ITC-04 Filing

Form ITC-04 is the annual return that manufacturers and job-workers must file under GST to declare the details of inputs, semi-finished goods, and capital goods sent to a job-worker and the details of goods received back from the job-worker. It is a critical compliance form that bridges the manufacturer's records with the job-worker's records, establishing the chain of custody for goods that leave the manufacturer's premises for processing at a third-party job-worker's facility. The form captures the quantity and value of goods sent out under a delivery challan, the challan date and number, the job-worker's GSTIN, and the corresponding quantity and value of processed or unprocessed goods received back. Without ITC-04 filing, the input tax credit on goods sent for job-work is not properly established in the GST records.

Who Must File ITC-04 and When the Obligation Arises

Any registered person — whether manufacturer or job-worker — who sends inputs or capital goods to a job-worker under challan must file ITC-04 annually. The obligation applies even if the goods were sent and received back in the same financial year with no net transfer — the return must still show the challan-level details. The due date is 31 December of the succeeding financial year — for FY 2024-25, the deadline is 31 December 2025. If a NIL return is required (no job-work transactions during the year), it must still be filed as an explicit NIL declaration on the portal. Failing to file ITC-04 can trigger a reversal of input tax credit under Section 19 of the CGST Act and a penalty up to ₹25,000 under Section 122.

The Part-A and Part-B Distinction in ITC-04

ITC-04 has two parts that capture different aspects of the job-work transaction. Part-A covers inputs and semi-finished goods — raw materials and partially processed goods sent to the job-worker and the corresponding received quantities. Part-B covers capital goods — machinery, equipment, and tools sent for job-work, which may be returned over multiple years. Capital goods sent for job-work are treated differently from inputs because they are meant to be returned, not consumed in the process, and their input tax credit treatment depends on proper tracking. FinTax24 prepares both Part-A and Part-B from the manufacturer's delivery challan register, cross-referencing job-worker acknowledgement receipts to ensure the quantities received back match the quantities sent out.

Consequences of Not Filing ITC-04: ITC Reversal and Penalty

When a manufacturer sends goods for job-work, the input tax credit on those goods is normally blocked until the finished goods are received back and verified. The filing of ITC-04 establishes this chain and allows the credit to be retained. If ITC-04 is not filed, the input tax credit taken on goods sent for job-work is deemed to have been reversed, requiring the manufacturer to pay the equivalent GST from pocket. Additionally, a penalty of up to ₹25,000 under Section 122 of the CGST Act can be imposed for deliberate non-filing. FinTax24 ensures ITC-04 is filed before 31 December every year, with the ITC properly preserved and the manufacturer's GST records fully reconciled with the job-worker's records.