Goods and Service Tax

Section 2(68) of CGST defines 'job work' to mean any treatment or process undertaken by a person on goods belonging to another registered person, and the expression 'job worker' shall be construed accordingly. In terms of the definition, any treatment or process done on goods belonging to another person is job work where the applicant is not just doing something on the critical components. As per Circular No. 38/12/2018, dated 26-3-2018, issued by CBEC, it is clarified that, in addition to the goods received from the principal, the job worker can use his goods for providing the services of job work.

In the case of Job work, the services are performed on physical inputs owned by units other than the units providing the services. They are characterised as outsourced operations of a manufacturing process or a complete outsourced manufacturing process. Under job work services, the output is not owned…