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2012 (10) TMI 268 - AT - Central ExciseClearances on principal to principal basis v/s job workers to principal basis - duty demand on differential value with interest & penalty - Held that:- Definition of job worker incorporates the words "on behalf of". In the market no one knows the OEMs (five appellant firms). Air Coolers are recognised as of Symphony only. There is no sale to Symphony nor to anyone else. In such a situation, what the OEMs are doing is nothing but manufacturing on behalf of Symphony. The fact that in this case Symphony used their clout and capacity to market the products and their reputation to ensure that the profits made by OEMs was always limited and had nothing to do with the demand for products in the market. While there is a cap for the profit and the earnings of job workers based on Symphony's market, there is no cap for the earning of Symphony, who has exercised total control over every aspect of the transaction with the OEMs and the transaction of the OEMs with the Vendors. Under these circumstances, it would be appropriate to require Symphony also to deposit a portion of the penalty since they are the main party and main beneficiary of the whole arrangements and the transactions. Moreover when the law was amended Symphony had the responsibility to change the system of Valuation being the driving force behind the whole operation. It would be totally unfair and unjust to require only job workers to make pre-deposit of duty and allow Symphony to go scot free without requiring any deposit in spite of the fact that maximum profit accrued to Symphony and not the job workers in this case. Thus the OEMs are required to deposit 10% of the duty demanded within eight weeks from today & M/s. Symphony Comfort Systems is required to deposit an amount of equal to 20% of the penalties imposed on them in various orders within eight weeks from today. Subject to such pre-deposit of the amounts detailed above, the requirement of pre-deposit of balance dues from all the appellants, is waived and stay against recovery of the same is granted during the pendency of appeals.
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