Page 34 - GSTL_30th April 2020_Vol 35_Part 5

J86 GST LAW TIMES [ Vol. 35
the activity and will have no bearing on the rate of GST applicable
for the job worker.
(v) As per sub-section (5) of Section 143 of the CGST/SGST Act, 2017;
any waste and scrap generated during the job work may be sup-
plied by the registered job worker directly from his place of busi-
ness on payment of tax, or by the principal if the job worker is not
registered.
Conclusion
Thus, the movement or supply of inputs and capital goods from the
premises of a registered person to a job worker for job working, even though the
said movement qualifies as supply, is not liable to payment of GST as it is ex-
empted in terms of Section 143(1) of the CGST/SGST Act, 2017. The job worker
services for job working qualify as supply in terms of Section 13 read with Sec-
tion 31 of the CGST/SGST Act, 2017 and the supply of services by job worker is
liable to pay GST. The job worker has to issue invoices not only for service
charges but also the value of any goods or services used by him for supplying job
work services, if the same has recovered from the principal and job worker is
liable to pay GST on total value determined in terms of Section 15 of the
CGST/SGST Act, 2017.
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(f) The above-mentioned submissions were not discussed in the recent-
ly pronounced judgments and accordingly the waters need to be
tested again. Presently, most of the companies are not paying GST
under reverse charge on the salaries paid to the executive directors
of the company. There is a need for clarification in this respect from
CBIC after due examination of the above-mentioned arguments.
However, in this period of COVID-19, where most of the institu-
tions are locked down, we do not expect any circular to come too
soon.
(g) We would suggest that the companies should review the terms of
appointment of the directors and ensure that it passes the test of
employment. Without prejudice to anything mentioned above, in
case where the companies are getting complete credit and does not
desire to have any litigation in the future, they may pay GST under
RCM and avail Input Tax Credit for the same.
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GST LAW TIMES  30th April 2020  34