Proof machining does not change the identity of forgings where it is only a limited finishing process

Proof machining of mild steel forgings, undertaken only to remove forging scales, smooth uneven surfaces and detect flaws, did not alter their commercial identity. The limited finishing process did not convert the forgings into machine components or automobile parts merely because further machining might be done by customers before use. On the facts and the trade description of the goods, the forgings remained forgings for assessment purposes and were assessable under the relevant declared-goods entry at the applicable rate.

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Issues: Whether proof machining undertaken on forged products altered their character so as to take them out of the category of forgings and justify reassessment at a higher rate of tax.

Analysis: The goods manufactured were mild steel forgings brought to a rough and unfinished stage by hammering under pressure. The further process of proof machining was only to remove forging scales and uneven surface and to detect flaws. On the facts and on the description of the commodity in the trade entries, that limited finishing process did not convert the forgings into a different commercial commodity or destroy their identity as forgings. The revisional authority and the Tribunal were therefore not justified in treating the goods as machine components or automobile parts merely because customers might carry out further machining before use.

Conclusion: Proof machining did not change the identity of the forgings, and the assessee was entitled to assessment of the goods as forgings under the relevant declared-goods entry.

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