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TMI Blog2021 (1) TMI 503X X X X Extracts X X X X X X X X Extracts X X X X ..... duty has been calculated in the above manner by including the value of clearance of the goods manufactured by M/S Orion Wire Manufacturing Company in the total clearances of the appellant. 2.1 Learned Counsel pointed out that the appellant had sent raw materials to M/S Orion Wire Manufacturing Company for manufacturing welding electrodes on job work basis and the electrodes manufactured by Orion Wire Manufacturing Company were cleared on payment of Central Excise duty from the premises of M/s Orion Wire Manufacturing Company. He pointed out that there is no dispute that M/s Orion Wire Manufacturing Company is not a dummy Company. It is not in dispute that M/s Orion Wire Manufacturing Company is actually manufacturing these electrodes as all the facilities for such manufacture. 2.2 Learned Counsel argued that in this background, it is apparent that allegation of department that the aggregate clearances should include the clearances made by M/s Orion Wire Manufacturing Company that is without any basis. Learned Counsel relied on the decision of tribunal in the case of ARIHANT UDHYOG-2018 (363) ELT 924 wherein, the tribunal held that duty liability would always arise on the end of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ures and the same view has been upheld by the tribunal in the case of THERMAX BABCOCK & WILCOX LTD-2018 (364) ELT 945. (Tri-LB). Thus the appellant held a bona fide view that independent job worker are manufacturers in their own right, and therefore, the value of clearance of independent job worker cannot be clubbed with the value of the clearances of principle Manufacturer for the purpose of Notification 8/2003-CE. 3. Learned Departmental representative pointed out that these sales from the job worker premises are done on behalf of the appellant. He pointed out that the VAT of those sales is paid by the appellant the sales are reported in Profit and Loss Account of the appellant. He argued that there is no purchase of welding rod by the appellant from the job worker and there are no trading sales as well as by the job worker to the appellant. He argued that in this circumstances it is apparent that the appellant is the manufacturer he further argued that there are common employees between the appellant and the job worker and there are common partners as well. 3.1 Learned Departmental representative relied of the decision of the Hon'ble High Court of Karnataka in the case of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant. The duty on the electrodes is paid by the job worker on the price at which the goods are sold by the appellant to the buyers. The Value Added Tax is paid by the appellant. Retail invoices are also issued by the appellant in respect of this clearance from the Job premises. The revenue is seeking to club the clearance made from the job worker premises into the clearances of the appellant for calculating the benefit of SSI Exemption available to the appellant. Notification No. 8/ 2003-CE grants duty exemption to clearance made by small scale units. This notification provides exemption to first clearances upto an aggregate value not exceeding Rs. 100 lakhs made on or after 1st day of the April of any financial year. This exemption is subject to the condition that the aggregate value of clearances of all excisable goods for home consumption by a manufacturer from one or more factories, or from a factory by one or more manufacturers does not exceed (rupees four hundred lakhs) in the preceding financial year. The notification further prescribed as follows. "3A.For the purposes of determining the aggregate value of clearances of all excisable goods for home consumption , ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ship of the goods is immaterial for the purpose of levy of duty and thus any person who has undertaken the activity of manufacture is liable to pay duty. In order to save the job worker from payment of duty the principal manufacturer has to own the liability to pay such duty. It is only by virtue of the Notification No. 214/86-C.E., dated 25-3-1986 that the liability of the job worker to pay duty is transferred to the principal manufacturer who undertakes to pay duty. 7.7 The intention of enactment of Notification (supra) was to shift the liability of payment of duty from job worker to the principal manufacturer under certain conditions as provided in the said notification. There is no blanket machinery provisions in the Central Excise law under which the liability to pay duty is transferred from the job work manufacturer to another person i.e. principal manufacturer. However when the principal manufacturer does not own up the liability to pay duty on finished goods, the provision of Notification No. 214/86-C.E., dated 25-3-1986 does not apply. In that case, it is the ultimate manufacturer i.e. the job worker who has to pay the duty. Following the procedure and conditions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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