Job-work duty liability remained with the supplier for fabrics processed under Rule 57F(3), not the job worker.

Fabrics sent for processing under Rule 57F(3) remained subject to the supplier's duty responsibility, and Notification No. 214/86-C.E. did not shift liability to the job worker. The Tribunal accepted that the goods were sent by the supplier for processing and were to be received back after job work, so the duty payable under law continued to rest with the supplier. It found no infirmity in the Commissioner (Appeals) order and rejected the Revenue's contention that the job worker had to pay additional duty of excise.

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Issues: Whether, in respect of fabrics sent for processing under Rule 57F(3), the job worker was liable to pay additional duty of excise despite Notification No. 214/86-C.E., or whether the duty liability remained with the supplier.

Analysis: The movement of goods was covered by Rule 57F(3) of the Central Excise Rules, under which the goods were sent by the supplier for processing and were to be received back after job work. On that footing, the responsibility to pay duty as applicable under law was on the supplier. The Tribunal found no infirmity in the order of the Commissioner (Appeals) and saw no merit in the Revenue's contention that the job worker was required to discharge the additional duty.

Conclusion: The issue is decided in favour of the assessee and against the Revenue; the job worker was not liable to pay the duty in the facts of the case.

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