Manufacture test for custom packs failed where packing and assembly did not create a new commercially distinct product.

Activities of cutting tubing, attaching connectors, packing and making the custom pack ready for use did not amount to manufacture because they did not create a commercially distinct commodity with a different name, character and use. On the Tribunal's factual findings, the process was only packing of goods already manufactured and did not bring into existence a new product. As the statutory definition of manufacture was not satisfied, the custom pack was not liable to excise duty.

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Issues: Whether the process carried out by the assessee in relation to the custom pack amounted to manufacture so as to attract excise duty.

Analysis: The dispute turned on whether the activities of cutting tubing, attaching connectors, packing and making the product ready for use resulted in emergence of a commercially distinct commodity having a different name, character and use. On the facts found by the Tribunal, the process was only packing of goods already manufactured by the assessee and did not bring into existence a new product. In the absence of a commercially new article, the statutory definition of manufacture was not satisfied.

Conclusion: The process did not amount to manufacture and no excise duty was leviable on the custom pack.

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