Aggregate job-work clearances govern excise liability, preventing fragmentation of manufacture to avoid the exemption threshold.

Rule 12B of the Central Excise Rules, 2002 treats the person getting goods manufactured on job work as the assessee once the statutory conditions are met. The exemption notification is applied on the basis of the aggregate value of clearances, not on separate clearances by individual job workers. The clarification circular and its illustrations support that once the aggregate threshold is crossed, exemption is unavailable for clearances covered by the scheme, and duty cannot be avoided by splitting work among multiple job workers. The challenge failed.

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Issues: Whether, for the purposes of Rule 12B of the Central Excise Rules, 2002 and the exemption notification, the duty liability of a trader getting textiles manufactured on job work is to be determined on the aggregate value of clearances from all job workers or only with reference to the job worker whose clearances exceed the exemption threshold.

Analysis: Rule 12B fastens liability on the person who gets the goods manufactured on job work by treating him as an assessee once the statutory conditions are attracted. The exemption notification also proceeds on the basis of the aggregate value of clearances and not on separate clearances of individual job workers. The clarification circular and its illustrations support the construction that once the aggregate threshold is crossed, the benefit of exemption is lost in respect of the clearances covered by the scheme. Accepting an individual-job-worker basis would defeat the express emphasis on aggregate clearances and permit fragmentation of work among multiple job workers to avoid duty.

Conclusion: The liability is to be determined on the aggregate value of clearances from all job workers, and not only with reference to the single job worker whose clearances exceeded the threshold; the challenge failed.

Ratio Decidendi: Where the governing rule and exemption notification make aggregate clearances the measure of liability, the statutory fiction treating the principal as an assessee must be given full effect, and duty cannot be avoided by splitting manufacture among multiple job workers.

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