E-Way Bill for Job Work: Who Generates It

Sending goods to a job worker is not a sale, so no tax invoice is raised and, under Section 143, no GST is paid when the goods leave. That leads a lot of businesses to assume the e-way bill does not apply either. It does. Rule 138 of the CGST Rules is written around the movement of goods, not the sale of them, and job work is one of the movements it names. This guide covers when the bill is needed, who generates it for each leg — out to the job worker, back to you, or straight to your customer — and the challan and ITC-04 paperwork that has to line up with it.

Job work is not a supply, but the goods still move

Job work means processing or treating goods that belong to another registered person, the principal. The job worker is supplying a service. The goods themselves stay the principal's property the whole time, so moving them to the job worker is not a supply of goods. If you are unsure how the job worker's own charges are classified, the HSN and SAC guide for job work covers that.

The e-way bill rules do not care whether a sale happened. Rule 138(1) requires a registered person who causes goods to move to generate an e-way bill in three situations: movement in relation to a supply, movement for reasons other than supply, and inward supply from an unregistered person. Job work falls under the second, alongside branch transfers, goods sent for repair and exhibition stock. The general framework is set out in our e-way bill rules and limits guide. This post covers only what is different for job work.

The value limit: ₹50,000, or no limit at all

Job-work movements have two value tests, depending on whether the goods cross a state border.

Within one state, the normal threshold applies. An e-way bill is needed where the consignment value is more than ₹50,000, or more than the higher limit the state has notified for intra-state movement. Several states use ₹1 lakh, but the figure is set by each state and changes independently. Check the current figure in our state-wise e-way bill limit guide and against the state's own notification.

Across a state border, the value test does not apply. The proviso to Rule 138(1) says that where goods are sent by a principal in one state or union territory to a job worker in another, the e-way bill must be generated regardless of the consignment value. A ₹6,000 batch of components going from Gujarat to a finisher in Maharashtra needs a bill. The same proviso covers inter-state movement of handicraft goods by a person who is exempt from registration. Those are the only two value-independent cases in the rule, and job work is the one that affects most manufacturers.

Consignment value for a job-work challan is the value of the goods declared on the challan. No tax is charged on the challan, so the tax fields on the e-way bill are usually zero. Do not understate the value to stay under a threshold. The ITC-04 you file later reports the same goods, and a gap between the two is easy for the department to see.

Who generates the e-way bill for each movement

A job-work cycle usually has more than one leg, and the person responsible changes with the leg. The general rule is that whoever causes the movement generates the bill. For job work, the proviso adds that the bill may be generated by the principal or, if registered, by the job worker. An unregistered job worker has no GSTIN to generate from, so the principal carries every leg in that case.

The return leg. The job-work proviso is worded around goods sent to a job worker. The site's e-way bill rules guide and most practitioners treat the inter-state return from a registered job worker the same way, so generate a bill for it at any value. Within a state, the normal ₹50,000 or state limit applies.

Direct supply from the job worker. Section 143 lets the principal sell processed goods straight from the job worker's premises. Tax is paid on a domestic sale, and an export can go without payment of tax as permitted. The principal normally has to declare the job worker's premises as an additional place of business. That requirement does not apply where the job worker is registered, or where the goods are of a notified class. This is a supply, so a tax invoice is required. The e-way bill goes on the principal's GSTIN with the job worker's address as the dispatch point.

The delivery challan that travels with the goods

Rule 55 of the CGST Rules allows a delivery challan instead of a tax invoice when goods move for job work, and in a few other cases where there is no supply. The challan is serially numbered and prepared in triplicate: the original goes to the consignee, the duplicate to the transporter, and the triplicate stays with the consignor. It must carry:

• the challan number and date;
• the name, address and GSTIN of the consignor, and of the consignee where registered;
• the HSN code, description, quantity and taxable value of the goods;
• the place of supply for inter-state movement, and a signature.

Rule 55 also requires the challan to be declared in the e-way bill. The e-way bill does not replace the challan. The goods travel with both: the challan (physically or electronically) and the e-way bill number. An officer who stops the vehicle checks that the challan number, value and HSN match Part A.

Get both GSTINs right on the challan. The job worker's GSTIN appears on the challan, the e-way bill and the ITC-04, and a cancelled or mistyped one causes problems in all three. Checking it once with the GSTIN validator or a GSTIN verification lookup before the first despatch takes seconds. GSTIN API does this in one call, returning registration status together with filing history. That matters because a job worker whose returns have lapsed can be blocked from e-way bill generation under Rule 138E.

Filling Part A for a job-work movement

On the portal, the Part A choices for job work are specific, and getting them wrong creates a record that contradicts your returns. The step-by-step walkthrough is in how to generate an e-way bill, and every field is explained in the Part A and Part B field guide. For job work:

• Transaction type: Outward when you are sending the goods, Inward when you are receiving them.
• Sub-type / reason: Job Work for goods going out. The inward list has a separate job-work-returns option for goods coming back. Check the current dropdown labels on the portal.
• Document type: Delivery Challan, with the challan number and date exactly as printed.
• From and To: the principal's and job worker's GSTINs and addresses. The PIN codes determine the distance and therefore the validity period.
• Item lines: HSN of the goods being moved (not the SAC of the job-work service), quantity and value, with tax rates left at nil because no tax is charged.

Part B holds the vehicle number or transport document, as for any other movement. The bill is not valid for movement until Part B is filled in, apart from the short intra-state first-leg relaxation described in the Part A and Part B guide.

Section 143 time limits and ITC-04

The e-way bill records each movement. Section 143 of the CGST Act controls how long the goods can stay with the job worker before tax becomes payable. A registered principal may send inputs and capital goods to a job worker without paying tax, provided they are brought back, or supplied onward from the job worker's premises, within:

• one year for inputs, and
• three years for capital goods.

Moulds, dies, jigs, fixtures and tools are excluded from these time limits. If inputs or capital goods are not back in time, Section 143 treats them as supplied by the principal to the job worker on the day they were originally sent out. Tax is payable on that deemed supply with interest from that date, so the cost runs back to the original despatch, not to the day you notice.

The principal can claim credit on inputs and capital goods sent to a job worker, including goods the supplier delivers directly to the job worker. On machinery that moves between your plant and a job worker, read the three-year limit together with the rules in ITC on capital goods.

Form ITC-04 is where the principal reports goods sent to job workers, received back, and supplied from their premises. Principals whose aggregate annual turnover in the preceding financial year exceeds ₹5 crore file it half-yearly, and others file annually. The due dates have been extended before, so confirm the current ones on gst.gov.in instead of relying on a remembered date. The challans reported in ITC-04 should match your e-way bills one for one. If a challan appears in one record and not the other, expect a question about it.

Frequently asked questions