Manufacture vs re-export distinction governs drawback where imported silk is transformed into identifiable table covers.

Imported silk that was cut, embroidered and converted into table covers was treated as a new and different commercial article with a distinct name, character and use. Section 42 of the Sea Customs Act, 1878 applied only to re-export of the very same identifiable goods, whereas Section 43B, with its Explanation, covered imported materials used in manufacture of exported goods. Because the transformation amounted to manufacture, drawback could not be claimed under Section 42 and was governed by the provision applicable to manufactured export goods.

---

---

Issues: Whether imported silk cut into pieces and embroidered into table covers was re-exported as the same identifiable goods so as to attract drawback under Section 42 of the Sea Customs Act, 1878, or whether the goods had been manufactured and therefore fell within Section 43B.

Analysis: Section 42 applies only where the very goods imported are re-exported and are capable of being identified as such; the words relating to easy identification qualify the nature of the goods and not merely their continued recognisability after alteration. Section 43B, read with its Explanation, covers imported materials used in the manufacture of exported goods. The silk in question was cut, embroidered, and converted into table covers, producing a new and different commercial article with a distinct name, character, and use. That transformation constituted manufacture, and the claim could not be treated as one for drawback on the identical imported goods under Section 42.

Conclusion: The claim for drawback under Section 42 failed, and the imported silk was rightly treated as material used in manufacture within Section 43B. The decision was against the petitioner and in favour of the Revenue.

Ratio Decidendi: Where imported goods undergo transformation into a new and different commercially recognizable article, drawback is governed by the provision applicable to materials used in manufacture and not by the provision confined to re-export of the same identifiable goods.

---