COLLECTOR OF CENTRAL EXCISE, BARODA versus MIS. M.M. KHAMBHATWALA

COLLECTOR OF CENTRAL EXCISE, BARODA versus MIS. M.M. KHAMBHATWALA

House-hold ladies manufacturing agarbatti, amlapodi, and dhup outside factory premises without the aid of power, using raw materials supplied by the respondents and without supervision, are the real manufacturers for purposes of excise duty. Goods so manufactured cannot be clubbed with the goods manufactured in the factory premises for determining exemption under Notification No. 80/80-CE. The respondents cannot be treated as manufacturers in respect of these goods; hence, the exemption claimed cannot be denied on that basis.

Parties
Appellant: Collector of Central Excise, Baroda; Respondent: M/s. M.M. Khambhatwala
Jurisdiction
India
Judgment Date
09 May 1996
Procedural Posture
Civil Appeal / Supreme Court Final Judgment on Appeal Against CEGAT Order
Outcome
Appeal dismissed.
Legal Topics
Exemption Notification, Definition of 'manufacturer', Clubbed Clearances, Liability to Excise Duty
Tax Law Central Excise Exemption Notification Definition of 'manufacturer' Clubbed Clearances Liability to Excise Duty

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Parties

Collector of Central Excise, Baroda

Appellant

M/s. M.M. Khambhatwala

Respondent

Procedural Posture

Civil Appeal / Supreme Court Final Judgment on Appeal Against CEGAT Order

Legal Issues

  1. 1 Whether goods manufactured outside the factory premises by house-hold ladies without the aid of power can be clubbed with goods manufactured in the factory for the purpose of exemption under Notification No. 80/80-CE dated 19.6.80.
  2. 2 Whether respondents can be considered as 'manufacturers' for agarbatti, amlapodi and dhup manufactured outside the factory premises without power.

Ratio Decidendi

House-hold ladies manufacturing agarbatti, amlapodi, and dhup outside factory premises without the aid of power, using raw materials supplied by the respondents and without supervision, are the real manufacturers for purposes of excise duty. Goods so manufactured cannot be clubbed with the goods manufactured in the factory premises for determining exemption under Notification No. 80/80-CE. The respondents cannot be treated as manufacturers in respect of these goods; hence, the exemption claimed cannot be denied on that basis.

Court Disposition

Appeal dismissed.

Orders

  • Order of the CEGAT is upheld, restoring the order of the Assistant Collector in favour of the respondents. No costs.