Chapter V - Input tax credit
Section 19
Section 19: ITC on goods sent for job work
Section 19 lets a principal take input tax credit on inputs and capital goods sent for job work, including direct dispatch to a job worker, subject to conditions and return or supply deadlines.
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Need advice on Section 19?
This article is for general information. Refer to the Central Goods and Services Tax Act, 2017 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) The principal shall, subject to such conditions and restrictions as may be prescribed, be allowed input tax credit on inputs sent to a job worker for job work.
(2) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16, the principal shall be entitled to take credit of input tax on inputs even if the inputs are directly sent to a job worker for job work without being first brought to his place of business.
(3) Where the inputs sent for job work are not received back by the principal after completion of job work or otherwise or are not supplied from the place of business of the job worker in accordance with clause (a) or clause (b) of sub-section (1) of section 143 within one year of being sent out, it shall be deemed that such inputs had been supplied by the principal to the job worker on the day when the said inputs were sent out: Provided that where the inputs are sent directly to a job worker, the period of one year shall be counted from the date of receipt of inputs by the job worker.
(4) The principal shall, subject to such conditions and restrictions as may be prescribed, be allowed input tax credit on capital goods sent to a job worker for job work.
(5) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16, the principal shall be entitled to take credit of input tax on capital goods even if the capital goods are directly sent to a job worker for job work without being first brought to his place of business.
(6) Where the capital goods sent for job work are not received back by the principal within a period of three years of being sent out, it shall be deemed that such capital goods had been supplied by the principal to the job worker on the day when the said capital goods were sent out: Provided that where the capital goods are sent directly to a job worker, the period of three years shall be counted from the date of receipt of capital goods by the job worker.
(7) Nothing contained in sub-section (3) or sub-section (6) shall apply to moulds and dies, jigs and fixtures, or tools sent out to a job worker for job work.
Explanation.––For the purpose of this section, “principal” means the person referred to in section 143.
Introduction
The Act permits direct delivery to the job worker without first bringing the goods to the principal's premises. If ordinary inputs or capital goods are not returned or supplied from the job worker's place within the statutory period, the Act deems a supply from the principal to the job worker on the original dispatch date.
Key takeaways
Direct dispatch can still qualify
The principal may take credit even where inputs or capital goods go straight to a job worker.
Inputs have a one-year clock
Inputs generally must return or be supplied from the job worker's place under section 143 within one year; direct dispatch counts from the worker's receipt.
Capital goods have a three-year clock
The analogous deadline for capital goods is three years, again counting direct dispatch from the worker's receipt.
Certain tools are excepted
The one- and three-year deemed-supply rules do not apply to moulds and dies, jigs and fixtures, or tools sent for job work.
Credit and direct delivery
Subsections (1), (2), (4) and (5) provide the principal's credit entitlement on inputs and capital goods, including where they are sent directly to a job worker. Check the prescribed conditions and retain the delivery trail.
Monitor return or onward supply
Track each dispatch and whether goods return to the principal or are supplied from the job worker's premises in accordance with section 143(1). The period is one year for inputs and three years for capital goods; direct deliveries start the clock on the worker's receipt date.
Deemed supply and exceptions
If the relevant period expires without a qualifying return or supply, the goods are deemed to have been supplied by the principal to the worker on the original sending date. Subsection (7) excludes moulds and dies, jigs and fixtures, and tools from this particular deadline rule.
Practical checklist
Do
- Record dispatch and job-worker receipt dates separately.
- Classify each item as input, capital good or an excepted tool.
- Reconcile goods returned or supplied from the worker's premises against section 143 records.
Avoid
- Assume direct dispatch defeats ITC.
- Apply the three-year period to ordinary inputs.
- Treat moulds, dies, jigs, fixtures and tools as subject to the same deemed-supply clock.
Frequently asked questions
Can goods be delivered directly to the job worker?
Yes. Section 19(2) and (5) expressly allow credit on directly delivered inputs and capital goods, subject to conditions.
When does the time limit start for direct dispatch?
From the date the job worker receives the inputs or capital goods, under the provisos to subsections (3) and (6).
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026