should the modifier always touch the noun it modifies??.

[RonPurewal]

both (a) and (b) would be correct, although the comma should be removed from (b).

But,Manhattan Verbal strategy guide says that the modifier should touch the subject it modifies and hence the confusion.

this rule applies only to adjectival modifiers - i.e., modifiers that MODIFY NOUNS.
this is an adverbial modifier, which modifies the action of the entire clause, so this rule is inapplicable here.

[goelmohit2002]

both (a) and (b) would be correct, although the comma should be removed from (b).

But,Manhattan Verbal strategy guide says that the modifier should touch the subject it modifies and hence the confusion.

this rule applies only to adjectival modifiers - i.e., modifiers that MODIFY NOUNS.
this is an adverbial modifier, which modifies the action of the entire clause, so this rule is inapplicable here.

Hi Ron,

Can you please tell what role does "upon" play here ?

Had upon been not there surely it would have been "comma + ing" setup...i.e. adverbial modifier...

But i am confused due to the presence of "upon"...can you please tell what is the role of upon here ?

[Ben Ku]

A noun modifier explains who or what is doing the action. An adverbial modifier explains how, when, or where an action was done.

In the sentence you gave,

Upon leaving the register, the customer received a receipt from the cashier.

"Upon leaving the register" does not providing information about the customer so it's not a noun modifier. Instead, it's providing information about the man's action; it describes when the customer received a receipt. It's an adverbial modifier.

Adverbial modifiers do not follow the "touch" rule because they're not modifying nouns. Instead, they can be placed anywhere in the sentence, as long as there is no ambiguity about what it modifies.