High Court Rules Duty Liability on Manufacturers, Not Laborers

The High Court dismissed the Revenue's appeal challenging duty liability allocation between manufacturers and hired labor. It held that duty liability rests with the manufacturer, not the laborer, based on job work principles. The Court also ruled that appeals on valuation matters should be directed to the Supreme Court under Section 35L, not the High Court under Section 35G, in accordance with the Central Excise Act. The appellant was advised to seek recourse under the Act for valuation disputes.

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Issues involved: Challenge to order regarding duty liability on manufacturer vs hired labor, jurisdiction of High Court under Section 35G of Central Excise Act.

Regarding duty liability: The case involved M/s Food & Health Care Specialties supplying raw material to M/s Heinz India Pvt. Ltd. for blending and packing of products, with job charges paid to respondent No.1. The Revenue contended duty is leviable on products sold by M/s Heinz India Pvt. Ltd. to respondent No.1. The Appellate Tribunal held that as respondent No.1 was doing job work, duty liability rests on M/s Heinz India Pvt. Ltd. The Revenue challenged this order.

Jurisdiction under Section 35G: Counsel for respondent No.1 argued that appeals against valuation orders should go to the Supreme Court under Section 35L, citing Commissioner of C.Ex., Chandigarh Vs. C ESTAC , New Delhi. The High Court concurred, stating that the appeal challenging the Tribunal's order on goods valuation does not lie before the High Court under Section 35G, advising the appellant to seek remedy under the Central Excise Act, 1944.

Conclusion: The High Court dismissed the Revenue's appeal as not maintainable under Section 35G, emphasizing the specific exclusion of High Court jurisdiction in valuation matters as per the Central Excise Act.

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