ITC avialable for job worker

[RAMKUMAR DURAI]

sir my client is engaged in adhesive coating on the fasteners sent from his cutomers. as you replied earlier it may be classified under job work service. we have a doubt that if we raise the invoice as job work @ 12% GST, whether we will be eligible for ITC on the adhesive which we purchase. Because the adhesives comes to nearly 50% of our invoice value and we buy them at 18% & 28% GST respectively.

[Atul Rathod]

Eligible for ITC- no restrictions.

[KASTURI SETHI]

ITC is admissible. No doubt at all. It is in the course of business.

AI Summary

Input tax credit entitlement for job workers purchasing inputs used in job work services is available under GST.
Input tax credit (ITC) is admissible to a job worker for adhesives purchased and used in providing job work services; the adhesives, even if procured at higher tax rates, qualify as inputs consumed in the course of business and are eligible for ITC subject to the normal GST input tax credit conditions.