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TMI Blog1989 (8) TMI 171X X X X Extracts X X X X X X X X Extracts X X X X ..... respondents herein have to pay duty only on the amount of job charges collected by them from their customers. The respondents manufacture tooth brushes falling under Tariff Item 68 on job work basis and for this purpose, they get materials from M/s. Ciba Geigy of India Ltd. The respondents filed a classification list claiming exemption under Notification No. 119/75, dated 30-4-1975. The Assistant Collector denied the exemption claimed in the classification list by the respondents on the ground that entirety different articles were manufactured by the respondents and as such they were not eligible for the exemption as contained in Notification 119/75 for job work. The order of the Assistant Collector on the classification list denying the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondary manufacture based on the definition of the term in the Act and had concluded that and/what the Notification 119/75 covers in respect of job work is manufacture in the nature of secondary manufacture. According to the learned Departmental Representative, the requirement of the notification is that a manufactured product should be given by the customer to the job worker which should be returned by the job worker after undertaking certain other processes of manufacture. In the case of the respondents, however no manufactured product was given but several materials like bristle, plastic handles, packing materials, were given to them by their customers Ciba Geigy out of which the respondents manufactured a complete tooth brush, a product ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal article was held to be totally lost. This was not so in the case of the respondents here. The learned Counsel further relied upon the case law reported in K.E.C. International Ltd. v. U.O.I. - 1988 (36) E.L.T. 31 (Bom.), 1985 (19) E.L.T. 80 (Bom.) and 1986 (26) E.L.T. 685 (Bom.) as supporting of the respondent s contention that it is not necessary for the Job worker to return the same article to the supplier of the material. The Collector (Appeals) being bound by the decision of the Bombay High Court had correctly followed the same. The learned Counsel also submitted in the alternative, if it is held against them, then in that case, the valuation should be as per the criteria laid down by the Hon ble Supreme Court in the case of M/s. Uj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dura Coats Ltd. v. Collector of Central Excise -1980 (6) E.L.T. 582 of the Calcutta High Court and the Madras High Court decision of M/s. Madura Coats Limited reported in 1982 (10) E.L.T. 370 and the Calcutta High Court judgment of Associated Pigments Limited v. Collector of Central Excise -1983 (13) E.L.T. 876. Besides, four other decisions of the C.E.G.A.T. itself were also considered. The Tribunal observed that no arguments appeared to have been advanced in these several cases before the High Courts to distinguish between the process of manufacture in the primary sense and the process of manufacture in the secondary sense of incidental or ancillary process leading to the completion of the manufactured product. The principles, thereafter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the manufactured product and not to the usual activities that are normally understood to comprise of the activity of manufacture. Therefore, to enable a person to claim the benefit of Notification No. 119/75, he will have to receive an article from the customer and subject the same to a manufacturing process, in the way of a process incidental or ancillary to the completion of the manufactured product and then return the said article to the customer, recovering from the customer charges for such activity only. This interpretation of the notification would also satisfy the requirement that the job worker will have to return to the customer that article which he had received from the customer for subjecting it to the necessary manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rushed aside an impossibility.... The article entrusted by the customer should, after the application of the manufacturing process by the job worker, not lose its essential identity entirely but should retain its essential ideality subject to the effect of the manufacturing process carried out . We find that in the case of the respondents, this criterion is not satisfied and the process applied by the respondents to the materials received from M/s. Ciba Geigy results in the emergence of the fully manufactured tooth brush in packed condition and would amount to primary manufacture of tooth brush out of raw materials received. In this view of the matter, therefore, the order of the Assistant Collector holding that the respondents are not elig ..... X X X X Extracts X X X X X X X X Extracts X X X X
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