TaxTMI 
TaxTMI 
2026 (7) TMI 82
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....b work basis by sending raw materials like pre-form pet bottles and caps to the job workers. The appellants entered into agreement with their job workers, according to which the franchisee job workers were required to manufacture mineral water as per the ISI standards, fill the same in the pre-form pet bottles supplied by the appellant and send the bottled water to the appellant and the appellants were paying conversion charges. The department noticed that they have shown two different incomes/turnovers in their Profit & Loss account viz., turnover of manufacturing and turnover relating to trading. 3. Therefore, department felt that since the transactions between the appellant and the franchisee job workers were that of principal manufacturer and job worker and the consideration was paid by the appellant, the value of the goods manufactured by the job worker also has to be included in the turnover of the appellant for the purpose of computing total turnover during preceding financial year. On adjudication, the adjudicating authority held that appellant got goods manufactured as principal manufacturer and therefore, the contention that job workers were independent entities was be....
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....ore, in this case, the manufacturer i.e., the appellant is not only manufacturing specified goods in their own factory but were also getting the said goods manufactured on job work basis from other job workers, which were also sold by them under the same brand and specifications as the one which the appellants were manufacturing in their own factory. He has also submitted that it is not disputed that in this case manufacturing has taken place under job work basis. In this regard, Rule 2(n) of Cenvat Credit Rules (CCR), 2004 defines 'job work' as processing or working upon of raw material or semifinished goods supplied to the job worker, so as to complete a part or whole of the process resulting in the manufacture. He has also invited attention to certain clauses of the agreement that the relationship between the appellant and job worker was that of principal manufacturer and job worker only. He has essentially invited attention to certain paras, as under. "2. That the company has agreed to supply packaging material like empty bottles, caps, cartons and labels to the franchise and the franchise has agreed to fill the empty bottles supplied by the company with packaged drink....
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....pellants have relied upon in their support, the matter was heard on 22.04.2026, wherein, learned Advocate has pointed out that they are relying on the judgment in the case of CCE, Baroda Vs M.M. Khambatwala [1996 (84) ELT 161 (SC)], ShaktiUdyog, Jalandhar Vs CCE, Chandigarh [1986 (25) ELT 423 (Tribunal)] and Basanth Industries Vs CCE, Kanpur [1995 (75) ELT 21 (SC)]. 8. Heard both sides and perused the records. 9. As the core issues involved in these appeals are same, we intent to take both appeals together for disposal. We find that appellants were availing themselves of certain benefit under exemption Notification No. 8/2003-CE. This notification is conditional notification, which requires fulfilment of certain conditions as also prescribes for different slab rates as well as turnover criteria beyond which eligibility for said notification was not available. The issue which the department has taken up is that the value of bottled water manufactured by certain job workers in terms of agreement with the appellant has to be clubbed with the turnover of the appellant and once it is clubbed, then they would not be eligible for exemption during certain financial years having cross....
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.... behalf of a manufacturer from one or more factories .... It is not manufacture "by or on behalf" that is the exempting determinant, but clearance "by or on behalf of". Manufacture is one thing, clearance another. Goods can be manufactured of behalf of another; they can never be cleared on behalf of another. A man who produces goods must clear them; they can never be cleared on his behalf or on behalf of some other man. Clearance is itself an end, it is self-sufficient and does not need to be done on behalf of anybody. It is enough to clear - it is not important on whose behalf goods are cleared. The producer/manufacturer clears goods and there is an end of the matter as far as clearance goes." 12. In the present case, the goods were being cleared back to the principal manufacturer and it is not being cleared by them directly or indirectly on behalf of the principal manufacturer. Thus, this judgment is also not relevant to the issue covered in the present appeals. In the case of Basanth Industries Vs CCE, Kanpur (supra), the Hon'ble Supreme Court examined the issue of scope of different units in a given factual matrix. The judgment was in favour of the appellant because....
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....(216) ELLT 177], there was a scope for entertaining doubt and taking a particular stand in view of two different circulars and hence the Hon'ble Apex Court held that mere omission to give correct information is not suppression of facts unless it was deliberate to stop the payment of duty. In the instant case the noticee were working under self-assessment procedure which cast a statutory obligation on them to do assessment correctly. Thus, they have no case on limitation and needless to mention the case laws relied upon by them are distinguishable on facts as well as on the legal provisions as existed during the relevant period. Further, on the issue of limitation of time, it would be pertinent to refer to the following judicial pronouncements, which make it clear that the noticee have no case on limitation: (i) Hon'ble Supreme Court in the case of CCE, Visakhapatnam Vs M/s. Mehta & Co [2011-TIOL-17-SC-CX] held as follows:- "Central Excise - DEMAND - Intention to evade - Limitation - Show Cause Notice issued within five years from the date of knowledge of the Department is valid: Although, the respondent has pleaded that it was done out of ignorance, but there appe....
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.... (iii) The Hon'ble Tribunal in the case of Yee Kay Technocrat (P) Ltd Vs CCE, Delhi-IV - 2011 (267) E.L.T. 92 (Tri-Del) held as follows:- "7. The other submissions that the demand is time barred, is also not acceptable. Section 11A provides for issue of show cause notice demanding duty short-levied non-levy or short paid. In certain situations, the show cause notice can be issued demanding duty for a period of five years from the relevant date as defined in the Central Excise Act, which is as under: ""(ii) "relevant date" means,- ............................ 8. ........Learned Consultant as not been able to show as to how the date of audit when the department came to know of the irregularity becomes relevant date in the light of the above provision defining the relevant date under Section 11A............" (iv) The gist of the decision of the Hon'ble Tribunal in the case of Union Quality Plastic Ltd., Vs CCE & ST, Vapi and Ispa Chemicals Pvt Ltd., Vs CCE & ST, Dama - 2013 - TIOL - 1702 - CESTAT - AHM-LB is reproduced hereunder:- "Extended period of limitation can be legitimately invoked even if Revenue has knowledge of suppress....