Cold rolling and annealing as manufacture under tariff note depends on proper technical evidence and expert analysis.

Note 4 to Chapter 72 treats hardening or tempering of flat-rolled products as manufacture, so the central question was whether size reduction by cold rolling and annealing could be equated with those processes. The record included technical literature and expert certificates suggesting that cold working may only marginally increase hardness and that true hardening requires heat treatment. Because the adjudicating authority did not meaningfully examine that material and largely reproduced the show cause notice, the Tribunal indicated that the technical evidence needed proper consideration and, if necessary, expert opinion before any conclusion could be sustained. The matter required fresh adjudication on the existing record.

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Issues: Whether the process of reducing the size of flat-rolled products by cold rolling and annealing amounted to hardening or tempering so as to constitute manufacture under the tariff note.

Analysis: Note 4 to Chapter 72 treats hardening or tempering of flat-rolled products as manufacture. The dispute was technical in nature and turned on whether the appellants' process of size reduction by cold rolling could be equated with hardening or tempering. The appellate record showed reliance by the appellants on technical literature and expert certificates supporting the view that cold working may cause only marginal increase in hardness and that true hardening requires heat treatment. The adjudicating authority did not meaningfully consider this material and instead reproduced the show cause notice more or less verbatim in the findings. The tribunal held that, in such a technical matter, the evidence produced by the appellants ought to have been examined and expert opinion could have been obtained if necessary.

Conclusion: The matter required fresh adjudication after proper consideration of the technical material and expert opinion, if needed, and the impugned decision could not be sustained on the existing record.

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