TMI Blog1978 (6) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... een agreed upon between the customer and the job worker. The articles which are brought to the job worker for being subjected to the process of manufacture do not belong to the job worker. In order to illustrate what is being done by each of the four petitioners, we will refer to the facts appearing in Special Civil Application No. 1184 of 1977. In paragraph 7 of the petition, it has been specifically stated that the customer supplies to the petitioner company materials, such as, tin plates, sheets, tubes, pipes, etc. for carrying out job work and making equipments and components. These materials which are supplied to the petitioner company by the customers are themselves excisable goods. The plates and articles which are supplied by the customers are all duty-paid goods and they are goods which are manufactured from raw materials like iron ore etc. in lump form. These goods which are supplied by the customers to the petitioner are themselves not raw materials but are articles. According to the petitioner, when the petitioner carried out job work on these articles, the job work so carried out by the petitioner company would fall squarely within the exemption Notification No. 119 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eived from the customer were not returned to the customer but an entirely different article is prepared and given to the customer after sophisticated manufacturing process, which is absolutely a new article having different description in trade and popular parlance, the material received from the customer and the article returned to him are entirely different in character and use and it cannot be said that the article supplied by the customer is returned to the customer and hence the so called job work done by the petitioner is not a job work as defined in the Notification and therefore the petitioner is not entitled to claim the exemption under the Notification. 4. Section 37 of the Central Excises and Salt Act, 1944, confers power on the Central Government to make rules to carry into effect the purposes of the Act. According to sub-section (2), in particular, and without prejudice to the generality of the foregoing powers, such rules may, under clause (xvii), exempt any goods from the whole or any part of the duty imposed by the Act. 5. We may peruse the Central Excise Rules. Rule 8 of the Central Excise Rules, 1944, made by the Central Government in exercise of the powers co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f taxation under the excise law. In order to exempt job workers from payment of duty except to the extent of duty on the job work charges, this Explanation to the Notification makes it clear that the article which undergoes manufacturing process at the hands of the job worker, must be supplied by the customer and the only thing which the job worker has to do is to subject that article supplied by the customer to the intended manufacturing process. The final result after the manufacturing process is completed has to be returned to the customer and the job worker only charges for the job work done by him. Under these circumstances, it is clear that, though excise duty would be otherwise leviable on the value of the article as it leaves the job worker's factory, by virtue of the Notification, excise duty has to be paid only on the charges for the job work and not on the total value of the articles when it leaves the factory of the job worker. No other meaning is possible on the wording on this particular Notification. 8. To take one or two illustrations : If a customer takes a sheet of brass to a factory which does job work and gets a brass pot made out from the job worker on paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion under Notification No. 119/75-CE, dated the 30th April, 1975 would appear to be applicable, irrespective of the trade nomenclature of the article at the time of receipt and at the time of despatch (after subjecting it to a manufacturing process)." 10. In the affidavit in reply filed in Special Civil Application No. 1184 of 1977, the stand taken up is that it is not admitted that in other States, excise duty on materials supplied by the customer and used by the job workers is not levied. Even with regard to the Trade Notice, the contention is that the interpretation sought to be placed by the petitioner is not correct, and the contention is that the Tariff Entry read with the Notification would govern the case and the excise authority would have to apply the statutory provisions and the Notification according to their true effect. 11. It is a very strange manner of functioning of the Central Excise Authorities that one and the same notification of the Central Excise Authority issued by the Central Government receives one interpretation at the hands of the Central Excise Authorities in the State of Gujarat and quite opposite interpretation at the hands of the Central Excise ..... X X X X Extracts X X X X X X X X Extracts X X X X
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