Manufacturer under the Central Excise Act
Manufacturer is the person who actually brings new and identifiable product into existence.
• Duty liability is on manufacturer in most of the cases.
• Mere supplier of raw material or brand name owner is not ‘manufacturer’.
• Loan licensee is not ‘manufacturer’.
Loan licensee can be treated as manufacturer only if the manufacture is carried out by use of his own raw material under his own supervision by hiring the premises and equipment shift-wise or otherwise.
Definition of Manufacturer
Section 2(f) defines the term ‘manufacture’ to “include any process –
(i) incidental or ancillary to the completion of a manufactured product; and
(ii) which is specified in relation to any goods in the Section or Chapter notes of the Schedule to the Central Excise Tariff Act, 1985, as amounting to manufacture;
(iii) which, in relation to the goods specified in the Third Schedule, involves packing or repacking of such goods in a unit container or labeling or re-labelling of containers including the declaration or alteration of retails sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer.
And the word “manufacturer” shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his own account”.
Thus, according to the above definition, the manufacturer is a person :
(a) who manufactures or produces any excisable goods, or
(b) carries on any process incidental or ancillary to the completion of the manufactured products.
Who is not a Manufacturer
The following have been held as not to be a manufacturer :
(a) `Where an activity is not a manufacture;
(b) Brand Owners, if their relation with the manufaturer is ‘Principal to Principal’ basis.
(c) Labour Contractors, who supply labor;
(d) Loan licensee.
(e) Raw material supplier is not manufacturer
next — classification of Goods