Mixed question of fact and law on manufacture led to remand for fresh evidence on gas refilling activity.

Refilling gas into small containers was considered a mixed question of fact and law under Chapter Note 10 to Chapter 28 of the Central Excise Tariff Act, 1985, so the assessee was entitled to raise the new defence with supporting material. Because the plea had not been taken before the adjudicating authority, fresh consideration was required to allow both sides to place relevant evidence on record. The matter was therefore remanded to the Commissioner for de novo examination of whether the activity amounted to manufacture, without expressing any view on the merits of that defence.

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Issues: Whether the appeal should be remanded to permit the assessee to raise and prove the new defence that refilling gas into small containers did not amount to manufacture under Chapter Note 10 to Chapter 28 of the Central Excise Tariff Act, 1985.

Analysis: The defence now sought to be raised had not been taken before the adjudicating authority. The question whether a particular activity amounts to manufacture is a mixed question of fact and law, and both sides must have an opportunity to place relevant material on record. The matter therefore required fresh consideration so that the new plea could be examined on evidence, without expressing any view on its merits.

Conclusion: The impugned order was set aside and the matter was remanded to the Commissioner for fresh after allowing both sides to adduce material on the issue.

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