Job worker exemption under Notification 83/94-C.E. supported waiver of pre-deposit and stay of recovery at interim stage

Notification No. 83/94-C.E. was examined in the context of a job worker seeking waiver of pre-deposit pending appeal. The notification required the supplier of raw material to furnish the undertaking that goods manufactured on job work basis would be used in the supplier's factory for manufacture of specified goods, and the text noted that this obligation did not extend to the job worker. As the applicant was only a job worker clearing goods on labour charges, a strong prima facie case was found for interim relief. The benefit of the notification was therefore not denied at the interim stage, and pre-deposit of duty, interest and penalty was waived with stay of recovery.

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Issues: Whether the job worker was entitled to the benefit of Notification No. 83/94-C.E. dated 11-4-1994 and, consequently, to waiver of pre-deposit of duty, interest and penalty during the pendency of the appeal.

Analysis: The notification required the supplier of raw material to file the undertaking that the goods manufactured on job work basis would be used in the supplier's factory in or in relation to the manufacture of specified goods. On the facts noted, the applicant was only a job worker and had cleared the goods on labour charges. The notification did not cast an obligation on the job worker to file any undertaking or declaration. Accordingly, the appellant had established a strong prima facie case for interim relief.

Conclusion: The benefit of the notification could not be denied to the job worker at the interim stage, and waiver of pre-deposit of duty, interest and penalty was granted with stay of recovery.

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