Job work exemption under Notification No. 119/75 applies where labour and skill predominate, even if a distinct product emerges.

Notification No. 119/75 extended concessional treatment to job work where the worker principally contributed labour and skill, and was not confined to processes merely incidental to completion of the finished article. The emergence of a new and distinct product did not by itself disqualify the claim. The decisive test was whether the job worker supplied raw material of substantial value; insignificant additions did not defeat eligibility. On the facts, the additions made by the assessee were not of substantial value and the manufacture was mainly from customer-supplied material, so the concession was available.

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Issues: Whether the assessee was entitled to the concession under Notification No. 119/75 for manufacture carried out on job work basis, notwithstanding that the process resulted in a new and distinct product.

Analysis: The notification was intended to benefit job workers who principally contribute labour and skill, and it is not confined to processes merely incidental or ancillary to completion of the manufactured product. The emergence of a new product by itself does not disqualify the claim. The decisive consideration is whether the job worker substantially contributes his own raw material of considerable value, as opposed to insignificant additions. On the facts, the appellants' additions such as clipping and slitting were not of substantial value and the manufacture was mainly from the material supplied by the customers.

Conclusion: The concession under Notification No. 119/75 was admissible, and the assessee succeeded.

Ratio Decidendi: A process done on job work basis remains eligible for the benefit of Notification No. 119/75 if the job worker mainly contributes labour and skill and does not supply raw materials of substantial value, even if a distinct final product emerges.

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