the preceding financial year is above Rs. 5 crores shall furnish ITC-04 once every six months, while taxpayers whose annual aggregate turnover in the preceding financial year is up to Rs. 5 crores shall furnish ITC-04 annually, as per rule 45 (3) of the CGST Rules.

The Central Goods and Services Tax (Eighth Amendment) Rules, 2021, were recently published by the CBIC.

With effect from October 1, 2021, the following changes will be made to Rule 45(3) of the CGST Rules: for the words “during a quarter,” the words “during a specified period” will be substituted; for the words “the said quarter,” the words “the said period” will be substituted; after the proviso, the following Explanation will be inserted: “Explanation. – The word “specified period” shall mean (a) the period of six consecutive months beginning on April 1st and ending on October 1st in respect of a principal whose aggregate turnover during the immediately preceding financial year exceeds five crore rupees; and (b) a financial year in any other case.”

Details of challans for goods dispatched to or received from a job worker during a specified period must be included in FORM GST ITC-04 filed for that period on or before the twenty-fifth day of the month following the said period, or within such further period as the Commissioner may extend by notification. Any extension of the time limit notified by the Commissioner of State Tax or the Commissioner of Union Territory Tax is presumed to have been notified by the Commissioner.