[Notification No. 19/2011 CE (NT) dated 28.07.2011]

Option to authorize job-worker to pay duty in case of readymade garments and made-up articles of textiles withdrawn

In the garment and made up industry, goods are being manufactured from several job-workers.  The person getting the goods manufactured on his behalf may or may not, himself, possess any manufacturing facility.

Central Excise Rules were amended to incorporate sub-rule (1A) in rule 4 vide Notification No. 4/2011 CE (NT) dated 01.03.2011 to prescribe that in case of readymade garments and made-up articles of textiles falling under Chapter 61 or 62 or 63 of the First Schedule to the Tariff Act, the liability to pay duty and comply with central excise procedures would be on the person on whose behalf the goods are manufactured by job-workers.  Alternatively, an option was given to merchant manufacturer to authorize the job-worker to obtain registration and comply with all formalities of Central Excise including payment of duty.

In a case where any merchant manufacturer has already authorized its job-worker to pay the duty under the provisions of sub-rule (1A) as it stood prior to the publication of this notification, he will have to obtain registration and comply with other related provisions within a period of 30 days from 28.07.2011.

[Notification No. 19/2011 CE (NT) dated 28.07.2011]

Sub-rule (1A) has been further amended to withdraw the option available to merchant manufacturer to authorize the job-worker to pay duty and comply with all the procedures.  Therefore, now only the merchant manufacturer can pay duty in such cases.