In Brief
A textile trader obtained goods from 70+ job workers, clearing over Rs. 1.45 crore in total. Though only one job worker's clearances exceeded the Rs. 25 lakh exemption limit, the trader disputed liability, arguing duty was owed only on that particular job worker's excess. The Supreme Court held that Rule 12B and the Exemption Notification focus on aggregate clearance value across all job workers. Once that aggregate exceeds the limit, the entire trader becomes liable on all clearances combined—not just those from the job worker exceeding the threshold. The legal fiction that the trader is an assessee must be applied fully and logically, preventing evasion through fragmentation across multiple job workers. The Court dismissed the appeal and affirmed the duty demand."
The lawyer headnote and full judgment text are available to registered users.