Real manufacturer test in job-work excise matters: duty liability stayed with the assessee on unreliable records.

Goods manufactured from raw materials supplied by the assessee, processed by a job-worker on the assessee's instructions, and cleared from the assessee's premises were treated as the assessee's own manufacture where the agreement and records were found unreliable and no material showed the job-worker to be an independent manufacturer. On those facts, the job-worker was not regarded as the real manufacturer, so central excise duty liability remained with the assessee and the duty demand and allied consequences were upheld.

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Issues: Whether, on the facts of the case, the assessee or the job-worker was the real manufacturer liable to pay central excise duty on the cleared goods.

Analysis: The goods were manufactured from raw materials supplied by the assessee, processed by the job-worker on the assessee's instructions, and cleared from the assessee's premises after job work. The agreement and records relied upon by the assessee were found unreliable, and there was no material to show that the job-worker was the independent manufacturer. In these circumstances, the job-worker could not be treated as the real manufacturer, and the duty burden remained on the assessee.

Conclusion: The issue is decided against the assessee and in favour of the Revenue; the assessee was held liable for the duty demand and allied consequences.

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