Express tariff deeming provision treats stainless steel flat conversion as manufacture, defeating refund claim.

Chapter Note 4 of Chapter 72 of the Central Excise Tariff Act, 1985 deems hardening or tempering of flat rolled products to be manufacture. On that basis, conversion of stainless steel flats into cold rolled patta/patties by reduction in gauge and hardening was treated as manufacture, because the later tariff contained an express deeming provision and the resulting goods were regarded as commercially distinct and marketable. The earlier Supreme Court ruling under the old tariff regime was distinguished. As the process amounted to manufacture, refund of duty was not admissible and the duty retained was upheld.

---

---

Issues: Whether conversion of stainless steel flats into cold rolled patta/patties by reduction in gauge and hardening amounted to manufacture, and whether refund of duty was admissible.

Analysis: The dispute turned on Chapter Note 4 of Chapter 72 of the Central Excise Tariff Act, 1985, which deems hardening or tempering of flat rolled products to be manufacture. The earlier Supreme Court ruling relied upon by the assessee arose under the old tariff regime and was distinguished because the later tariff contained an express deeming provision. The Tribunal also relied on the earlier decision in Indian Strips, where an identical process was held to amount to manufacture and the resultant goods were treated as commercially distinct and marketable. Following that reasoning, the conversion of S.S. flats into S.S. patta/patties was held to satisfy the requirement of manufacture.

Conclusion: The process amounted to manufacture and no refund was admissible; the appeal was rejected.

Final Conclusion: The order affirmed the finding that the disputed process gave rise to excisable goods under the tariff note and therefore the duty paid was correctly retained.

Ratio Decidendi: Where the tariff expressly deems a particular process on flat rolled products to be manufacture, conversion of stainless steel flats into cold rolled patta/patties by that process is manufacture and does not entitle the assessee to refund.

---