PRESTIGE ENGINEERING (INDIA) LTD. ETC. ETC. versus THE COLLECTOR OF CENTRAL EXCISE, MEERUT, ETC. ETC.

Citation: [1994] SUPP. 3 S.C.R. 30 · Decided: 01-09-1994 · Supreme Court of India · Bench: B.P. JEEVAN REDDY · Disposal: Disposed off

Judgment (excerpt)

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PRESTIGE ENGG. v. COLLECTOR OF CENTRAL EXCISE 
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No. 119/75, so that it would be liable to pay duty only on the value of the A 
job work undertaken by it, as otherwise it would be liable to pay duty on 
the full value including the value of steel pipes supplied by Modipon. 
Unable to succeed before the Central Excise Customs and Gold (Control) 
Appellate Tribunal, the appellant pr-eferred the appeal. 
Similarly, in the other appeals also the appellants claimed the 
benefit of the Notification No. 119/75. 
Disposing of the appeals, this Court 
HELD : 1.1. Once an expression is defined in the Act, that expression 
wherever it occurs in the Act, Rules or Notifications issued thereunder, 
should be understood in the same sense. The expression "manufactured" 
in the Notification should be understood as defined in the Central Excises 
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and Salt Act, 1944. At the same time, it cannot be said that the expression 
"manufacture" contemplated by Notification N o.119/75 is confined to those D 
.processes alone which are "incidental or ancillary to the completion of 
manufactured product" - processes contemplated by clause (i) of Section 
2 (f). There is no warrant for restricting. the meaning of the expression 
"manufactured" occurring in the Notification only to the aforesaid proces-
ses. The stress in the Notification is rather upon the word 'job work'. The E 
dictionary meaning of the expression 'job work' is "work done and paid for 
the job". The Notification, it is evident, was conceived in the interest of 
small manufacturers undertaking job-works. The idea behind the Notifica-
tion was to help the job-workers - persons who contributed mainly their 
labour and skill, though done with the help of tools, gadgets or machinery, 
as the case may be. The Notification was not intended to benefit those who 
contributed their own material to the articles supplied by the customer 
and manufactured different goods. However, addition or application of 
minor items by the job-worker would not detract from the nature and 
character of his work. [44-B, G-H, 45-A-C] 
1.2. The above interpretation does not render the Explanation in the 
Notification redundant in any manner, while at the same time it advances · 
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the object of the Notification, vi~., helping factories undertaking manufac-
turing processes in the nature of job-work. It is true that processes 
incidental or ancillary to the completion of the manufactur~d product are H 
32 
SUPREME COURT REPORTS [1994] SUPP. 3 S.C.R. 
A within the purview of the Notification, but it may not be correct to say that 
the Notification refers only to those processes and to nothing else. Insist-
ing upon the same article being returned to the customer after undergoing 
the manufacturing process at the hands of the job-worker may rob the 
Notification of any substance whatsoever. Confining the operation of the 
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Notification only to those processes which are incidental or ancillary to 
the completion of the manufactured product amounts to undue curtail-
ment of the ambit of the Notification. If that was the intention of the 
Central Government in issuing the Notification, it would have said so 
clearly. The Notification was issued simultaneously with the introduction 
of Tariff Item 68 in Schedule-I to the Act and was intended to help those 
factories undertaking job works, who were charging their customers only 
for the work done by them. In their hands, the value of the article would 
be the value of the job-work done by them - and not the total value of the 
article which would have been the case but for the Notification. 
(45-E-H, 46-A-C] 
Union of India v. Delhi Cloth and General Mills Co. Ltd., A.I.R. (1963) 
S.C. 791, relied on. 
Precision Te/econ Products v. Superintendent of Central Excise and 
Ors., (1986) 24 E.L.T. 235 and National Organic Chemical Industries Ltd. v. 
Collector of Central Excise Bombay, (1985) 21 E.L.T. 252, affirmed. 
Madura Coats Ltd. v. Collector ~f Central Excise, (1980) E.L.T. 582; 
Collector of Central Excise v. Madura Coats 1-:td., (1982) 10 · EL.T. 129; 
Associated Pigments Ltd. v. Collector of Central Excise, Calcutta, (1983) 13 
E.L.T. 876 andAnup Engineering Co. v. Union of India, (1978) 2 E.L.T. 533, 
considered and explained. 
Bapalal & Co. v. Government of India, (1981) E.L.T. 587; Madura 
Coats Ltd. v. Superintendent of Central Excise, (1982) 10 E.L.T. 370 and 
Union of India v. Delhi Cloth and General Mills Ltd., A.I.R. (1963)

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