Own-manufactured goods cannot be cleared as job work; statutory duty and record-keeping requirements still apply.

Goods manufactured in an assessee's factory from its own raw materials cannot be cleared under job work challans, because the job work procedure and its record-keeping requirements apply only to job work receipts and not to self-manufactured finished goods. The assessee must account for such production in the statutory records and discharge duty in the manner applicable to its own manufacture. Revenue neutrality was rejected on the facts as inapplicable, and the cited authorities were treated as distinguishable. The result stated in the text is that duty demand and penalty were sustained.

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Issues: Whether finished goods manufactured from the appellant's own raw materials could be cleared under job work challans without payment of duty.

Analysis: The clearance of goods manufactured in the appellant's factory from its own raw materials could not be equated with a clearance under the job work procedure. The appellant was required to account for production in the statutory records, and the undisputed facts showed that finished goods made from own raw materials were cleared to customers under job work challans. The job work scheme and the record-keeping obligations applicable to such receipts were held to be different from the treatment required for goods manufactured from the appellant's own inputs. The plea of revenue neutrality was also rejected as inapplicable on the facts, and the cited decisions were found to be distinguishable.

Conclusion: The appellant was not entitled to clear its own manufactured finished goods under job work challans without discharging duty, and the duty demand and penalty were sustained against the assessee.

Ratio Decidendi: Goods manufactured from an assessee's own raw materials must be cleared in accordance with the duty and record-keeping requirements applicable to such manufacture and cannot be treated as job work clearances merely by using job work challans.

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