TaxTMI 
TaxTMI 
2024 (2) TMI 76
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....ng the brand name "parryware" and clearing the same on payment of duty. The appellant was manufacturing the said products for M/s. Rocca Bathroom Pvt. Ltd. Chennai. These parties had entered an agreement for manufacture of EFS effective for a period of two years and subsequently renewed. 3. It was found that M/s. Roca were supplying the major input namely urinal casing to the appellant on sale basis enabling fixing the electronic system in the urinal casing by the appellant. The appellant fixes the EFS system in the urinal casing in order to make it have an automated function. The urinal casing with this automated function is called electronic flushing system. These finished goods are packed as single unit per carton box and dispatched to various depots of Roca on sale basis as per the purchase order. The price for the said goods is arrived at by the appellant by cost constructing method with some profit margin. Such price is subjected to negotiation with Roca to arrive at the agreed price and duty is paid accordingly. All these activities are governed by the conditions laid down in the agreement made between Roca and the appellant. 4. It appeared to the Department that the trans....
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....n which is essential for aforesaid process and the expression "job worker" shall be construed accordingly," 6.1 The lower authorities have failed to see that no items was owned by M/s. Roca Bathroom Products Ltd (called RBPPL) which was supplied by M/s. RBPPL on sale and this item was not supplied free of cost to the appellants. This factual position is not disputed in the impugned order. Hence, the manufacture of goods by the appellants was only on the materials owned by themselves. 6.2 At para 9 of the impugned order-in-appeal, the Commissioner takes objection in purchasing this item 'urinal castings' from M/s. RBPPL themselves and not from any other person but he has not given a finding as to under which provision there is a prohibition for purchasing, an input from the buyer himself. So long as M/s. RBPPL had sold such goods and paid sales tax on the same it cannot be said the final product was manufactured by the appellants from the inputs/materials supplied by the customer and the transaction was one of 'job work'. Both the lower authorities have failed to note that in a job work transaction, the product is manufactured on the materials supplied by principal manufacturer. M....
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....nsel submitted that the issue stands squarely covered the decisions rendered in the appellant's own case as reported in [2020 (3) TMI 308-CESTAT-CHENNAI]. The Ld. counsel prayed that the appeal may be allowed. 7. The Ld. Authorized Representatives Shri M. Selvakumar and Shri Harendra Singh Pal for the Department and reiterated the findings in the impugned order. 8. Heard both sides. 9. The issue that arises for consideration is whether the appellant M/s. Tescom is a job worker of M/s. Roca or whether the transaction between the above two is on principal to principal basis. To understand the issue, the relevant part of the Agreement is reproduced as under:- 4. BASIS 4.1 It is specifically agreed and understood by and between the Parties that the sale of the said products by TEPL to RBPPL is on the basis of principal to principal and TEPL is fully responsible for manufacture, sale and supply of products and nothing contained herein shall constitute or deem to constitute either of the parties as the agent of the other. Further M/s.TEPL shall discharge all liabilities under various statutes with reference to manufacture, supply and/or sale of products to RBPPL and undertake to i....
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....are Division - M/s. EID Parry (India) Ltd) In March 2006, the Parryware Division was hived off and a new company known as M/s. Parryware Glamourooms Pvt. Ltd, was formed. After entering into a joint venture with M/s. Roca, Spain, the name of the company M/s. Parryware Glamourooms Pvt. Ltd was changed to M/s. Parryware Roca Pvt. Ltd and thereafter, to M/s Roca Bathroom Products Pvt. Ltd. The agreement made in 2001 was renewed every year and extended till December 2009 as per the letter dated 15.06. 2009 of the appellant M/s. Roca. 2.3 From the terms of the agreement, the Department was of the view that the transactions between M/s. Inova and M/s. Roca were not on principal to principal basis. From investigations the Department was of the view that M/s. Inova were manufacturing as job worker for M/s. Roca on contract basis. The price adopted by M/s Inova was only the cost of production at their hand as evidenced from the cost sheet prepared. There was a difference of 200 to 250 per cent in the sale price of the goods from M/s. Roca when compared to the sale price of M/s. Inova to M/s. Roca. The brand name "Parryware" was owned by M/s Roca and M/s. Inova did not have any claim on su....
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....tion of goods on behalf of a principal manufacturer, from any inputs or goods supplied by the said principal manufacturer or any other person authorized by him Thus to qualify as job worker, in our view, the following hard sticks require to be satisfied (i) Job worker should be engaged in manufacture or production of goods on behalf of another manufacturer. (ii) Inputs or goods should be supplied by the said principal manufacturer or by any other person authorized by him. (iii) By implication, the inputs or goods so supplied will not be required to be paid for by the job worker. When we apply these tests to the facts of the appeal at hand, we find that Sujhan does not appear to quality to be a job worker" for the purpose of Rule 10A ibid. The inputs or goods are not supplied free by Honeywell, or other persons authorized by Honeywell. 8.4 On the other hand, Sujhan have to buy these inputs and goods etc. at a price. The goods are not cleared by Sujhan without payment of Central Excise duty. The goods are cleared by Sujhan to Honeywell only after discharge of Central Excise duty on the assessable value and the value indicated in the invoices from Sujhan to Honeywell. 8.5 ....