TaxTMI 
TaxTMI 
1988 (3) TMI 68
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.... the customers is done under a contract entered into by the Company with its customer. In the absence of a notification, to which a reference will be made shortly, excise duty will be leviable on the product which emerges from the factory of the petitioner under Item 68 of the First Schedule to the Central Excises and Salt Act, hereinafter referred to as "the Act". However, by Notification bearing No. 119/75, dated 30th of April, 1975, certain exemption was given to a factory of the type of the petitioner which manufactures articles of what can be called job work basis. The second respondent to this petition, who is the Assistant Collector of Central Excise, however, has taken a view that the said notification does not apply to the factory ....
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....ssued to the petitioner and they were also confirmed by the same officer taking a similar view. The petitioner, therefore, has approached this Court under Article 226 of the Constitution of India challenging the view taken by the respondent and seeking a writ from this Court for setting aside the orders dated 2nd June, 1981 and 13th August, 1981. 3. There is no return filed to this petition. That itself is hardly of any consequence because it has not been disputed, and indeed it could not be disputed, that the petitioner Company is carrying on a sort of manufacturing activity which has already been described by me in the earlier part of this judgment. That it is doing such manufacturing activity is evident from the order passed by the re....
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....ended manufacturing process, on charging only for the job work done by him." 5. Even a cursory reading of the said notification should show that the main part of the notification applies necessarily to a factory which does manufacturing activity because the first part of the notification says that the Central Government exempts goods "manufactured in a factory as a job work". Obviously, therefore, the notification must apply to a factory where goods are manufactured as a job work. In order to leave no doubt on the use of the word "job work" an explanation has been added to this notification which, if anything, reinforces the view that the notification must apply to a factory where manufacturing activitites are carried on. Job work has be....
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....the customer and the job worker. The Division Bench noticed what is an obvious fact that unless there was a manufacturing process the article could not be subjected to excise duty. That was the very basis of taxation under excise law. The Division Bench further noted that in order to exempt job workers from payment of duty except to the extent of duty on the job work charges, the notification was issued and the Explanation to the notification made it abundantly clear. The defence on behalf of the department before the Division Bench was the same, namely the view that is reflected in the orders which are under challenge before me. 7. The view taken by the Division Bench of the Gujarat High Court was noticed by Bharucha J. in Noble Paints ....