Appellate Tribunal: Stranding Wires not Manufacturing. Valuation based on final sale price.

The Appellate Tribunal allowed the appeal, recalling the Final Order, as the issue of whether the stranding of wires amounts to manufacture was settled in favor of the assessee. The Tribunal determined that the conversion of Galvanised Stranded Stay Wire did not constitute manufacture under the Central Excise Act. It clarified valuation principles, stating that the value of goods should be based on the final sale price to customers at the time of clearance. The decision was influenced by a separate judgment of the Apex Court in a related case.

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Issues involved: The issue of whether the stranding of wires amounts to manufacture and the applicability of a previous Tribunal decision that was later overruled by the Apex Court.

Issue 1: Stranding of wires as manufacture

The Appellate Tribunal upheld the Adjudicating Authority's order based on a previous Tribunal decision regarding the stranding of wires. However, it was pointed out that the Apex Court had overruled this decision, stating that the conversion of Galvanised Stranded Stay Wires does not amount to manufacture. The non-consideration of such a binding precedent was argued to be an error apparent on the face of the record. Citing relevant case laws, it was contended that the decision of the Apex Court should prevail. The Tribunal acknowledged this argument and allowed the appeal, recalling the Final Order as the basic issue of manufacture had been settled in favor of the assessee.

Issue 2: Valuation and job work basis

The Tribunal determined that the conversion of Galvanised Stranded Stay Wire out of Gl wires did not amount to manufacture under Section 2(f) of the Central Excise Act. It was held that the value of the goods manufactured on a job work basis should be added to the clearances of the manufacturer and not the raw material supplier. The Tribunal also clarified that the value of the goods should be based on the final sale price to customers, excluding sales tax and surcharge. The Tribunal emphasized that the value should be calculated at the time of clearance, not at the time of seizure. These valuation principles were crucial in determining the assessable value of the goods manufactured by the job worker.

Separate Judgement:

A separate judgment by the Apex Court in the case of General Industrial Corporation v. Collector clarified that the conversion of Galvanised Stranded Stay Wire did not amount to manufacture. This judgment influenced the decision of the Appellate Tribunal in the present case, leading to the allowance of the appeal and the recall of the Final Order.

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