Fabrication of steel structurals from duty-paid inputs was not manufacture, so central excise duty demand failed.

Fabrication of duty-paid steel inputs by cutting, bending, grinding, punching, bolting and welding into columns, beams, trusses and similar structural members was held not to constitute manufacture for central excise purposes. The Tribunal followed earlier Supreme Court decisions on fabrication of steel structurals and applied that principle to conclude that the process did not bring into existence a new excisable product. As manufacture was not established, the central excise duty demand could not be sustained.

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Issues: Whether cutting, bending, grinding, punching holes, bolting and welding of duty-paid steel materials to fabricate columns, beams, trusses and similar steel structurals amounts to manufacture and attracts central excise duty.

Analysis: The activity undertaken consisted of processing duty-paid angles, channels, rounds, joists, plates and similar inputs into fabricated steel structures. The reasoning followed earlier decisions holding that fabrication of trusses, beams and columns from such materials does not bring into existence a product that can be treated as manufacture for central excise purposes. The Tribunal applied the same principle to the facts before it and found the earlier decisions of the Supreme Court to be directly applicable.

Conclusion: The activity did not amount to manufacture, and the demand of central excise duty could not be sustained.

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