Cutting and slitting imported rolls may not amount to manufacture absent a specific deeming provision.

Cutting and slitting imported jumbo rolls of adhesive plastic and aluminium foil were examined as to whether the activity amounted to manufacture for purposes of duty and penalty. The analysis noted that Chapter 48 contains a specific deeming provision treating slitting or cutting of thermal paper as manufacture, but no comparable provision was shown for Chapters 39 or 76. Relying on tribunal precedent that similar cutting and slitting activity does not amount to manufacture, the applicant was found to have a strong prima facie case. Waiver of pre-deposit of duty and penalty was granted, and recovery was stayed pending appeal.

---

---

Issues: Whether the process of cutting and slitting imported jumbo rolls of adhesive plastic and aluminium foil amounted to manufacture so as to justify pre-deposit of duty and penalty.

Analysis: The order noted that Chapter 48 of the Central Excise Tariff Act, 1985 contains a deeming provision in Note 10A treating slitting or cutting of thermal paper as manufacture, but no similar note was shown for Chapters 39 or 76. It was also noted that Tribunal precedent had taken the view that such activity does not amount to manufacture in comparable situations. On that basis, the applicant was found to have a strong prima facie case.

Outcome: Waiver of pre-deposit of duty and penalty was granted and recovery was stayed pending the appeal.

---