Manufacture with the aid of power requires reliable proof of actual power use in the process; soap stayed under the lower tariff heading.

Classification of Ayurvedic soap under the Central Excise Tariff depended on whether manufacture was carried out with the aid of power. The Department's evidence did not reliably establish actual use of electrically operated equipment in the relevant manufacturing process; the witness statements and material on record were insufficient, and the claimed movement of caustic soda lye did not by itself show manufacture with the aid of power. On that basis, classification under sub-heading 3401.19 was not justified, and the soap remained classifiable under sub-heading 3401.12.

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Issues: Whether the Ayurvedic soap manufactured and cleared under the brand name MEDIMIX was classifiable under sub-heading 3401.12 of the First Schedule to the Central Excise Tariff Act, 1985 or under sub-heading 3401.19 on the ground that power was used in the manufacture.

Analysis: The dispute turned on whether the Department had established actual use of electrically operated equipment in the manufacture of the soap during the relevant period. The material relied upon did not conclusively show that laboratory equipment was used for testing raw materials or the finished product with the aid of power during the period of dispute. The evidence of the departmental witnesses was not sufficient to prove such use, and the statement of the concerned employee did not clearly establish that the equipments were used in manufacture rather than for training or exposure. The alleged use of power for bringing caustic soda lye to the storage tanks also did not bring the process within manufacture with the aid of power for this product, especially in light of the earlier unchallenged decision relating to another unit manufacturing the same soap.

Conclusion: The Department failed to prove use of power in the manufacture of the soap, so classification under sub-heading 3401.19 was not justified and the assessee was entitled to classification under sub-heading 3401.12.

Ratio Decidendi: Classification as manufacture with the aid of power requires reliable proof of actual use of power in a process integrally connected with manufacture; unproved or incidental handling of raw material does not suffice.

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