Question: In case of in-House job work undertaken by the job worker, where goods have not been sent outside the factory premises of principal but covered under challan but no e-way bill is being generated, for recording and control purpose, but as per rule 45(3), ITC-04 shall be filed in respect of goods sent for job work under cover of challan. Kindly, suggest, if we do not file ITC-04 based on this contention that goods have not been sent outside the factory, whether department will accept this view or they can levy any penalty for contravention of this provision.
Answer: Please refer rule 45 which contains procedure for compliance of section 143 of the CGST Act, 2017. The provisions are required to be complied in case where goods are sent to a job worker under the cover of a challan. Thus, the provision speaks about goods leaving the premises of the principal and going to those of job worker. In case the challan is issued for a record of handing over of goods within the premises and not for movement of goods from the premises of the principal to the job worker, such challan is not required to be reported under rule 45 in ITC 04. The challan is merely fixing the responsibility to record the loss of production and not for handing over the goods. The goods still remain under the control and possession of the Principal being in the premises of the Principal, though temporary custody is given for performing work to the job worker.
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