Job work clearances cannot be clubbed with principal's turnover for SSI exemption where the job worker is the manufacturer.

Clearances of goods manufactured by an independent job worker could not be clubbed with the appellant's clearances for denying SSI exemption under Notification No. 8/2003-CE. The text applies the larger Bench principle that the job worker is the manufacturer for duty purposes, ownership of the goods is immaterial to levy, and liability remains with the job worker unless a specific notification shifts it. It also notes that the brand-name exclusion in the notification does not, by itself, treat goods as manufactured by another person. On those facts, the revenue's basis for clubbing was insufficient and denial of SSI exemption was unsustainable.

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Issues: Whether the value of clearances of welding electrodes manufactured by an independent job worker could be clubbed with the appellant's clearances for denying benefit of SSI exemption under Notification No. 8/2003-CE.

Analysis: The appellant supplied raw materials to an independent job worker who manufactured the goods and cleared them from its own premises on payment of duty. The notification excludes certain clearances from the aggregate value and also provides that goods bearing another person's brand name are not, merely for that reason, to be treated as goods manufactured by that other person. The reasoning in the larger bench decision on job work was applied to hold that the job worker is the manufacturer, the ownership of goods is immaterial for levy of duty, and liability to pay duty remains at the end of the job worker unless the conditions of the specific notification shifting liability are attracted. The facts relied on by the revenue to invoke clubbing were therefore insufficient.

Conclusion: The value of the job worker's clearances could not be added to the appellant's aggregate clearances, and denial of SSI exemption was unsustainable.

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