Clarification on scope of the notification entry at item (id), related to job work, under heading 9988 of Notification No. 11/2017 (Rate) [FTX.56/2017/24 dated 29-06-2017] - GST - States - 80/2019-GST

GOVERNMENT OF ASSAM OFFICE OF THE COMMISSIONER OF TAXES, ASSAM KAR BHAWAN DISPUR, GUWAHATI-781006 CIRCULAR NO. 80/2019-GST Dated Dispur the 23rd December, 2019. Subject: Clarification on scope of the notification entry at item (id), related to job work, under heading 9988 of Notification No. 11/2017 (Rate) [FTX. 56/2017/24 dated 29-06-2017] -reg. No. CT/GST-15/2017/280 .- I am directed to say that doubts have been raised with regard to scope of the notification entry at item (id) under heading 9988 of Notification No. 11/2017 (Rate) [FTX.56/2017/24 dated 29-06-2017] inserted with effect from 01-10-2019 to implement the recommendation of the GST Council to reduce rate of GST on all job work services, which earlier attracted 18 % rate, to 12%. It has been stated that the entry at item (id) under heading 9988 of Notification No. 11/2017 (Rate) [FTX.56/2017/24 dated 29-06-2017] inserted with effect from 01-10-2019, prescribes 12% GST rate for all services by way of job work. This makes the entry at item (iv) which covers manufacturing services on physical inputs owned by others with GST rate of 18%, redundant. 2. The matter has been examined. The entries at items (id) and (iv) under heading 9988 read as under: (3) (4) (5) (id) Services by way of job work other than (i), (ia), (ib) and (ic) above; 6 - (iv) Manufacturing services on physical inputs (goods) owned by others, other than (i), (ia), (ib), (ic), (id), (ii), (iia) and (iii) above. 9 - 3. Job work has been defined in Assam GST Act as under. Job work means any treatment or processing undertaken by a person on goods belonging to another registered person and the expression job worker shall be construed accordingly. 4. In view of the above, it may be seen that there is a clear demarcation between scope of the entries at item (id) and item (iv) under heading 9988 of Notification No. 11/2017 (Rate) [FTX.56/2017/24 dated 29-06-2017]. Entry at item (id) covers only job work services as defined in section 2 (68) of Assam GST Act, 2017, that is, services by way of treatment or processing undertaken by a person on goods belonging to another registered person. On the other hand, the entry at item (iv) specifically excludes the services covered by entry at item (id), and therefore, covers only such services which are carried out on physical inputs (goods) which are owned by persons other than those registered under the Assam GST Act. 5. This Circular is clarificatory in nature and not meant for any interpretation of provisions of the Act and rules. 6. Difficulties, if any, in implementation of the above instructions may be brought to the notice of the Commissioner at an early date. 7. This Circular shall be deemed to have been issued on 22nd November, 2019. Sd/- Anurag Goel, IAS., Commissioner of State tax, Assam, Dispur, Guwahati