(1) The principal shall, subject to such conditions and restrictions as may be prescribed, be allowed input tax credit on inputs sent to a jobworker for jobwork.
(2) Notwithstanding anything contained in clause (b) of subsection (2) of section 16, the principal shall be entitled to take credit of input tax on inputs even if the inputs are directly sent to a jobworker for jobwork without being first brought to his place of business.
(3) Where the inputs sent for jobwork are not received back by the principal after completion of jobwork or otherwise or are not supplied from the place of business of the jobworker in accordance with clause (a) or clause (b) of sub-section (1) of section 143 within one year of being sent out, it shall be deemed that such inputs had been supplied by the principal to the jobworker on the day when the said inputs were sent out:
Provided that where the inputs are sent directly to a jobworker, the period of one year shall be counted from the date of receipt of inputs by the jobworker.
(4) The principal shall, subject to such conditions and restrictions as may be prescribed, be allowed input tax credit on capital goods sent to a jobworker for jobwork.
(5) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16, the principal shall be entitled to take credit of input tax on capital goods even if the capital goods are directly sent to a jobworker for jobwork without being first brought to his place of business.
(6) Where the capital goods sent for jobwork are not received back by the principal within a period of three years of being sent out, it shall be deemed that such capital goods had been supplied by the principal to the jobworker on the day when the said capital goods were sent out:
Provided that where the capital goods are sent directly to a jobworker, the period of three years shall be counted from the date of receipt of capital goods by the jobworker.
(7) Nothing contained in sub-section (3) or sub-section (6) shall apply to moulds and dies, jigs and fixtures, or tools sent out to a jobworker for jobwork.
Explanation.- For the purpose of this section, "principal" means the person referred to in section 143.