COLLECTOR OF CENTRAL EXCISE, CHANDIGARH vs DECENT DYEING CO.

The Supreme Court held that under Section 35L(b) of the Central Excises and Salt Act, 1944, the liability to pay excise duty lies with the manufacturer of the base yarn, not the processor. The Court dismissed the Revenue's appeal, affirming that the Respondent, Decent Dyeing Co., was correct in assuming that the duty on the base yarn had already been paid by the manufacturers. The Court emphasized that it is unreasonable to require purchasers to verify duty payment, as they lack the means to do so, thus reinforcing the principle that excise duty is primarily a manufacturer's responsibility.