Whether goods manufactured by SSI manufacturer output of raw materials supplied by another person / manufacturer would be entitled to exemption under Notification No. 1/93-C.E. (NT), dated 28-2-1993

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.... SSI manufacturer output of raw materials supplied by another person / manufacturer would be entitled to exemption under Notification No. 1/93-C.E. (NT), dated 28-2-1993 I am directed to invite your attention to Board's Circular No. 50/88-CX-8, dated 20-9-1988 (F. No. 267/31/88-CX-8) wherein it was clarified in consultation with the Ministry of Law that if the raw materials are supplied by a principal manufacturer for the manufacture of any goods on job work basis, then the same would not be entitled for SSI exemption (unless principal manufacturer himself is entitled for the SSI exemption) even if the job worker is otherwise entitled for the SSI exemption. This circular was further modified by Board's Circular No. 49/90CX-8, dated 23-7-....

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....er the raw material supplier or the job worker will be treated as manufacturer came for consideration before the CEGAT, Special Bench, New Delhi in the case of Kerala State Electricity Board v. Collector of Central Excise [1990 (47) E.L.T. 62 (Tribunal)]. In that case the Kerala State Electricity Board used to get PSC/PCC and RCC poles produced according to their specification and satisfaction with the help of material supplied by them, through contractors. On detailed examination of the terms and conditions of the contract between the two, the CEGAT came to the conclusion that the contractors were not merely working as hired labour under the Board. Instead, the agreement between the Board and the contractors was on principal to principal b....