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TMI Blog1997 (7) TMI 415X X X X Extracts X X X X X X X X Extracts X X X X ..... r adjournment. We have heard Shri M. Ali, JDR for the common respondent, the department. 2. M/s. Saheli Synthetic (P) Ltd. (Appellant in A.No. E/843/90-A) was processing grey man-made fabrics supplied by merchant manufacturers M/s. Saheli Textile (Appellant in A.No. E/844/90-A), M/s. Saheli Silk Industries (Appellant in A.No. E/845/90-A), M/s. Nand Syndicate Enterprises (Appellant in A.No. E/846/90-A), M/s. B.P. Investment Company (Appellant in A.No. E/847/90-A), M/s. Rahul Textiles (Appellant in A.No. E/848/90-A) and Maya Silk Syndicate (Appellant in A.No. E/849/90-A) and paying duty on the fabrics at the stage of clearance from the processors factory on the value declared by the merchant manufacturer in terms of Notification 305/77 dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extile Mills Others, 1996 (88) E.L.T. 493 (Tribunal) = 1997 (68) ECR 109 (T) and the case of Pharmasia Ltd, 1996 (63) ECR 380 (T) after considering the Ujagar Prints judgment and clarificatory order in detail and holding that as long as the supplier and the processor are in the position of principal and principal and the transactions are at arms length and the case will be governed by the dictum in Ujagar Prints clarificatory order and assessable value will be the sum total of the cost of raw materials supplied, the value of job work done and the manufacturing profit of the job worker. The Supreme Court also made it clear that profit earned by supplier (merchant manufacturer) would not be part of assessable value. Therefore, necessarily i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was further held that the question of imposition of penalty also would not arise where the demand of differential duty cannot succeed. 6. Shri M. Ali further contended that Ujagar Prints clarificatory order did not advert to Notification No. 305/77 and did not purport to set it aside. Notification No. 305/77 exempted the operation of Rule 174 of the Central Excise Rules, 1944 in regard to every manufacturer who gets goods manufactured on his account from any other person subject to certain conditions; the conditions are that the manufacturer authorises the job worker to comply with all excise procedural formalities on behalf of the merchant manufacturer and furnishes to the department information relating to the price at which the said m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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