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2016 (12) TMI 727 - CESTAT CHENNAIManufacture - deputation of manpower - Appellant for the purpose of administrative convenience deputed its persons to the premises of SPPL. There was no relation between both the parties to cause evasion to Revenue when the transaction was at arm’s length. The party only agreed to manufacture medicine on behalf of appellant in its factory i.e., of the SPPL. According to the provisions of Central Excise Act, 1944 and according to the Loan License Agreement, appellant is not the manufacturer of the goods. Department merely relied on certain statements to proceed to hold that the appellant as the manufacturer. Held that: - The moot question in these appeals is to decide who is the manufacturer. We are not concerned with any “Loan License Agreement” because such term is used for convenience of the parties and that has no relevance to the Central Excise law. We are also not concerned with the quality or standard of the drugs manufactured by the loan licensee or anybody manufacturing such product. We are only concerned with the parameters of Section 3 of the Central Excise Act. Mere supply of the raw material shall not alter the status of a manufacturer or a job worker. The term “manufacture” or the “Loan Licensee” if used in the Drugs and Cosmetics Act, 1940 has no relevance to Section 3 of the Central Excise Act, 1944. Both the statutes serve their own purpose. Revenue law is concerned with the manufacture of excisable goods. The factual scenario of the case brings SPPL to the fold of “manufacture” under Section 3 of the Central Excise Act, 1944. Therefore, in absence of any evidence to the contrary, appellant cannot be held to be a manufacturer of the product. Accordingly, its appeal is allowed - The other two appellants are the persons concerned with the appellant-company. Once the principal-appellant gets relief in its appeal, consequential appeals of these persons are allowed. Appeal allowed - decided in favor of appellant-assessee.
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