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CMA Final · Indirect Tax Laws and Practice · Transition to GST (Transitional Provisions)

A manufacturer sent inputs to a job worker for processing under the existing law before the appointed day. The inputs are returned to the manufacturer's place of business on or after the appointed day. Under the transitional provisions on job work, within what period must the inputs be returned for no tax to be payable, without any extension?

The inputs must be returned within six months from the appointed day. If they come back within that time, no tax is payable. An extension is possible only on sufficient cause, so six months is the basic period.

  1. AWithin three months from the appointed day
  2. BWithin six months from the appointed dayCorrect
  3. CWithin eight months from the appointed day
  4. DWithin twelve months from the appointed day

Explanation

Section 141(1) provides that no tax is payable if inputs sent for job work under the existing law are returned within six months from the appointed day. Eight months is only the outer limit after an extension of up to two months, so it is not the base period.

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