Consequent to the introduction of GST, exemption of job work under IGST on export goods was not extended. This was not intended as it defeated the basic principle of export- "goods and services are exported, taxes not exported." The mistake was corrected by the Government vide amending the IGST Act on 29 August 2018 wherein clause 13(3) the words- "except in the case where imported for repairs and then exported," was changed to "except in the case where imported for repairs or any other treatment or process," clarifying that GST will not be charged for export, even if any other process or treatment is also done in addition to repairs. It is also pertinent to mention that this act of 29 August 2018 was notified vide Notification No. 01/2019 'Integrated Tax w.e.f. 01.02.2019,' after five months.

Due to these fallacies and initial teething problems in GST, a large number of small exporters will have to pay huge amounts of tax, penalty, and interest for the period from 01.07.2017 to 31.1.2019 and face business closure and bad debts for banks. Considering the small taxpayers’ unwarranted financial agony, the unintended mistake needs to be rectified from retrospective effect to give genuine relief to a large section of small-scale industries.

Accordingly, CII recommended to the Central Board of Indirect Taxes and Customs (CBIC), Ministry of Finance, and the GST Council that the definition of place of supply of Job work under IGST be implemented retrospectively from 01.07.17 rather than 01.02.2019.