Procedure loan licensing and contract manufacturing(JOB WORK ) in pharma industry in GST Regime

[nandankumar roy]

Sir,

Pl help regarding Procedure loan licensing and contract manufacturing(JOB WORK ) in pharma industry in GST Regime with gst credit and debit procudure also. Any help will be highly appreciated.

With Regards,

N K ROY

9427181604

[KASTURI SETHI]

EXTRACT FROM FAQ DATED 31.7.17

Question 4 : How loan and licensee units carry out their operations in GST regime?

Answer : GST law does not have any special provision for loan and licensee units. Where the contract are in the nature of performance of job-work, these units can opt to follow the procedure laid down in section 143 of the CGST Act, 2017 i.e. the principal can send any inputs etc. to such units without payment of tax and the principal can clear the goods from the premises of such units if the principal declares these units as his additional place of business or where such units are themselves registered under section 25 of CGST Act, 2017.

[nandankumar roy]

thanks sirji

[KASTURI SETHI]

You are always welcome, Sir.

AI Summary

Job-work treatment allows principals to send inputs tax-free and clear goods from contractor premises when declared additional place of business.
Where arrangements are in the nature of job-work, the principal may send inputs and goods to the contract unit without payment of tax and may effect clearance of goods from the contract unit's premises if the principal declares the unit as an additional place of business or the unit is itself registered, thereby governing the timing of tax liability and input tax credit between principal and contract manufacturer.