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CA Final · Indirect Tax Laws · Job Work

Kapoor Steel Ltd. sent steel bars (inputs) on 10 March 2024 under intimation to Rao Forgings, an unregistered job worker, for forging. Kapoor wants to supply the finished goods directly from Rao's premises on payment of tax. The Commissioner has not notified any goods for this purpose. Rao could not finish the work by 10 March 2025, and Kapoor shows sufficient cause to the Commissioner. Which statement is correct?

Kapoor must first declare Rao's premises as its additional place of business because the job worker is unregistered and no notification applies. For inputs, the Commissioner can extend the one-year period by a further period of up to one year, not two years.

  1. AKapoor can supply from Rao's premises only if it first declares those premises as its additional place of business, and the Commissioner may extend the one-year period by a further period of up to one yearCorrect
  2. BKapoor can supply from Rao's premises without any declaration because the job worker is a small unit
  3. CKapoor must declare the additional place of business, and the Commissioner may extend the period by up to two years
  4. DKapoor cannot supply from the job worker's premises under any circumstances

Explanation

The proviso to section 143(1)(b) requires the principal to declare the job worker's premises as an additional place of business unless the job worker is registered or the goods are notified. Rao is unregistered and no goods are notified, so the declaration is needed. The second proviso allows extension of the one-year period for inputs by a further period not exceeding one year; two years applies to capital goods.

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