GST on job work

[Kaustubh Karandikar]

Respected Experts, in my view, w.e.f. 01.10.19, for job work the GST Rates will be 1) Repairs to machinery / equipment / moulds etc. 18% under Heading 9987 (Sr.No. 25(ii) of Notfn.) 2) Services by way of job work not amounting to manufacture. 12% under Heading 9988 (Sr.No. 26(i)(id) of Notfn.) 3) Services by way of job work amounting to manufacture. 18% under Heading 9988 (Sr.No. 26(ii)(iv) of Notfn.). Kindly confirm.

[Atul Rathod]

My view is:

1) repairs-agreed

2) job work not amounting to manufacture-18% under residuary clause. since entry 26 heading itself starts with manufacturing services on goods owned by others.

3) job work amounting to manufacture -12% under 26(i)(id).

[KASTURI SETHI]

Sh. Kaustubh Karandikar Ji,

I agree with you on all the points. However, the situation calls for clarification from the Board. The phrase, 'Manufacturing Services' has not been defined.

[DR.MARIAPPAN GOVINDARAJAN]

I observed that Shri Kaustubh Karandikar raised many queries but he did not participate in giving any opinion on any question. Sir, this is not the one way - it is the two way.

[KASTURI SETHI]

Sr.Mariappan Govindarajan Ji,

Your observation is right, Sir. Sh.Kaustubh Karandikar Sir is very knowledgeable and experienced person. He must contribute to the Discussion Forum. I am sure his contribution will boost the quality of this forum.

Knowledge is power, if shared. Otherwise it would rust i.e. will become outdated/time-barred.

AI Summary

GST rate classification for job work disputed: differing views on repairs, manufacturing job work, and non manufacturing job work.
The initiating submission proposes three GST treatments for job work from 01.10.2019: repairs to machinery at 18% under Heading 9987 (entry 25(ii)); job work not amounting to manufacture at 12% under Heading 9988 (entry 26(i)(id)); and job work amounting to manufacture at 18% under Heading 9988 (entry 26(ii)(iv)). Respondents disagree on classification: one accepts repairs but argues job work not amounting to manufacture should fall to the residuary 18% given entry 26's heading, while another requests Board clarification of the term Manufacturing Services.