Job-worker manufacture under excise law requires control or supervision; mere raw material supply does not make supplier the manufacturer.

A raw material supplier is not treated as the manufacturer of goods produced by an independent job worker under excise law unless special relationship, financial control, supervision, or other material indicia of control over the manufacturing process is shown. Mere supply of raw material or use of the supplier's brand name is insufficient. The note also states that manufacture requires emergence of a new and different commodity with a distinct name, character, and use; where identity remains unchanged, manufacture is not established. On that basis, the exemption notification was held applicable and the revenue's objection failed.

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Issues: (i) Whether the respondent could be treated as the manufacturer of separators manufactured by an independent job worker for the purpose of Section 2(f) of the Central Excises and Salt Act, 1944. (ii) Whether Notification No. 119/75 was inapplicable to the separators on the ground that no manufacture took place.

Issue (i): Whether the respondent could be treated as the manufacturer of separators manufactured by an independent job worker for the purpose of Section 2(f) of the Central Excises and Salt Act, 1944.

Analysis: The respondent supplied raw material to an independent concern which manufactured the separators. Mere supply of raw material or use of the respondent's brand name was held insufficient to establish manufacture by the respondent. In the absence of any special relationship, financial control, supervision, or other material indicia of control over the job worker, the supplier of raw material could not be deemed to be the manufacturer.

Conclusion: The respondent was not the manufacturer within the meaning of Section 2(f) of the Central Excises and Salt Act, 1944.

Issue (ii): Whether Notification No. 119/75 was inapplicable to the separators on the ground that no manufacture took place.

Analysis: The term manufacture was construed to require emergence of a new and different commodity having a distinct name, character, and use. If the identity of the article does not change, no manufacture takes place and the process cannot be treated as a manufacturing process for denying the notification. On that reasoning, the objection to the notification was rejected.

Conclusion: Notification No. 119/75 was applicable and did not support the revenue's objection.

Final Conclusion: The appeal failed on both issues and the order in favour of the respondent was maintained.

Ratio Decidendi: A raw material supplier cannot be treated as the manufacturer of goods made by an independent job worker unless a special relationship or actual control or supervision over the manufacturing process is shown, and manufacture requires emergence of a new commodity with a distinct name, character, and use.

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