1986 (5) TMI 175

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....eal was then heard on 14-5-1986. 2. The learned Counsel for the appellants argued that his main contention was that M/s. Shakti Udyog could not be regarded as the manufacturers of the steel utensils made by M/s. Mittal Steel Works, Vishwakarma Industries, Mittal Industries and Nishkam Udyog on their behalf, even though they sent stainless steel flats to them for the purpose. The manufacturer of the steel utensil is that person who makes the utensil from the raw material steel sheet or flat, and not the supplier of the steel sheet or even the owner of the utensil. It might be true, said the counsel, that they owned the steel sheets and utensils made from them; but they were not the manufacturers of the utensil. The other units who ma....

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.... 5. We can see in the order No. 1/CE/81 dated 21-1-1981 passed by the Collector Central Excise, Chandigarh that there was no dispute that the utensils were manufactured by the 4 outside units. There was no dispute either that the manufacture was on behalf of M/s. Shakti Udyog and that the stainless steel sheets were sent by them and that the goods remained the property of M/s. Shakti Udyog at all times. The makers simply fabricated the utensils and charged the owners for the work. 6. In these conditions it is not permissible to adjudge the utensils as the manufactures of M/s. Shakti Udyog or as cleared on their behalf. The utensils were manufactured by the four independent units and they were the manufacturers of the utensils, ....

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....anufactured on behalf of Shree Agency and the Supreme Court held this to be the case from the facts surrounding the transactions. Because of this, Shree agency was considered to be the manufacturer in terms of Section 2(f)(iv) of the Central Excises and Salt Act and hence the exemption was not available to them. Had the Notification No. 176/77-C.E. been similarly worded M/s. Shakti Udyog would also be disentitled. 9. But notification No 176/77-C.E. is not similarly worded: it gave exemption to goods falling in item 68 : cleared for home consumption on or after the first day of April in any financial year by or on behalf of a manufacturer from one or more factories .... It is not manufacture "by or on behalf" that is the exempting d....

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....ccount - they must be taken under the makers' account. Notification No. 176/77-C.E. can take the total clearances of such outside unit - it cannot lift clearances from some unit to add to the total of another. We would like to emhasize again that there is nothing as "clearance on behalf" in the central excise law and in fact the phrase is meaningless. 12. To be sure, a man may camouflage his operations and conceal that he owns more than one factory. When it discovered that the other 2 or 3 factories are his, we will be tempted to say that their goods were cleared on his behalf. It is nothing of the kind. The goods were cleared by the owner, though he may have remained unknown before, and though to all appearances, somebody also clea....