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Challan › Challan for job work
Delivery challan for job work
When you send material to someone else to cut, dye, stitch, polish or assemble, the goods still belong to you. GST lets you send them on a delivery challan without paying tax, as long as they come back in time and you report the movement.
Who is who
- Principal: the registered business that owns the goods and sends them out (you).
- Job worker: the person who does the work. They may or may not be registered.
The principal can send inputs or capital goods to the job worker on a challan, and also send them straight from a supplier to the job worker. The principal can keep claiming input tax credit on those goods.
What to write on the challan
- Purpose: Job work, and in Notes what work is to be done ("for dyeing", "for machining as per drawing 42").
- Full description, HSN, quantity and unit, so the job worker can count what arrives.
- The value of the goods. No GST is charged on goods sent for job work, but the value is needed for records and the e-way bill.
- Vehicle and transport details if a transporter carries them.
When the job worker sends the processed goods back, they make their own challan referring to yours, and a tax invoice for their job work charges if they are registered.
Time limits for return
| Goods sent | Must come back within |
|---|---|
| Inputs (raw material, parts) | 1 year from the day sent |
| Capital goods (machines) | 3 years from the day sent |
| Moulds, dies, jigs, fixtures and tools | No time limit |
If inputs or capital goods do not come back (or are not supplied onward from the job worker's place) within the limit, the law treats them as supplied by you on the day you sent them. You then issue a tax invoice and pay GST with interest. Waste and scrap left at the job worker's place can be sold from there.
ITC-04: reporting job work
The principal reports goods sent and received back in form ITC-04. At present it is filed every six months by businesses with turnover above ₹5 crore (April to September by 25 October, October to March by 25 April) and once a year by others (by 25 April). Your challan numbers and dates are what ITC-04 asks for, so keep the series clean. Check the current due dates with your accountant, as they are sometimes extended.
A worked example
A hosiery unit in Ludhiana sends 500 kg of grey yarn to a dyer in Jalandhar on 4 Nov 2026: DC/26-27/021, purpose Job work, value 500 kg × ₹280 = ₹1,40,000, note "for dyeing, navy blue shade 12". Value is over ₹50,000, so an e-way bill goes with it.
On 20 Dec 2026 the dyer returns 485 kg of dyed yarn with their own challan, plus an invoice for dyeing charges of ₹21,000 + GST. The 15 kg loss is normal process loss: note it on your copy. The yarn came back in 46 days, well within one year, so no tax arises on it. Both movements go into ITC-04.
In the maker
- Choose purpose Job work and the job worker as consignee (saved as a customer for next time).
- Leave GST unticked; enter rates so the value prints.
- When the goods come back, open Saved delivery challans and set the status to Goods returned. Challans still at Goods sent are the ones to chase before the time limit.