TaxTMI 
TaxTMI 
2006 (11) TMI 84
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....nufacture Ready Made Garments (RMG). The RMG would be affixed with the brand name of the appellant. The job worker would clear the RMG in bulk condition. Duty would be paid by the job worker on the RMG cleared in bulk condition on a value arrived at on the basis of cost of raw materials plus the processing charges. On receipt of the RMG, each RMG would be removed from the bulk pack to retail pack and put in individual polythene cover. The price tag would be affixed to each RMG. In the case of shirts, the said goods are thereafter put in a product box. A label indicating the style code, the price of the RMG, the size is affixed to the product box together with a small piece of the fabric, commercially known as swatch. Each RMG is thereafter arranged and stored for further transportation for which purpose they are put in a corrugated box. The appellants availed the benefit of exemption Notification 38/2003-C.E., dated 30-4- 2003 exempting garments which are subjected to any of the processes like labeling/relabelling, repacking from bulk packs to retail packs, alteration, etc., subsequent to its purchase. The internal audit party visited the appellants unit and examined the procuremen....
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....ne person to another for a consideration, the definition of sale and purchase in Section 2(h) of the Central Excise Act, 1944 is satisfied. (iv) The Apex Court in the Ujagar Prints case as reported in 1988 (38) E.L.T. 535 (S.C.) in the context of valuation of goods manufactured by the job worker has clearly held that the job worker's premises would be the deemed factory gate, as if the processed goods have been sold by the processor. In the present case, the appellants had paid the job workers the job charges and that there has been a transfer of possession from one person to another. Once the transfer of possession of the garments has taken place from the job worker to the appellants for a consideration, the conditions specified in the Notification are satisfied. (v) The following case laws are relied on: (a) Rado Tyres Ltd. v. CCE - 2004 (174) E.L.T. 218. (b) CCE v. Video Master - 1996 (88) E.L.T. 117. (c) CCE v. Moldtek Plastics Ltd. - 2002 (148) E.L.T. 906 (T) = 2002 (50) R.L.T. 944. (d) Partap Steel Rolling Mills (P) Ltd. v. CCE - 2001 (137) E.L.T. 741. (e) Imex Eng. Co. Pvt. Ltd. v. CCE - 1990 (47) E.L.T. 32. (vi) The Tribunal in the case of Imex Eng. ....
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....rate 4. The appellant is a dealer/trader in RMG, which have the name Levis and Dockers on them. These goods were got manufactured by the appellant from independent contract manufacturers on payment of job charges, after supply of inputs such as fabrics/accessories. After paying duty, the job workers send the goods to another unit called Vishesh Enterprises who did the activity of affixing MRP, tagging, packing and labelling the goods. The goods were thereafter sold obtaining space at the premises of a concern called MERX Logistics. Revenue issued Show Cause Notice dated 21-3-2005 to the appellant on the ground that the goods were not entitled to the benefit of Notification No. 38/2003-Central Excise, dated 30-4-2003 and the appellants alone are required to pay the duty. The reason for denying the exemption Notification is that the Notification in question would apply only when there is a 'purchase' or 'sale' of goods. But in the present transaction, there is no 'purchase' or 'sale'. The Original Authority in the impugned order No. 24/2005, dated 25-8-2005 held that the Notification No. 38/2003 would not be applicable to the goods procured on job work basis as there was no 'purch....
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....teel Rolling Mills (P) Ltd. v. CCE - 2001 (137) E.L.T. 741(T) (f) CCE v. Video Master -1996 (88) E.L.T. 117 (T). E/290/2006 - M/s. Arvind Clothing Limited v. CCE, Bangalore-I Commissionerate 6. The appellants supply all inputs for manufacture of garments to the job workers and the inputs are consigned to them. The inputs are duty paid. The job workers receive the input, take Cenvat credit and manufacture garments. They clear the garments in bulk on payment of excise duty valuing the goods under Section 4 (on the value of raw materials + job charges). These garments are sent back to the warehouse of the appellant. On receipt of the duty paid garments in bulk into their warehouse, the appellant carries out price tagging, stickering, washing instructions, tagging and retail packing. The goods were cleared by availing exemption Notification 7/2003-Central Excise as amended by Notification No. 38/2003. Revenue issued Show Cause Notice to the appellants alleging that they are not entitled for the benefit of exemption Notification No. 38/2003. The Adjudicating Authority, consequently, held that the appellant is liable to pay duty in terms of Notification 20/2001-C.E. (N.T.), date....
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....s to "sale" in terms of Section 2(h) of the Central Excise Act. Even though the appellants relied on 5 case-laws to press their point that the transaction amounts to sale/purchase, the Commissioner has observed that the said case-laws are not applicable to the present cases. According to him, the case-laws are in connection with the availment of Modvat credit. According to the Commissioner, the said case-laws cannot be taken as a general ruling on the definition of 'sale' or 'purchase' that has limited application. We find that the said Notification has not defined 'sale' or 'purchase'. In the absence of such a definition in the Notification, we have to go by the definition given in the Central Excise Act. According to Section 2(h) of the Central Excise Act "Sale' and 'purchase' with their grammatical variations and cognate expressions, to mean any transfer of the possession of the goods by one person to another in the ordinary course of trade or business for cash or deferred payment or other valuable consideration ". The learned Advocate pointed out that as per Karnataka Sales Tax Act, there should be transfer of property of goods, so that the transaction can be considered as sale....
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....hesh Enterprises carry out the activity of affixing MRP, tagging, usage instructions, labeling, re-packing, etc. Vishesh Enterprises send the goods to MERX Logistics India. The goods are sold from there. It is the contention of the appellant that they are not manufacturers. They have relied on the Apex Court's decision in the case of CCE v. M. Khambatwala (supra) decision. In the said case, it was held that when the goods were produced on piece rate basis out of raw materials supplied by the person paying wages, the jobbers were the manufacturers and sale or ownership of raw material was not at all relevant. In the above- mentioned case, the question arose as to whether the Respondents are manufacturers of agarbatti, amlapodi and dhup etc., even though they were manufactured in various premises of the household ladies outside the factory of the Respondents. The Apex Court held that the ownership of the end product is irrelevant and the job workers are only the manufacturers. We reproduce paras 7 and 8 of the above decision. 7. We have considered the submissions advanced before us by the learned Counsel on both the sides. We find force in the arguments of the learned Counsel for ....