Manufacture for excise purposes requires a commercially distinct product; crushed and seasoned betel nuts remained betel nut classification.

Mere crushing of betel nuts into smaller pieces and adding oils, menthol and sweetening agents did not amount to manufacture for excise purposes because the process did not create a commercially distinct product with a different name, character or use. The end product retained the essential identity of betel nut, albeit in modified form, so it remained classifiable as betel nut under Chapter 8 rather than as a new product under Chapter 21. The chapter note on betel nut powder did not change the position, since the underlying process still fell short of manufacture.

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Issues: Whether crushing betel nuts into smaller pieces and adding oils, menthol and sweetening agents results in manufacture of a new product liable to excise duty under Chapter 21, or whether the goods remain betel nut classifiable under Chapter 8.

Analysis: The process adopted by the assessee did not bring about a transformation into a new commodity with a different character and use. The end product continued to retain the essential identity of betel nut, though in a modified form. The principle that manufacture requires more than mere change or processing was applied, and the chapter note dealing with betel nut powder did not alter the position because the process itself did not amount to manufacture.

Conclusion: The process did not amount to manufacture, and the goods were not classifiable as a newly manufactured product under Chapter 21.

Ratio Decidendi: Mere crushing and seasoning of betel nuts, without emergence of a commercially distinct product having a different name, character and use, does not constitute manufacture for excise purposes.

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